Kelly v. Bastedo

DE CONCINI, Justice.

In 1927, August Heckscher became interested in the Westward Ho Hotel in Phoenix, Arizona, by loaning $275,000.00 to one Charles V. Bob. Bob pledged to Heckscher 10,000 shares of stock of the Pacific Hotels Company, an Arizona corporation, whose sole property was the Westward Ho Hotel. In 1940, the name of the Pacific Hotels Company was changed to Westward Ho Hotel Company. Bob disappeared leaving Heckscher to learn that his stock was not an authorized issue, and that the authorized stock was pledged to a Chicago bank. Heckscher took up Bob’s notes at that bank and became…