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Judell v. Goldfield Realty Co.

April 1910

H. L. JUDELL COMPANY, RESPONDENT, V. GOLDFIELD REALTY COMPANY, APPELLANT.


Appeal from the District Court of the Seventh Judicial District of the State of Nevada, Esmeralda County; Theron Stevens, Judge.

Pyne & Douglass, for Appellant.

John F. Kunz, for Respondents.

By the Court, Sweeney, J.:

The plaintiff in this action brought suit to obtain a judgment against defendant in the sum of $961.15, with interest and costs, on account of an indebtedness due plaintiff for

[32 Nev. 351, Page 354]

goods, wares, and merchandise sold and delivered by plaintiff to the Goldfield Catering and Café Company, a California corporation, which indebtedness the plaintiff alleges defendant assumed and agreed to pay. The defendant company interposes a defense to the complaint that its manager and secretary was not authorized to bind the company in the execution of said promissory note, evidencing the amount of the indebtedness in dispute, a determination of which issue is determinative of this appeal.

An examination of the record on appeal discloses that the Goldfield Realty Company is a corporation organized under the laws of the State of Nevada, and during the times mentioned was conducting the Goldfield Hotel at Goldfield, Nevada. Among the various objections for which this corporation was formed, as disclosed by its articles of incorporation, we find: “(a) To purchase, sell and own real estate, to erect buildings thereon, and to engage in a general hotel business. (b) To engage in the business of buying and selling merchandise, wines, liquors and cigars either at wholesale or retail. (c) * * * (d) To engage in a general commission business, and to do all and anything necessary, suitable or convenient for the accomplishment of any of the purposes or attainment of any of the objects hereinbefore enumerated.” The transcript further discloses that the Goldfield Catering and Café Company is a California corporation, and owned, operated, and conducted the café and restaurant in the Goldfield Hotel, as well as the bar and cigar stand in connection therewith; that in January, 1908, the Goldfield Catering and Café Company was indebted to various creditors, not only for furniture and fixtures, but also for goods, wares, and merchandise sold to it in conducting the said branches of business, and for part of which said indebtedness notes had been given to some of its creditors and indorsed by the appellant, Goldfield Realty Company. To secure the Goldfield Realty Company for indorsing these notes of indebtedness, a mortgage was executed by the Goldfield Catering and Café Company on January 17, 1908, to the Goldfield Realty Company, under the terms of which, however, the Goldfield Catering and Café

[32 Nev. 351, Page 355]

Company was permitted to remain in possession of all of the personal property so mortgaged.

Pursuant to certain negotiation between the officers and agents of the Goldfield Realty Company and the Goldfield Catering and Café Company, the following resolution, prepared and drawn by J. F. Douglass, general manager and secretary of the Goldfield Realty Company, was passed on February 19, 1908, by the board of directors of the Goldfield Catering and Café Company:

“Whereas, the Goldfield Catering and Café Company is indebted to various merchants of Goldfield, San Francisco, Oakland and other places in large sums of money, aggregating many thousands of dollars, for the equipment and supplies used in the kitchen, dining-room and bar room in the Goldfield Hotel; and whereas, owing to prevailing conditions it is unable to secure the money for payment of these bills either through profits of its café and bar, or by any other means; and whereas, the Goldfield Realty Company is desirous of purchasing said equipment and stock from the persons and concerns from whom the same was secured, providing the Goldfield Catering and Café Company releases all its claim, both in law and in equity, in and to said equipment and stock to said persons and concerns from whom the same was secured. Now, therefore, be it resolved, that in consideration of the surrender of all promissory notes given by this company in payment for said equipment and stock, and the release of this company from all indebtedness on account of said equipment and stock where same is not secured by notes or otherwise by its several creditors, this company will surrender all its right and claim of whatsoever nature in and to said equipment and stock of goods to the persons from whom same was secured, and that this resolution be effective as to any individual instance of indebtedness as soon as this company is released from same. (Signed) O. Groppengiesser. Harry Cole, Acting Secretary. Approved: Harry Cole, Arthur Starkey, B. J. Sears.”

Pursuant to this resolution, the business and assets of the Goldfield Catering and Café Company in the Goldfield Hotel

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were turned over to the appellant, which included all of its furniture, stock, etc., in bar, kitchen, and dining-room, which the appellant accepted and received. Afterwards the Goldfield Realty Company leased the said business formerly owned and conducted by the Goldfield Catering and Café Company to the individual stockholders or part of them of the said Goldfield Catering and Café Company. In conformity with the understanding evidenced by the foregoing resolution, J. F. Douglass, the secretary and manager of the defendant company, while in San Francisco arranging the indebtedness with the creditors of the catering company, called upon the plaintiff, and proposed, executed, and delivered the note in dispute in behalf of the defendant company, and represented to the plaintiff that he was fully authorized to make the arrangements for an assumption of ...


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