Court Opinion

ID: 6562363
Source: CourtListenerOpinion
Date Created: 2022-07-20 19:16:40.916512+00
Date Added: 2024-06-11T15:56:35.300940
License: Public Domain

Upon Rehearing.
Per Curiam:
Upon the rehearing it is contended that plaintiffs were employed by defendants Lay, Mallory and Brown as brokers to sell the mining property of said defendants ; and that the averments of the complaint are sufficient to maintain an action for commissions.
The complaint sets forth at length three separate agreements. The first agreement was verbal; it was entered into October 1,1886, between plaintiffs and the defendants Lay, Mallory and Brown, whereby it was agreed that plaintiffs might cause the mining property of said-defendants to be sold *421for the price of #1,500,000, and might cause a corporation to be organized for the purchase thereof. That in consideration of their services in effecting such sale plaintiffs might obtain a one fifth part of the capital stock of such corporation. By such agreement it is not to be understood that plaintiffs were to receive one fifth of the capital stock as compensation for the mere service of organizing a corporation to which the mining property could be conveyed. The fair construction of the agreement is, that plaintiffs might obthin a one fifth part of the stock of such corporation upon condition that said defendants should receive the full sum of #1,500,000 for their mining property by the sale of the remaining four fifths of the stock, or otherwise.
The second agreement was in writing; it was entered into March 22,1887, between the plaintiff Bailey and the defendant Cummins, and is to the effect that, if said mining property should be found satisfactory in character and value, upon examination, a corporation should be organized in which said Bailey and Cummins should have the right to purchase a certain amount of the .capital stock.
The third agreement was in writing; it was executed by defendants Cummins and Olcott of the one part, and the defendant Lay of the other part, Cummins and Olcott acting, as it is alleged, for plaintiffs and their associates as well as for themselves; and Lay acting for himself and also for his codefendants, Mallory and Brown. In determining whether or not a cause of action is alleged under the third agreement, its provisions must be considered and construed in the light of the two former agreements, and in connection with the acts and doings of the several parties thereto or interested therein, as alleged in the complaint.
The third agreement provides for the sale of said mining property through the organization of a corporation, and the disposal of its capital stock. By this agreement the defendants Lay, Mallory and Brown were to receive the full sum of #1,500,000 for their property, though as a means of raising a part of such sum it was provided that, the defendant Lay *422should subscribe and pay for certain shares of the capital stock at a certain price per share. With this exception, said defendants by the third agreement were to make no deduction from the full purchase price of $1,500,000; nor did they' undertake to pay any commissions, nor in any way to compensate plaintiffs for their services. Plaintiffs were to have the privilege of subscribing and paying for a certain portion of the capital stock at a certain price per share.
It cannot be maintained under and by virtue of any of the agreements, or any of the averments of the complaint, that plaintiffs are entitled to recover commissions as brokers. It is true, the third agreement provides for the sale of the property upon certain terms and conditions ; but the only benefit plaintiffs could derive from the consummation of the sale was the privilege of purchasing at a specific price a certain portion of the capital stock of the corporation to which the mining property was to be conveyed.
The conclusion of the complaint shows that the action is for damages against the owners for their refusal to deed the premises, rather than a suit for commissions. The prayer is for judgment against the owners for the sum of $750,000, the amount of the gains and profits which it is alleged plaintiffs might and would have realized from the purchase of their share in the capital stock but for the default of the owners in consummating the agreement of sale; the further prayer is that such judgment be declared a lien upon the mining property, and that said property be sold to satisfy such damages and costs. Such averments and prayers are entirely inconsistent with the claim that the suit is for commissions.
Does the complaint state a cause of action on the theory that plaintiffs were purchasers ? The pleader undertakes to allege a breach of the third agreement in certain particulars. It is alleged that the defendants Lay, Mallory and Brown would not make a conveyance of the mining property to the corporation, nor deposit such deed of conveyance with the trustee mentioned in the agreement, nor participate in tbe organization and issuance of the capital stock of the corpora*423tion. In respect to these averments it need only be said that the agreement does not provide that said defendants should organize or participate in the organization of the corporation, except that they should be named as directors and officers thereof ; besides, it is alleged that the corporation was duly organized. The issuance of the stock would have been of no avail to-anyone, without the conveyance of the mining property to the corporation; and by the terms of the agreement the delivery of such conveyance was to be concurrent with the performance of certain acts by plaintiffs and their associates.
