Corporation Commission v. . Harris

Adams, J. His Honor instructed the jury to answer the issue in the affirmative if they believed all the evidence. In this instruction we think there was error. The stock appeared on the books of the bank as having been issued to and in the name of the defendant but this entry, while prima facie evidence of the defendant’s ownership, is not conclusive; the burden of the issue remained with the plaintiff throughout the trial to satisfy the jury by the greater weight of the evidence that the defendant Harris was a stockholder in the bank, as alleged. White v. Hines, 182 N. C., 276; Austin v. R. R., 187 N. C., 7. There was evidence in rebuttal of the presumption arising from the entry of the stock in the name of the defendant on the books of the bank. To constitute the defendant a stockholder it was necessary to show, not only that the stock had been issued, but that it had been actually or constructively accepted by the defendant. The defendant denied that he had accepted the stock. There was evidence tending to show that on 5 January, 1921, the Peoples Bank of East Spencer issued two shares of stock to R. H. Terry and that on 4 April, 1924, Terry’s certificate was surrendered to the bank endorsed by Terry to the defendant; that certificates Nos. 103 and 104 were then issued in the name of the latter. The defendant testified that he had never bought any stock in the Peoples Bank of East Spencer, had never authorized any person to buy it for him, and had never paid for such stock. In explanation he said that four or five years before the trial, one E. J. Lassiter came to the defendant’s store in "Winston-Salem, told him that a letter was coming to Lassiter from East Spencer in the defendant’s name, and gave the defendant instructions to deliver the letter to Lassiter without having it opened. It was in evidence that the defendant’s wife opened the letter; that Lassiter came to defendant’s store on the day following; that the defendant then told Lassiter that he had never authorized him to buy stock in the defendant’s name;' that he did not want the stock and *204 that be wanted Lassiter to bave tbé entry on tbe books of tbe bank canceled. Tbe defendant testified that after tbe letter was opened be signed these certificates in blank, gave them to Lassiter, and at tbe same time wrote tbe bank that be bad not subscribed for tbe stock. He said that be transferred tbe certificates to Lassiter who bad caused them to be sent because be thought Lassiter was tbe owner, and that be wanted tbe bank “to take tbe certificates out of bis name.” Tbe defendant said, also, that be bad never received any dividends and bad never beard anything further in reference to tbe stock until after tbe appointment of tbe receiver. This evidence bad a direct bearing upon tbe questions whether tbe defendant bad bought tbe stock, whether it bad been sent to him without bis knowledge, and whether be bad refused to accept it. If be neither bought nor subscribed for tbe stock nor accepted it when it was sent to him, it can hardly be said that be is a stockholder subject to liability for assessment. Under these circumstances, nothing else appearing, there would be neither ratification nor estoppel which would bar tbe defense. We do not say there is no evidence that the defendant accepted the stock, but merely that there is evidence to the contrary. In Trust Co. v. Jenkins, 193 N. C., 761, it was shown that one of the appellants admitted that be bad been a stockholder in the bank and bad sold bis stock without having it transferred on the books of the bank. Tbe Court said: “He was not relieved of bis statutory liability as such stockholder by the sale of such stock. He remained subject to such liability so long as such shares of stock stood in bis name upfon the books of the bank. He could be relieved of such liability only by a transfer of such shares to a purchaser, in accordance with the provisions of the statutes. 3 C. S., 219(d).” This statement of the law will apply in the present case if the defendant’s acceptance of the stock is established. New trial.