OCALA COMMUNITY HOTEL COMPANY, A CORPORATION ORGANIZED AND EXISTING UNDER THE LAWS OF THE STATE OF FLORIDA, PLAINTIFF IN ERROR,
v.
F. H. HOLLOWAY, DEFENDANT IN ERROR
AI-generated. These summaries, headnotes, and key points are machine-generated and may contain errors or omissions. Always verify against the full opinion text below. Not legal advice.
The Florida Supreme Court reversed a judgment sustaining a demurrer to a stock subscription agreement, holding that a corporation may sue to enforce a subscription agreement made before the corporation was formed, relying on the concurrent decision in Perry Hotel Company v. Courtney.
A corporation may maintain an action for a subscription made to its stock before it was formed, even though it is not named as a promisee in the agreement. Any defenses or matters entitling the defendant to rescind or avoid the subscription must be asserted by appropriate pleadings as a defense, not by demurrer, when the declaration sufficiently alleges the making of the subscription and that the contemplated corporation has been duly formed.
“a corporation may maintain an action for a subscription made to its stock before it was formed, though it is not named as a promisee in the agreement to subscribe”
Establishes the primary holding that a pre-incorporation subscriber may be sued by the subsequently formed corporation.
Previewing 1 of 3 key quotes on this case — the court’s exact language, pinpointed for members.
Join FLexlaw to unlock all legal intelligenceOcala Community Hotel Company sought to recover on a stock subscription agreement dated June 16, 1925, wherein F. H. Holloway subscribed for 2 shares …
The full statement of facts, procedural history, and disposition for this case are member content.
Join FLexlaw to unlock all legal intelligence© FLexlaw, Inc. — AI-generated enrichments are proprietary. All rights reserved.
Explore caselaw by topic → Browse Rescission Of Contract cases and more on FLexlaw
was a suit by Ocala Community *522Hotel Company seeking to recover on a stock subscription agreement, the material part of which is as follows:
“COMMUNITY HOTEL CORPORATION OF OCALA, FLORIDA
Subscription of Stock
$300 Ocala, Florida 6/16 1925
In consideration of the agreement of others of like effect,, the mutual promises and agreements herein contained, and the benefits and advantages resulting to each of us respectively, I hereby subscribe for 2 shares of the Common Stock of the par value of $100.00 each; 1 shares of the Preferred Stock of the par value of $100.00 each, (with which stock shall be issued one share of non par value non participating stock with each two shares of common and one of preferred combined) of the Community Hotel Corporation, a corporation to be organized under the laws of the State of Florida, for the purpose of providing a new and modern hotel in the City of Ocala. ’ ’
Demurrer was sustained to plaintiff’s declaration which declared on the subscription agreement and accompanying promissory note in separate counts. The writ of error herein brings up for review the judgment entered in favor of defendant' oh his demurrer after plaintiff declined to further plead.
In Perry Hotel Company v. Courtney, decided at the present term (opinion filed September 29, 1931,), we held that a corporation may maintain an action for a subscription made to its stock before it was formed, though • it is not named as a promisee in the agreement to subscribe. We further held in that ease that if any matters existed or happened which entitled the defendant to rescind or avoid the subscription after it was made that such matters were such as should have been asserted by appropriate pleadings by way of defense, when it appeared that the declaration sufficiently alleged the making of the subscription and that the corporation contemplated therein, had been duly formed in accordance with it.
*523On authority of that case the judgment herein should be reversed with directions to overrule the demurrer to the declaration and have further proceedings as may be according to law.
Reversed and remanded.
Whitfield, P.J., and Terrell and Davis, J.J., concur.
Buford, O. J., and Ellis and Brown, J.J., concur in the ■opinion and judgment.
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
-
Duncan v. Cady, 109 Fla. 491 (Fla. 1933)…re retained by the bank merely as memoranda of the transaction. On authority of the opinion in the case of Newsom v. Tampa Shipbuilding & Engineering Company, 100 Fla. 1173, 131 So. 115, and of the opinion in that case on rehearing, 100 Fla. 1179, 137 So. 882, the decree of the Chancellor should be modified to eliminate therefrom the item of $18.34, interest paid on the escrow deposit, the remainder of the decree to stand affirmed. Whitfield, Ellis, Terrell, Brown and Buford, J. J., concur. Davis, C. J…