Pecht v. Colby Management Corp.

WORKS, P. J.

This action was commenced for the purpose of recovering the consideration paid by plaintiff, because of the fraud and misrepresentation of defendant, for certain alleged void certificates of stock in defendant, a corporation. Judgment went for plaintiff and defendant appeals.

Since the appeal the original respondent has deceased and his administratrix has been substituted in his stead. Throughout this opinion, however, we shall refer to “respondent” as if the substitution had not been made.

The commissioner of corporations had issued to appellant a permit to sell certain shares of its stock. The permit required: “That a true copy of this permit be exhibited and delivered to each prospective subscriber for, or purchaser of, said securities before his subscription therefor shall be taken or any sale thereof made to him.” The trial court found that no copy of the permit was exhibited to respondent before he purchased his stock, and it is claimed by appellant that there was no evidence to support this finding; indeed, that the evidence shows the contrary without dispute. Respondent signed eight separate “subscriptions” for the stock which he purchased, and on each of the subscription blanks was printed, immediately above the place where he signed, this language: “(Copy of Corporation Commission Permit is printed on reverse side.) ” A copy of the permit was actually printed on the back of each of the blanks.

As a preliminary to the final consideration of the finding that appellant did not exhibit the permit to respondent it is proper to observe that there was evidence from which the trial court could properly have found the

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following facts: When respondent signed the eight subscription agreements he did not read from any of them the copy of the permit printed on its back, nor did he ever read the permit until a few months before this action was commenced. When respondent had signed the “subscriptions” an agent of appellant gave him a receipt corresponding with each and took the “subscriptions” away with him. The receipts showed no copy of the permit and contained no reference to it.

This leaves for consideration the bare question whether the statement on the front of each of the subscription agreements, “ (Copy of Corporation Commission Permit is printed on reverse side) ’ ’, nullifies the finding that the permit was not exhibited to respondent. We think it does not. The word “exhibit” implies, as everyone understands, some affirmative act or at least some conduct upon the part of the person charged with the duty of exhibiting a thing or who exhibits it. When the corporation commissioner charged appellant to “exhibit” the permit he meant that appellant should “show” it. The language printed above the place where respondent signed the subscription agreements did not exhibit or show the permit. It did not invite respondent to read the permit, nor even suggest that he read it. Suppose a man says to another, “1 have a Jersey cow in my pasture.” Surely he cannot be said, by this remark, to exhibit the cow to the man he addresses. The finding that the permit was not exhibited to respondent is supported by the evidence.