Drum

This is an action by a corporation against four men who are alleged to have been its promoters, for the recovery of secret profits made by them on the sale of certain properties to the corporation. A joint and several judgment for thirty-two thousand five hundred dollars was rendered against the defendants, from which two of them appeal. The facts as disclosed either by the defendants’ answer, evidence that is undisputed, or the findings of the trial court are these:

In the early part of 1910 there was considerable excitement in the oil business in this state, and the defendants C. P. Drum and George H. Coffin formed a plan to find some oil properties and organize a corporation to take them over. They found two properties, one belonging to the Hamilton Oil & Gas Company and the other to the California Petroleum Lands Company. On March 23, 1910, Coffin secured' a written memorandum from the president and chief stockholder of the Hamilton Company which gave Drum an option to purchase that company’s land. Later there was substituted for this option a formal contract of purchase and sale, with the Hamilton Company as vendor and Drum as vendee. This contract is dated March 23,1910,…