Shannon v. Tooker

SHAW, J.

This is an action by the plaintiff to recover from the defendant, Tooker, certain shares of stock in the

[485]

defendant company, which were sold to Tooker upon a sale for the collection of a delinquent assessment, alleged by the plaintiff to have been voidable because of a defect in the proceedings leading up to the sale. The judgment below was for the defendants. The plaintiff appeals from said judgment and from an order denying his motion for a new trial.

The assessment was made on September 12, 1907, and the resolution stated that it would become delinquent if not paid on or before October 16, 1907, and that if it became delinquent a sale thereof would be made on November 11, 1907, unless previously paid. The publication of the notice of sale of the stock after it became delinquent on October 16th was defective and for that reason the directors, by resolution, postponed the sale until December 9, 1907. The directors did not, after said postponement, republish the notice of the assessment provided for in sections 335 and 336 of the Civil Code. They did, however, publish anew the notice of the delinquent sale as provided in section 339. On December 9th the stock was sold to the defendant Tooker.

Under the decision of this court in

Smith

v.

Gate City Oil Co.,

160 Cal. 446, [117 Pac. 525], and under the provisions of section 346 of the Civil Code, it appears that the proceedings for the postponement and sale were irregular because the notice of the assessment was not published anew. If this were the only question in the case it would necessarily follow that the judgment should be reversed.

But a condition precedent to the recovery of stock under such circumstances is imposed by section 347 of the Civil Code. It provides that no action for such recovery can be sustained upon the ground of irregularity or defect in the sale, or the proceedings therefor, unless the party seeking recovery first pays or tenders to the party holding the stock sold the sum for which it was sold, together with all subsequent assessments paid and interest. The tender of these amounts was alleged in the complaint and denied in the answer. The court below found that the plaintiff never tendered defendants, nor either of them, the sums required to be tendered under the aforesaid section, nor any part thereof. The plaintiff recognizes the importance of this finding and argues with great earnestness that it is entirely contrary to the evidence. With this contention we cannot agree. It is not the province