Housekeeper Pub. Co. v. Swift

• Decision Date: 16 October 1899
• Docket Number: 1,224.
• Citation: 97 F. 290
• Court: U.S. Court of Appeals — Eighth Circuit
• Parties: HOUSEKEEPER PUB. CO. v. SWIFT et al.

97 F. 290

HOUSEKEEPER PUB. CO. v. SWIFT et al.

No. 1,224.

United States Court of Appeals, Eighth Circuit.

October 16, 1899

This is an action to recover $25,000 and interest, which is the alleged balance of the purchase price of a printing and publishing plant, and of the good will of the business of publishing a newspaper. The plaintiff in error, the Housekeeper Publishing Company, a corporation, conveyed this plant and good will to the wives of the defendants in error Lucian Swift and William E. Haskell, and received $25,000 for them. The vendor insists that it made this conveyance in performance of a contract which it made with the defendants through Frederick Fayram, one of their number, on June 14 1895, to sell them this property for $50,000; and the defendants contend that the conveyances were made in the performance of a contract made by the plaintiff with the defendant Haskell on July 22, 1895, to sell the property for $25,000. The facts are set forth in the complaint. The court below deemed them insufficient to constitute a cause of action, sustained a demurrer to the complaint, and dismissed the suit. These are the alleged facts:

The plaintiff owned a printing plant, and the good will of the business of publishing a newspaper, subject to a mortgage of $50,000, which secured 250 bonds, upon some of which the interest was overdue. The defendant Fayram was authorized to and did, act for the defendants, who were negotiating to purchase this property. On June 11, 1895, the plaintiff caused the following letter, which was signed by its president, George F. Jackson, to be delivered to Fayram:

'Minneapolis, Minn., June 11, 1895.

'Frederick Fayram, St. Paul, Minn.-- Sir: In accordance with the several conversations I have had with you, I hereby agree, on receipt of a written proposition from you offering to buy the plant, property, and good will of the Housekeeper Publishing Company, and to pay therefor the sum of fifty thousand dollars ($50,000), not less than twenty-five thousand dollars to be paid in cash, and the balance by notes payable in four, eight, and twelve months, with interest at six per cent. per annum, to use every personal endeavor to consummate the sale and deliver the property into your hands within as short a time as possible after receipt of aforesaid proposition.

'(Signed) George F. Jackson, Prest.'

On June 14, 1895, Fayram delivered to the plaintiff a written acceptance of the proposition contained in this letter, in which he agreed to buy the property, and to pay for it $25,000 in cash, and three promissory notes of defendants, of $8,333.30 each. The plaintiff orally notified the defendants that it would accept this proposition. During the negotiation it was agreed that the title should be approved by the attorneys of the defendants. On June 17, 1895, the defendants notified the plaintiff that their attorneys required, and they demanded, that the title to the property should be transferred to them through a foreclosure of the mortgage on the plant, and they also insisted that their written acceptance and agreement to pay $50,000 for the property should be returned and surrendered to them. They gave as a reason why they required a surrender of this acceptance that, if such a contract of purchase should come to the knowledge of the plaintiff's creditors, a charge of collusion might be made against the plaintiff and the defendants, in connection with the foreclosure of the mortgage. They assured the plaintiff that they would take the property as theretofore agreed, contract or no contract, that they intended to and would carry out their agreement, that they did not desire to cancel or modify the contract, and that the only purpose upon their part of having the custody of the written agreement was to insure against the hazard of its becoming an evidence of collusion in any attack on the foreclosure. The plaintiff believed these assurances, and surrendered the written acceptance and agreement. It then caused the mortgage upon this property to be foreclosed, and caused the title under the foreclosure to be vested in its attorney, Mr. C. W. Tankersley. While the foreclosure proceedings were pending, and after the agreement had been surrendered, the defendants again assured the plaintiffs that they were willing, ready, and anxious to buy the property, and to pay for it $25,000 in cash and $25,000 in their notes. Before the foreclosure sale, which was made on July 6, 1895, they advised the plaintiff that seeming negotiations should be carried on between them after the foreclosure was completed, relative to the sale of the property; but they assured the plaintiff at all times that the only contract and transaction they desired to make was that made between the plaintiff and Fayram, and that all subsequent apparent transactions should be without meaning or validity, except as a method of transferring the title. In pursuance of this plan, simulated negotiations were conducted, and on July 22, 1895, the defendant Haskell wrote and delivered this letter:

'Minneapolis, Minn., July 22, 1895.

