Sarbach v. Kansas Fiscal Agency Co.

Citations

• 86 Kan. 734
• 122 P. 113
• 1912 Kan. LEXIS 371

Syllabus

<p>SYLLABUS BY THE COURT.</p> <p>1. Corporation — Stockholder—Conditional Subscription. A corporation organized ostensibly to sell insurance as agent for another company proceeded to sell stock in its own concern. It sold one hundred shares to M., taking his note due in six months and giving a written agreement that “his note given in payment for stock” should not be discounted before maturity, and that if at any time, for any reason, M. should desire to surrender the stock certificate he might do so and receive his note back together with any profit that might accrue in replacing such stock, also any money he might have paid on the note. He- receipted for the stock “purchased by me,” also receipted for a dividend “on Certificate No. 330, for 100 shares of the capital stock of the Company, owned by me August 15, 1907.” Held, that M. thereby became a stockholder and not a mere optional subscriber.</p> <p>2. Stock — Subscription■—Promissory Note — Collateral Agreement. The company sold its stock to many persons, though it had no substantial value, and being insolvent the company, upon the petition of certain shareholders, was put in charge of a receiver who succeeded in collecting a small sum netting about $1400, constituting the entire discoverable assets of the concern. The note was promptly negotiated and M. was compelled to pay it, the company-refusing to take back his stock or repay the amount of the note. M. intervened in the receivership suit, setting up his contract with the company and its breach and praying for an order allowing him the amount of the note out of the assets in the hands of the receiver or his just proportion thereof with other allowed claims against the company. Held, that as between M. and the other stockholders his contract with the company was one which equity will not enforce at their expense.</p>