10 N.J. Misc. 577 | N.J. | 1932
This matter comes before me upon a motion to strike out the defendant’s answer upon the grounds that the body of the answer, and the four separate defenses, do not set forth any legal defense to the amended complaint, and that the denials contained in the body of said answer as sham.
The amended complaint seeks to recover damages for the breach of a contract alleged to have been made between Cities Service Securities Company and William W. McFarland, a copy of which is attached to the amended complaint and made a part thereof, and provides as follows :
“The undersigned, owner of four thousand four hundred and twenty-four shares of the capital stock of Warner-Quinlan Company (a Maine corporation), which are this day being transferred to Cities Service Securities Company in exchange for two thousand two hundred and twelve shares of the common capital stock of Cities Service Company (a Delaware corporation), does hereby agree, as consideration for such exchange, that none of said shares of Cities Service Company common stock will be sold or disposed of at any time within one year from the date hereof, unless said shares are first
Dated, Hew York, February 27th, 1931.
Witness:
H. C. Reigby. W. W. MgFakland.”
The breach of the contract alleged in the amended complaint is that the defendant, McFarland, sold the shares of
For convenience we will consider the separate defenses first before disposing of the body of the answer. The first separate defense alleges that the complaint does not disclose a cause of action for one or more of the following reasons:
(a) “Ho facts are alleged upon which the court can lay any basis for the assessment of damages.”
It is sufficient answer to this contention that from the breach of a contract damages are presumed and the plaintiff is entitled to recover at least nominal damages. New Jersey School and Church Furniture Co. v. Board of Education, 58 N. J. L. 646; 35 Atl. Rep. 397.
(b) “Ho facts are alleged to show when and where the alleged contract was breached.”
It is sufficient to say that the complaint adequately sets forth the cause of action which is the basis of this suit under the existing practice.
(c) “Ho facts are alleged to show how the plaintiff has been damaged by the alleged breach by the defendant.”
As already noted the breach of the contract, being fully alleged in the complaint, the plaintiff would be entitled to nominal damages at least. The defendant would be fully protected by a bill of particulars, inasmuch as the complaint alleges that the “plaintiff demands as damages the sum of $30,000.”
(d) “Ho facts are alleged to show what, if anjg interest the plaintiff has in the alleged contract.”
This defense raises the principal question set up by the answer. A copy of the contract is incorporated in the amended complaint and this very clearly shows that the basis of the contract was an exchange by the Cities Service Securities Company of two thousand two hundred and twelve shares of Cities Service Company common stock to the defendant, William W. McFarland, in exchange for four thousand four
(e) “Ho facts are alleged to show that the plaintiff has suffered any monetary damages.”
This is not so for the reasons above stated. All of the first separate defense will therefore be stricken out, as not setting forth a legal defense.
The second separate defense alleges that “the paper set forth as Exhibit A to the amended complaint is so vague, indefinite and uncertain, that it does not constitute a valid and binding contract.”
An examination of the copy of the contract annexed to the complaint shows that it has all the essentials of a valid contract and is not vague, indefinite and uncertain. The second separate defense will, therefore, be stricken out as not disclosing a legal defense to the amended complaint.
The third separate defense is to the effect that the restrictions placed upon the defendant regarding the sale of the capital stock of the Cities Service Company transferred to him constituted an unlawful restraint upon the sale and transfer of personal property so as to make the said contract wholly void. It is unnecessary to discuss this contention because the plain wording of the contract will not sustain the proposition.
The fourth separate defense asserts that the alleged contract between the plaintiff and defendant lacks mutuality and is therefore not binding upon the defendant. It is true that the contract is not signed by the plaintiff, but it is con
Turning now to the denials contained in the body of the answer, I find that most of them turn on the question of whether or not the present plaintiff has any interest in the contract so as to bring the present action thereon. As this has already been answered in the affirmative, it would appear that such denials are sham.
It should be further noted that the defendant, in the body of the answer, denies that he sold the stock in question in violation of the agreement but admits that said shares were sold in the months of April and May, 1931. In his affidavit accompanying this motion the defendant asserts that said sale was by or on behalf of the Hew Jersey Hational Bank and Trust Company, which held such shares as collateral security for a loan to the defendant, and that the lien of the bank was superior to the rights, if any, of the plaintiff, and that the sale of said shares by said bank was in violation of an understanding between the bank and the defendant that the bank would, before selling said stock, offer it to Henry L. Doherty & Company. Conceding all of this to be true, it would constitute no defense to the present action, for the defendant expressly contracted that none of said stock would be sold or disposed of within one year without first offering it for sale to Henry L. Doherty & Company, as fiscal agents for the plaintiff herein. The plaintiff could not be deprived of its rights under this contract by the defendant’s dealings with the aforesaid bank or because of any understanding between them respecting the shares in question.
The defendant in his affidavit further alleges that the “two thousand two hundred and twelve shares of Cities Service
■ The affidavit does not attempt to show that there was any modification of the agreement in question by any writing, and at the argument it was conceded that such was not the fact.
The denial of damages, while not effective as against nominal damages under the circumstances, nevertheless does raise a question of fact respecting substantial damages, which should be passed upon by a jury.
The entire answer, including the separate defenses, will, therefore, be stricken out for the reasons hereinbefore stated, except paragraph 6 which denies the damages, and as a term for allowing such denial to stand, the case will be put on the commercial calendar for May, 1932, without further notice, and no costs will be allowed on this motion.