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Lord v. United States Transp. Co.

Supreme Court of New York, Appellate Division

March 17, 1911

GEORGE O. LORD, Respondent,

Page 438

APPEAL by the defendant, The United States Transportation Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 22d day of April, 1910, upon the verdict of a jury, and also from an order entered in said clerk's office on the 29th day of April, 1910, denying the defendant's motion for a new trial made upon the minutes.


Page 439

Joseph W. Welsh, for the appellant.

James R. Deering, for the respondent.


The plaintiff is a real estate broker, and he brought this action to recover commissions for sub-leasing for the defendant pier No. 84 and bulkhead, North river, situate at the foot of West Forty-fourth street, borough of Manhattan, New York. He claims to have been employed as a broker for this purpose on the 21st day of November, 1907, by one Robert C. Scholz, an employee of the defendant, whose position was designated general manager. Scholz was neither a director nor an officer of the company, and the position of general manager was created by its president, and the duties were prescribed by him, and were confined to the passenger and freight transportation business of the defendant. The case may be better understood by stating briefly at the outset the contentions of the appellant. They are that Scholz had no authority to sub-lease the pier or to employ plaintiff as a broker; that he did not assume to do either; that the plaintiff was not the procuring cause of the sub-leases of the pier which were subsequently made by the defendant, and were of materially different property and on materially different terms from those with respect to which, on his own theory, he was employed in the matter, and that the verdict is against the weight of the evidence on these points.

The defendant is a foreign corporation. It was duly incorporated under the laws of Connecticut on the 4th day of October, 1906, and it was authorized, among other things, to acquire and operate 'either singly for trading purposes, or as lines' vessels operated by any power between ports in the United States and any other part of the world, and 'to construct, acquire, lease and own all such docks, wharves, piers or other terminal facilities as shall be necessary in the maintenance and operation of such vessels or line or lines.' Its certificate of incorporation required that its principal office be located in Connecticut, and its by-laws provided that its general offices should be located there. Shortly after its incorporation it established general offices at No. 742 East Twelfth street, borough of Manhattan, New York, and there the business of the president, secretary and treasurer and the financial business of the company was transacted. It

Page 440

also had an office at No. 40 Wall street, where monthly meetings of the directors were held. It used, occupied and had an office on pier 28, East river. It owned and operated four coast lines of steamers from New York. Its by-laws provided that the president should have 'the general supervision and direction of the affairs of the company, subject to the instructions and advice of' the board of directors; that the 'officers and agents of the company shall perform such duties as may from time to time be assigned to them respectively by the board of directors or the president,' and that 'no conveyance of real estate belonging to the company shall be made without the authority of the board of directors.'

On the 28th day of March, 1907, defendant obtained a lease of pier 84 and bulkhead, North river, from the city by its commissioner of docks. By this lease the city agreed to erect sheds on the pier and bulkhead. The lease was for a term of ten years and was to commence when the sheds were completed. It does not appear definitely when the defendant took possession under this lease, but it was shown that the city did not erect the sheds and that the defendant erected temporary sheds, 60 by 160 or 170 feet in dimensions, near the bulkhead line, and occupied the pier during the summer season of 1907 in connection with the transportation of passengers and freight by one of its lines known as the Neptune line, and had an office on the pier. Scholz, as general manager, had an office on this pier and also on pier 28, East river. On the 6th day of January, 1908, after certain negotiations, which will be considered presently, the defendant made an agreement in writing with the Compagnie Generale Transatlantique, known as the French line, to sublet to the latter company a 'portion' of pier 84 for a rental of $31,500 per annum from February first thereafter for the balance of the original term, for which the defendant held the pier under its lease from the city. It was recited in this agreement that the portion of the pier thus sublet had been agreed upon verbally by the parties that day. The pier was 700 feet in length by 100 feet in width. The bulkhead extended from the northerly line of the pier southerly 220 feet, leaving 120 feet of bulkhead opposite the slip southerly of the pier. The defendant then, evidently according to an understanding which it had with the French line, negotiated with the city for a modification of its lease, or for a new lease to be substituted

Page 441

therefor, and on the 12th day of March, 1908, it obtained from the city a lease of the pier and bulkhead for a period of ten years from March 1, 1908, with the privilege of one renewal. This lease omitted provisions contained in the first lease with respect to the erection of sheds by the city and the payment of an additional rental thereafter of five per cent on the estimated cost thereof, which was $200,000, and substituted therefor provisions authorizing and requiring the erection of temporary sheds by the defendant to continue until the end of the original term, and then to become the property of the city. On the same day the defendant and the French line made a preliminary memorandum agreement for sub-leasing the entire pier and bulkhead at $36,500 per annum for ten years from the 1st day of March, 1908, subject to the terms and provisions of the defendant's lease. The defendant in the meantime evidently had determined that it would have but little use for the pier, and it was willing, if it could obtain authority from the city therefor, to sublet the entire pier and bulkhead to the French line with some understanding or agreement with respect to the limited use which it desired to make thereof; but the lease could neither be assigned nor any part of the pier or bulkhead sublet without the written consent of the commissioner of docks, and he refused to consent without consulting the mayor, and owing to the delay incident to an application for leave to sublet the remaining part of the pier it was determined to execute a formal lease of the entire bulkhead and three-fourths of the pier according to the original agreement of January sixth, with the exception that in the meantime it had been agreed that the part of the pier to be reserved by the defendant should be the outer end of the northerly side of the pier instead of the inner end and that it should be only 252 feet instead of one-half the length of the pier, and excepting also that the expiration of the term was definitely fixed to correspond with the substituted lease made between the defendant and the city. Accordingly, on the 28th day of May, 1908, a formal lease of the bulkhead and pier, with this exception, was made by the defendant to the French line, for the period of nine years and nine months from the 1st day of June, 1908, at the annual rental of $31,500, the lessee agreeing to perform the lessor's duty to the city to erect the temporary sheds and on the same day a formal license in writing

Page 442

was given by the defendant to the French line to use the remaining part of the pier when the same was not in use by the defendant. The license was to commence on the 1st day of June, 1908, and to terminate with the lease, March 1, 1918, and the defendant was to receive therefor $5,000 per annum. The consent of the commissioner of docks to the defendant sub-leasing the rest of the pier having finally been obtained, the license was formally canceled on the twenty-first day of January thereafter by mutual consent, to take effect on March 1, 1909, and at the same time a formal agreement was executed by the parties, by which the French line sub-leased the remainder of the pier for the balance of the period for $5,000 per annum. At the time the first agreement for part of the pier was made on the sixth of January, there was no agreement or understanding with respect to sub-leasing the remainder of the pier, but it was understood that the French line was to have the use of it in the winter, when the defendant would not need it. All of the negotiations with respect to these various agreements were had between the defendant and the French line, and the plaintiff took no part therein.

The plaintiff made a specialty of leasing water-front property in or about the harbor of New York. In 1905 he had had some negotiations with the French line with a view to having it lease this pier, or a pier at the foot of West Forty-second street, but on account of the anchorage of war vessels opposite those points the pier was not satisfactory to said line.

In the fall of 1907 he knew that the defendant had a lease of this pier, but he was not aware that it desired to sublet the pier or any part of it, or that the French line wanted a pier; but he says that he saw an article in a paper with respect to the defendant's discontinuing its line at this pier, and thinking that the pier might be for rent he addressed a letter to the defendant at the foot of West Forty-fourth street on the 19th day of November, 1907, as follows:

'Will you please advise me if you will sub-lease any part of pier at the foot West 44th St., N. ...

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