Randolph v. Lindsay

SHAW,

J.—Appeals by defendant from the judgment and from an order denying his motion for a new trial.

The plaintiff sued to recover $26,784.62 alleged to be due for money paid by plaintiff for the defendant under two special contracts. It is contended by the appellant that the findings as to the amount due plaintiff are not sustained by the evidence.

Randolph Lindsay, and one Mackay acquired certain gold mines in Mexico, which they conveyed to a corporation organized by them named the Llanos de Oro Mining and Milling Company, with a capital stock of four million dollars, divided into four hundred thousand shares of the par value of

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ten- dollars each. In consideration of the conveyance of the mines the three parties received the entire capital stock of the company in equal shares. In order to get the gold from the mines, it was necessary to expend a large amount of money in the erection of a stamp mill and in development work. Randolph and Lindsay, as managers of the company, undertook to raise the required funds by means of notes of the company. It was agreed between the three that in placing these loans each payee was to receive, as a bonus, four dollars in stock for each dollar loaned, the stock required for that purpose being contributed in equal amounts by the three interested parties. Mackay, however, was not expected to, and did not, procure any loans or otherwise aid in financing the concern. The sum of $446,300 was raised in this manner and expended on the mines prior to April 21, 1906. The stamp mill was not finished and it was necessary to raise more money to carry the enterprise to completion and fruition. Randolph had already advanced for the company sums amounting to $20,250. The complaint alleges, and the court finds, that on or about April 21, 1906, the plaintiff and defendant agreed with each other that the corporation should continue to carry on its business and plans of development and equipment, and that to enable it to do so they would advance for it the necessary funds, share and share alike, and would pay, share and share alike, any and all debts of the company incurred by reason of carrying on its business and plans aforesaid, and that each would pay to the other whatever sum of money was necessary to equalize their respective advances. It is claimed by the appellant that this does not cover the amounts previously advanced by Randolph, as aforesaid, which amounts were included in the judgment. As we have concluded that the judgment and order must be reversed for other reasons to be presently stated, we need not consider this point. We state the facts aforesaid because they tend t» explain the subsequent transactions.