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that no bailment could be implied charges by the shipper or consignee. from the mere leaving by a contractor Warehouse service or storage is valuof machinery on the right of way of able, because calculated to preserve a carrier. In that case the railroad, and protect the article stored against having been sued for the value of the hazard. I think 'place of delivery' in machinery, which it was alleged it had a uniform bill means either the unmisappropriated, sought to prove an loading platform or some other place implied or an involuntary bailment. customarily used for the delivery of It was said by the court: “He volun- freight, and calculated, either by tarily left his property on defendant's
of its character, location, right of way, but not in its custody supervision, or care, to afford protecnor by virtue of any contract of bail- tion against the usual hazards to ment with it, express or implied, nor unstored or unguarded property.” It with any intention of rendering it was held, therefore, that, having supliable as bailee or otherwise for its plied nothing, the carrier could charge safety.” In that case it was held that nothing. In other words, there was no the railroad was liable for the ma- contractual relationship between the chinery appropriated by it, and that parties. the owner might waive the tort, and In Lancashire & Y. R. Co. v. Gidlow sue the wrongdoer in assumpsit for (1875) L. R. 7 H. L. (Eng.) 517, the the value of the property taken. private act in respect to the railroad
In Chicago G. W. R. Co. v. Davis permitted it to make certain charges (1924) 1 F. (20) 729, certain steel for the conveyance of goods, and also fence posts, having reached their des- to charge for services incidental to tination, were accepted by the con- such conveyance. The carrier brought signee and the freight charges paid. an action for charges, including thereAs the consignee delayed in removing in charges for storage on coal which them, they were unloaded by the car- the defendant had left on its right of rier on its right of way, where they way. The defendant pleaded overremained for some time. The carrier charge as to that, claiming it was not then presented a bill for storage which a service incidental to the conveyance the consignee refused to pay, where- of goods within the act. In deciding upon the carrier sold the posts, ap- that matter the court said: “In truth, plied the money to its bill, and brought the only suggestion made in the arguan action against the consignee for ment before your lordships was, that the remainder. The uniform bill of at one or more of the stations to which lading under which the posts had been the coal was carried there had been a shipped provided that if the property privilege given to the colliery owner was not removed in forty-eight hours of using a larger or smaller portion after notice of its arrival had been of the ground of the railway company given, it might be kept in the car, for the purpose of leaving his coal depot, or place of delivery, subject to upon the ground; and in the case of a reasonable charge for storage, and one particular station, an agreement to the carrier's liability as a ware- or a license was shown by which the houseman. In regard to this the court colliery owner was permitted to leave said: “The posts were not kept in a his coals at and around a particular car, depot, or warehouse. Therefore, siding, and the company was not to be unless they were kept in the 'place of at liberty to take away that license delivery of the carrier, so as to be from him except upon one month's no'subject to a reasonable charge for tice. My lords, that may or may not storage,' then no storage charge could be a matter for which the company be made. Now it seems to me that might have made an agreement and this contract clearly contemplates required payment, but it undoubtedly mutual obligations; that it contem- is not a 'service' performed by the plates the storage of the freight in company for the colliery owner. If a question by the railroad company, as man lets to me an acre of land for well as the payment of the storage the purpose of my placing my goods or minerals upon it, or if he gives me held that, the transportation having a license to place my goods or minerals ceased and the goods having been deupon a limited portion of his land or
livered, the relationship between the siding, that may be a matter for which
carrier and the consignee ended, and he and I may enter into an agreement,
the carrier could exact more and for which payment may be made; but it is not, within the parliamentary charges for such transportation, or for power, to be termed a 'service per
services incidental to the transportaformed' by him for me." The court tion.
W. Q. F.
T. N. PUGH et al., Appts.,
Mississippi Supreme Court (In Banc) - October 13, 1924.
(136 Miss. 661, 101 So. 691.) Contracts, § 180 — sale of stock — part performance.
1. When corporate stock is bought and sold with a position and salary as manager as a part of the consideration, the giving up of the position by one party and the assuming management and control of the business by the other under the agreement is part performance, which takes the case out of the Statute of Frauds.
