Greenspun v. Greenspun

211 S.W.2d 977, 1948 Tex. App. LEXIS 1302
CourtCourt of Appeals of Texas
DecidedApril 30, 1948
DocketNo. 14937.
StatusPublished
Cited by8 cases

This text of 211 S.W.2d 977 (Greenspun v. Greenspun) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Greenspun v. Greenspun, 211 S.W.2d 977, 1948 Tex. App. LEXIS 1302 (Tex. Ct. App. 1948).

Opinion

SPEER, Justice.

Plaintiff, Max Greenspun, sued his brother, defendant, Morris Greenspun, seeking to establish his ownership of 500 shares of the capital stock of Parker-Browne Company, a corporation. He sought recovery as against defendant individually and as trustee of the assets of the corporation embraced within three classes or types of obligations by defendant. Briefly stated, they were (1) plaintiff’s proportionate part as holder of 500 shares of the capital stock, in the value of the assets of the corporation, which defendant had in 1941, without plaintiff’s knowledge or consent, caused to be dissolved, and had the a'ssets of the corporation transferred to him and thereafter in 1942 organized and had chartered a new corporation, in which defendant and two nominees holding only qualifying shares claimed and had issued to them all of the stock of the newly incorporated company; (2) to recover plaintiff’s proportionate part of large sums of money withdrawn from *980 the corporation by defendant for which withdrawals no restitution had been made, and (3) for plaintiff’s proportionate part of certain purported dividends defendant had caused the directors, whom he dominated, to pay to him under a claim that he owned all the capital stock. Judgment was entered in favor of Max establishing his ownership of 500 shares of stock, for his proportionate part of the assets of the corporation; the same proportionate part of Morris’ withdrawals in that form and as pretended dividends over and above his salary and commissions which had not been repaid to the corporation, and interest on both items at six per cent, per annum 'since August 28, 1942 to the date of the judgment. From this judgment Morris has appealed.

We shall not attempt to state in detail the pleadings of the parties, since the verdict on special issues and the judgment thereon reflect the respective contentions of each; except in a single instance which we shall later mention.

This case was before us on a former appeal (Greenspun v. Greenspun, Tex.Civ. App., 194 S.W.2d 134), at which time we reversed and rendered one phase of the judgment that was in favor of plaintiff, and reversed and remanded the remainder of the case for another trial for the reasons therein set out. The Supreme Court affirmed our holding. 198- S.W.2d 82. That part of plaintiff’s alleged cause of action which we rendered against him, of course, is not involved in this appeal. The pleadings have since been amended and as we shall later demonstrate, the testimony on some phases of the case has been more completely developed.

Parker-Browne Co. was for many years a corporation, and at all times here involved had a capital stock of $75,000 divided into 7500 shares of $10 par value each. Only 6610 shares were ever issued, the remainder was held by the corporation. Prior to 1918 Morris Greenspun bought up all outstanding shares and operated the business as his own. Plaintiff, Max Greenspun, worked for the corporation in various capacities, including bookkeeper, and later as general manager.

Plaintiff’s contentions are that he was the owner of 500 shares of stock on December 7, 1920, as a result of a transaction had with defendant for services rendered and to be rendered to defendant, Morris Greenspun, in conducting the business.

Prior to December 7, 1920, when Max claims he became the owner of 500 shares of the capital stock of the corporation, as above indicated, Morris had purchased all outstanding stock held by a dozen or more persons, but the record shows that Morris did not thereafter have any stock certificates of the corporation issued to him, nor was there issued by the corporation to Max a certificate evidencing his claimed 500 shares. Indeed, at no time, after Morris purchased the outstanding shares of stock up until the directors caused the corporation to be dissolved in 1941 was there any stock certificates of shares issued by the corporation to any one.

Morris wanted to return to Europe during 1919 and before going away put Max in charge of the business, telling him to run it the best he could; during Morris’ absence he drew many drafts for large sums of money against the business and Max paid them through a local bank. When Morris returned during 1920 he stayed a while and decided to return to Europe; the bank wanted a more definite arrangement made to authorize Max to make payments for the corporation of the drafts Morris might draw. Max and Morris went to a local attorney and Morris told the attorney to draw up minutes of a meeting of the stockholders, prepare by-laws, etc., necessary to make all acts of Max legal.

The jury found upon competent evidence that Morris gave to the attorney the information placed in the minutes of December 9, 1920, among other things they recited: “The following stockholders were present in person, the number of shares held by each being set opposite his name:

“Morris Greenspun . 6100 shares
“Max Greenspun. 500 shares
“J. M. Greenspun. 10 shares
“The number of shares of stock so represented in person aggregated sixty-six hundred ten shares, being the total amount *981 of the capital stock of the company issued and outstanding.”

The ten shares in the name of J. M. Greenspun belonged to Morris Greenspun and they are not in controversy here. By the verdict it was also found that by the minutes above referred to it was the intention of Morris that Max should be the real owner of 500 shares of said stock; and that Max accepted such ownership thereunder.

In his brief, Morris argues that even if Max did thus acquire title to 500 shares at that time, he, Morris, thereafter reacquired ownership by reason of “adverse holding for the requisite time.” This is embraced in Morris’ first point of assigned error. The jury found against his contentions in this respect, and there was evidence to support the finding.

Points 5 and 6 assert that whatever right plaintiff may have ever had to recover from defendant individually or as trustee as prayed for was barred by limitation when he instituted this suit. These points go to the very heart of plaintiff’s asserted cause of action. It is quite obvious that because of laches and the statutes of limitation, conditions could have arisen under which Max could have lost the property represented 'by his stock. Plaintiff had no certificate evidencing his interest in the corporation; we think none was necessary. His interest in the corporation was measured by his ownership of stock. A certificate by the corporation is not the stock or shares or interest owned by a party but is only evidence of that interest and the interest may be otherwise proven. Yeaman v. Galveston City Co., 106 Tex. 389, 167 S.W. 710, Ann.Cas.1917 E, 191.

At the trial from which this appeal comes, Morris requested a peremptory instruction based upon the theory that Max’ suit was barred by limitation. The request was denied and he makes no assignment of error upon that particular ruling. Upon the former appeal he did assign error for a similar ruling and both this and the Supreme Court overruled them in the cited opinions, supra. It seems that the evidence at both trials was substantially the same on this point.

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Bluebook (online)
211 S.W.2d 977, 1948 Tex. App. LEXIS 1302, Counsel Stack Legal Research, https://law.counselstack.com/opinion/greenspun-v-greenspun-texapp-1948.