tify the legislative determination that those subjects require special enactment."

And to the same point, see Matter of Ap

plication of Miller, 162 Cal. 687, 124 P. 427; Miller v. Wilson, 236 U. S. 373, 35 S. Ct. 342, 59 L. Ed. 628, L. R. A. 1915F, 829.

The governing principle is covered by the statement that, "it is only when a business is lawful and has no injurious tendency that the governing body cannot say who shall and who shall not exercise the right itself." Goytino v. McAleer, 4 Cal. App. 655, 88 P. 91, citing County of Los Angeles v. Hollywood Cemetery Assn., 124 Cal. 344, 57 P. 153. 71 Am. St. Rep. 75.

Sam'l A. Boorstin and J. D. Johnston, both of Tulsa, for plaintiff in error.

of Okmulgee, and Ernest Anthis, of Muskogee, for defendants in error.

R. W. Stoutz, of Muskogee, Eaton & Gilder,

NICHOLSON, J. This is an appeal from an order of the trial court granting a perpetof the defendants in error to dismiss the apual injunction, and is before us on the motion peal.

and the recitations in the journal entry are so indefinite that it is impossible for us to intelligently pass thereon. While the record is styled a case-made and is settled and signed as such by the trial judge, it is merely a transcript, and the errors assigned are such that they could only be presented by case-made or bill of exceptions.

reversal of the judgment upon the alleged erThe plaintiff in error bases his right to a ror of the trial court in its conclusions of law based on its findings of fact contained in the journal entry of judgment. These soThat the ordinance in question is within called findings of fact appear to be based the police power of the state, and that it upon the construction given by the trial court constitutes a regulation of motion picture ex- to a bill of sale offered in evidence, but such hibitions and is not prohibitory, see the well-instrument is not contained in the record, considered cases of Ames v. Gerbracht, 194 Iowa, 267, 189 N. W. 729, and Power v. Nordstrom, 150 Minn. 228, 184 N. W. 967. Considering that, according to the authorities to which reference has been had, moving pictures "are liable to degenerate and menace the good order and morals of the people," for present purposes they must be classed with other businesses having like tendencies, and as such subject to the same rules governing their operation. In reliance upon the rule that "Sunday laws" are universally upheld, and in line with the decision in the Murphy Case, supra, it must be held that the prevention of the plaintiff from transacting its business on Sundays, and at the same time permitting an apparently identical act by a religious organization or a philanthropic society, in no way invades the plaintiff's constitutional rights.

The judgment is reversed.

We concur: CONREY, P. J.; CURTIS, J.

BLUMENFELD v. ANTHIS et al. (No. 15204.)

(Supreme Court of Oklahoma. Oct. 28, 1924.)

(Syllabus by the Court.)

Appeal and error 554 (2)-Where errors assigned are such as could only be presented by case-made or bill of exceptions, appeal by transcript will be dismissed.

Where the appeal to this court is by transcript and the errors assigned are such that they could only be presented by case-made or bill of exceptions, nothing is presented for review, and the appeal will be dismissed.

Appeal from District Court, Okmulgee County; James Hepburn, Judge.

Action by James M. Anthis and another against Maurice Blumenfeld. From a judgment for plaintiffs, defendant appeals. Dismissed.

Therefore nothing is presented for review, and the appeal is dismissed.

All the Justices concur, except MASON, J., not participating.

MCKENNEY V. CAMPBELL et al. (No. 13296.)

Oct. 7, 1924. Rehearing Denied Nov. 3, 1924.)

(Supreme Court of Oklahoma.

(Syllabus by the Court.) Corporations 314(4)-President and general manager cannot apply corporate property to payment of individual debts.

The president and general manager of a corporation occupies a position of trust, and is not permitted to apply corporate property to the payment of his individual debts.

Commissioners' Opinion, Division No. 1. Appeal from District Court, Jefferson County; Cham Jones, Judge.

Action by J. W. McKenney, receiver of the Big Diamond Oil & Refining Company, against John F. Campbell and another. From a judgment for defendants, plaintiff appeals. Reversed, with directions.

Bridges & Vertrees, E. B. Anderson, and Harley Ivy, all of Waurika, for plaintiff in error.

Weeks, Morrow & Francis, of Wichita Falls, Tex., and Green & Pruet, of Waurika, for defendants in error.

RAY, C. The principal question here to be decided is whether the president and gen

(230 P.)

eral manager of an oil and gas company, a corporation, may, by the execution of his company's notes and mortgaging its property to secure their payment, apply his company's property to the payment of his individual debts. No question of an innocent purchaser for value is involved. The mortgagees are parties to the action.