[See note on this question beginning on page 693.] Contracts, 8 86 - sale of corporate such case the seller agrees to take stock absence of details.
negotiable notes, and the buyer agrees 2. Where corporate stock is sold to make and deliver them to the for a fixed price, and a part is to be seller in such form and terms as will paid in cash, and part to be carried make them negotiable. The buyer in negotiable notes by the seller, to cannot take possession of the business be closed by a named date, there is which he gets charge of by the agreea contract, even though the maturities ment, and refuse to carry out his and specific terms of notes are not part of the contract. set out. In such case the customary [See 6 R. C. L. 643 et seq.; 2 R. C. L. dealings may be looked to, and in Supp. 171; 4 R. C. L. Supp. 431; 5 Headnotes by ETHRIDGE, J.
R. C. L. Supp. 360.]
APPEAL by defendants from a judgment of the Chancery Court for Lauderdale County (Tann, Ch.) in favor of plaintiff in an action brought to compel specific performance of an alleged contract for the purchase and sale of corporate stock. Affirmed.
The facts are stated in the opinion of the court.
Messrs. Wells, Stevens, & Jones, for ble because within the Statute of appellants:
Frauds. There was in fact no agreement by Mayhaw Canning & Preserving Co. defendant Howard to purchase the v. Cohen, 135 Miss. 378, 99 So. 896; stock.
27 C. J. 238 and note 68; Sprague v. Yazoo & M. Valley R. Co. v. Jones, Hosie, 155 Mich. 30, 19 L.R.A.(N.S.) 114 Miss. 787, 75 So. 550; Pioneer 874, 130 Am. St. Rep. 558, 118 N. W. Box Co. v. Price Veneer & Lumber 497; Spencer V. McGuffin, 190 Ind. Co. 132 Miss. 189, 29 A.L.R. 1349, 96 308, 14 A.L.R. 385, 130 N. E. 407; So. 103.
Franklin v. Matoa Gold Min. Co, 16 The alleged contract is unenforcea- L.R.A.(N.S.) 381, 86 C. C. A. 145, 158
(136 Mi88. 661, 101 80. 691.) Fed. 941, 14 Ann. Cas 302; Coleman laws of the state of Mississippi, v. St. Paul & T. Lumber Co. 110 Wash. domiciled and doing business at 259, 188 Pac. 532; Willis v. Ellis, 98 Meridian, Mississippi; that on or Miss. 197, 53 So. 498, Ann. Cas. 1913A, about the day of September 1039; Ballingall v. Bradley, 16 Ill.
1922, the said T. N. Pugh and A. T. 373. The alleged contract is unenforcea
Howard agreed to purchase from ble because lacking in mutuality.
the complainant the said twenty Pom. Eq. Jur. § 1405; Williston,
shares of the capital stock of said Contr. $ 55; Cold Blast Transp. Co. v. company and pay him therefor the Kansas City Bolt & Nut Co. 57 L.R.A. sum of $10,000, $4,000 of which 696, 52 c. c. A. 25, 114 Fed. 77; purchase price was to be paid upon Pantages v. Grauman, 112 C. C. A. 61,
delivery of the stock, and the re191 Fed. 317; Ryan v. McLane, 91 Md. mainder of the purchase price to be 175, 50 L.R.A. 514, 80 Am. St. Rep. settled for in the note or notes of 438, 46 Atl. 340; Deitz v. Stephenson, 51 Or. 596, 95 Pac. 803; Strasburg R.
the defendants, to be executed in
favor of the complainant in negoCo. y. Echternacht, 21 Pa. 220, 60 Am. Dec. 49; Chilhowie Iron Co. v. Gar
tiable form, and of such dates of diner, 79 Va. 305; Hissam v. Parrish, maturity as that said notes would 41 W. Va. 686, 56 Am. St. Rep. 892, pass in the usual channels of banks 24 S. E. 600; C. Jutte & Co. v. Pfeil, and banking as negotiable paper. 219 Pa. 520, 69 Atl. 59; McIlroy v. Complainant further alleged that, Richards, 148 Mich. 694, 112 N. W. at the time he entered into said 489.
