Lerner v. Stone
| Decision Date | 15 December 1952 |
| Docket Number | No. 16744,16744 |
| Citation | 126 Colo. 589,252 P.2d 533 |
| Parties | LERNER et al. v. STONE et al. |
| Court | Colorado Supreme Court |
Louis G. Isaacson, William H. Burnett and Joel E. Stone, Denver, for plaintiffs in error.
Edward H. Sherman and Philip Hornbein, Sr., Denver, for defendant in error, Herman H. Stone.
One phase of this litigation, which apparently is now the controlling factor, was before this court in the case of Stone v. Lerner, 118 Colo. 455, 195 P.2d 964, 4 A.L.R.2d 97 in a review of a forcible entry and detainer action in which it was finally determined that Stone had unlawfully retained possession of the premises involved beyond the term of a lease. As an outgrowth of that litigation, Lerner filed the present action against Stone under the provision of our statute, being section 26, chapter 70, '35 C.S.A., for treble damages resulting from the unlawful detention of the premises. Stone, by his answer, in substance, admitted liability under the circumstances, but alleged, and by a counterclaim sought to offset Lerner's claim in that Lerner had violated the terms of the contract of sale of a partnership interest and had entered the premises and destroyed his business.
During the course of the litigation, Eliot Lerner died; Sara Lerner was substituted as party plaintiff, and now appears for herself individually and as administratrix of the estate of Eliot Lerner. In the course of the trial it developed that Stone had formed a corporation which took over his business while he was occupying the premises during the period of unlawful detention, the court dismissed Stone's counterclaim on the ground that he had not shown damage personally sustained; that the unlawful detention was by the corporation; and then directed a verdict for plaintiffs Lerner for the nominal sum of $1 trebled because plaintiffs had failed to show what portion of the premises was occupied by Stone, defendant, and what portion was occupied by the corporation which was not a party to the action. The orders and judgments so entered are brought here by the Lerners for review.
It appears from the record that on May 13, 1943, a partnership existed between Lerner, Stone and Schwartz, which operated a business under the name of Capitol Fixture and Supply Company at 1430 Larimer Street, Denver, Colorado. The partners had a lease on the premises at that location, which by its terms would expire on September 3, 1947. This lease had previously been renewable. On August 11, 1945, Lerner notified Herman Goalstone (name later changed to Herman Stone) that he desired the dissolution of the copartnership firm formed by the agreement of May 13, 1943, and, in conformity with said agreement gave the required notice to buy or sell, offered to pay Stone the sum of $16,000 in full for his entire net interest in and to the assets of the said copartnership, including good will, and in turn offered to accept that amount for his interest, including good will. This offer to sell was accepted by Stone and Lerner transferred his undivided one-third interest to Stone and Schwartz who continued the partnership operations until Stone shortly thereafter bought out the interest of Schwartz and became the sole owner of the business. The written sale and dissolution agreement was signed by all of the partners on September 13, 1945, and is silent on the item of good will.
As hereinbefore noted, the original partnership had a lease on the premises with expiration date as of September 13, 1945, and in the month of June 1946, persons related to Lerner acquired the leased premises by purchase, and shortly thereafter title was conveyed to Lerner. It is stated that this ownership was concealed by Lerner until July 24, 1947 when a written notice was served on Stone to vacate upon the termination of the lease. Stone refused to vacate, and the forcible entry and detainer suit hereinbefore mentioned was instituted in the justice court by Lerner, who recovered judgment for possession, and Stone, as is provided, appealed the case to the county court, there met with an adverse decision and he promptly brought the case here on writ of error to the county court. In the trial in the county court, Stone presented his reasons for not vacating and based his defense on the provisions of the sale and dissolution agreement wherein Stone contended that Lerner had sold and received consideration for the good will of the partnership as a part of the assets; that the good will included the right to continue to do business at 'SAME OLD STAND;' AND THAT THEREFORE THERE was an implied contract on the part of Lerner not to interfere on the partnership, or in the right of the partnership to continue, nor to interfere with the leasing of the property to the partnership. On review by this court, it was determined that in the action for forcible entry and detainer, these equitable defenses were not available against the claim of the holder of the legal title in his right to possession, and the judgment of the county court was affirmed.
In the present action Lerner sought treble damages against Stone for holding over, and prayed for an accounting of Stone's business during the period involved. Stone answered and counterclaimed generally as in the county court. During the trial it developed that Stone, about a year prior to the expiration of the lease, had incorporated a company under the same name as the partnership had carried, and transferred all of his interest and ownershop of the business into the corporation in return for all of its stock except two qualifying shares. It was clearly and definitely established that Stone owned the corporation and all of its assets, lock, stock and barrel, by virtue of his stock interest and had complete and full control of the corporation's operations. Throughout all of the proceedings leading up to the trial and during the course of almost the entire trial, in which the corporation was not a party, Stone was considered the real party in interest until the matter of the incorporation was disclosed, at which time Stone moved for leave to join the corporation as a necessary party defendant. This motion was objected to on the ground that the answer and counterclaim...
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Marriage of Huff, In re, 91SC266
...suit.14 Goodwill has long been accepted in Colorado as an attribute of a business, trade or profession. See Lerner v. Stone, 126 Colo. 589, 595, 252 P.2d 533, 536 (1952); In re Marriage of Bookout, 833 P.2d 800, 804 (Colo.App.1991) (holding that husband's goodwill in physical therapy practi......
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Auraria Businessmen Against Confiscation, Inc. v. Denver Urban Renewal Authority
...the goodwill of a business, though not property in and of itself, has value and may form the subject matter of a sale. Lerner v. Stone, 126 Colo. 589, 252 P.2d 533; Herfort v. Cramer, 7 Colo. 483, 4 P. 896. Nevertheless, goodwill and profits traditionally have not been regarded as elements ......
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Huston v. Dickson
...in passing that Massachusetts does not follow the majority rule. We have examined all of the cases cited by plaintiff. Lerner v. Stone, 126 Colo. 589, 252 P.2d 533; Milgrim Bros. v. Schlesinger, 168 Or. 476, 123 P.2d 196; George v. Burdusis, 21 Cal.2d 153, 130 P.2d 399; J. L. Cooper & Co. v......
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Westric Battery Co. v. Standard Elec. Co., Inc.
...of Colorado: "Good will has long been accepted, and so treated, as an attribute of a business, trade or profession." Lerner v. Stone, 126 Colo. 589, 252 P.2d 533, 536 (1952). The Colorado court has not ruled in a context like the present one, but there is no dearth of authoritative support ......
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A Field Guide to Intellectual Property
...to Idea Protection," 60 Journal of the Patent Office Society (Sept. 1978) for a current approach to decision making. 72. Lerner v. Stone, 126 Colo. 589, 252 P.2d 533, 536 (1952). 73. C.R.S. 1973, § 7-70-101(4); Lanham Act, § 45, 15 U.S.C. 1127. 74. Lanham Act, 15 U.S.C. 1051-1127. 75. Id.,§......