When Does the Statute of Limitations Begin In Lawsuits Regarding Buying Into Corporation ?
In Silverman v. Chicago Ramada Inn, Inc., 63 Ill. App. 2d 96, 211 N.E.2d 596 (1965), the plaintiffs bought a 3% interest in the defendant corporation.
They made four payments over several months and received their stock when the final payment was made. Plaintiffs then discovered the securities were not registered and brought suit.
The defendant argued that the claim was barred by the statute of limitations which ran from the date of "sale," because the date of sale was the date of the first payment.
The plaintiffs argued that the statute ran from the date of the last payment.
The court stated that the "definition of a sale is in itself liberal.
Its obvious purpose is to exclude nothing that could possibly be regarded as a sale.
Under this broad and unambiguous definition every step toward the completion of a sale would be a sale." 63 Ill. App. 2d at 101.
The court held that the "solicitation by the defendants constituted a sale under the statue as did" all of the payments made by the plaintiffs. 63 Ill. App. 2d at 102. See also, Green v. Weis, Voisin, Cannon, Inc. 479 F.2d 462 (7th Cir. 1973) (stating that the Silverman "interpretation of the word sale appears to be in accord with the paternalistic purpose of the" ISL).