Nigro v. Conti

• Decision Date: 03 May 1946
• Citation: 66 N.E.2d 353,319 Mass. 480
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: ARTHUR N. NIGRO v. JOSEPH CONTI & others. [1]

319 Mass. 480

66 N.E.2d 353

ARTHUR N. NIGRO v. JOSEPH CONTI & others. ^[1]

Supreme Judicial Court of Massachusetts, Middlesex.

May 3, 1946

March 5, 1946.

Present: FIELD, C.

J., LUMMUS, QUA DOLAN, & SPALDING, JJ.

Contract, What constitutes, Construction, Sale, Contract of sale, Of stock. Equity Jurisdiction, Specific performance.

A certain writing containing all the necessary terms of a complete contract for the sale of substantially all the capital stock of a restaurant corporation was construed by this court as intended by the parties to be presently binding notwithstanding a provision that if a municipal licensing commission "approves . . . [of the buyer], a formal agreement between the parties is to be drawn within a reasonable time after said approval."

A provision of a contract for the sale of substantially all the capital stock of a restaurant corporation, that the contract "is to be binding until the . . . [municipal licensing] commission makes its decision" of approval or disapproval of the buyer, did not mean that the contract should cease to be binding upon the commission's acting, but that, if the commission should approve of the buyer, the contract was to remain binding and the parties, in accordance with another provision, were to proceed to draw "a formal agreement" "within a reasonable time."

The mere existence of an agreement for the sale of all the liquor of a restaurant corporation, separate from and collateral to a contract between the same parties for a sale of substantially all the capital stock of the corporation, was not inconsistent with the immediate taking effect of the contract respecting the stock.

A contract for the sale of closely held corporate stock not purchasable in the market will be specifically enforced in equity.

In a suit in equity to compel the defendant specifically to perform a contract to sell to the plaintiff substantially all the capital stock of a corporation, a provision of a decree for the plaintiff requiring the defendant to resign the offices of treasurer and director held by him in the corporation was not improper although there was no provision in the contract respecting such a resignation.

BILL IN EQUITY filed in the Superior Court on February 27, 1945. The suit was heard by Dillon, J.

W. F. Henneberry for the plaintiff.

S.

H. Lewis, (H.

L. Barrett with him,) for the defendants Joseph Conti and another.

QUA, J. In the Superior Court the plaintiff obtained a decree for specific performance of an agreement in writing by which the defendants Conti and Mayo contracted to sell to the plaintiff their shares of stock in the defendant Elena Restaurant Inc., for $10,000. The trade seems to have been made on the basis that all the stock in the company was to be included at $100 a share, but the decree allows a deduction of $100 for one share not owned by either defendant. The defendant Mayo has apparently been willing to carry out the agreement on his part. The defendant Conti has refused to carry it out on his part. Only the defendants Conti and Elena Restaurant, Inc., appeal from the decree. The evidence is reported.

The agreement in writing was as follows: "Agreement made this 8th day of February 1945 between Frank Mayo and Joseph Conti holders of the stock of Elena Restaurant, 657 Cambridge Street, Cambridge, and Arthur Nigro in consideration of $100.00 deposit paid forthwith. The above named parties agree: 1. That the said Mayo and Joseph Conti will sell their shares of stock in said Restaurant to said Nigro for $10,000.00. 2. The said deposit of $100.00 is to be reimbursed to Nigro if the Cambridge Licensing Commission does not approve of him as a prospective buyer of said premises. 3. The said agreement is to be binding until the Cambridge Licensing Commission makes its decision. 4. If the Cambridge Licensing Commission approves of Mr. Nigro as buyer, a formal agreement between the parties is to be drawn within a reasonable time after said approval. 5. The said Frank Mayo and Joseph Conti agree that they will not attempt to sell their shares of stock while this agreement is in effect. Joseph Conti Frank Mayo Arthur N. Nigro."

The principal contention of the appealing defendants is that this writing of February 8 was never intended to bind the parties to anything; that it was designed merely to be shown to the licensing commission for the purpose of obtaining its approval of the plaintiff as a buyer, which in fact was granted on February 12; and that the parties did not intend to be bound until the "formal agreement" referred to in paragraph "4" should be drawn up and signed.

The trial judge made no express findings of fact, but it is evident from the decree that he did not accept the defendants' contention and after an examination of the whole case we agree with his conclusion. The writing in question contains all the necessary terms of a complete contract for the sale and purchase of the stock. It specifies definitely the parties selling and buying, the subject matter of the sale, and the price. It is signed by all the parties concerned. Paragraph "5" was very evidently intended to go into effect at once. It is difficult to see how the instrument can be construed so as to give to paragraph "5" the effect of a present contract while the other paragraphs, particularly paragraph "1," expressed with equal positiveness, are regarded as still only in the stage of preliminary negotiation. Paragraph "3" says the "agreement is to be binding until the Cambridge Licensing Commission makes its decision." This also imports a present contract. We do not construe this paragraph as meaning that the agreement cases to be binding the moment the commission acts. That would render the instrument futile. We construe...