#### Strait, Respondent, vs. Northwestern Steel & Iron Works, Appellant.

*January 13*

January *30, 1912.*

*Corporations: Contract made by president: Ratification: Payment for property in stock: Agreement to repurchase stock: Breach: Tender: Measure of damages.*

1. Where the president of defendant corporation conducted all the negotiations which resulted in the transfer hy plaintiff to the corporation of personal property at the price of $5,000, to he paid in stock of the corporation, and the engagement of plaintiff at a salary so long as his services should be satisfactory, with a further agreement to buy back his stock at par in case of his being discharged, the defendant, which approved such agreement and accepted and ratified the fruits of the negotiations, thereby ratified the acts of its president; and it, not the president personally, was bound by such agreement to repurchase the stock.

2. After defendant had agreed to the price and salary named by plaintiff, the latter wired “Will accept and do my best, with the understanding you take my stock at par in case you wish me to retire,” to which defendant replied, “Consider deal closed.” *Held,*that this constituted a binding agreement to take plaintiff’s stock off his hands at par in case of his discharge from defendant’s employ.

3. Plaintiff having by letter offered to return the stock and demanded his money, and having afterwards, before suit, tendered the certificates of stock properly indorsed, which offer and tender were refused, his acts were the equivalent of actual delivery and entitled him to treat the contract as performed on his part and to sue for and recover the face of the certificates.

Appeal from a judgment of tbe circuit court for Eau Claire county; A. I. ViNje, Judge.

*Affirmed.*

The complaint sets out two causes of action. The first alleges that the plaintiff, prior to February 20, 1907, was engaged in the manufacture of agricultural and other machinery at Elmira, New York, and that the defendant was similarly engaged at Eau Claire, Wisconsin. It is alleged that the defendant, desirous of enlarging its plant, agreed to pur*255chase personal property from the plaintiff of a schedule value of inore than $11,000, the consideration to he paid therefor being corporate stock of the defendant to the amount of $5,000 and an agreement to employ the plaintiff at a salary of $100 per month as long as his services were satisfactory, and the additional agreement, in the event of the plaintiff’s services being unsatisfactory or of his being discharged, that the defendant would take hack the stock and in lieu thereof pay the plaintiff for said personal property the sum of $5,000. It is alleged that about April 1, 1908, after having been employed by the defendant for about a year, the plaintiff was discharged from the employ of the defendant because his services were unsatisfactory, that the' plaintiff offered to return the stock certificates and demanded the $5,000 from the defendant, and that the defendant has refused to pay the $5,000.

The second cause of action alleged is for recovery of $12,000, the alleged value of the personal property sold by the plaintiff to the defendant.

The answer admits the agreement to purchase the personal property from the plaintiff and the paying therefor by $5,000 worth of stock; denies that there was an agreement to take back'the stock at par in the event of the plaintiff’s discharge from defendant’s employ as unsatisfactory; and sets up a counterclaim for the salary paid the plaintiff, on the ground that his services were valueless to the defendant, a counterclaim for alleged l^rge expenditures made necessary to avoid paying royalties to the plaintiff and his wife upon patents which they claimed to hold and which covered implements for the manufacture of which the property purchased from the plaintiff was solely adapted, and a further counterclaim based on the ground that the defendant had been compelled to make large expenditures because the plaintiff, by using the machinery and time of the defendant, had obtained patents upon implements for the manufacture of which the machines *256owned by it were solely adapted, and because it became necessary for the defendant to expend large sums of money in designing and making new implements and machinery to manufacture a line of goods not covered by the plaintiff’s patents.

The evidence shows that as the result of correspondence between the parties the plaintiff visited Eau Claire in the early part of Eebruary, 1907, and inspected the plant of the defendant. On Eebruary 6 or 7, 1907, the president of the defendant corporation visited the plaintiff’s place of business at Elmira, New York, inspected the personal property, made inquiries about the business, and, after his return to Eau Claire, wrote to the plaintiff on Eebruary 11, 1907, offering $5,000 for the plaintiff’s personal property, to be paid in stock of the defendant corporation, promising the plaintiff employment if he accepted the offer, and asking the plaintiff to wire if he accepted the offer.

