Opinion
No. 27,541.
January 17, 1930.
Verdict for defendant properly directed.
Directed verdict for defendant in action on promissory note, given for purchase of stock in company which was authorized to sell its stock for cash only, was proper as note is not collectible. [Reporter]
Plaintiff as receiver of the United Petroleum Company, Inc. appealed from a judgment of the district court for Carver county, Tifft, J. entered upon a directed verdict for defendant. Affirmed.
Erling Swenson, for appellant.
F. R. Allen and Sam G. Anderson, for respondent.
Plaintiff, as receiver of the United Petroleum Company, Inc. a Minnesota corporation (hereinafter referred to as the company), appeals from a judgment in favor of defendant.
The action was brought in October, 1927, to recover on two promissory notes, one for $100 dated November 15, 1921, and the other for $200 dated November 18, 1921, each due 90 days after date and bearing eight per cent interest per annum. Both notes were turned over to Simerman, who was on October 5, 1922, appointed receiver of the company for the benefit of creditors.
The notes were given respectively for one and two shares of the company's stock. The company had secured from the state securities commission authority to sell 750 shares of its capital stock at $100 per share for cash only.
It was within the power of the commission to prescribe that the stock should be sold for cash only. The sales here made were unauthorized; collection of the notes cannot be enforced; the trial court rightly directed a verdict for defendant. L. 1919, p. 99, c. 105, §§ 7 and 10.
Affirmed.