18 Colo. 405 | Colo. | 1893
Lead Opinion
delivered the opinion of the court. '
The sustaining of the demurrer to the amended complaint' is assigned for error. The demurrer specifies several grounds of objection; but upon this review it is only necessary to' consider whether the complaint states facts sufficient to constitute a cause of action against the principal defendants, Lay, Mallory and Brown.
The gravamen of the complaint is, that defendants Lay, Mallory and Brown refused to make and deliver a deed of conveyance of their certain mining property to the Iron Mask Mining and Smelting Company, as by said agreement in writing they had contracted to do. According to the terms of the written agreement the defendants were to deliver the deed to the mining property at the time of the first payment of $250,000 which sum was to be provided for as follows: The Iron Mask Mining and Smelting Company was to be organized as a corporation with a capital stock of 500,000 shares. Of these shares Lay was to take 26,000, Cummins 26,000, Bailey 16,000, and Oleott 15,000, each paying therefor at the rate of $3.20 per share, thus raising a fund of $265,600. Of this fund $250,000 was to go to the owners of the property, and the residue to the treasurer of the corporation as a Smelting Works fund.
The agreement in regard to the first payment and the agreement to deliver the deed were to be performed at the same time; they were mutual and dependent agreements; and performance or an offer to perform in respept to first payment was necessary to make .it incumbent upon the defendants to deliver the deed. Englander v. Rogers, 41 Cala. 420; Bakeman v. Pooler, 15 Wend. 637; 2 Parsons on Contracts, 528, 675; 2 Chitty on Contracts (11th ed.), 1082.
The complaint alleges that plaintiffs’ associates, Cummins and Oleott, and the Iron Mask Mining and Smelting Company, notwithstanding the default of the defendants in respect
The averment that Cummins and Olcott and the Iron Mask Company were ready and willing to accept the premises and make payment, is not equivalent to an averment of payment or of an offer to pay. In a case of this kind, when the time for payment has actually arrived, mere readiness and willingness to pa3r are immaterial — such readiness and willingness, without more, will not discharge coutrapt obligations. An averment of readiness and willingness to pay presents nothing tangible or substantial; it involves little more than the state of mind of the party presenting the plea ; and the determination of an issue taken thereon would not decide the rights of the parties. On the other hand, an averment of payment or of an offer to pay, is an averment of an overt act —an important and substantial fact; and the determination of an issue taken thereon would, subject to other issues in the case, be decisive of .the controversy. Hence it is, that to state a cause of action in $ case of this kind the law requires that the complaint shall contain a direct and positive averment of payment, or of an offer to pay.
The fact that the delivery of the deed and the payment of the money under the contract was to be accomplished through the organization of an incorporated company and the issuance and transfer of shares of stock, does not change or affect the application of the rule in regard to the time of performance ; nor does it affect the rights of the parties that the owners of the property may have been bound to accept the 26,000 shares of stock which Lay agreed to take at $3.20 per share, as part
Giving the written agreement as pleaded a fair and reasonable construction, it clearly appears that the intent of the parties was that the whole transaction, up to and including the first payment as specified, should be consummated simultaneously. There is nothing in the conduct of the parties, nor in the written agreement as stated in the complaint, to indicate that Lay or any of the owners of the mining property had any desire or intention to organize a corporation and issue shares of stock, unless, by so doing they could dispose of their property and receive therefor the payments as specified in' the written agreement; and they had the right to retain their property in their own individual names, unless, concurrently with its transfer to the corporation, the first-payment as provided by the written agreement was paid or tendered for their acceptance.
The complaint does not show such a performance or offer to perform by plaintiffs or their associates as made it incumbent upon defendants to deliver the deed. The ruling of the trial court sustaining the demurrer was, therefore, right, and must be affirmed.
Affirmed.
Rehearing
Upon Rehearing.
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
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
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
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
“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.
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.
