Michels v. Olmstead

• Decision Date: 18 March 1895
• Docket Number: No. 100,100
• Parties: MICHELS v. OLMSTEAD
• Court: U.S. Supreme Court

157 U.S. 198

15 S.Ct. 580

39 L.Ed. 671

MICHELS

v OLMSTEAD.

No. 100.

March 18, 1895.

John D. Conely, for appellant.

John L. Peak, for appellee.

Mr. Justice GRAY delivered the opinion of the court.

This was a bill in equity filed in the circuit court of the United States for the Western district of Missouri by Olmstead, a citizen of Missouri, against Michels, a citizen of Michigan, for an injunction against the prosecution of an action at law brought in the same court by Michels against Olmstead to recover damages for the breach of a contract, in writing, by which Michels agreed to furnish, and to put into a building to be erected by Olmstead at Kansas City, in the state of Missouri, the machinery necessary for manufacturing corn into a syrup commonly called 'glucose,' by the so-called 'dry process,' and of sufficient capacity to manufacture 2,000 bushels of Indian corn into such syrup every 24 hours; and Michels guarantied the machinery to be of that capacity, and to produce a yield of a certain amount and quality of syrup, and Olmstead agreed to pay Michels therefor the sum of $81,160.

The bill, among other things, alleged that, before the contract was signed, Olmstead informed Michels that he did not desire to engage in the business of manufacturing syrup indi- vidually, but only as a member of a corporation which he and others contemplated forming, and as agent for whom he was negotiating; and Michels promised him that if he would sign the contract he would permit him to see the operation of manufacturing syrup from corn by the dry process in the works of Michels at Detroit, in the state of Michigan, and then return and report to his associates, and if he should be satisfied and report that the process was in successful operation, and should accomplish the organization of the corporation, the terms of the contract might be taken as the basis of a proposition by Michels, which the corporation might adopt, but that in no event should the contract bind Olmstead individually.

The bill further alleged that after the signing of the contract the plaintiff and his associates discovered that the pretended dry process was worthless, and was so known to be to all persons skilled in the manufacture of syrup from corn, and that the price of machinery mentioned in the contract was extortionate and excessive, and that the plaintiff and his associated therefore did not accept Michels' proposition, nor organize a corporation, and that he was advised that his...