Katz v. Feldman

Opinion

KINGSLEY, J.

These two cases—in which consolidated briefs were authorized and which we deal with in this one opinion—arise out of transactions between the parties relating to the merger of KMS Industries, Inc., with Heliodyne Corporation, in which transactions plaintiff Katz and his fellow plaintiffs (in No. 964,840) allege that they were defrauded. Superior court case No. 962,159 (our case No. Civ. 38619) was brought by Katz, only, against defendant Feldman and against Feldman and his wife as trustees of a private trust. Superior court case No. 964,840 (our case No. Civ. 38620) was brought by Katz and five other persons against Feldman, only. So far as these appeals are concerned, we need state only that, in case No. 962,159, Katz alleged, in a verified complaint, that, as an inducement to Katz to agree to the merger, Feldman had promised that Katz would be the person in active charge of the merged companies, whereas in case No-. 964,840, Katz (in an unverified complaint) alleged that Feldman had promised to be the active manager of the merged companies. In addition, in case No. 962,159, Katz sought recovery of $6,500 allegedly paid to- Feldman on the latter’s; representation that it was to be used to; pay gift taxes on certain stock passing to Katz in the deal.

Calling pointed attention to the inconsistency

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between the two cases in the allegations as to the person who was to- become the active manager, defendants sought, by sundry motions in the trial court, to strike those allegations as sham. They also demurred to the counts in case No. 962,159, dealing with the $6,500 item. Ultimately, the trial court dismissed case No. 964,840 as to Katz only, struck the counts in case No-. 962,159

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relating to the alleged promise to utilize Katz as active manager, sustained demurrers to the counts in that case relating to the $6,500 item, and dismissed that case also. Katz has appealed;

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we reverse.

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Much of the unduly long and confused briefs tendered to us deals with Katz’ contention that the trial court’s rulings involved serious procedural errors such as (if we understand his briefs) made the orders appealed from void and therefore reversible. We see no need to explore the issues thus pressed on us, because we conclude that, even assuming no procedural errors, the rulings were erroneous on the merits.