B & B Equipment Co. v. Bowen

When partner Braymen wanted to retire from B & B Equipment Co. (plaintiff), the remaining partners, Jacques and Hughes, brought in Bowen (defendant) to replace him; because Bowen lacked the $15,000 needed to buy Braymen's shares, B&B itself bought the stock on Bowen's behalf in exchange for a $2,500 payment and a $12,500 promissory note from Bowen, who would receive the shares' dividends but had to apply them toward the note until paid off. In exchange, Bowen was responsible for all corporate recordkeeping, bookkeeping, and other needed tasks, but his performance eventually became unsatisfactory to Jacques and Hughes, who discharged him. When settlement negotiations over Bowen's interest broke down, B&B sued for a declaration that it had properly rescinded the agreement, Bowen counterclaimed, and the trial court ruled B&B had the right to rescind; Bowen appealed.