Intercontinental Planning, Limited v. Daystrom, Inc.

• Decision Date: 10 April 1969
• Citation: 300 N.Y.S.2d 817,248 N.E.2d 576,24 N.Y.2d 372
• Parties: , 248 N.E.2d 576, 47 A.L.R.3d 125 INTERCONTINENTAL PLANNING, LIMITED, Appellant, v. DAYSTROM, INCORPORATED et al., Respondents.
• Court: New York Court of Appeals Court of Appeals

Page 817

300 N.Y.S.2d 817

24 N.Y.2d 372, 248 N.E.2d 576, 47

A.L.R.3d 125

INTERCONTINENTAL PLANNING, LIMITED, Appellant, v. DAYSTROM, INCORPORATED et al., Respondents.

Court of Appeals of New York.

April 10, 1969.

Charles S. Desmond, Stuart A. Jackson and John M. Cochran, III, New York City, for appellant.

Charles C. Parlin, Jr., and James A. Quaremba, New York City, for respondents.

JASEN, Judge.

The plaintiff, Intercontinental Planning, Limited is a New York corporation engaged in the business of bringing together European and American firms desiring to enter into business relationships. By this action plaintiff seeks to recover a finder's fee of $2,781,848 for its alleged services with respect to the acquisition in 1962 of a New Jersey electronics corporation, Daystrom, Incorporated, by defendant Schlumberger, Limited. ¹ Defendants deny that plaintiff played any role with respect to this acquisition, and assert that neither they nor Daystrom ever requested or agreed to pay compensation for any services plaintiff may have rendered concerning this particular acquisition.

This appeal is limited solely to plaintiff's cause of action in contract for recovery as a finder. Special Term granted defendants' motion for summary judgment upon the ground that plaintiff's action was barred by the New York Statute of Frauds. The Appellate Division unanimously affirmed the dismissal of plaintiff's cause of action in contract. ²

It is firmly established, of course, that summary judgment may not be granted whenever the pleadings raise material and triable issues of fact. (Sillman v. Twentieth Century-Fox, 3 N.Y.2d 395, 404, 165 N.Y.S.2d 498, 504, 144 N.E.2d 387, 392.) We consider the evidentiary facts alleged in the light most favorable to plaintiff on this appeal from the grant of summary judgment to defendants. We conclude, however, that no triable issue of fact is raised when the evidentiary facts are so weighed.

The affidavits submitted upon the motion for summary judgment show that plaintiff's president, Salomon Jakob, ³ met Jean Royer, the president of a small French electronics firm, Rochar Electronique, at a trade fair in New York City in May, 1960. Mr. Royer requested Mr. Jakob to introduce him to 'American companies which had similar manufacturing capabilities and desired a foreign affilitation.' Mr. Jakob undertook to locate interested American firms by placing an advertisement in the May 9, 1960 issue of the Wall Street Journal. Daystrom responded to this advertisement.

On May 20, 1960, Mr. Jakob introduced the presidents of Daystrom and Rochar at a luncheon meeting at the Pinnacle Club in New York City. Prior to this meeting, Daystrom agreed in principle to pay plaintiff a finder's fee should a suitable business relationship be established with Rochar. Negotiations were held at this meeting concerning the establishment of a business relationship between Daystrom and Rochar. Both principals indicated their readiness to pay plaintiff a finder's fee should an 'active business relationship' be concluded between the two firms. ⁴

Between May 20, 1960 and June 20, 1960, several letters and telephone calls passed between Mr. Jakob in his New York office and Daystrom's president in his New Jersey office concerning the amount of the finder's fee to which plaintiff would be entitled should the business relationship be concluded. Daystrom's attorney drafted a proposed agreement, dated June 20, 1960, establishing the terms and armount of the finder's fee. This draft agreement was mailed to plaintiff's New York office. Mr. Jakob then traveled to New Jersey on June 27, 1960, and signed the agreement in Daystrom's New Jersey office. In pertinent part, this agreement states:

'As you requested, I am writing to confirm my understanding of the terms of our agreement reached through our discussions and telephone conversations by reason of which you have been acting in behalf of Daystrom, Incorporated with a view toward the acquisition of Rochar Electronique.

'Should we acquire the company in question by purchase of its stock or assets, we shall pay you a commission equal to * * *

'This shall be the entire agreement between us and if the foregoing is acceptable to you, please execute the acceptance noted below on one copy of this letter and return the same to us, whereupon it shall constitute an agreement on the terms stated herein.

Very truly yours,

/s/ THOMAS ROY JONES

Thomas Roy Jones

President

Accepted:

By S. Jakob June 27, 1960.'

The proposed acquisition of Rochar by Daystrom did not take place, however, as Rochar was acquired instead by defendant Schlumberger in July, 1960. Thereafter, Mr. Jakob 'encouraged' Daystrom to negotiate with defendant Schlumberger.

