Van Denburgh v. Tungsten Reef Mines Co.

YORK, J.

Emma Beatrice Clark, now deceased, was the widow of A. J. Clark, who prior to his death in November, 1927, owned one-third of the stock of the defendant corporation, which had been theretofore organized for the purpose of acquiring, owning and operating certain mining, properties in Cochise County, Arizona. After the death of A. J. Clark and during the period from November, 1927, to and including June, 1934, the mining property of the corporation was inactive so far as production of minerals was concerned, and one George Krieg, the secretary of the company, was acting manager of the mining properties, as well as a member of the board of directors thereof. The other members of said board were Mrs. J. H. Parsons and Emma Beatrice Clark, now deceased.

During this period of nearly seven years, from November 9, 1927, to June 14, 1934, there were apparently seven meetings of the board of directors held, and at four of these meetings there were present only secretary Krieg and the said Emma Beatrice Clark, who was a stockholder, as well as president and director of defendant corporation. Because of the inactivity of defendant’s mine, there were no funds in its treasury with which to meet taxes, special assessments upon unpatented claims and. expenses for a watchman to guard the property, and an item of $1700 which had accrued prior to the death of A. J. Clark. Therefore, as money was needed from time to time for these various expenses and because the property was threatened by attachment on account of the $1700 indebtedness, secretary Krieg notified Mrs. Clark and she advanced various sums of money by sending her check to secretary Krieg, who in turn paid the bills and made entry thereof in the account books of defendant corporation. This action was brought by plaintiff as administrator of the estate of Emma Beatrice Clark, deceased, to recover the sums advanced with interest, and from a judgment entered in favor of such administrator, defendant corporation prosecutes this appeal.

Appellant contends that the evidence is wholly insufficient to sustain the finding that the relationship of debtor

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and creditor existed between Emma Beatrice Clark and the defendant corporation; that the evidence is insufficient to sustain the finding that there was an accounting between said Emma Beatrice Clark and the defendant corporation for moneys advanced to the latter, and further that the evidence established a voluntary payment on the part of Mrs. Clark.