
    Delaware Trust Company, Plaintiff, v. Maxmilian Calm and Others, Defendants.
    First Department,
    December 6, 1907.
    Contract — agreement to repurchase share in joint venture notice — tender — taking up option. ■
    Under a-contract whereby the plaintiffs' assignors were<to advance moneys to promote mining claims on defendants’ agreement tliat.at any time within three years, at the request of the assignors, ’ they wótild' purchase'for cash all the right and interest of the assignors in the-business, paying therefor the actual amount of cash expended by them, the defendants are obligated to' repurchase on notice by the assignors that they availed themselves of that clause of the contract, and a tender of their interest or offer to .return the advantagesfeceived under the contract is not a condition precedent to action.
    A notice by the assignors that they accepted the conditions of 'the agreement, etc., was á sufficient tender of their interest. '• - .
    Laughlir, ,J.. dissented.
    Motion by the plaintiff, The Delaware Trust Company, for a new trial -upon a case epntaitiing exceptions ordered to. be heard at the Appellate Division in the first instance upon the dismissal of the complaint by the direction of the court after a trial at the Hew York Trial Term in February, 1907.
    
      George P. Breckenridge, for the plaintiff.
    
      Henry L. Scheuerman of counsel [Hoadly, Lauterbach & Johnson, attorneys], for the defendants.
   Clarke, J.:

This is a motion for a new trial on exceptions directed to be heard in the first instance at the Appellate Division. The complaint was dismissed upon the trial at the close of the plaintiff’s case. The action is brought by the plaintiff, as assignee of the interests of J. Ernest Smith, S. Rodman Smith and Edward T.- Canby, against the defendants to recover the amount expended by the assignors in a venture with the defendants.

On November 21, 1899, an agreement in writing was entered into between plaintiff’s assignors as parties of the second part and the defendants as parties of the first part. This agreement, after reciting that the defendants have invited the plaintiff’s assignors to go into a business venture in locating, taking up and acquiring ore lands and claims, and incidentally .mineral-and ore lands of every description, in the State of California, and that the defendants had secured the expert services of H. B. Stevens, of Los Angeles, Cal., to exploit, discover, locate, take up and prove such claims and lands, stated that the parties agreed to take, hold and acquire all lands, ^claims and rights of all kinds in the following shares and proportions : two-eighths parts to H. B. Stevens, three-eighths parts to the Calms, and the balance, three-eighths parts thereof, to S. Rodman Smith and J. Ernest Smith.

It was further agreed that all expenses should be paid by the Calms and that the Smiths would pay one-half thereof on presentation of statements, and that not more than $4,000 should be expended. There are also clauses by which each party gives to the other an option to buy their interests. There was also in the- original agreement a sixth clause on which this action is based, as follows : “ Sixth — The said parties of the first part further covenant, promise and agree that they will, at, any time within three years of this date, at the request of .the said parties of the second part, purchase for cash all the right and interest of the -said parties of the second part in said business and this agreement, paying them there-' for the actual-amount of cash paid out or expended by them in and about said business.”

After the agreement had been entered into, the Smiths assigned one-third of their interests, or one-eighth of the whole, to Edward T. Can by, who ' agreed to pay his share of. the expenses. This assignment is written on the agreement.

The evidence satisfactorily establishes that the plaintiff’s assignors had paid as their share of the actual amount of cash paid out and expended in and, about, the business $2,142.83. Before the expk ration of the three-years, to wit, on November 18, 1902, plaintiff’s assignors wrote to-the defendants as follows: “I have received a letter, since the negotiations looking to the sale of the "oil property, from my brother, and Ire states that he thinks- it would be best to close the whole matter up, and to that end he desires" me to write you that we will accept the condition in our agreement of repayment by you of moneys advanced in .this undertaking. To this-conclusion both Mr. Canby and I agree. This notice is given you in conformity with the contract, which expires-on the - 25th of this month.” It is conceded that said'letter was received.by defendants on November njgeteenth. No answer was returned'to it, and it is to recover upon said agreement the amount .indicated that the action was brought. ■ ,

The complaint was dismissed at the close of the plaintiff’s case^ upon the ground that there had been no tender or offer to return any advantage received by plaintiff’s assignors under the contract. To support this ruling the defendants cite Taylor v. Blair (59 Hun, 347.) In that case plaintiff’s intestate had purchased stock and paid $10,000 upon his subscription. ■ To induce him to- purchase this stock t'he defendants agreed that if a-t the end of one year plaintiff’s intestate should desire to sell the said shares at the price paid for the saíne by him, they would purchase the same and -pay to him the amount paid by him. The Court held that under that' agreement, before a recovery could be had, it was incumbent to prove that there had been an offer or a tender of transfer of those shares. They also cite Lester v. Jewett (11 N. Y. 453). In that case also defendant agreed to purchase from the plaintiff shares of stock within one year at a fixed price. Under such circumstances it was said that “A cash purchase can only be made by a payment of the purchase money on the one side, and a delivery of the thing purchased on the other.”

It seems to me that these authorities do not apply to the facts developed on this trial and under this contract. Here was a joint venture, the interest in which was divided into eight 'shares. The contract in the 6th clause provided for the purchase of “ all the right and interest of the said parties of the second part in said business and this agreement.” At the beginning plaintiff’s assignors held three-eighths interest and the defendants three-eighths, and the agent, whom the defendants employed to locate the property, the exploitation of which was the purpose of the enterprise, held two-eighths. ■ Said agent having proved unsatisfactory, his two-eighths were recovered from him and one of the eighths had been disposed of'to another person. Evidently, this provision in the contract was intended to be, and was, a guaranty of repayment in case the enterprise, into which the defendants had invited the plaintiff’s assignors, should prove unsuccessful. It did not provide for the purchase and sale of specific property, shares of stock or other tangible assets. It was to purchase the interest in the venture which was represented by the shares thereof which the defendants owned. Anything inci dental thereto in the way of muniments of title- as assignments of options, or locations which had been obtained, or even deeds of property, were all incidental to the real thing. This was the purchase of shares of the whole venture which the plaintiff’s assignors owned and which the defendants agreed to take back and return to plaintiff’s assignors the amount, they had expended. Under this agreement, all that the plaintiff’s assignors had to do, in my opinion, was to notify the defendants within the three years that they proposed to take advantage of the privilege reserved. After receiving said notice the defendants could not sit by and do nothing. If they wished anything further they should have said so. If there were any details necessary to insure complete possession of the shares they should have asked for. them; they should have done something to put the plaintiff’s assignors in the wrong.

The interest in the venture was susceptible to purchase as such, as evidenced by the fact that one-eighth had been sold to one' Elliott for $1,500. This carried, as an incident thereto, a one-' eighth interest in all the options, locations, etc., obtained. It is not-pretended that there was any physical transfer to said Elliott of one-eighth of each of said things-which now defendants claim should ; have been tendered to them. The character of the transaction precludes any idea of the strict tender or. manual delivery of the component evidences of title of the things which entered into and made up the whole" venture. When the defendants were notified that plaintiff’s assignors accepted “ the condition in our agreement of repayment by you. of moneys advanced in. this undertaking,” sufficient tender of their interest was made.

The dismissal of' the complaint, therefore, was error, the exceptions should be sustained and a new trial ordered, with costs to plaintiff to abide the event.

Patterson, P. J¡., Ingraham and Scot*, JJ., concurred.; Laughlin, J., dissented.

Exceptions sustained and new trial ordered, with costs to plaintiff to abide event. Settle order on notice."  