Church v. Church

DORAN, J. This is an appeal by plaintiffs from a final judgment.

The action was brought by appellants as minors, suing by their guardian ad litem, for an alleged conversion by respondents of certain stock certificates issued in the name of Harry [698]A. Church, as trustee for said respective appellants. The said Harry A. Church is the respondent H. A. Church, Jr. (hereinafter referred to as Harry Church), and is the father of appellants.

The complaint sets forth four separate causes of action, one for each of said appellants, alleging that prior to and on or about February 20, 1928, each of said appellants was the owner of preferred shares of the capital stock of respondent corporation South Pasadena Finance Company, of the then value of $5,600, and that on or about said date the respondents converted said shares to their own use and benefit.

All of the named defendants and respondents, except Harry Church, and in addition D. L. Brainerd, sued by a fictitious name, appeared and joined in answering appellants’ complaint. It does not appear that Plarry Church interposed any answer or that any default was taken against him.

Respondents by their answer deny ownership of said stock by appellants and the conversion thereof by respondents, and set up affirmative defenses of the bar of limitations; also an additional separate defense of estoppel.

The trial court found for the respondents on practically all material issues raised by the pleadings including the separate defenses of respondents.

As will hereinafter appear, the basis for the alleged conversion on which appellants’ causes of action are founded is the sale by Harry Church back to respondent South Pasadena Finance Company of shares of its stock issued in his name as trustee for appellants, his minor children, and held by him.

The following appears from facts stipulated and evidence adduced at the trial:

There were two corporations of the name South Pasadena Finance Company, one virtually a successor of the other. The first was organized in April, 1924, and was dissolved in April, 1927, and‘the second was incorporated on March 18, 1926. The shares of stock in question here were those of the second corporation.

The first corporation was organized by H. A. Church, Senior, the father of Clyde, Ralph and Harry Church, and the grandfather of appellants; R. 0. Church (Ralph Church) ; H. A. Church, Jr. (Harry Church) ; W. W. Cottle and C. M. Church (Clyde Church). The second corporation was or