Roth v. Stuerken

• Decision Date: 10 December 1914
• Docket Number: 10
• Citation: 92 A. 808,124 Md. 404
• Parties: ROTH et al. v. STUERKEN et al.
• Court: Maryland Court of Appeals

92 A. 808

124 Md. 404

ROTH et al. v. STUERKEN et al.

No. 10

Court of Appeals of Maryland

December 10, 1914

Appeal from Circuit Court No. 2 of Baltimore City; James M. Ambler Judge.

"To be officially reported."

Suit by Ernest A. Stuerken and others against John C. Roth and Henry Hertel. From an order overruling demurrers to the complaint defendants appeal. Affirmed, and cause remanded.

William Colton, of Baltimore, for appellants. Frank G. Turner, of Baltimore, for appellees. CONSTABLE, J.

This appeal is from an order overruling demurrers of the appellants, filed to an amended bill of complaint.

The bill alleges that all of the parties, both plaintiffs and defendants, with the exception of the complaining corporation, associated themselves together for the purpose of forming a corporation for the purpose of carrying on the sand and gravel business; that prior to the formation of the corporation, and in pursuance of the plan agreed upon by the members of the syndicate, options to purchase were secured upon two separate parcels of property. One of said options was taken in the name of George Schamberger, the consideration therefor, $300, being paid by the said Schamberger and John T. Scheu, both being members of the syndicate and two of the complainants. The other option was taken in the name of Henry Hertel, one of the defendants. It is alleged that the said options, although taken in the individual names of members of the syndicate, were, under the terms of the agreement entered into by all of the members intended to be for the joint benefit of all the parties to the enterprise, and were to be assigned to the corporation later to be formed.

The bill further alleges that a charter was obtained from the state of Virginia, and the Atlantic Sand & Gravel Company Incorporated, was formed, and that 4,000 shares of the common stock of said company were subscribed for by George A. Frick, a member of the syndicate, to be held by him, by agreement, for all the members of the syndicate, and to be equitably distributed among them, as might thereafter be agreed upon, in accordance with the services rendered, respectively; it having been agreed upon that the consideration for the stock should be the transfer to the corporation of the options secured by the efforts of the individual members of the syndicate.

It is alleged that difficulty was experienced in obtaining subscriptions for the stock of the company, and that it became necessary to obtain extensions of time on the options, and that these extensions were secured through the efforts of three of the plaintiffs, although the money payments required therefor were made through advances, to the extent of $8,500, made by John C. Roth, one of the defendants; that it was understood, by and between Roth and the other members of the syndicate, that the advances were not made for his individual benefit, but for the benefit of the enterprise, and that the said Roth agreed to take preferred stock, on account of said payments and other payments to be made by him, to the extent of $15,000; that, at the request of Roth, the options secured were assigned to him as security for the advances made and to be made, then for the benefit of himself and associates, and then to be assigned to the corporation.

It is further alleged that offers to purchase the properties, under contracts of option, were made, and, after several consultations among the members of the syndicate, it was determined to sell, and the properties were sold; that after the payment of the balance due and the payment of the advances made by John C. Roth and others, and certain expenses and fees, there remained in the hands of Roth the sum of $8,450, which the said Roth has refused to account for.

It is further alleged that, unknown to the other members of the syndicate, Henry Hertel received commissions from the vendors of the properties to the amount of $1,871.25, and refuses to account for the same with his associates, contrary to the agreement that the transactions were to be for the joint benefit of the members of the syndicate, and that the said Hertel was acting for his associates at their suggestion and request, and for them and himself.

The prayers of the bill are that the defendants answer and discover and set forth all sums received by them from said sale of land; that the said Henry Hertel set forth all profits received by him, either as commission or otherwise that the defendants account with the Atlantic Sand & Gravel Company, Inc., and with the other plaintiffs, for the profits of said land sold; that the defendants may be deemed to pay over to the Atlantic Sand &...