This suit was commenced in the district court of Jefferson county by J. W. McKenney, receiver of the Big Diamond Oil & Refining Company, a corporation, against John F. Campbell and the First National Bank of San Saba county, Tex., for the cancellation of a mortgage given to secure the payment of two notes, one to John F. Campbell, in the sum of $6,623.64, and one to the First National Bank of San Saba county, in the sum of $3,120, and to have the notes decreed to be null and void, in so far as they affect the Big Diamond Oil & Refining Company. The defendants answered by general denial, and by cross-petition, in which they prayed judgment for the amount of the notes and for a foreclosure of the mortgage. The plaintiffs replied by general denial. Judgment was for the defendant for the principal of the notes, interest, and attorney's fee, and a foreclosure of the mortgage. Plaintiff has appealed.

Prior to the organization of the Big Diamond Oil & Refining Company, its president, P. M. Faver, and its directors, had engaged in an unsuccessful oil venture in Texas, as a result of which they had become indebted to the First National Bank of San Saba and to J. W. Campbell, its president. Soon after the organization of the Big Diamond Oil & Refining Company in 1917, the bank and Campbell, its president, became insistent upon the settlement of these obligations. In October, 1919, the notes and mortgage in question were executed in settlement of that indebtedness, or as additional security for its payment. The only cash consideration for the notes and mortgage was $1,400.

The officers and directors of corporations are, in a sense, trustees for the stockholders, and are required to act in good faith and for their benefit. In the case of McKee v. Interstate Oil & Gas Co., 77 Okl. 260, 188 P. 109, this court said:

"A director of a corporation occupies a fiduciary relation, where his dealings with the subject-matter of his trust or agency, and with the corporation, are viewed with jealousy by the courts, and they may be set aside on slight ground."

And. in the case of Bentley et al. v. Zelma Oil Co., 76 Okl. 116, 184 P. 131, it is said:

of the company, and guardians of the interests of the stockholders, and will not be permitted by a court of equity to violate such trust, by selling or purchasing the corporate property to their own personal advantage and to the detriment of their cestuis que trust."

The

The notes and mortgage were void, in so far as it was sought to apply the company's property to the payment of the individual debts of its president and directors. only authority cited by the defendants in error in support of the judgment is Skirvin Operating Co. v. Southwestern Electric Co., 71 Okl. 25, 174 P. 1069, 15 A. L. R. 1104. The law, as stated in that case, is that, where an insolvent corporation is absorbed by and merged into another, and in fraud of its creditors all of the assets are taken over and absorbed by the new corporation, and the business is continued in the same place, on the same property, and by substantially the same officers, and no provision made respecting the liability of the insolvent corporation so merged and absorbed by the new corporation, the new corporation will, as a general rule, be answerable for all the liabilities of the old corporation thus merged and absorbed. That is not the instant case. It appears that the assets of the two insolvent companies, whatever they were, were assigned to Dafflemeyer, one of the directors, and one Clark, who was also in some way connected with the two insolvent companies. These assets were never assigned to the Big Diamond Oil & Refining Company, nor came into its hands. The only asset of any value of either of the insolvent companies was a tract of nine and a fraction acres on which there was a small well, known as the Humble property. It was transferred by Dafflemeyer and Clark to one Thompson, so that the only thing taken over by the Big Diamond Oil & Refining Company was the indebtedness of the two insolvent companies, or, more properly stated, debts incurred by

Faver and associates on behalf of the two in

solvent companies. It is made clear by the evidence that the real purpose of Faver, president and general manager of the Big Diamond Oil & Refining Company, and those associated with him in the transaction, was to have that company take over their prior existing indebtedness. The $1,400 received by the Big Diamond Oil & Refining Company is separable from the unlawful indebtedness sought to be assumed, but it is not made to appear whether that item was included in the note given to Campbell or in the note given to the First National Bank.

The judgment should be reversed, with di"Directors and officers of a corporation, hav-rections to vacate the judgment, and to proing the management of its corporate affairs, ceed in accordance with the views expressed occupy the position of trustees of the welfare in this opinion.

Action by the State, through the County STATE ex rel. LAND OFFICE COM'RS v. Attorney of Pittsburg County, against G. M. Gelabert and one Buick automobile, for the confiscation of the latter. From a judgment for plaintiff, defendants appeal. Dismissed.

