Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

BEHRENS v. SKELLY

March 1, 1948

BEHRENS
v.
SKELLY et al.



The opinion of the court was delivered by: MCVICAR

In this action, plaintiff seeks a judgment that all of the capital stock of the defendant Liggett Spring & Axle Company, and of the defendant Axleton Water Company and certain obligations of Liggett, consisting of judgments, promissory notes, mortgage bonds, open accounts, and interest upon the foregoing -- such obligations together aggregating approximately $ 300,000 -- are the sole property of the plaintiff; that the defendants be ordered to assign and transfer the said stock and obligations to the plaintiff; that the defendants be required to account to the plaintiff for the avails and profits of the said shares of stock and obligations, all monies, assets, and other property of Liggett and Axleton, and for all sums of money received by the individual defendants from Liggett and Axleton, whether as creditors, stockholders, directors, officers, employees, or otherwise; and that the defendants pay the plaintiff such compensatory and exemplary damages as are found just and proper by the Court.

This action is now before us on motion of defendants Charles E. Dexter, Jr., Marc J. Sandler, Clarence O. Devore, Liggett Spring & Axle Company and Axleton Water Company for judgment on the pleadings (which consists of the complaint, answer and reply). The reason assigned, and which was argued, is that it appears from the pleadings that the claim asserted by the plaintiff against the above defendants has been previously adjudicated by the plaintiff and predecessors in title of said defendants and therefore the plaintiff is barred by res judicata from prosecuting this action against these defendants.

 In the consideration of this motion, the allegations of fact in the complaint and reply must be taken as true.

 Defendants, in their answer, pleaded as a defense to plaintiff's claim, an award in arbitration and judgments of the Supreme Court of New York and the Court of Appeals in that State in favor of Gertrud Feuerring and Alfred Schwabacher in an action in which Henry Behrens, the plaintiff in this case, was plaintiff and above Gertrud Feuerring and Alfred Schwabacher were defendants.

 The following facts are established for the purpose of this motion:

 (a) Prior to June 5, 1941, City Bank Farmers Trust Company, a New York corporation, as trustee under the will of William G. Park, deceased, owned all of the shares of capital stock of Liggett, all of the shares of capital stock of Axleton and certain obligations of Liggett which are described in paragraph 9 of the complaint, the said obligations (hereinafter called 'other property') aggregating as before stated, approximately $ 300,000.

 (b) Prior to June 5, 1941, Behrens entered into negotiations with City Bank for the purchase of the said shares of stock and other property. On or about June 5, 1941, an agreement was reached whereby City Bank agreed to sell the shares of stock and other property to Behrens for a consideration of $ 80,000.

 (c) Subsequently, Gertrud Feuerring and Alfred Schwabacher became participants with Behrens in the intended purchase under three successive agreements, the second (October) amending the first (September) and the third (November) superseding the other two. All were made in 1941.

 (d) Behrens as one party, and Feuerring and Schwabacher, collectively as the other party, entered into an agreement on Onvember 12, 1941 (ex. 'D' to complaint), superseding both earlier agreements. In the November agreement it was provided that Behrens had a 10 percent participation in the 'acquisition of Liggett' concluded by Feuerring and Schwabacher under the aforementioned agreements of October 3 and 30, 1941, for which Behrens was to pay Feuerring and Schwabacher $ 8,066.34 prior to April 1, 1942. It was further agreed therein that Behrens had an option to purchase an additional 10 per cent participation, prior to April 1, 1942, on the same terms, or after that time, but before November 1, 1942, on terms to be fixed by the parties. Feuerring and Schwabacher, in addition, agreed to offer their 'participation in Liggett' to Behrens if they should desire to sell, the offer to be held open for thirty days.

 (e) On or about January 14, 1943, without having offered them to Behrens, Feuerring and Schwabacher sold and assigned the said shares of stock and other property to one David Kennedy, a straw man for some or all of the defendants and others, who, since that date, have asserted title to the said shares of stock and other property.

 (g) Relying upon such notice and upon other matters alleged in the complaint charging the defendants or some of them, with knowledge or notice of his alleged rights, the plaintiff, Behrens, brings this action demanding the judgment hereinbefore mentioned.

 (h) The defense of res judicata is based upon the record of the Supreme Court of Appeals. Exhibits Nos. 3 to 10 inclusive of the answer, are admitted in the reply.

 (i) The contract between Henry Behrens and Gertrud Feuerring and Alfred Schwabacher, dated November 12, 1941, Exhibit'D' of the complaint being a copy thereof, superseded the prior agreements by the parties and it provided that all disputes which may arise between the two parties regarding the application or interpretation of this agreement and of the legal relations connected therewith, which shall not be settled by way of amicable agreement, shall, to the exclusion of any court of law, be arbitrated with final effect by a board of arbitration consisting of three persons.

 (j) On December 10, 1942, Behrens gave notice to Feuerring and Schwabacher of a motion to be filed in the Supreme Court of New York, New York County, for an order directing that Feuerring and Schwabacher submit the differences arising between them and Behrens under the aforementioned agreement of November 12, 1941 (ex. 'D' to complaint), to arbitration, as provided in said agreement. That motion was granted on March 1, 1943. It was ordered that Behrens, as petitioner, and Feuerring and Schwabacher, as respondents 'proceed to arbitration in accordance with the terms of the aforesaid contract entered into among them dated the 12th day of November, 1941, and that the arbitrators and the umpire determine any and all controversies, disputes, and matters of difference which might have arisen among the parties under the said contract.'

 (k) A letter from Behrens then attorney, William J. Block, Esquire, to the American Arbitration Association, set forth his complaint that he demanded damages for the breach of the contract aforesaid dated November 12, 1941, and as reasons therefore, set forth the following:

 'I. their refusal to admit him to the initial ten (10%) per cent participation in the purchase referred to therein;

 'II. their refusal to convey to him the additional ten (10%) per cent participation therein as to which he enjoyed an option under paragraph 3 of the said contract;

 'III. their refusal to permit him to purchase their eighty (80%) per cent participation therein upon the terms of their sale thereof to a third party.

 'IV. the increased taxation resulting from being compelled to resort to recovery of damages for breach of the aforesaid contract instead of being permitted to enjoy the fruits of performance thereof;

 'V. their refusal to permit him to be elected a director of Liggett Spring & Axle Company and thus to become entitled to the rights, ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.