It is true, the complaint alleges that Cummins and Olcott, associates of plaintiff, duly kept and performed all the conditions of the agreement with said Lay, Mallory and Brown by them to be kept and performed. But in view of the other averments of the complaint, it is clear that this averment cannot be taken to mean that Bailey and Cummins and Olcott had each severally offered to pay for and take the number of shares of stock by them to be taken and paid for as a means of raising their quota of the first cash payment of #250,000.
As was said in our first opinion, supra, the gravamen of the complaint — -the real gist of the action — is the alleged breach of defendants to make and deliver a deed of the mining property to the corporation. This the defendants Lay, Mallory and Brown had agreed to do upon certain conditions. The essential condition was that they should receive the first payment of #250,000 at the time of the malcing and delivery of the deed.
Counsel for plaintiffs contend that it is-not necessary that actual payment or offer to pay should be alleged, but that the averment that Cummins and Olcott were ready and willing to accept the premises, and ‘make payment therefor according to the terms of the agreement, is sufficient. Such an averment may suffice under some circumstances, but it is not the general rule applicable to cases of this kind. Counsel cite Smith v. Lewis, 26 Conn. 109-118, in support of their view. In that case, where the sufficiency of the declaration *424was considered after verdict, the declaration alleged a readiness and willingness on the. part of plaintiff to perform all the acts to be done by him, particularly describing them, on the day mentioned for their performance in the agreement; it also alleged that the defendant did not perform, fulfill or keep anything in the agreement on his part to be kept and performed, but on the contrary wholly neglected and refused, and ever since has neglected and 'refused, so to do. Upon this state of the pleadings the court in its opinion says:
“The refusal of the defendant to perform, the agreement on his part, when the plaintiff was ready and willing to perform it on his part, superseded the necessity of any further acts towards a performance by the latter, even if, under any circumstances, it would have been necessary to go further and allege a tender or offer by the plaintiff; and therefore that the declaration shows that the plaintiff did all that it was necessary for him to do in order to maintain this action. The refusal of the defendant to perform would render such an offer a futile act, which the law did not require.”
. In the present case, the complaint does not show a refusal to perform on the part of Lay, Mallory and Brown; it shows that they failed and neglected to perform, claiming that the $250,000 should be deposited to their credit before the delivery or deposit of the deed of conveyance. The pleader alleges that such claim was false. Technically, it was not in accordance with the terms of the agreement; as was said in our original opinion, plaintiffs were bound to pay the $250,000, not before the delivery of the deed, but concurrently with such delivery. Nevertheless, such claim or excuse for not delivering the deed was of such a character that it cannot be properly called a refusal on their part to deliver the deed, nor a violation of their contract without an offer to pay or deposit the money on the part of plaintiffs and their associates. In fact, such a claim by its very nature called for payment or deposit of the money, or a bona fide offer so to do, on the part of plaintiffs, before they could justly claim that defendants were in default.
*425Giving the averments of the complaint a fair and reasonable construction, it nowhere appears that Lay and Ins associates refused absolutely to perform their concurrent agreements. Moreover, the complaint in this action does not allege an unconditional readiness and willingness on the part of plaintiffs and their associates to accept the premises and make payment therefor, according to the terms of the written agreement. The averment is, that Cummins and Olcott and the Iron Mask Mining Company were ready and willing to accept the premises and pay according to the terms, letter and spirit of said agreement, provided Lay would produce and deliver smelter returns of ore samples taken from the mine in refutation of certain rumors and charges of corrupt practices alleged against said Lay in respect to the examination of the mine and ore samples taken therefrom; that Lay frequently promised to do this; but had never complied with such promises. These averments were foreign to the terms of the contract. Plaintiffs and their associates undertook to examine and satisfy themselves as to the character and value of the mining property,- and the complaint alleges that they did so. By the terms of the agreement Lay did not undertake to produce and deliver smelter returns of the ore, nor in any manner to refute rumors and charges affecting such mining property. His alleged promises to produce and deliver such smelter returns were not in. the written agreement, and are not alleged to have been, made upon any new consideration.
Notwithstanding the complaint is long and much involved, we have endeavored to give the same careful consideration, and now feel constrained to adhere to our former decision.