'Mr. George F. Jackson, Minneapolis, Minn.-- Dear Sir: I will pay, or cause to be paid, the sum of $25,000 for the transfer to me, or to such person or persons or corporation as I may name, of the absolute title to the following described property, free and clear of all incumbrances, except as hereinafter specified, to wit: All the property described in the certain mortgage made on October 31st, 1891, by the Buckeye Publishing Company to L. Parker Veazey, as trustee, which mortgage was filed in the office of the city clerk of the city of Minneapolis on December 23rd, 1891, subject, however, to certain mortgages on two Huber presses. This offer is made upon the following conditions: (1) Title shall be examined by Kitchel, Cohen & Shaw, and shall not be taken unless they certify that it is satisfactory to them. (2) This offer shall hold good until 12 o'clock noon of the 23d day of July, 1895, and no longer. Yours, truly, W. E. Haskell.'

George F. Jackson, as the complaint reads, 'for the purpose of performing the plaintiff's original contract, and not otherwise, pretended personally and orally, and not otherwise, to accept, in form, the offer of said Haskell, and on July 26th thereafter formal instruments of conveyance and transfer of all said properties were executed both by plaintiff and said Tankersley in part performance of the contract of June 14th, and not otherwise. ' Twenty five thousand dollars was paid for these conveyances. The bonds were surrendered to the defendants. On September 1, 1895, the president of the plaintiff left the city where the transactions were had, and did not return until October 25, 1895. On this day the plaintiff was advised for the first time that the defendants repudiated and denied the contract of June 14th, and they have ever since asserted that the negotiations between Jackson and Haskell in July constituted the contract between the parties. No demand was ever made for the promissory notes until about October 25, 1895.

Francis B. Hart, for plaintiff in error.

Emanuel Cohen (Stanley R. Kitchel and Frank W. Shaw, on the brief), for defendants in error.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

SANBORN Circuit Judge, after stating the facts as above, .

This is an action on a contract. The plaintiff has sold and delivered its property, and the defendants have paid it $25,000 for it. It seeks to recover $25,000 more, with interest, on the ground that the defendants agreed not only to pay the $25,000 in addition, or, in effect, to pay $50,000 for the property. It is obvious that there can be no recovery here, and that the complaint states no cause of action unless it shows that there was an existing contract by the defendants to give these notes, and to pay $50,000 in all for the property when this action was commenced. When the complaint is read with this question in mind, its most striking feature is that it discloses an executed contract of sale between the plaintiff and the defendants of the property in question, for $25,000 which was made and performed between July 21, 1895, and August 29, 1895, and which is evidenced by the letter of the defendant Haskell of July 22, 1895, and the conveyance of the property and the surrender of the bonds which followed it, while, for the recovery it seeks, it counts on a contract between the same parties for the sale of the same property for $50,000, made between June 13 and June 17, 1895, more than a month before the second contract. It is unnecessary to determine whether or not Haskell's letter of July 22d, and the oral acceptance of Jackson, the president of the plaintiff, constituted a valid contract by the Housekeeper Company, whose specific performance could have been enforced in equity. However that may be, it is certain that this letter, its acceptance by Jackson, and the conveyances of the property, the surrender of the bonds upon it, and the payment and acceptance of the $25,000 which it fixed as the price of the property, in strict accordance with its terms, when taken together, made a valid contract of sale, which was completely performed by the parties, and all the terms of which were clearly expressed in the letter and the deeds. For convenience, this agreement will be called the 'Contract of July 22d.' Nor is it requisite to the determination of this case that we decide whether or not Jackson's letter of June 14th, in which he offered to use every personal endeavor to consummate a sale of the property for $25,000 in cash and...