131 N.J. Eq. 523 | N.J. Ct. of Ch. | 1942
The question is whether complainant or defendant Miss Mildred L. Martindell is entitled to a dividend of $100 a share on 27 shares of stock of Fiduciary Counsel, Inc., declared December 30th, 1940. The parties had entered into *524 an agreement dated October 25th, 1939, which recited their desire that the defendant should have an option to purchase the stock from the complainant:
"Now therefore, the seller [complainant] agrees to sell and transfer said 27 shares of stock of Fiduciary Counsel, Inc., to the buyer [defendant] for the price and sum of $5,000 at any time within five years from the date of this agreement."
On December 27th, 1940, defendant wrote complainant as follows:
"I hereby exercise the option referred to in agreement between us dated October 25, 1939, and accordingly do hereby demand that you transfer, sell and deliver to me twenty-seven (27) shares of stock of Fiduciary Counsel, Inc. I have deposited the purchase price of Five Thousand Dollars ($5,000) with the Colorado National Bank of Denver, Colorado, to which bank I have given instructions to pay over said sum of Five Thousand Dollars ($5,000) to you or your order against delivery of said shares of stock of Fiduciary Counsel, Inc., duly endorsed and stamped for transfer.
"If you do not accept such procedure for the delivery of said shares and payment of the purchase price, I hereby demand that you designate the time and place for same and I will make payment pursuant to your notice to that effect."
The letter was received by complainant on December 29th, and the next day the directors of Fiduciary Counsel, Inc., declared the dividend. On January 3d, complainant acknowledged receipt of defendant's letter. She was unwilling to conclude the transaction in the manner suggested by defendant, but stated that she would be ready to deliver the stock against legal tender in the amount of $5,000 at a certain hour and place in New Jersey. The stock was transferred and the consideration paid early in February.
The option agreement of October 25th, 1939, of course, did not by itself make defendant the owner of the stock or entitle her to dividends. An option is only a continuing offer; it cannot become an agreement without being accepted. In order to make a contract, the acceptance must, in every respect, meet and correspond with the offer, neither falling within nor going beyond the terms proposed. Potts v. Whitehead,
When a person makes an offer, he can couch it in such terms that it may be accepted by a promise, express or implied, so that a bilateral contract arises, executory on both sides. Or he may so frame his offer that it can be accepted only by an act, so that a unilateral contract is formed, executory on the part of the offerer alone. We have examples of both kinds in our reports. In Houghwout v. Boisaubin,
If a contract of sale is silent as to the time of payment, the purchase price is payable upon delivery of the subject of the sale. 55 C.J. 513. Stock certificates are commonly kept in safe deposit boxes. I cannot suppose that complainant usually carried in her handbag the certificate for the Fiduciary Counsel stock, ready for delivery against the possibility that defendant would tender her $5,000. Her offer called for exactly what happened, namely, an acceptance by mail, followed by an arrangement as to hour and place of delivery and payment. The acceptance created the contract. If the parties should fail to agree on the details of execution, the stock would be deliverable and the price payable in accordance with the implied terms of the contract, namely, at the home of the seller on demand within a reasonable time.
An executory contract for the sale of complainant's stock had been made and was binding on both parties before the dividend was declared. Legal title to the shares did not pass until later, when the contract was carried into operation. R.S. 14:8-27 and36. Did the contract operate to transfer the right to the dividend, as between vendor and vendee? Generally, a dividend belongs to him who owns the shares at the time the dividend is declared. Beattie v. Gedney,