State v. Golden

12 N.W.2d 617, 216 Minn. 97
CourtSupreme Court of Minnesota
DecidedNovember 19, 1943
DocketNo. 33,366.
StatusPublished
Cited by12 cases

This text of 12 N.W.2d 617 (State v. Golden) is published on Counsel Stack Legal Research, covering Supreme Court of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State v. Golden, 12 N.W.2d 617, 216 Minn. 97 (Mich. 1943).

Opinion

Magney, Justice.

This prosecution is based upon the provisions of certain statutes. As a determination of the questions presented rests chiefly upon the application of these statutes to the facts, it may be well to have them quoted at the outset. L. 1927, c. .68, § 1, Minn. St. 1941, § 80.80 (Mason St. 1927, § 4000-1), provides as follows:

“That no person shall sell to any person in this state any oil or gas lands, or any lands represented to contain or to be a prospect for oil or gas, or any interest therein or thereunder or royalties therefrom, unless and until such lands, interests or royalties shall have been first registered for sale by the department of commerce (commerce commission) of this state * * *

Section 8 of the same chapter, Id. § 80.01, subd. 13 (§ 4000-8), provides:

“As used in this act the ivords ‘person,’ ‘sale,’ ‘sell,’ ‘sold,’ ‘broker,’ ‘agent,’ and any other word or words requiring a definition thereof, *99 shall mean the same as in Chapter 192, Laws 1925, commonly known as the blue sky law.”

Section 9, Id. § 80.36 (§ 4000-9), provides:

“Any transaction involving or relating to oil or gas lands, or lands represented to contain or be a prospect for oil or gas, or any interest in or under such lands, or royalties therefrom, which comes within the purview of the blue sky law, being Chapter 192, Laws 1925, as now existing or hereafter amended, shall be controlled by said blue sky law; but any transaction or offense fairly coming within the provisions of both said blue sky laAV and this act may be dealt with by the commerce commission, or prosecuted by the proper public officers, under either of said laws.”

L. 1925, c. 192, § 1(2), as amended, Id. § 80.01, subd. 3 (§ 3996-1 [2]), gives the folloAving definitions:

“ ‘Sale,’ 'sell’ or ‘sold’ means and includes any disposition for value, an offer to sell, a solicitation of a> subscription or sale, or an attempt to sell in any manner an option of sale, a subscription, a pre-organization subscription or certificate, * * *” (Italics supplied.)

Under these statutes, an amended information charged defendant, David Golden, with the offense of offering to sell to one J. E. Hanstein, a certain interest in oil lands situated in the state of Oklahoma, the said oil lands not having first been registered for sale by the state department of commerce and said offer having been made in the course of repeated and successive offers for the sale of like interests. The jury found the defendant guilty.' He appeals from the judgment.

The main question raised here is whether defendant’s activities Avere in violation of the statutes quoted. He contends that the evidence was insufficient to sustain the verdict.

The land involved was not registered. For several years prior to November 1941 defendant was attorney and investigator for the United States Securities and Exchange Commission. He *100 resigned the position and opened a law office in Tulsa, Oklahoma. •In the early part of November 1941 he came to St. Paul to interest several persons he knew in an oil proposition. Among others, he spoke to Hanstein, the person named in the information. He suggested that Hanstein investigate a certain described oil property in Oklahoma which he was representing.- The name of the owner could not be divulged. He stated that the option would have to be taken within a very short time and that he had to have a certain amount of earnest money to obtain the option. Hanstein testified: “Mr. Golden asked me if I would be interested in investing some money in this oil transaction — property.” Defendant wanted the money in large blocks and requested $2,500, of which $500 was to be used for expenses. He said that he and his associate, a Mr. Cooper, were to receive some bonus stock from sale of the interest. This bonus stock was to be held in escrow pending certain developments. He thought the property could be bought for $20,000, and that it would take $2,000 or $2,500 above the purchase price for expenses.

On November 17, 1941, defendant wrote Hanstein that he had consummated a contract for the purchase of the oil and gas lease and that he secured it for $17,250 instead of $20,000. He would therefore require only $20,000, of which he already had $2,500, instead of $22,500, which he had expected would be necessary. He wrote:

“During my conversation with you, you indicated that you would be willing to invest about $1,000 in the proposition. * * * would not accept * * * less than $2,500. * * * If we accepted investments of lesser amounts we would have a large stockholder, list Avhich would add to the expense of administering the affairs of the corporation.”

Enclosed in the letter was a “proposal.” It stated that defendant and two associates had contracted to purchase a %-interest in an oil and gas lease for $17,250; that they had made a substantial payment ; that the expenses brought the cost to $20,000; that they were *101 entitled to a reasonable profit; that they needed $17,500 to . consummate the transaction; that defendant intended to organize a corporation with a capitalization of $27,000 — 270 shares; that 200 shares would be represented by actual cash invested and 70 shares would be set aside for defendant and his associates as profit. It stated: “I will not accept any investment in a sum of less than $2,500.” Also, “if you believe that you will be willing to invest the sum of $2,500 or more in this proposition * * * communicate with me by return mail.” Substantially the same proposition was submitted orally and in writing to witnesses Harold Bergman, Theodore W. Koch, and Thomas H. Garrett.

