Cass v. Pittsburg, Virginia & Charleston Railway Co.

Mr. Justice Sharswood delivered the opinion of the court, The subscription of the plaintiff in error to the stock of the defendants was upon condition “that in the judgment of the board of directors of said company a sufficient amount is subscribed to the capital stock of said company on or before the 1st day of April 1871, to grade and bridge the road, including the right of way from South Pittsburg to West Brownsville.” The board of directors on the 1st day of April 1871 passed a resolution, “that in the judgment of this board the conditions named are fully complied with; that sufficient stock has been subscribed to grade and bridge the road, including the right of way from South Pittsburg to West Brownsville.” The contention of the plaintiff in error was that this resolution was not a boná; fide exercise of the judgment of the board, and that question was submitted by the learned judge below to the jury and was passed upon by them. The first two assignments of error are to offers by the plaintiff to prove that the actual cost of portions of the road and of the right of way was much in excess of the whole amount of subscriptions on or before the 1st of April 1871. We are of opinion that these offers were rightly rejected as irrelevant to the issue. The bona fides of the judgment of the board could not be tested by the event. The plaintiff had agreed to be bound by that judgment, and nothing was properly relevant and admissible which did not bear upon the question it presented to the minds of the directors at the time fixed.. They could not be expected to foreknow the future. The third assignment of error is to the rejection of an offer to prove in substance, that the agent of the defendants by whom the subscription had been procured, before it was reported to or accepted by the company, at the request of the plaintiff, agreed to hold back the subscription until he should authorize him to hand it to the company, and that afterwards a third person, not a member of the board, obtained possession of the paper, under pretence of merely wishing to look at it, put it into his pocket, and without consent of the agent or defendant, delivered it to the company. We think this evidence ought to have been received. It is true as a general rule that delivery of a bond or deed as an escrow cannot be made to the obligee or grantee. That principle, however, does not apply in this case. When a delivery of an absolute deed is made to the party, his acceptance is presumed primá facie, because it is for his benefit. Then subsequent acceptance relates to the first delivery. So it might have been now, had the subscriptions been absolute. But it is different when the condition imposes a burden upon the other party. He must then expressly or impliedly accept before the contract becomes completely binding on [37] both parties. When such contract is made with an'agent he may well agree to hold it as an escrow. Until both sides agree, if revocable by one it must be so also by the other. Martin, the agent, had no authority to accept the conditions and was not incapacitated from making such an agreement by his relation to the company. The fourth specification of error, on account of the rejection of the offer of the plaintiff to prove what representations were made to him at the time of his subscriptions, cannot be sustained. It was not offered to show by whom the representations were made, nor what they were, and it is clear, according to Custar v. Titusville Gas and Water Co., 13 P. F. Smith 381, the offer was inadmissible and was therefore rightly rejected. The plaintiff’s first and second points, the refusal to affirm which forms the subject of the fifth and sixth assignments, requested the court to instruct the jury in effect “that the hasty, inconsiderate and unfounded judgment of the board, even if in good faith, or if in point of fact the subscriptions were greatly inadequate,” would not be binding on the plaintiff. tWe think the learned judge was right in refusing to affirm these points. It was in effect to sub-' stitute the judgment of the jury for that of the board, and that at a different point of time from that named in the contract. Their judgment upon the 23d of December 1873 would probably be very different from what it would have been on the 1st of April 1871. Gross inadequacy at that period would have been evidencé of bad faith, but this was not the instruction requested. The contention that the judgment was quasi judicial, and that it was necessary that the plaintiff should have notice and an opportunity to appear and be heard, has no foundation. It is but one of many instances to be found in the books, that one party may conclude himself beforehand, and before any controversy has arisen, by the opinion or judgment of the other party or of a stranger, upon what, at the time of the contract, is in uncertainty. Without an express stipulation, he is not entitled to notice or hearing. The last assignment of error is to the affirmance of the fourth point of the defendants in error, the plaintiffs below, “that the plaintiff is entitled to recover twelve per cent, interest on the amount of the subscription.” The defendants were incorporated under the Act of April 8th 1867, Pamph. L. 897, and its supplements, subject to the provisions of “An Act regulating railroad companies,” approved February 19th 1849, Pamph. L. 79. The eighth section of the Act of 1849, after providing that the capital stock shall be called in and paid at such times and places, and in-such proportions and instalments, not, however, exceeding five dollars per share in any period of thirty days, as the directors shall require, of which two weeks’ public notice shall be given, proceeds to declare that “if any stockholder shall neglect to pay any such [38] proportion or instalment so called for at the time and place appointed, he, she or they shall be liable to pay, in addition to the proportion or instalment so called for, at the rate of one per cent, per month for the delay of such payment.” Upon receiving notice of the call for a second instalment, the plaintiff in error addressed a nóte to the secretary of the company, in which, after denying notice of the first instalment, he says : “I am not aware of being a stockholder, or of having subscribed to the stock of this corporation, and therefore your notice to me is in error.” After this distinct and unequivocal repudiation of his subscription, it was no longer necessary to give him notice of the calls. It was a waiver of all notice, and operated in all respects as if the notices had been regularly given. Admitting the rate of interest to be a penalty, it was a necessary consequence of his waiver, that it was incurred by the non-payment of the calls without notice. We think there was no error in the affirmance of this point. Judgment reversed, and venire facias de novo awarded.