Canaday v. Brainard

144 A.2d 240, 51 Del. 226, 1 Storey 226, 1958 Del. LEXIS 101
CourtSupreme Court of Delaware
DecidedAugust 1, 1958
Docket4, 1958
StatusPublished
Cited by6 cases

This text of 144 A.2d 240 (Canaday v. Brainard) is published on Counsel Stack Legal Research, covering Supreme Court of Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Canaday v. Brainard, 144 A.2d 240, 51 Del. 226, 1 Storey 226, 1958 Del. LEXIS 101 (Del. 1958).

Opinion

Southerland, C. J.:

This is a suit for brokers’ commissions. It concerns the activities of two industrial brokers, Samuel Vance, Jr. and Millar Brainard, in attempting to effect a sale of the interest of Ward M. Canady, the defendant, in Willys-Overland Motors, Inc.

(Brainard died before the suit was brought.)

The plaintiffs asserted that Vance and Brainard were employed by Canaday to find a purchaser for Canaday’s holdings upon an understanding, either expressed or implied, that Canaday would pay them if successful; that Brainard did find such a purchaser in the ICaiser-Frazer Company; that the sale was consummated; and that Brainard was the procuring cause of the sale, or, alternatively, that Brainard was wrongfully prevented by Canaday from consummating the sale.

*228 All these contentions were denied by Canaday.

The case was tried by jury. At the conclusion of the trial Canaday moved for a directed verdict. It was denied and the case was submitted to the jury. A verdict for plaintiffs in the sum of $168,640 was returned. A motion for a new trial was denied. Canaday appeals.

The principal contentions of the parties at the trial are renewed here. In the view we take of the case, however, it is necessary to consider only one question:

Was there any evidence from which the jury could find that Millar Brainard was the procuring cause of the sale?

The evidence on that point adduced by the plaintiffs below, viewed in its most favorable light, is as follows:

The defendant in the case is Ward M. Canaday. At the times with which we are concerned he was president and chairman of the board of Willys-Overland Motors, Inc. The business of Willys-Overland was the manufacture of motor vehicles. Canaday owned about 75% of the stock of a holding company, Empire Securities, Inc., which in turn owned more than a million shares of Willys stock. Thus a substantial part of Canaday’s fortune was invested in the Willys enterprise.

In January of 1950 Canaday talked to Mr. C. Kenneth Baxter of the Donner corporation about his Willys investment. He was advanced in years and was disturbed about the future of his investment if anything happened to him. Baxter suggested that Canaday try to dispose of his interest in Willys and create a diversified investment portfolio. Canaday told Baxter that if the latter heard of anyone who had an interest in buying his “Willys-Overland stock” he and Baxter might talk about the matter further.

After his talk with Canaday Baxter told Samuel Vance, Jr., one of the plaintiffs, of the possibility that Canaday might sell his Willys investment. Vance is an industrial broker. Vance ar *229 ranged a conference with Canaday. Canaday said that he wanted Vance to find a buyer for the stock, without disclosing that Canaday was willing to sell it and without putting a price upon it. During the year 1950 and during early 1951 Vance made several efforts to produce a purchaser, but with no success. One possible purchaser asked that Canaday name a price, but Canaday refused to do so.

In the spring of 1950 Canaday and officers of the ICaiser-Frazer Company engaged in negotiations looking to the merger of the two companies. They failed because Canaday insisted on a firm commitment to buy his holdings, and the ICaiser officials insisted that the commitment be conditioned upon the approval of the merger.

In early 1951 Vance had effected an association with Millar Brainard, now deceased, whose administrator is the other plaintiff below. Brainard was also an industrial broker. Vance told Brainard of the possibility of Canaday’s selling his interest in Willys. Brainard, who knew Cyrus Eaton, of Otis & Co., talked to Eaton about it. Vance then arranged a meeting between Canaday and Brainard.

Canaday and Brainard met in Boston on April 7, 1951, and Brainard suggested Eaton as a possible purchaser. Canaday thought Eaton a logical purchaser, and saw a possibility of harmonizing various interests by settling the litigation between Eaton and the ICaiser-Frazer Company and putting Willys and ICaiser-Frazer together. Some talks between Eaton and Brainard occurred during the next two or three months, in the course of which the possible merger of Willys and ICaiser-Frazer was mentioned. Nothing came of these conversations.

On May 16, 1951 Canaday sailed for Europe. On June 12, 1951 Brainard sent him a memorandum embodying a plan of merging Willys and ICaiser-Frazer. Brainard thought that if the merger could be put through it would be possible thereafter to effect a sale of Canaday’s holdings.

*230 On July 25, 1951 Brainard called upon George Woods, chairman of the board of the First Boston Corporation, and financial adviser to the Kaisers. Brainard told Woods that he (Brainard) believed that Canaday had a real interest in trying to work out a combination between Willys and Kaiser-Frazer. Brainard asked Woods to inquire of Edgar Kaiser, president of Kaiser-Frazer, whether he too would be interested. Woods said he would do so.

Woods could not get into telephone communication with Edgar Kaiser, but talked to Trefethan, a vice president, about his talk with Brainard. Woods said to Trefethan that Canaday had “come up with a new mouth” — i.e., was ready to deal with the problem of disposing of his interest in Willys in a new fashion. Trefethan said that he would report the Woods-Brainard conversation to Edgar Kaiser.

On July 31, the day Canaday returned to his office, Brainard reported to Canaday that he had a conversation with Woods; that Woods was really interested; and that what Woods wanted to do was to buy Canaday’s stock in Empire Securities. It was arranged that Brainard should visit Canaday at the latter’s farm at Woodstock, Vermont.

On August 8 Kaiser tried unsuccessfully to call Canaday on the telephone. On August 9 he talked to Canaday on the telephone.

On August 11 Brainard met with Canaday in Woodstock. From the evidence adduced by the plaintiffs it could be inferred that Canaday was much interested in the possible sale to KaiserFrazer and that he encouraged Brainard to keep working on it.

On August 13, however, Canaday telephoned Brainard. Canaday said that he had been thinking over their talk in Woodstock and did not want to spend any money on anyone trying to follow up the Kaisers; that he didn’t think anything was to be gained by Brainard “peddling his stuff”.

*231 On the same day and also on August 15 Canaday called Kaiser. On August 22 and 28 Woods telephoned Canaday with respect to the ICaiser-Frazer matter. The record does not show what was said.

On September 5 Kaiser met Canaday in Toledo. They discussed the possibility of reactivating the prior discussions about putting together Willys and ICaiser-Frazer. The talk appears to have covered general ideas but not the details of any sale or merger.

At Canaday’s request Kaiser returned to Toledo to look at the new Willys passenger car. It was Kaiser’s belief that the car was not a vehicle that would sell in the price class and produce the volume that was required.

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144 A.2d 240, 51 Del. 226, 1 Storey 226, 1958 Del. LEXIS 101, Counsel Stack Legal Research, https://law.counselstack.com/opinion/canaday-v-brainard-del-1958.