The evidence supports the verdict. The statutes prohibit an offer to sell, a solicitation of a subscription or sale, or an attempt to sell in any manner whatsoever any oil or gas land, or lands represented to contain or to be a prospect for oil or gas, or any interest therein or thereunder or royalties therefrom, unless and until such lands, interests, or royalties shall have been first registered for sale by the state department of commerce. It is evident that the legislature intended to make it legally impossible for a person to sell or offer to sell any type of interest in oil land without first registering it. When persons associate themselves together in the purchase of land, they do not come within the prohibition of the blue sky law. This is not such a case, and Hanneman v. Gratz, 170 Minn. 88, 42, 211 N. W. 961, 963, relied upon by defendant, has no application to the facts here. In that case the parties “voluntarily associated themselves in the joint venture of acquiring a number of oil leases.” Defendant here did not consider state’s witnesses as associates, and they were not such in fact. He writes:

“Two of my associates and I have contracted to purchase the full % working interest in an oil and gas lease * * *. My associates and I, of course, are entitled to a reasonable profit out of the proposition for finding and developing it. * * * 70 shares of the stock will be set aside for my associates and myself as profit for handling and developing this transaction.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Shepperd v. Boettcher & Co., Inc.
756 P.2d 182 (Wyoming Supreme Court, 1988)
Witter v. Buchanan
476 N.E.2d 1123 (Appellate Court of Illinois, 1985)
Hayden v. McDonald
742 F.2d 423 (Eighth Circuit, 1984)
Blue Sky L. Rep. P 72,084 Austin Hayden, James Hartzell, Lee Greenslit, Frank Johnson, Dwain Kasel, James Nordlie, James Maki, Michael H. Bitterman, Donald C. Severtson, Jeanne Stewart and Vernon D. Kotula v. Orison F. McDonald Individually, Orison F. "Mack" McDonald Ii, Individually, D/B/A Ole Chaparral and McDonald Investments, Inc., a Texas Corporation, Austin Hayden, James Hartzell, Lee Greenslit, Frank Johnson, Dwain Kasel, James Nordlie, James Maki, Michael H. Bitterman, Donald C. Severtson, Jeanne Stewart, Vernon D. Kotula, Donn Barber, Bernie Beaver, Lyle Bing, James Brown, L.T. Demeules, John Emmer, Don Erickson, Patrick Farley, Dennis Frandsen, Robert A. Godfrey, Karl Gramith, Howard Gruhlke, Cecil Herring, Lee Heutmaker, Vernice Heutmaker, Earl Heyerdahl, Sheldon Hoffman, Jim Hoversten, Delbert Kelzer, Robert Kepple, George Krienke, James Loosen, John McCormick James McKevitt Carol Mozzetti, James Munn, E.J. Pacheco, William Phelps, David Remes, James Reissner, Terry Ripley, Arnold Smith, D.P. Tschimperle, Gust Zahariades and Donald Zibell v. Orison F. McDonald Individually, Orison F. "Mack" McDonald Ii, Individually, D/B/A Ole Chaparral, and McDonald Investments, Inc., a Texas Corporation, John W. Adler, Sally F. Adler, Carol Adler Zsolnay, Diane L. Adler, Lisa M. Adler, Leslie O. Frishman, Dean L. Greenberg, Henry Hanson, Harold L. Rutchick and Howard D. Stacker v. Orison F. McDonald Individually, Orison F. "Mack" McDonald Ii, Individually, D/B/A Ole Chaparral and McDonald Investments, Inc., a Texas Corporation, Harold L. Rutchick v. Orison McDonald Ii, Also Known as Mack McDonald Individually, and D/B/A Ole Chaparral and McDonald Investments, Inc., a Texas Corporation
742 F.2d 423 (Eighth Circuit, 1984)
People v. Blum
35 Cal. App. 3d 515 (California Court of Appeal, 1973)
State v. Investors Security Corporation
209 N.W.2d 405 (Supreme Court of Minnesota, 1973)
Polikoff v. Levy
204 N.E.2d 807 (Appellate Court of Illinois, 1965)
State v. Markuson
113 N.W.2d 346 (Supreme Court of Minnesota, 1962)
Virnig v. Smith
90 N.W.2d 241 (Supreme Court of Minnesota, 1958)
State v. Howe
211 P.2d 467 (Arizona Supreme Court, 1949)

Cite This Page — Counsel Stack

Bluebook (online)
12 N.W.2d 617, 216 Minn. 97, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-golden-minn-1943.