In view of appellant's petition for rehearing a few words may be added to the former opinion. We may concede the rule concerning parol testimony to be as stated by appellant. It is a mistake, however, to assume that we have added or attempted to add anything to the written agreement of the parties. We have simply held — what must be apparent — that under the circumstances of this case the agreement was in effect to cancel respondent's obligation if she exercised her option within ten months. As to this it may be declared that the contract was so treated and interpreted by respondent and by the president of appellant; it was so represented by the agent and so understood by Miss Harney at the time of its execution, and it cannot be doubted that a cancellation of respondent's obligation by appellant would have been essentially a compliance with the corporation's agreement. This necessarily follows from the fact that the contract was executory, and respondent promised to pay the same amount for the same number of shares of stock as appellant. The stock was never delivered to respondent and she made no payment therefor, but simply gave her promissory note. Suppose appellant had kept its promise; what would have occurred? It would have delivered to respondent the contract and promissory note and whatever was necessary to evidence a satisfaction or cancellation of respondent's obligation. But, according to appellant's theory, to carry out its contract this proceeding would be required; respondent would pay appellant the sum of five hundred dollars and receive the five hundred shares, and then she would immediately return the shares and receive the money again. Such circuity of action would not be required. Its equivalent would be indubitably the cancellation of respondent's obligation and the return of the note. So it seems perfectly plain that the court below, as well as the parties to the action, had a right to construe the agreement as one for the cancellation of respondent's liability. We have not varied nor added to the terms of the agreement, but have sought to give it effect according to its plain meaning and intent. *Page 263
We think, also, that appellant is mistaken in the suggestion that the main contention of respondent is that "she was deprived of a most important consideration, in that the collateral agreement was not embodied in the original, and hence she could not take advantage of its provisions." That was only one of the series of fraudulent acts perpetrated by the corporation through its agent. However, the fraud is not so important if we accord to respondent the full benefit of the contract that was actually entered into. And we can see no reason why, in an action brought by appellant to recover on the promise of respondent, she may not show a failure of consideration by reason of the refusal of the former to keep the covenant which was the sole inducement for the promise on the part of respondent. Appellant having brought the suit, invited the very defense that was interposed, and made it proper to adjudicate the merits of the whole transaction. In this connection it may be said that the record shows that respondent did exercise her option, and that appellant failed to keep its agreement is not the subject of dispute.
It seems entirely plain that respondent could bring no such independent action for damages as is suggested by appellant. How could she sue for the failure to purchase from her stock which she did not own and never had in her possession? How could she tender the stock, as required, before bringing an action for the purchase price when she had no control of said stock?
But we need not go further than to say that in our judgment appellant has failed to appreciate the situation of the parties and the nature of their contract. It has been treated as though the stock had been delivered by respondent and the money paid for it and she were the moving party in the action. It may be that from a legal standpoint the defense might have been presented more artistically and accurately, but the cause was fairly tried and justly decided, and the conclusion should not be disturbed. The petition is denied.
Chipman, P. J., and Hart, J., concurred. *Page 264