Case ID: njl_71/html/0293-01.html
Source: Caselaw Access Project
Author: {"author": "Cum mere, Chiee Justice.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

HORACE B. FRY AND REGINALD FRY, PLAINTIFFS IN ERROR, v. BENJAMIN F. MILES ET AL., DEFENDANTS IN ERROR.
    Argued June 21, 1904
    Decided November 14, 1904.
    1. A person who seeks to recover the compensation, provided by a contract, for services rendered by him in accordance with its terms, must show either performance of the contract on his part or else that his performance was prevented by the willful or fraudulent act of the other party to the contract, in violation of such party’s undertaking.
    2. Where a person renders services under an express contract, by the terms of which his right to compensation is made dependent upon complete performance on his part, the contract itself furnishes the sole ground of recovery.
    On error to the Supreme Court.
    For the plaintiffs in error, George T. Werts and John B. Vreeland.
    
    For the defendants in error, Linjabury, Depue & Faulks.
    
   The opinion of the court was delivered by

Cum mere, Chiee Justice.

The plaintiffs in error, who were the plaintiffs below, conceived the idea of forming a combination of several of the companies engaged in the manufacture and sale of linseed oil in opposition to what was known as the Rational Linseed Oil Company. After conferring with two of the defendants, who were connected with one of these companies, the plaintiffs sent a circular to twelve of the other companies, asking each of them to send a representative to a meeting to be held for the purpose.of considering the proposed combination. Ten of the companies to whom the circular was sent complied with the request, and the meeting was held on the 38th of February, 1898, lasting for two days. The outcome of the meeting was that each representative agreed that his company would agree to a merger and consolidation of its property and interests with the property and interests of the others represented at the meeting, provided that the capital of the consolidated corporation should fairly represent the combined value of the properties and the expenses incurred in bringing about the consolidation; and that the plant of each concern should be put into the combination at a valuation satisfactory to each of the others; and provided further, that the plaintiffs' should secure the underwriting of the moneys necessary to be raised for the purpose of completing the consolidation and putting it in operation. It was agreed that the plaintiffs should receive for their services in • bringing about the consolidation and securing the underwriting of the scheme a commission of two and one-half per cent, of the capital stock of the consolidated company. After the meeting attempts were made by the various concerns engaged in the scheme for their consolidation to agree upon the values at which their various plants should be put in, but these attempts were unsuccessful. The plaintiffs, on their side, attempted to raise the moneys necessary to float the proposed consolidated company, but they also were unsuccessful. Finally, on the 34th of June, the various companies engaged in the scheme received a report from their committee having'the matter in charge that the attempt to agree upon values had so far been unsuccessful, and that the plaintiffs had not as yet been able to secure the financing of the scheme. The committee was thereupon discharged and the proposed combination fell through. Some months later negotiations were entered into between the National Linseed Oil Company and eight of the concerns who had been engaged in the scheme of consolidation, engineered by the plaintiffs, for the formation of a corporation which should absorb the plants controlled by the national and those of the eight concerns. These negotiations resulted in the formation of the American Linseed Oil Company with a capital stock of $33,000,000. The plaintiffs had nothing to do with the formation of this corporation or the bringing together of the various interests concerned in and absorbed by it. They claimed, however, that the formation of the consolidated corporation entitled them to receive commissions upon its capital stock at the rate fixed by the agreement of February 28th, viz., two and one-half per cent., and, upon their claim being repudiated, brought this suit. The defendants are nine of the individuals who attended the meeting of February 28th as the representatives of the various concerns who had received the circular of the plaintiffs, requesting that such representatives be sent to that meeting.

The suit is based primarily upon the contract, the amount sought to be recovered being the contract price agreed to be paid to the plaintiffs in case their scheme of consolidation rvas successfully consummated. Failing this, they seek to recover the reasonable value of the services rendered by them in attempting to bring about the consolidation. At the close of the plaintiffs’ case, the aboAre recited facts appearing, the trial justice directed a nonsuit; and this writ of error brings up for review the judgment entered pursuant to that direction.

There Avas no error in the direction complained of. In the first place the defendants attended the meeting at which the contract sued upon was made, not in their own behalf but as the agents of the various corporations and copartnerships which they represented; and this fact was fully known to the plaintiffs. The contract Avhich they entered into Avas the contract of their principals, and for any breach thereof by their principals they were not liable. Citation of authority in support of so elementary a principle is unnecessary.

In the second place, to entitle the plaintiffs to recover upon the contract they were bound to shoAV performance on their part, or else that their performance was prevented by the willful or frarrdulent act of the defendants in violation of their OAvn undertaking. Hinds v. Henry, 7 Vroom 328. That they did not carry out their part of the agreement they admit; that they Avere prevented from doing so by any act on the part of the defendants, Avhich Avas in violation of the defendants’ undertaking, is not suggested by the evidence. Their claim on the contract therefore failed. Nor were they entitled to recover on a quantum meruit. Their services were rendered unpler a special agreement, by the terms of which their compensation was contingent upon performance on their part. The contract furnished the sole ground of recovery. Hinds v. Henry, supra; Runyon v. Wilkinson, Gaddis & Co., 28 Vroom 420.

The judgment under review should be affirmed.

For affirmance — Ti-ie Chancellor, Chief Justice, Dixon, G-arretson, Fort, Pitney, Swayze, Bogert, Vre-DENBURGH, VROOM, GREEN, GRAY. 13.

For reversal — None.