Forde v. Vernbro Corp.

FORD, J.

This is an appeal by the plaintiff from a judgment rendered in an action brought by him for a declaration of the rights and obligations of the parties under a written agreement and for other relief. The defendant is Vernbro Corporation.

The defendant corporation erected a medical office building. The plaintiff, Dr. Forde, was one of the original stockholders of the corporation and became a tenant of a portion of its premises. When he became delinquent in payment of rent, in an unlawful detainer action the defendant obtained a judgment against him in January 1960 for possession of the premises and for the sum of $10,982.64. Thereafter Dr. Forde vacated the premises under an agreement in writing which was made later in the same month.

The body of the agreement is as follows: “It Is Hebebt Agbeed by and between Wells E. A. Forde defendant and Vernbro Corp. plaintiff in the matter of

Vernbro

vs

Forde

L. A. Superior Court # 733 603 by their respective

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attorneys that defendant Forde will vacate the premises which are the subject of the said lawsuit on or before January 31, 1960 and further that the stock now owned by defendant in plaintiff’s corporation will be surrendered to plaintiff in return for which plaintiff will pay defendant the amount of the fair evaluation as agreed by the attorneys hereto less the amount of judgment and costs in the aforementioned lawsuit said payment to be $1000.00 cash on or before the 31st day of January, 1960 and the balance in 5 equal annual installments. ’ ’

The shares of stock had been held in escrow pursuant to an order of the Commissioner of Corporations. The escrow holder was the attorney who has represented the corporation in the matter presently before this court. The attorneys for the parties were unable to agree with respect to the matter of the fair value of the stock. The sum of $1,000 was not paid to Dr. Forde. On April 21, 1960, the defendant corporation purchased the plaintiff’s shares of stock at an execution sale for the amount of its judgment against Dr. Forde.