The plaintiff on Eebruary 13, 1907, sent to the defendant the following telegraphic message: “With matters more definitely understood, probably can get together. Writing;” and in the letter stated: “As we talked, we think we ought to be worth $1,200 per year if anything, and if it should appear later on that *Mr. Strait’s*services were not satisfactory to the company, and you wished him to step aside, we would like to have it arranged so that you would take our stock off our hands at the sacrifice price that we consider we are putting our appliances in for.” The defendant in reply wrote: “As to your salary, $100 a month, I think, would be satisfactory to our people,” and asked the plaintiff to wire as to some details. That part of the plaintiff’s answer relative to the matters involved in the instant case was as follows: “Will accept, and do my best, with understanding you take our stock at par if you wish me to retire.”

On February 20, 1907, the defendant wired the plaintiff as follows: “Consider deal closed. When can you start? Considerable business in sight already,” and also wrote him *257a letter in which the repurchase of the stock was spoken of as not advisable. On the day the plaintiff received defendant’s telegram he telegraphed the defendant as follows: “Telegram received. Will pull up and move at once.” The plaintiff packed up the property thus sold to- the defendant and arrived with it at Eau Olaire, received his certificates of stock, and went to work for the defendant. About a year later the defendant notified him that his services were unsatisfactory. Plaintiff then offered to turn over his stock and demanded $5,000 for it. This was refused, and after negotiations for a settlement had failed the plaintiff brought action.

The court granted plaintiff’s motion that a verdict he directed in his favor as to defendant’s counterclaims; denied defendant’s motion that a verdict he directed in its favor dismissing the plaintiff’s cause of action as alleged in his complaint; and granted plaintiff’s motion that a verdict he directed in his favor on his first cause of action. This is an appeal from the judgment in accord with the verdict.

Eor the appellant there was a brief by *Bundy & Wilcox,*and oral argument by *C. T. Bundy.*

They cited *Moench v. Mower,*137 Iowa, 621, 115 N. W. 229; *Brie City Iron Works v. Thomas,*139 Eed. 995; *Oalteaux v. Mueller,*102 Wis. 525, 78 N. W. 1082; *Atlanta & W. B. & O. Asso. v. Smith,*141 Wis. 377, T23 N. W. 106; *Tolman v. New Mexico & D. M. Go.*4 Dak. 4, 22 N. W. 505; *Watters v. Mc-Guigan,*72 Wis. 155, 39 1ST. W. 382; *Micks P. Go. v. Wis. Cent. B. Go.*138 Wis. 584, 120 N. W. 512; *Qehl v. Milwaukee P. Go.*105 Wis. 573, 81 N. W. 666; *Woodman v. Blue Grass L. Go.*125 Wis. 489, 103 N. W. 236, 104 N. W. 920; *Lincoln v. Charles Alshuler Mfg. Go.*142 Wis. 475, 125 N. W. 908.

Eor the respondent there was a brief by *Sturdevant & Farr,*and oral argument by *L. M. Sturdevant.*

They cited, besides other cases, 3 Cook, Corp. (6th ed.) § 716, pp. 2290, 2291; *258*Sprague G. M. Go. v.*Fuller, 158 Fed. 588; *Pittsburgh, C. ■& St. L. B. Go. v. Keokuk & H. B. Go.*131 U. S. 371, 9 Sup. Ct. 770; *Milwaukee T. Go. v. Van Valkenburgh3*132 Wis. 638, 112 N. W. 1083; *Northwestern F. Go. v.*Lee, 102 Wis. 426, 78 N. W. 584; *Haynes v. Kenosha E. B. Go.*139 Wis. 227, 241, 119 N. W. 568, 121 N. W. 124; *Curtis L. & L. Go. v. Interior L. Co.*137 Wis. 341, 118 N. W. 853; *Vent v. Duluth G. ■& S. Go.*64 Minn. 307, 67 N. W. 70; *Browne v. St. Paul P.*Works, 62 Minn. 90, 64 N. W. 66; *Ophir G. M. Go. v. Brynteson,*143 Fed. 829; *Gilchrist v. Highfield,*140 Wis. 476, 123 N. W. 102; *Atlanta & W. B. •& C.*/isso. *v.*Smith, 141 Wis. 377, 123 N. W. 106.

Siebecker, J.