agreement with the defendants, he Plaintiff was not entitled to any re
was a director and officer of said lief, because he did not come into a court of equity with clean hands, and
corporation, having the general the contract sought to be enforced is
management and control of its businot only void for indefiniteness, but is ness as its place of domicil, and it unconscionable.
was agreed and understood that he Haffner v. Dobrinski, 215 U. S. 446, was to sever his connection with 54 L. ed. 277, 30 Sup. Ct. Rep. 172; said corporation, and was to be sucT. B. Harms & Francis, Day & Hunter ceeded in the active management v. Stern, 145 C. C. A. 531, 231 Fed. thereof by the defendant A. T. How645; Elliott v. Elliott, 3 Alaska, 364;
ard; it being agreed and understood Schneider v. Schneider, 125 Iowa, 16,
by and between the parties that the 98 N. W. 164; Palo Alto County v. Harrison, 68 Iowa, 90, 26 N. W. 19;
said contract and agreement would Jones v. Williams, 139 Mo. 90, 37
be executed and completed between L.R.A. 706, 61 Am. St. Rep. 436, 39 the parties on or by October 15, S. W. 486, 40 S. W. 353; State v. Baum, 1922. Complainant further averred 6 Ohio, 386; Newton v. Wooley, 105 that, after said agreement had been Fed. 545; Strang v. Richmond, P. &
entered into verbally, on the 30th C. R. R. Co. 93 Fed. 74; Rudisill v. Whitener, 146 N. C. 403, 15 L.R.A.
day of September, 1922, complain(N.S.) 81, 59 S. E. 995.
ant received a letter from the deMessrs. Jacobson & Brooks and fendant T. N. Pugh, as follows: George Butler also for appellants. Messrs. Cassedy & Potter and T. L.
“September 30, 1922. Bailey for appellee.
“Mr. J. B. Gressett,
"Meridian, Mississippi. Ethridge, J., delivered the opinion
“Dear Joe: of the court: The appellee was complainant in
"Howard and myself made the the court below and filed his bill
trade 0. K., and he will be over there against the appellants, alleging that
Wednesday morning to take charge, prior to the 1st day of October, 1922,
and if he wants you to stay with the complainant was the owner of
him a few days I will appreciate it twenty shares of the capital stock if you will. I will be over the latter of the Meridian Chero-Cola Bottling part of the week, or anyhow by the
Company, a corporation under the time Mr. Simpson gets back from his trip, to straighten everything confirming said conversation; said up.
telegram reading as follows: "Yours truly,
"Columbus, Georgia, October 4, "T. N. Pugh."
1922. Later on, to wit, October 2, 1922,
"J. B. Gressett, the defendant T. N. Pugh wired to
“Howard comes to Meridian tocomplainant the following message:
day to take charge of the affairs of “Columbus, Miss., October 2, 1922. the company in line with agreement. "J. B. Gressett, Meridian, Miss. Also we are to buy your stock for
“Everything 0. K. Howard will ten thousand dollars. Terms to be be there Wednesday morning.
agreed on by October fifteenth. "T. N. Pugh.”
