Hilliard

Chase was in the used car and trailer business for several years. William H. Musselman invested in the business of Chase by purchasing “Jesse M. Chase Investment Certificates,” which were promissory notes signed by Chase personally. On January 1, 1947, Chase transferred the whole business, of an alleged net worth over $175,000.00, to a corporation, “Jesse M. Chase, Inc.”, for which common stock of par value of $164,000.00 was issued to Chase. The balance was subsequently accounted for in additional stock issue and paid in surplus. Chase, Hubble and Nelson, the incorporators, each purchased one share of stock for $100.00, and paid for it in cash. On January 31, 1947, Hubble purchased 20 shares more, and turned in -cash assets in-that amount. Subsequently, $27,000.00 additional was invested by others in common and preferred stock of the corporation, which operated at a profit during its first year. Chase and wife turned in by warranty deed, dated February 10, 1947, four lots in Pocatello, upon which was a garage.

Mrs. Sisil obtained a judgment against Chase in the United States District Court for the District of Idaho in the sum of over $10,000.00, on the investment certificates…