Steinthal v. Cohn

Citation22 A.D.2d 644,252 N.Y.S.2d 977
PartiesMartin B. STEINTHAL and Augustus J. Steinthal, Plaintiffs-Respondents, v. Roy M. COHN, Defendant-Appellant.
Decision Date01 October 1964
CourtNew York Supreme Court Appellate Division

J. Howard Carter, New York City, for plaintiffs-respondents.

J. A. Kiser, New York City, for defendant-appellant.

Before BREITEL, J. P., and VALENTE, STEVENS, EAGER and STEUER, JJ.

PER CURIAM.

Order, entered on June 29, 1964, granting plaintiffs' crossmotion for summary judgment, and denying defendant's motion for leave to serve an amended answer, and judgment, entered July 2, 1964, in favor of plaintiffs for $631,932.85 in damages for breach of a contract granting option to sell unregistered shares of stock on 20 days' notice unanimously affirmed, on the opinion of Mr. Justice Sarafite at Special Term with the following added comments. While the parties to the option agreement contemplated the possibility that 30,500 of the shares would become registered, the agreement required defendant to purchase, or find a purchaser for, the 30,500 shares whether or not registered at $17.78, or make up the difference if sold to another for less. If the net proceeds of any sale of such shares, whether registered or not, were less than $800,000, defendant was required by the agreement to buy an additional number of shares at $17.78 as might be necessary to total $800,000. Plaintiffs were thereby entitled to demand that defendant purchase 44,995 shares at $17.78. Although the 20-day notice to defendant to purchase was defective, because delivered simultaneously with plaintiffs' delivery to Lionel of a 10-day prior option to Lionel to purchase 44,000 of these shares, this defect could have been readily cured by giving defendant ten additional days within which to buy. Under these conditions, such a curable defect was waived by defendant's failure to ask for 10 additional days. There was, in any event, a sufficient exercise of the option, the curable defect relating to an insignificant time interval. This was especially insignificant in the light of defendant's association with Lionel. Under section 84-a, of the Personal Property Law such an immaterial variance does not defeat the exercise of the option. Shares of stock are considered 'goods' for purposes of the sales law provisions of the Personal Property Law (Agar v. Orda, 264 N.Y. 248, 190 N.E. 479, 99 A.L.R. 269). Compare Uniform Commercial Code, § 2-207 (eff. September 27, 1964). If plaintiffs...

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