Marson v. Rand

McCOMB, J.

Plaintiff appeals from an adverse judgment in a rescission action whereby he sought to recover the purchase price which he had paid for outstanding shares of stock

[467]

in Cienega Village, Inc. (hereinafter referred to as the corporation), which plaintiff purchased from defendant Richard Rand pursuant to a contract of sale dated February 10, 1951.

The action was predicated upon the theory that the stock which defendant Richard Rand sold and transferred to plaintiff was void for the reason that it had been issued in violation of terms of the permit granted by the corporation commissioner, in that the consideration for the issuance of the stock was not received by the corporation

until a date

subsequent to the issuance of such stock.

The case was tried before the court sitting without a jury who found that the shares of stock which plaintiff purchased had been issued

after

the consideration therefor had been paid.

Questions:

First:

Was there substantial evidence to sustain the trial court’s findings, (a) that the stock which plaintiff purchased had been issued after the consideration therefor had been received by the corporation, and (b) that there were no fraudulent representations made in the application to the corporation commissioner for a permit to issue stock, even though it was conceded the application stated that 7.12 acres of land of the value of $37,000 would be conveyed to the corporation when in truth and fact only 5.5 acres of land of the value of $37,000 was conveyed to the corporation?

Yes.

We have examined the record and are of the opinion there was substantial evidence to sustain the inferences the trier of fact reasonably drew therefrom to support each and every material finding of fact upon which the judgment in favor of defendants was necessarily predicated.

(a) The records and testimony received in evidence disclosed the corporation had received prior to the issuance of shares of stock the consideration which the permit of the Corporation Commissioner required to be given prior to the issuance of the stock.