B & B Equipment Co. v. Bowen
Missouri Court of Appeals
581 S.W.2d 80 (1979)
Three partners, Braymen, Jacques, and Hughes, owned B & B Equipment Co. (BB) (plaintiff). Braymen wanted to retire so Jacques and Hughes sought out a partner to replace him. Jacques and Hughes entered into an agreement with Bowen (defendant) to replace Braymen. However, Bowen did not have the necessary $15,000 to buy Braymen’s 100 shares of stock. Therefore, BB bought the stock from Braymen on behalf of Bowen, for which Bowen gave BB $2,500 and a promissory note for $12,500. Bowen and the other partners agreed that he would be entitled to all dividends on the 100 shares, but that he would turn over the dividends until the note was paid. Bowen’s duties under the agreement were to take over all corporate recordkeeping and bookkeeping and to do anything else that needed to be done. After time, Bowen’s performance became unsatisfactory to the other partners. Jacques and Hughes informed Bowen that he was discharged. Bowen informed BB’s attorney that he would surrender all of his interest in the corporation for a particular sum. BB’s attorney responded by stating the agreement had been rescinded and repaid the original $2,500 and all additional sums that Bowen had paid toward the stock purchase. Bowen responded and the parties came to an impasse. BB filed suit seeking declaratory judgment. Bowen filed a counterclaim for declaratory judgment. The trial court declared that BB had the right to rescind the contract. Bowen appealed to the Missouri Court of Appeals.
Rule of Law
Holding and Reasoning (Wasserstrom, J.)