“T. N. Pugh." Complainant further alleged that
In response thereto, complainant the above letter and telegram were
sent said Pugh the following telewritten in connection with the
gram: agreement between the complain
"Meridian, Miss., Oct. 4, 1922. ant and the defendants, whereby “T. N. Pugh, 'Montgomery, Alathe defendants were to purchase bama. complainant's said shares of stock "Telegram received. I confirm in said corporation for the sum of sale twenty shares Meridian Chero$10,000, to be paid for as stated, Cola Bottling Company stock to you and that complainant was to sur- for ten thousand dollars. Terms render the control of said business and payment to be arranged negoof said corporation to said Howard. tiable by October fifteenth. Complainant further alleged that
"J. B. Gressett, Jr.” on October 4, 1922, the said Howard,
Complainant further alleges that defendant, then being in Meridian
A. T. Howard was then present at for the purpose of taking active
Meridian at said Chero-Cola plant, charge of the business and manage
and was fully advised of all that was ment of said plant, and at a time
transpiring between the complainwhen said defendants had not paid
ant and the defendant Pugh, and to complainant the purchase price fully agreed on his part to all the for said stock, complainant had a
terms and conditions of said trade, conversation with said T. N. Pugh
and assured complainant that the by long-distance telephone, said purchase price agreed upon between Pugh then being in Columbus, the parties for the said twenty Georgia, and complainant being in shares of capital stock would be paid Meridian, Mississippi; the substance
as soon as A. D. Simpson, the vice and purport of said telephone con- president of the First National Bank versation being that complainant of Meridian, returned home; he would not surrender the manage- then being absent, and it being ment and control of said corporation thought he would return to Meridunto said Howard without the trade ian prior to October 15, 1922; that, for his stock being fully consum- complainant being thus assured that mated, and that said Pugh then, the defendants were acting in good during the course of said conversa- faith with him, he, in good faith, tion by telephone, assured com
com- surrendered to the defendants, A. plainant that he would be in Merid T. Howard and T. N. Pugh, full conian in the next few days, and would trol and management of said Mecomplete the trade for the said ridian Chero-Cola plant, and surrenstock, and in order that there might dered his position and office as genbe no misunderstanding or doubt eral manager and superintendent, about the matter he would send to and that in a few hours thereafter complainant on said date a telegram the defendants began to be conten
(136 Mi88. 661, 101 So. 691.) tious about the trade, and insisted that on final hearing the court will that complainant should accept less render a decree in favor of comthan $10,000. Complainant then plainant and against defendants for avers he was induced to surrender the sum of $10,000 and all costs, the control and management of said and prays for general relief. corporation by said conduct of the The defendants answered the bill defendants and their agreement to and admit that prior to the 1st day pay to complainant the sum of of October, 1922, the complainant $10,000 in the manner hereinbefore was the owner of said twenty shares set out.
of capital stock as alleged in the bill, Complainant further avers that admit also that complainant was a defendants took into their posses
director and officer of said company, sion and began the active control and had entire control and manageand management of the affairs of ment of said business at its said said corporation as an integral part place of domicil, and aver that comof their agreement to pay to him the plainant kept all the books of said sum of $10,000 for said capital corporation, and was fully familiar stock. He further avers that they with and well knew the financial failed and refused to pay to com- condition and status of said corporaplainant the said sum of $4,000 in tion, and knew the indebtedness due cash, and refused and neglected to by said corporation, and was fully execute their notes for the balance informed as to all of the financial of the purchase price of said capital circumstances, condition, and status stock, or do anything towards carry- of said corporation on and prior to ing out said agreement, save the tak- and during the months of September ing over from him of the active con- and October, 1922, and well knew trol and management of the busi- such condition for a long time prior ness affairs of the corporation. thereto. Defendants further charge Complainant further avers that, that complainant was the only ofnotwithstanding the agreements and ficer and stockholder of said corobligations of said defendants, and poration, having entire charge of notwithstanding the 15th day of Oc- said corporation, attending to its aftober, 1922, had passed, said defend- fairs in the city of Meridian, and ants and neither of them had paid aver that neither of the defendants to complainant the sum of $4,000 in knew of the condition of said corcash, or any part thereof, or ten- 'poration as to its financial status, dered to him their negotiable notes and what it owed, and what was for the sum of $6,000, or for any due and owing said corporation at other sum.
Complainant further the beginning of the negotiations avers that he tendered performance for the sale of complainant's said of said contract in full on his part, twenty shares of stock in said corand has actually performed part of poration. Defendants deny that said contract by surrendering to they or either of them purchased of said defendants the entire manage
the complainant his said twenty ment and control of the affairs of shares of stock in said corporation said corporation, and has been and as averred in the bill of complaint. is now ready, willing, and able to Defendant Pugh represents unto deliver to defendants a complete and the court that the facts and matperfect transfer of said twenty ters concerning said negotiations shares of the capital stock in said averred by the complainant, GresMeridian Chero-Cola Bottling Com- sett, were not as stated in the bill pany, and hereby tenders full per- of complaint, but charges that on formance of each and every part of the day of September, 1922, said agreement which he is required the said complainant approached the by the terms of said agreement to defendant Pugh and told him that perform, and prays that defendants he was anxious to sell his twenty be summoned to answer the bill, and shares of capital stock in said cor