Johnson v. Dodgen

LAVORATO, Justice.

This breach of contract action is the aftermath of a bank failure caused by the embezzlement of $16.7 million by Des Moines stockbroker Gary Lewellyn. In 1967 Joe W. Dodgen agreed to buy controlling interest in the First National Bank of Humboldt under a stock purchase agreement (agreement) calling for monthly payments. Ben P. and Adeline G. St. John, the sellers, died shortly thereafter. Two trusts were then established to receive payments under the agreement.

Dodgen assigned the agreement to his company, Humboldt Realty Insurance Co., Inc. Humboldt Realty, which was not in…