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Opinion of the Court.
tained a copy of the record, assigned errors thereon, and filed the same in this court; and the attorney of Jeremiah Pratt and Randall, supposing that DeWolf had sued out a writ of error, joined in the errors assigned on the record; that the court reversed the decree and remanded the cause to the court below. This trial was had in this court at the April term, 1866. The circuit court, on the 21st of January, 1868, rendered a decree granting the relief sought, and ordered the purchase money to be paid into court, a conveyance to be made by the Pratts, and that on their failure to do so, the master make the conveyance. The money was paid into court as required by the decree, and the master in chancery, on the 10th of November of that year, made the deed to Clement H. DeWolf, as required by the decree.
It is alleged that Amos Pratt did not appear in either court, and that he was not served with process from either court.
It is alleged that Clement DeWolf did not deposit the money
in court, but that it was done by Calvin DeWolf and Stone. The bill alleges that no part of the money thus deposited was withdrawn by complainants, and the knowledge that it was 30 deposited did not come to them until after this bill was filed.
It is likewise alleged that James Pratt paid all of the purchase money for the land; that he had used $1500 of his wife's money, and, being unable to pay the same, he directed Jere miah Pratt to convey to her, in payment of that sum. This conveyance was made on July 13, 1865. It charges that Stone and the DeWolfs had notice of appellants' equities, and that appellants were not made parties to the bill filed by Clement H. De Wolf; that Emily H. Pratt, on the 19th of September, 1867, filed a bill in the circuit court against both of the DeWolfs, and, on a hearing, her title to the tract was confirmed against them and all persons claiming under them; that complainants afterwards, in April, 1869, took possession of the land, but were forcibly expelled therefrom by Stone.
To this bill defendants filed a demurrer, which, on a hear ing, was sustained and the bill dismissed, and complainants
Opinion of the Court.
appeal to this court, and the case has been argued here on its merits under the demurrer.
The bill in this case was filed on the 3d of July, 1871, orer nineteen years after it is claimed by the bill that appellant James Pratt acquired his secret trust in this property. It is only claimed that the trust was created by a verbal arrrangement between Amos and James Pratt; nor was it formally declared in writing or attempted to be executed until the conveyance was made by Jeremiah to Mrs. Pratt, on the 13th day of July, 1865, more than thirteen years after it is claimed to have been raised. The property in the meantime had been conveyed by Amos to Jeremiah by a deed absolute in terms, but it is alleged that it was agreed and understood that onehalf belonged to James, and had been so held until Jeremiah conveyed to Mrs. Pratt.
Such a claim, held such a length of time without its active assertion in some manner, must be regarded as stale. It is secret in its nature, and leaves the apparent undisputed title of record in others, and induces the world at large to deal with those in whom the title appears to be vested by the public records, where titles are expected to be found. Here, appellants have stood by and permitted Stone to lay off and plat the land into town lots, as early as in 1853, nearly eighteen years before they exhibited their bill; and as such plats are made with a view to the sale of the property in small sub-divisions, and as we find a very large number of defendants besides Stone, to this bill, it is but a reasonable inference that they have become purchasers froin Stone. The bill charges that they claim some interest in the property, or parts thereof, but fails to state in what manner they derive their claim.
Again, in nearly twenty years, property thus situated undergoes vast changes in value, and it would be inequitable to permit an apparent owner to hold such a length of time, the greater portion of which, even if he had notice, under the reasonable supposition that their claim was abandoned. The bill alleges the assertion of ownership in but one instance, and that was, taking possession about two years before the bill was
Opinion of the Court.
filed. It does not allege that appellants paid taxes, assessments on the property, or did any but the one act indicative of claim of ownership, and that about seventeen years after it is alleged the trust was created. Stone has been by them permitted to hold the property for this great length of time, and the property has probably risen in value to as many thousands now as it was worth hundreds then. Stone has been deprived of the use of his money a considerable portion of the time, and equity forbids that, under these probable changes, the property should be decreed to them.
If James Pratt paid all of the money for this land, as the bill alleges, he must have had interest enough in the matter to have kept himself informed as to its condition. He must have been fully apprised of the fact that Amos had sold it to DeWolf, and his assignment by which the contract passed to Stone. In fact, it would seem almost impossible to believe he could long remain ignorant of that sale. Again, he must have known of the suit brought by De Wolf to compel a specific performance of the contract, and yet he did not intervene to protect his rights, or to repudiate the sale by Amos to DeWolf.
He nowhere alleges that he ever notified De Wolf or Stone that he had or would repudiate the sale, and it would not be equitable now to permit him to assert the claim for the land; and his wife having taken her equity of him, she must be held bound by his laches. She can claim no better right than he held. She is, no doubt, entitled, on the showing of this bill, to the purchase money paid into the court under the decree in the case of DeWolf against Pratt and others.