(230 P.)

this act and provides for the foreclosure of such mortgages upon default and for the appointment of a receiver in the following language:

"In case of default in the payment of principal or interest due upon any loan made under the provisions of this act or upon the failure of the mortgagor or his assigns to comply with any of the terms or conditions of any mortgage as herein provided, the holder of any such mortgage may file suit in any court of competent jurisdiction to foreclose such mortgage and such court shall, upon the application of the plaintiff in said action and a showing of default of any of the terms of said mortgage, appoint a receiver to take charge of the real estate covered by said mortgage.

At the hearing upon the application for a receiver the proofs established default in the payment of interest on the loan secured by the mortgage, but the trial court refused to make the appointment because no evidence was introduced to show that the indebtedness was not sufficiently secured, holding that the appointment of a receiver in the case was within the discretion of the court. Section 9483, supra, applies specially to mortgages made to the state under article 8, supra, and therefore enters into and becomes a part of the contract made with reference to such law. In Knight v. Clinkscales, 51 Okl. 508, 152 P. 133, it is said:

"The laws which exist at the time and place of making a contract, and at the place where it is to be performed, affecting its validity and construction, enter into and form a part of it."

And again in Buckley v. Morton, 93 Okl. 45, 219 P. 685, this court held:

"The remedy subsisting in a state or territory when and where a contract is entered into and to be performed, is a part of the obligation."

In Lorando v. Gethro, 228 Mass. 181, 117 N. E. 185, 1 A. L. R. 1374, the Supreme Court of Massachusetts said:

"When a statute is in force, giving special

force and effect to a particular contract, parties who enter into such a contract are held to contemplate and assent to the force and effect attributed by the law to that statute."

The Court of Appeals of Alabama, in Cobbs v. Home Ins. Co. of N. Y., 18 Ala. App. 206, 91 So. 627 said:

"If a contract is made with reference to the existing law, such law is read into and becomes a part of the contract, whether it is between individuals dealing with each other, or between individuals and the government, where the contract is consummated by an acceptance of the terms of a statute proposing a status which the individual may either accept or reject."

This provision of the act being a part of the mortgage contract, the plaintiff was entitled to a receiver upon a showing of de

fault of any of the terms or conditions of the mortgage as a matter of law.

For the reasons stated, the judgment of the lower court is reversed and remanded, with instructions to appoint a receiver in the above-entitled cause.

OKMULGEE DEMOCRAT PUB. Co. v. NA-
TIONAL SUPPLY CO. et al.
(No. 14769.)

(Supreme Court of Oklahoma. Oct. 28, 1924.)
(Syllabus by the Court.)

Appeal and error 1010(1) — Judgment in law action tried to court not upheld, unless reasonably sustained by competent evidence.

In an action at law tried to the court, the judgment of the trial court will not be upheld, unless it is reasonably sustained by competent evidence.

Appeal from District Court, Okmulgee County; James Hepburn, Judge.

Action by the National Supply Company against the Okmulgee Democrat Publishing Company and others. From a judgment for plaintiff, defendant named appeals. Reversed and remanded.

Fred M. Carter and C. M. Gordon, both of
Okmulgee, for plaintiff in error.
Dick & Pitchford, of Okmulgee, for de-
fendants in error.

NICHOLSON, J. This action was brought by the National Supply Company, a corporation, as plaintiff, against John H. Rebold, Minnetonka Lumber Company, a corporation, Okmulgee Furniture Company, Okmulgee Democrat Publishing Company, a corporation, and E. R. Black, to recover the sum of $18,000, and interest and attorney's fee, upon a promissory note executed and delivered by John H. Rebold to E. R. Black, and by Black sold, indorsed, and delivered to the

plaintiff, and for the foreclosure of a mortgage securing the payment of said note, covering certain real estate situated in the city of Okmulgee.

It was alleged in the petition that, in addition to the aforesaid note, said Rebold did, on the same day, execute and deliver to the defendant Black two promissory notes for the sum of $5,000 each, and one for the sum of $2,000, the payment of which was also secured by said mortgage; that one of said notes for the sum of $5,000 was owned and held by the defendant Okmulgee Democrat Publishing Company; one of said notes for the sum of $5,000 was owned and held by the Minnetonka Lumber Company; and the note for $2,000 was owned and held by the Okmulgee Furniture Company.