Tbe defendant contends that the court

erred in holding, as a matter of law, that the negotiations between the plaintiff and the defendant’s president, Mr. Ros-holt, resulted in an agreement whereby defendant obligated itself to pay plaintiff $5¿000 in cash for the $5,000 worth of shares of the defendant’s corporate stock held by him. The contention is based on two grounds: (1) that the negotiations fail to establish any such agreement, and (2) that if such an agreement-was made it was a personal agreement between the plaintiff and Mr. Rosholt, defendant’s president, and hence created no obligation of the defendant corporation. The evidence shows that Mr. Rosholt, the president of the defendant corporation, conducted all the negotiations with the plaintiff through which the defendant acquired the personal property of the plaintiff’s company, upon the terms and conditions under which the defendant accepted and now holds it, and the terms of plaintiff’s employment by defendant. These agreements were approved on defendant’s part and accepted by it. Under these circumstances Rosholt’s authority to act for defendant in all matters embraced in such negotiations cannot be questioned. These transactions establish the fact that Rosholt had authority to contract for a transfer of plaint*259iff’s personal property to tbe defendant, to employ bim for tbe defendant, and to agree upon tbe terms of tbe transactions, as beld by tbe court. It is clearly shown that defendant accepted and retained tbe fruits of bis negotiations witb tbe plaintiff and fully ratified bis agreements. It must therefore be beld that none of such agreements were tbe personal agreements of Rosbolt and that they were in fact made by him as tbe agent of tbe defendant.

Tbe offer by tbe defendant to purchase plaintiff’s personal property and to employ bim in tbe defendant’s business at $100 per month was accepted by tbe plaintiff “with tbe understanding” that defendant would take plaintiff’s stock “at. par” if tbe plaintiff was to retire from tbe business. This was agreed to by tbe defendant, as evidenced by its answer of February 20, 190 Y, which in effect accepted this offer of plaintiff’s, and to which plaintiff replied affirming tbe agreement and stating that be would move at once. Tbe context of these communications clearly shows that tbe negotiations, resulted in an agreement by tbe defendant to purchase plaintiff’s property, to employ him in its business, and to take tbe corporate stock off bis bands if be should be discharged from, its service. Subsequent events fully corroborate these facts.. It appears that tbe plaintiff, pursuant'to these arrangements, forthwith transported tbe property embraced in this transfer to Eau Claire, that defendant accepted it, and that plaintiff entered into and remained in tbe defendant’s employ until bis discharge about April 1, 1908, tbe year following. Tbe court’s conclusion that tbe evidence showed without dispute that tbe defendant agreed to purchase tbe personal property specified, pay therefor bj transferring to plaintiff $5,000 worth of its corporate stock, and in case plaintiff was discharged from its service to take such stock off bis bands, is fully sustained by tbe record and cannot be disturbed.

It appears that tbe plaintiff, after bis discharge from defendant’s service in April, 1908, offered by letter to return *260this stock to the defendant and demanded payment of $5,000 in cash therefor. Defendant refused to comply with this request. Plaintiff thereafter and before action was brought tendered to defendant the certificates of stock properly indorsed. Again it refused to accept them, and denied that the defendant company was obligated to receive them. Thereupon this action was commenced to recover the sum of $5,000 under such agreement. At the trial plaintiff again tendered the certificates of stock and defendant persisted in its refusal to accept them. There is no dispute as to plaintiff’s discharge from the defendant’s employ as alleged by him. The question is: To what relief is plaintiff entitled under these facts ? The teirns of the stipulation are in substance that in case of plaintiff’s discharge from defendant’s employ it would take his stock at par. The effect of this is that the defendant obligated itself to take at par the $5,000 worth of its stock held by the plaintiff whenever the contingency of his discharge from its employ happened. Plaintiff has tendered full performance of his obligation and stands ready to comply with its terms by transferring the stock to the defendant. Under these circumstances the plaintiff’s acts are in a legal sense the equivalent of a delivery of the certificates of stock and entitle him to a recovery of the agreed price, namely, $5,000. After plaintiff, by entering defendant’s employ and continuing therein until discharged, had performed his part of the agreement and had tendered a transfer of the stock certificates in compliance therewith, defendant’s refusal to pay for the stock operates as a breach of this part of the agreement. Upon these facts and the circumstances of the transaction plaintiff is entitled to stand upon the agreement as being performed by him and the defendant is obligated to accept the certificates of stock as tendered and pay the plaintiff the amount due for the stock, namely, the sum of $5,000. *Thorndike v.*Locke, 98 Mass. 340; *Pearson v. Mason,*120 *261Mass. 53; *Pratt v. S. Freeman & Sons Mfg. Co.*115 Wis. 648, 92 N. W. 368.

We are satisfied from the record that the court properly dismissed the defendant’s counterclaim for want of evidence to support it.

The judgment is correct as to .amount and proper in form and must stand.

*By the CouH.*— Judgment affirmed.

,Vinje, J., took no part.