Tomberlin v. Waycross Commercial Hotel Co.

Stephens, J.,

dissenting. I can not concur in the conclusion reached by my colleagues that the provisions of sections 29 and 35 of the securities act of 1920 (Ga. L. 1920 p. 250), which provide that "every sale or contract of sale” made under the circumstances there mentioned "shall be .void and may be rescinded by the purchaser within one year, but not thereafter,” and that “every sale and contract of sale made in violation of any of the provisions of *83this act shall he void at the instance of the purchaser at any time within twelve months from the date of such purchase, or contract of purchase,” will not prevent a buyer or subscriber from later pleading a want of compliance with such act defensively to an action upon an executory sale or subscription contract. I am of the opinion that, under a proper construction of these sections of the act, the time limitation applies to every contract of sale, irrespective of whether the purchaser had “parted with money or other thing of value.” Just what proceedings a purchaser who had executed and delivered his note for the subscription price of stock and had not received the stock would take to “rescind” or “void” the contract, and whatever practical difficulty may be in the way of his effecting a rescission or a voidance of the contract, is not material. Under the statute, as I construe it, the contract is valid and enforceable unless the purchaser, within a period of one year or twelve months after its execution, “rescinds,” or “voids,” the contract. It might be that the purchaser could evidence his intent to rescind the contract, or “void” it, by demanding of the seller the return of the note, and disclaiming all right and title to the stock.

The defendant’s plea, in which he alleges that he within twelve months “advised” the agents and solicitors who had sold him the stock “that he would not pay for said stock and that he rescinded the purchase thereof” is insufficient to show any valid rescission of the contract, since it does not appear that the solicitors and agents who sold him the stock represented the seller as agents, and had authority from the seller to accept notice of the purchaser’s intent to “rescind” or “void” the contract.

I therefore am of the opinion that the plea failed to set out a valid defense, and that it was properly stricken. For this reason I dissent from the judgment of reversal.