The Okmulgee Democrat Publishing Com

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

and the amount owing it by the Black Petroleum Corporation on said account. The Rebold Lumber Company credited the Black Petroleum Corporation for the full amount of said account, and the Black Petroleum Corporation entered a credit on its books to the account of E. R. Black for the amount of said account. Afterwards, and on May 6, 1921, the Rebold Lumber Company sold, indorsed, and delivered said note to the Okmulgee Democrat Publishing Company, and received in payment therefor the sum of $5,062.47; the same being the amount of the principal on said note with interest thereon to that date.

pany filed its answer and cross-petition, admitting the execution of the notes and mortgage as alleged, and that it was the owner and holder of one of said notes for the sum of $5,000, and alleged that said John H. Rebold had been adjudged bankrupt; that D. H. McMasters was the duly elected trustee in bankruptcy of the estate of said bankrupt, and prayed that he be made a party de fendant in said cause; that it have judgment against the property covered by said mortgage for the sum of $5,000, and accrued interest thereon, and for the sum of $500, attorney's fee, and prayed a foreclosure of said mortgage. To this answer and cross-petition the defendant E. R. Black filed reply, pleading that said note had been fully paid to him by John H. Rebold. Upon the issues thus framed, a trial was had to the court "These two $5,000 notes were becoming due, which resulted in a judgment in favor of and I spoke to Mr. Rebold once or twice, and the plaintiff, National Supply Company, for I think he spoke to me once or twice about the amount sued for, and in favor of the them. I told him-no, I don't believe I told Minnetonka Lumber Company, for the him that I owed the Minnetonka Lumber Comamount due on the note held by it, and in pany a bill-I told Mr. McConnell, who was favor of the defendant E. R. Black, the asmanager, that I had these two $5,000 notessignee of the note, and claim of the Okmul- Mr. Rebold. A. I indorsed those two notes to "Q. Go ahead and tell the conversation with gee Furniture Company, but denied the Ok-the Minnetonka Lumber Company preparatory mulgee Democrat Publishing Company recov- to turning them over to the Minnetonka Lumered on the note held by it. From this judgment, the Okmulgee Democrat Publishing Company has appealed.

The only question presented is whether or not the evidence shows that the note involved has been paid. It appears from the record that John H. Rebold, the maker of this note, was the president and treasurer of the Rebold Lumber Company, a corporation, and owned 65 per cent. of the capital stock thereof, the other 35 per cent. of the stock being owned by E. A. Scripture and others; that said Scripture was the general manager of the company. The Okmulgee Democrat Publishing Company is also a corporation, of which said Rebold was president, and owned about 75 per cent. of its stock. The remainder of said stock was owned by E. G. Martin and others, and Martin was general manager of such corporation. The Black Petroleum Corporation was likewise a corporation, and the defendant E. R. Black owned more than 50 per cent. of its capital stock, and was its president.

The Black Petroleum Corporation was indebted to the Rebold Lumber Company on account for lumber and rig timbers purchased in the sum of $4,132.06, which was long past due, and the general manager of the lumber company was insisting upon the payment of said account. On April 21, 1921, the note here involved, which bore date March 10, 1921, and matured 6 months after date, was indorsed and delivered by Black to the Rebold Lumber Company, and said company issued and delivered to Black its check for $914.64, the difference between the face of

The only evidence upon the question of payment is that of the defendant E. R. Black, and is as follows:

ber Company. Mr. Rebold saw me, says that the Black Petroleum Corporation owes the Rebold Lumber Company, which Mr. Scripture tells me, some $4,000, and he asked me would the difference and take up his note, his $5,000 it be satisfactory if he sent over a check for note, and pay the bill of the Black Petroleum Company, or Black Petroleum Corporation, oil company, to the Rebold Lumber Company. In as much as the Rebold Lumber Company was his, and the Black Petroleum was mine, I told him it would be satisfactory. Mr. Scripture came up and said Mr. Rebold had spoke to him about it and wanted to know if that was the deal, and I said 'yes.' Mr. Rebold, either in my office or again on the street, met me, and the question of the notes came up again, and he said it was satisfactory; he would send Mr. Peterson over, and Mr. Peterson came over when he came he brought a check, which I there and took up one of the $5,000 notes, and didn't see, and had not seen it until to-day. I presume it was John Rebold's check for the difference in the bill of the Black Petroleum Corporation and the note against the Rebold Lumber Company, and I told Mr. Peterson that I had indorsed this note preparatory to turning it to the Minnetonka, and to strike my indorseRagsdale would handle that, and he stepped in ment off that note, and he said he and Mr. the other room, and I didn't see the checkno, I didn't see the note any more until to-day, and the first time I knew that the note had not been paid between Mr. Rebold and myself was when the Democrat intervened here. I simply say that because of the fact that the notes were indorsed by me, both notes were indorsed, and I went to the Minnetonka and told them I could only give them one of the notes because one of them was taken up.

"Q. Mr. Black, I ask you to examine Exhibit A, and the indorsement thereon, and state