Worden v. Coast Tire & Rubber Co.

KOFORD, P. J.

This is an appeal from a judgment in favor of plaintiff, based upon fraudulent misrepresentations. The ground of the appeal is insufficiency of the evidence to prove that the representations made were false or fraudulent.

The evidence showed that the president of the appellant company, over the signature of the company, sent circular letters to its stockholders, including' plaintiff, and these letters contained the representations' alleged to be false and fraudulent. The circular letters stated that the appellant company had formed a plan of operation with the Bankers Mortgage & Discount Company, by which the latter would discount the appellant company’s trade acceptances, warehouse receipts and the like, and strongly urged the stockholders to buy unit shares of the Bankers Mortgage & Discount Company so that they could share in the large profits to be realized from that source. The letters also stated that representatives would call. The letters were fulsome in their praise of the prosperity and strength of the company, of the wisdom and efficiency of its officers, and of the large profits which were soon to fall into the lap of the stockholders. They contained direct and indirect statements concerning the arrangements made and to be made with the Bankers Mortgage

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Discount Company to effectuate the discount scheme.

Relying upon these letters, plaintiff gave an order for the purchase of fifteen units of the said Discount Company to two men, unidentified by the evidence as connected with either company, who called at her door. She gave them $1,500 cash and her 150 shares of capital stock of the appellant company, with a signed order upon their printed form addressed to the Bankers Securities Company, for the purchase of the fifteen units of the Bankers Mortgage

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Discount Company. A receipt for the money and stock was signed by these men, with the name of Bankers Securities Company, and it stated that her shares were to be con

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verted at not less than ten dollars per share and the proceeds applied on the purchase of the unit shares.