Court Opinion

ID: 8826024
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:47:28.705665+00
Date Added: 2024-06-11T17:04:47.074633
License: Public Domain

SMYTH, Chief Justice.
I dissent, and briefly state my reasons for doing so:
(1) The action is upon a contract made by the Leeds Manor Orchards, Limited, a corporation, party of the first part, and the appellants, parties of the second part. Twigg is not a party to it, yet the action is against him. It is alleged that he, with the consent of the plaintiffs, adopted the contract as his personal undertaking. This is denied by him, and there is not a line or a word in the testimony which supports the allegation. On the contrary, he made it clear in his letter of November 5, 1913, that the contract was with the corporation, and not with him, and, when he approved the Johnson contract, he did it in the name of the corporation. There is no suggestion anywhere that this case falls within the principle that, where the stockholders or officers of a corporation are seeking to use the corporation as a means to screen illegal acts by them, the corporate entity rule may be ignored, and the wrongdoers treated as if no corporation existed. McCaskill Co. v. United States. 216 U. S. 504;1 Linn & Lane Timber Co. v. United States, 236 U. S. 574, 35 Sup. Ct. 440, 59 L. Ed. 725; State v. Standard Oil Co., 49 Ohio St. 137, 30 N. E. 279, 15 L. R. A. 145, 34 Am. St. Rep. 541. There is no theory, then, upon which Twigg can be held upon a contract that he never made.
(2) It is said that the appellants are undoubtedly entitled to commission on the sale to the Johnsons (there were two). By the contract sued on the corporation was authorized to fix the terms of payments for the *422land, and it agreed to pay to the appellants “a commission of 25 per centum, said commission to be paid out of the first moneys received by the said party of the first part [the corporation] on each of said sales.” The Johnson contract recited that with it they handed to Twigg “the first payment of $2,625, payable to the Continental Trust Company of Washington, D. C.,” etc. The contract was delivered to the trust company, but it was not accompanied by the money. Afterwards the John-sons sent a check payable to the trust company for the amount of the first payment, hut later stopped payment on it. Just why they stopped the payment is not explained in the record. It appears, then, that no money was received on the contract by the corporation, or by Twigg, and hence that the appellants are not entitled to recover any commission, for, as we have just seen, the commission was to be paid out of the first money received by the corporation on the contract. This accords with appellants’ construction of the contract, if that be material, for one of them testified that he never made any-demand for the payment of the commission after he knew the Johnsons had stopped payment on the check. According to the record, “he knew that the payment of the check had been stopped, and never asked Mr. Twigg to pay his commission on that sale.” He repeats this statement several times. It indicates -that he regarded the Johnson sale as never having been consummated, because Johnson did not make the first cash payment required by the terms of the contract, and therefore that he was not entitled to any commission on account of it. But, whatever he thought about the matter, he has no right to the commission.
13) With respect to the other contracts I do not think there is any evidence that the corporation or Twigg acted arbitrarily in refusing to ■approve them. If the terms and conditions were not satisfactory, the corporation had a right to reject the contracts, and the mere fact that it did so, and there is no more, fails utterly to prove that the rejection was made in bad faith. We have said that where a party assumes the obligation of furnishing a machine that would be satisfactory to the purchaser he must do so or fail to effect a sale. In such .a case, Mr. Justice Van Orsdel, speaking for the court, said, nothing was “to be .left to the judgment of a third party, henc'e, nothing for the jury to determine.” “We are not concerned,’.’ said the Justice, “with the wisdom or the folly of the plaintiff in making such a contract.” Rondinella v. Southern Railway Co., 33 App. D. C. 65, 79. See, also, Bayer Steam Soot Blower Co. v. Cornell Co., 47 App. D. C. 146. There is no difference in principle .between the obligation to furnish a satisfactory machine and the obligation to furnish a satisfactory contract.
(4) The contract between the corporation and the appellants provided that it should not.be in force after January 1, 1914, unless the appellants had sold in the meantime 100 acres of the land on terms and conditions satisfactory to the corporation. By eliminating the 35 acres which the Johnson contract called for, and giving the appellants credit for all the other sales which they claim to have made, they disposed of less than 65 acres within the time limited, and hence the contract ceased by its own terms on January 1, 1914. This being so, the *423appellants cannot maintain an action for damages because not permitted to make sales after that date.
Believing the lower court was right, I think its judgment should be affirmed.

 30 Sup. Ct. 386, 54 L. Ed. 590.