Big Spring Electric Co. v. Kitzmiller

Citations

• 268 Pa. 34
• 110 A. 783
• 1920 Pa. LEXIS 625

Syllabus

<p>Corporations — Issue of bonds — Fraud—Practice, C. P. — Pleadings — Charge of court — Failure to ash for instructions — Illegal transaction — Evidence—Burden—Receipt—Fraud, etc. — Theory of case — Defense—Constitution, art. XVI, sec. 7 — Act of April 17, 1876, P. L. 82.</p> <p>1. Under article XVI, sec. 7 of the Constitution of 1874 and the Act of April 17, 1876, P. L. 32, which provide that no corporation shall issue bonds except for money or property actually received, a sale and purchase of bonds must he bona fide, and not a mere device to evade the law, and to impose upon the corporation a greater obligation than there is occasion for it to assume.</p> <p>2. Where in an action by a corporation to recover a balance alleged to he due for bonds sold to defendants, where the pleadings show a prima facie case for plaintiff, and defendants first set up payment by a transfer of land which raised the question of sufficiency of the consideration for the bonds issued, defendants cannot complain that the case was tried on a theory advanced by themselves.</p> <p>3. In such action, where the minutes of the corporation show that the sale was carried out as a cash transaction, and proof is produced that no payment was in fact made, a prima facie case is established.</p> <p>4. Where a party can make out a case, without the aid of an illegal transaction, he may be permitted to recover.</p> <p>5. Where, in an action by a corporation to recover for a balance alleged to be due for bonds of the company sold and delivered to defendants, the latter rely on a treasurer’s receipt in full, and plaintiff sustains the burden imposed upon it by the court of showing that the statements in the receipt were not correct, defendants cannot complain that the court failed to instruct the jury that the receipt could only be set aside for fraud, accident or mistake; and especially is this the case where the trial judge at the end of the charge asked if any omissions or mistakes had been made by h