Libby v. LJ CORPORATION, 13614.

Citation247 F.2d 78
Decision Date13 June 1957
Docket NumberNo. 13614.,13614.
PartiesWilliam G. LIBBY, Appellant, v. L. J. CORPORATION et al., Appellees.
CourtUnited States Courts of Appeals. United States Court of Appeals (District of Columbia)

COPYRIGHT MATERIAL OMITTED

Mr. Robert E. Lynch, Washington, D. C., for appellees.

Mr. Mark P. Friedlander, Washington, D. C., with whom Mr. Edward A. Aaronson, Washington, D. C., was on the brief, for appellant.

Before PRETTYMAN, WILBUR K. MILLER and BURGER, Circuit Judges.

BURGER, Circuit Judge.

Appellant seeks $75,000 damages for alleged breach of what he described in his complaint as an oral agreement to form a "partnership" to acquire a specific tract of land, subdivide it and erect dwellings for sale. The complaint asserts that appellant, Cohen and Ochsman associated in this venture to acquire the property, commenced the undertaking and then, after adding Funger to the enterprise, appellees Cohen, Ochsman and Funger consummated the venture without appellant.

The District Court granted summary judgment for appellees on the pleadings, depositions, interrogatories and answers and arguments presented to the court.

The record indicates that appellant and Ochsman, while associated in building projects, learned that a large tract of land suitable for development was available. After commencing but not completing negotiations for purchase, Ochsman suggested that they consult with his father-in-law, Cohen, an older and more experienced businessman. Cohen expressed interest and joined appellant and Ochsman in the venture, and as the senior more or less assumed the role of manager or director of operations. He suggested, among other things, that they engage an outside real estate man to act for them. This was done and a contract to purchase was made in the name of Funger, also a son-in-law of Cohen, in order to keep the enterprise and plan secret. During the negotiations Cohen insisted that Funger be made a "partner." Subsequently Ochsman and/or Cohen advised appellant that the contract had been accepted. Cohen requested appellant to take steps to arrange for financing the purchase which was to cost $130,000 to $140,000 and required a $100,000 loan. Pursuant to Cohen's directions appellant obtained a commitment for financing which Cohen rejected as too expensive. Appellant alleges his ability and willingness to contribute his share and that on inquiry from time to time he was told the matter was being considered.

The complaint asserts that Cohen, Ochsman and Funger secretly acquired the tract for approximately $143,000 in the name of Funger and his wife, that title was thereafter transferred to Cohen and his wife and by them to O. F. C. Corporation.1 Subdivided lots were then transferred to the L. J. Corporation (31 lots), J. W. Corporation (32 lots) and S. L. Corporation (31 lots) at a stated price of $75 per lot. Lots were also conveyed by the O. F. C. Corporation to the M. P. Corporation. Thereafter houses were built on these lots and sold at a profit. Appellant alleges that Cohen, Ochsman and Funger "have failed and refused to account to this Plaintiff or to advise him of the development" of their common enterprise.

It is asserted by appellees and denied by appellant that from examination of the contract of purchase and the projected date of settlement appellant knew of the date of closing, the amount of his share and that he abandoned and withdrew from the venture. In their motion for summary judgment appellees ment claimed, in addition to the theory of abandonment, a failure of consideration, estoppel, the Statute of Frauds, and that the preliminary negotiations in which appellant participated did not constitute an enforceable agreement.

This appeal is, of course, not concerned with the ultimate resolution of the issues but with the narrow question of whether the record discloses genuine issues of fact which, if proven, will entitle appellant to relief. That it discloses sharply controverted issues of fact is clear; it remains only to decide whether, taken as a whole, (1) these issues are genuine and (2) recovery upon these facts is precluded as a matter of law.

(1)

The action in form is for damages for breach of an oral agreement to form a partnership. Viewed by its "four corners," the complaint fairly states (a) the making of an oral agreement which gave rise to a fiduciary relationship between the four individuals; (b) that the individual appellees breached fiduciary duties by their failure to inform appellant and by acquiring title and carrying out the project in a manner hostile to appellant's interests; (c) that the defaulting members of the venture have profited by their breach of fiduciary duties; and (d) that the defaulting members "have failed and refused to account to" appellant.

The venture for acquisition of a tract of land known as the "Hartley Tract," described in the complaint began with appellant and Ochsman, then associated in real estate developments other than the one here involved. The venture reflected by the record as it now stands concerns the purchase and development of this land but the entire project is now in the control of Ochsman, Cohen, who is Ochsman's father-in-law, and Funger, who is Ochsman's brother-in-law, and perhaps their wives. We need not and of course do not decide whether in fact appellant was "frozen" out, as in effect he claims, by Cohen and his two sons-in-law. However, the very existence of close family ties between Cohen, Ochsman and Funger lends credibility to appellant's complaint and made it more essential that appellees avoid any action which would benefit them as a family group at the expense or to the detriment of appellant.

So read and giving appellant the most favorable view of the record, as we must, we conclude that genuine issues of fact are presented.

(2)

The complaint alleges in substance, if not in form, the existence of a joint venture. Two or more persons who join in a particular business enterprise for profit, as in the purchase, development and sale...

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  • Trusted Integration, Inc. v. US
    • United States
    • U.S. District Court — District of Columbia
    • January 20, 2010
    ...and with respect to the subject matter of the joint venture." Sind v. Pollin, 356 A.2d 653, 655 (D.C.1976) (quoting Libby v. L.J. Corp., 247 F.2d 78, 81 (D.C.Cir.1957)). Defendant first argues that this is essentially a contract claim, or in the alternative, it argues that even if it is a t......
  • Queen v. Schultz
    • United States
    • U.S. District Court — District of Columbia
    • August 30, 2012
    ...business enterprise for profit....” Jonathan Woodner Co. v. Laufer, 531 A.2d 280, 286 n. 8 (D.C.1987) (quoting Libby v. L.J. Corp., 247 F.2d 78, 81 (D.C.Cir.1957)). The District of Columbia Court of Appeals has recognized that joint ventures and partnerships are so similar that “there is ve......
  • TMG II v. US, Civ. A. No. 85-2469-LFO.
    • United States
    • U.S. District Court — District of Columbia
    • September 30, 1991
    ...See Riviera Congress Assoc. v. Yassky, 18 N.Y.2d 540, 547, 223 N.E.2d 876, 879-80, 277 N.Y.S.2d 386, 392 (1966); Libby v. LJ Corp., 247 F.2d 78, 81 (D.C.Cir.1957). One of Markowitz's duties was to carefully account for all partnership property. See D.C.Code § 41-210(a)(2) (1986); N.Y. Partn......
  • Johns Hopkins University v. Hutton
    • United States
    • U.S. District Court — District of Maryland
    • March 29, 1972
    ...time of its discovery rests upon the defendant. Emphasis supplied. See, to the same general effect, Libby v. L. J. Corporation, 101 U.S.App.D.C. 87, 247 F.2d 78, 82 (1957) (Burger, J.); Johnson v. Mansfield Hardwood Lumber Co., 159 F.Supp. 104, 105 (W.D.La. 1958), aff'd, 263 F.2d 748 (5th C......
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