National Leather Co. v. Roberts

Citations

• 221 F. 922
• 137 C.C.A. 492
• 1915 U.S. App. LEXIS 1390

Syllabus

<p>1. Corporations <§=>80—Stock Subscriptions Obtained by Miseepbesen-- . taitón—Grounds for Rescission.</p> <p>Where a corporation, as an inducement to purchase its preferred stock, offered as a bonus to subscribers an equal amount of common stock, a false representation to complainant that preferred stock offered to him and which he_ bought had been contracted by a prior subscriber, who insisted on retaining his common stock, when in fact the stock offered was treasury stock, was not ground for rescission of his subscription, since the misrepresentation did not tend to induce his subscription, but the contrary.</p> <p>[Ed. Note.—For other cases, see Corporations, Cent. Dig. §§ 244, 246-264, 1407, 1407% ; Dec. Dig. <§=>80.]</p> <p>2. Equity <§=>42—Jurisdiction—Waiver of Objections.</p> <p>Where a suit in a federal court is within a recognized head of equity jurisdiction, the question whether it is rightfully brought on the equity side will not be raised by the court on its own motion, but must be presented by the defendant at the first opportunity.</p> <p>[Ed. Note.—For other cases, see Equity, Cent. Dig. §§ 119, 120; Dee. Dig. <§=>42.]</p> <p>8. Corporations <§=>80—Stock Subscription Induced by Misrepresentation—Grounds for Rescission.</p> <p>While an untrue representation that all or a certain amount of the stock of a corporation has been subscribed may justify a rescission of a subscription contract so induced, it is not ground for rescission where it was immaterial, as where it was so nearly the truth that no loss resulted to the subscriber.</p> <p>[Ed. Note.—For other cases, see Corporations, Cent. Dig. §§ 244, 246-264, 1407, 1407%; Dec. Dig. <§=>80.]</p> <p>4. Corporations <§=>80—Stock Subscription Induced by Misrepresentation—Grounds for Rescission.</p> <p>A false representation, made to a subscriber for preferred stock of a corporation, that all of such stock had been subscribed for, hold not ground for rescission of his subscription, where at the time less