Plaintiff alleges that, on November 22, 1960, Daystrom's president orally agreed to extend the terms of the written agreement to include a merger between defendant Schlumberger and Daystrom. ^{5 5} Defendant Schlumberger acquired Daystrom in February, 1962, by purchasing its assets.

Plaintiff contends that the written finder's fee agreement, dated June 20, 1960, when interpreted in the light of other documents, establishes its right to compensation for the merger of defendant Schlumberger and Daystrom and constitutes an agreement sufficient to meet the New York Statute of Frauds. We note that plaintiff concedes that none of these other writings satisfies the applicable section of the Statute of Frauds (Personal Property Law, Consol.Laws, c. 41, former § 31, subd. 10, now General Obligations Law, Consol.Laws, c. 24--A, § 5--701, subd. 10) independent of the written agreement.

At the time the events in dispute occurred, subdivision 10 of former section 31 of the Personal Property Law read:

'Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent, if such agreement, promise or undertaking;

'10. Is a contract to pay compensation for services rendered in negotiating a loan, or in negotiating the purchase, sale, exchange renting or leasing of any real estate or interest therein, or of a business opportunity, business, its good will, inventory, fixtures or an interest therein, including a majority of the voting stock interest in a corporation and including the creating of a partnership interest. This provision shall not apply to a contract to pay compensation to an auctioneer, an attorney at law, or a duly licensed real estate broker or real estate salesman.'

It is settled that former section 31 (subd. 10) applies to claims for fees by finders as well as brokers. (Minichiello v. Royal Business Funds Corp., 18 N.Y.2d 521, 527, 277 N.Y.S.2d 268, 272, 223 N.E.2d 793, 796.) Plaintiff's contract cause of action is, therefore, encompassed by former section 31 (subd. 10), the applicable section of the Statute of Frauds.

We conclude that the writings relied upon by plaintiff are insufficient to constitute an enforceable agreement under subdivision 10 of former section 31.

3]In a contract action a memorandum sufficient to meet the requirements of the Statute of Frauds must contain expressly or by reasonable implication all the material terms of the agreement, including the rate of compensation if there has been agreement on that matter'. (Cohon & Co. v. Russell, 23 N.Y.2d 569, 575, 297 N.Y.S.2d 947, 953, 245 N.E.2d 712, 715; Poel v. Brunswick-Balke-Collender Co., 216 N.Y. 310, 314, 110 N.E. 619, 620; Restatement, 2d, Contracts, § 207 (Tent. Draft No. 4, 1968); cf. Matter of Levin's Estate, 302 N.Y. 535, 541, 99 N.E.2d 877, 879; cf. Stulsaft v. Mercer Tube & Mfg. Co., 288 N.Y. 255, 258, 43 N.E.2d 31, 32.) It is true that a memorandum sufficient to satisfy the Statute of Frauds need not be contained in a single document. Thus, the terms of an agreement between the parties may be established by a combination of signed and unsigned documents, letters or other writings provided 'at least one writing, the one establishing a contractual relationship between the parties, must bear the signature of the party to be charged (or his authorized agent), while the unsigned document must on its face refer to the same transaction as that set forth in the one that was signed.' (Crabtree v. Elizabeth Arden Sales Corp., 305 N.Y. 48, 56, 110 N.E.2d 551, 554.) Nevertheless, it is equally well settled that extrinsic and parol evidence is not admissible to create an ambiguity in a written agreement which is complete and clear and unambiguous upon its face. (Tramco Ind. v. Broad Hollow Assoc., 23 N.Y.2d 841, 297 N.Y.S.2d 739, 245 N.E.2d 408; Rodolitz v. Neptune Paper Prods., 22 N.Y.2d 383, 292 N.Y.S.2d 878, 239 N.E.2d 628; Tobin v. Union News Co., 18 A.D.2d 243, 239 N.Y.S.2d 22, affd. 13 N.Y.2d 1155, 247 N.Y.S.2d 385, 196 N.E.2d 735; cf. General Phoenix Corp. v. Cabot, 300 N.Y. 87, 92, 89 N.E.2d 238, 241; cf. Laskey v. Rubel Corp., 303 N.Y. 69, 71, 100 N.E.2d 140, 141.)

The June 20, 1960 written agreement purports to be the complete agreement of the parties concerning plaintiff's right to a finder's fee and is signed by both parties. This agreement is clear and unambiguous on its face and specifically refers to the acquisition of 'Rochar Electronique' by 'Daystrom, Incorporated'--and not to the later purchase of Daystrom by defendant Schlumberger, Limited in February, 1962. It follows that plaintiff receives no support for its claim to a finder's fee for the merger of Daystrom and Schlumberger from the terms of the June 20 written agreement. Plaintiff cannot resort to extrinsic writings, none of which independently satisfies the Statute of Frauds, to create an ambiguity in the unambiguous and complete written agreement. (Tramco Ind. v. Broad Hollow Assoc., Supra.)

Plaintiff, however, also alleges that Daystrom later orally agreed on November 22, 1960, to extend the terms of the June, 1960 written finder's fee agreement to include its proposed...