Nor is there any averment in the bill that the other defendants than Stone acquired their claim with notice of appellants' claim of a trust. If they purchased without notice of this secret trust, only claimed to exist by a verbal agreement, then they would undeniably be protected, in any event, against appellants' claims. But we are clearly of opinion the claim is barred by laches, and complainants must be held to be estopped from having the relief sought. We are inclined to think the decree was right, on other grounds, but we regard the case so
plain on the ground of laches, that we deem it unnecessary to discuss them.
Perceiving no error in the decree of the court below, it is affirmed.
80 446 27a 513 80 446 32a 627
SAMUEL H. MELVIN et al.
THE LAMAR INSURANCE COMPANY et al.
80 446 133 274 80 446 35a 247 80 446 40a 358 80 16 49a 637 80 446 59a 539 80 446
164 451 80 446 99a 4589
1. SUBSCRIPTION—whether a subscription or security for a loan. Where a contract with an insurance company recites an absolute agreement" to subscribe for and purchase 5500 shares of the capital stock ” of the company, and to pay therefor to the company $550,000 in certain installments, and provides that the subscription and purchase shall be made in ten days, and gives the subscriber the option to have the company resell or repurchase the stock within a given time, and under the agreement the subscription was made and certificate of stock issued, it was held, that this was an actual sub scription, and that the shares were not taken as collateral security for a loan. The option in such case is a right secured by the contract above, and in ad. dition to the absolute title to the stock.
2. SAME-right to cancel same as against other stockholders. Where a subscription is made to an insurance company to a large amount, and twenty per cent paid in to enable the company to procure the Auditor's cer. tificate, but under a: contract giving the subscriber the right to withdraw the sum so paid in and have the subscription canceled, and other large subscriptions are afterwards made to the capital stock by parties, without actual notice of the contract, and believing the subscription to be a permanent one, it was held, that such subscription could not be canceled and the money paid thereon withdrawn, without the knowledge and consent of those subscribing on the faith of it.
3. SAME-presumption in respect to. All subscriptions are presumed to be upon the same basis, and all shares entitled to the same benefits and subject to the same burdens, and in the subscription of each person every other subscriber has a direct interest, and a right to have the same remain and contribute in future burdens.
4. SAME-agreement for withdrawal, fraudulent. A subscription to the capital stock of a corporation of a large amount, coupled with a right, under a separate contract, to surrender the certificate of stock, and take back the money paid therefor, and cancel the subscription, is a fraud upon the
other subscribers, and such agreement will be treated as void, and the party so subscribing held to all the responsibilities of a bona fide subscriber.
5. SAME-releasing not alloroed. The subscribed capital stock of a cor. poration, as well as its other property, is a trust fund for the benefit of cred. itors, and a subscriber can not be released from his obligation to pay, to the prejudice of creditors or of any other stockholder.
6. SAME-stockholders not bound to take notice of contract limiting and qualifying absolute subscription. Where a certificate of stock is issued, unaccompanied with any evidence of a condition, and the books of the company show the stock to be bona fide and absolute, other subscribers will have the right to rely on what thus appears as being true, and are not bound to go back and take notice of an antecedent individual contract existing between the directors and the takers of such shares, and it seems that even if such contract is spread upon the record, it affords no notice to other stockholders.
7. AGENCY-power of agents to release claim. Where a committee appointed by the stockholders of an insurance company, to settle the affairs of the company as they might deem equitable and best; and, second, that if, in their opinion, the affairs of the company should be wound up, then giving them authority to collect the assets, sell the franchise, and distribute proceeds, after paying debts; and, third, if they should deem it desirable to continue the business, to instruct the central committee to make an assessment, and the committee determined to wind up the affairs, it was held, that they had no authority in that event to settle with and release a subscriber who had wrongfully withdrawn money paid on his subscription and canceled his subscription. The only power the committee had was to collect the same.
8. Authority to collect and distribute, does not embrace the power to release without payment.
9. RELEASE-of claim by agent without consideration not valid. A release of a claim by a committee of the stockholders of a corporation, not under seal, and for no consideration, except the waiver of a questionable right to one of the parties for additional compensation as vice-president, and procured by taking advantage of the party's confidential relation, and his control of the available assets of the corporation, will not be enforced in a court of equity.
10. AGENCY_ratification by acquiescence. Where a committee of stock. holders of a corporation made a settlement with another stockholder, releasing him from a claim, in June, 1871, and suit was brought by certain stockholders to enforce the claim so released, in July, 1873, the delay in bringing suit will not be such an acquiescence in the acts of the committee beyond their power as to ratify their action.
11. CORPORATION-remedy by stockholders as against another who is wrongfully released. Where a stockholder in a corporation, under a prior