Jacob v. Cummings

182 N.W. 115, 213 Mich. 373, 1921 Mich. LEXIS 574
CourtMichigan Supreme Court
DecidedMarch 30, 1921
DocketDocket No. 22
StatusPublished
Cited by14 cases

This text of 182 N.W. 115 (Jacob v. Cummings) is published on Counsel Stack Legal Research, covering Michigan Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Jacob v. Cummings, 182 N.W. 115, 213 Mich. 373, 1921 Mich. LEXIS 574 (Mich. 1921).

Opinion

Wiest, J.

The plaintiff, a real estate broker, having learned that Peter Smith & Sons, a corporation, was considering the sale of the leasehold interest and building owned by it at the corner of Griswold and State streets in Detroit, and being advised by Mr. Talbot, secretary of the company, that the same might be purchased for $325,000, provided some representative man was interested, and being told that it would not [375]*375be sold, to Mm as he would want it for speculative purposes, went to Alfred M. Low and requested him to obtain an option on the premises. Mr. Low, not wishing to invest any money in purchasing the option, consented to accept an option in his name if plaintiff would procure the money necessary to secure it, and agreed he would assign the option to a suitable person upon receiving compensation for his services. The plaintiff heard that defendant was looking at the property with a view of purchasing and went, to see him to find if he would be interested in paying Mr. Low the consideration necessary to obtain the option, and take an assignment thereof. After conferences, defendant gave plaintiff a check for $5,000, payable to Mr. Low, for the purpose of securing the option. The plaintiff delivered the check to Mr. Low, and upon consultation with Mr. Talbot it was agreed that an option should be given Mr. Low, and the check was indorsed by Mr. Low and a 90-day option given him on March 9, 1916, and by him assigned to defendant, and thereupon defendant signed the following agreement:

“Mr. Ben B. Jacob,
“Detroit, Michigan.
“Dear Sir: Whereas, you have this day secured for me an assignment of a certain option to purchase the leasehold and building known as the Peter Smith & Sons building, located at the southwest corner of Gris-wold and State streets, in the city of Detroit, Michigan, which assignment is made direct from Alfred M. Low to me, but wMch was obtained and secured by you from the said Alfred M. Low, the assignment running direct from him to me, I herewith agree to pay you as a further consideration for said assignment and for your services, the sum of twenty-five thousand ($25,000.00) dollars unless (a) I shall sell said building for a sum in excess of four hundred thousand ($400,000.00) dollars before the time of the expiration of said option, in which event I shall pay you not only said twenty-five thousand ($25,000.00) dollars, but also twenty-five per cent. (25%) of the excess [376]*376over and above four hundred thousand ($400,-000.00) dollars for which I shall sell said building and leasehold; or (5) unless on or before fifteen (15) days before said option expires, I notify you in writing of nay intention not to exercise said option, and I do agree, in that event, to reassign said option to you any time within the fifteen (15) days prior to the expiration of said option, upon your paying me the sum of five thousand ($5,000.00) dollars, the same being the amount heretofore paid for said option and to apply on the purchase price, in the event the option is exercised.
“In the event of neither A or B happening, I shall remain liable for said twenty-five thousand ($25,-000.00) dollars and the same shall be payable as follows:
“If the leasehold and building is sold by me on or before the date of the expiration of said option, said twenty-five thousand ($25,000.00) dollars shall be payable forthwith in cash, but if the building is not so sold, I agree to form a corporation before the expiration of said option, which corporation shall have a capital of one hundred and six thousand ($106,-000.00) dollars, representing the eighty-one thousand ($81,000.00) dollars I have paid for said leasehold and building subject to a mortgage on same, less the six thousand ($6,000.00) dollars to be used to retire the past due bonds on same, and plus the twenty-five thousand ($25,000.00) dollars I am indebted to you for on account of your services and as a further consideration for securing said option. Said one hundred and six thousand ($106,000.00) dollars shall be the total capital stock of said corporation and twenty-five thousand ($25,000.00) dollars of said stock, I agree to deliver to you in payment of the twenty-five thousand ($25,000.00) dollars hereinbefore set forth and due you.
“In witness whereof, I have hereunto set my signature this tenth day of March, in the year one thousand nine hundred and sixteen.
(Signed) “George H. Cummings.”

As the time of the expiration of the option drew near, defendant talked matters over with plaintiff and [377]*377stated that an extension of time would be necessary, and four days before the expiration of the option he gave plaintiff his check for $5,000 with which to procure a renewal, and two days later was informed by plaintiff that no renewal could be obtained and the check was returned. Thereupon defendant himself secured an extension of the option by paying $5,000, but at the price of $345,000. Not being able to dispose of the property, defendant from time to time got other options, paying for options and taxes the sum of $28,442.85, and finally was unable to perform and lost all he had paid.

The last option was in April, 1918. The bill herein was filed June 13, 1916, and prayed, among other things, for an accounting relative to defendant’s exercise of rights under the first and second options and for a personal decree. The circuit judge held that the agreement was so modified and abandoned by the parties that plaintiff could not recover under the agreement, and no damages being shown, none could be recovered. It appears that the building was not sold 'before the expiration of the option, so that part of the agreement, providing for the payment of $25,000 and 25 per cent, of the excess over and above $400,000, is out of the case.

Plaintiff at the hearing planted his right to recover a money decree upon the failure of defendant to notify him of an intention not to exercise the option. It is clear that defendant did not form the intention not to exercise the option and this was well known to plaintiff, and with such knowledge plaintiff tried to have the option extended but failed and defendant obtained a new option at an increased price. If defendant did not sell the building for a sum in excess of $400,000 before the time of the expiration of the option, or, if he intended to exercise the option, then he was to pay $25,000 in cash if he sold the leasehold and [378]*378building before the date of the expiration of the option, and if he did not so sell, he agreed to form a corporation before the expiration of the option' and deliver $25,000 of the stock thereof to plaintiff. He did not sell, neither did he form a corporation, but secured other options at higher prices, paid money to obtain the same and finally lost all his option rights and the money he had paid. Plaintiff now asks that defendant be held to pay him $25,000 for failure to notify him that he did not intend to exercise the first option regardless of the fact that he did intend toi exercise it if he could get an extension, and regardless of the subsequent acts performed by plaintiff showing a departure from strict performance of the agreement and a hope' of being able to assist the defendant in saving the property and permit an exercise of the option regardless of the agreement. Plaintiff had a right to rest upon the agreement, or modify the same, or waive its terms.

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Cite This Page — Counsel Stack

Bluebook (online)
182 N.W. 115, 213 Mich. 373, 1921 Mich. LEXIS 574, Counsel Stack Legal Research, https://law.counselstack.com/opinion/jacob-v-cummings-mich-1921.