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Herron v. Cameron

Supreme Court of New York, Appellate Division

April 7, 1911

ASHLEY M. HERRON, Respondent,

APPEAL by the defendant, Margaret S.E. Cameron, from a judgment of the Supreme Court in favor of the plaintiff, entered

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in the office of the clerk of the county of New York on the 22d day of March, 1910, upon the verdict of a jury, and also from an order entered in said clerk's office on the 17th day of March, 1910, denying the defendant's motion for a new trial made upon the minutes.


Peter B. Olney, for the appellant.

Edgar J. Nathan, for the respondent.


This action is brought to recover the sum of $10,500, as the commission of a real estate broker for negotiating a lease of the premises Nos. 185 and 187 Madison avenue in the city of New York. The complaint sets forth the hiring in the month of March, 1907, by the defendant of the plaintiff as a broker to negotiate a lease of said premises, and that defendant particularly desired a tenant who would erect a new building on the property upon the terms stated by defendant; that in or about the said month the plaintiff secured one William C. Dewey as a tenant and introduced him to defendant, and that an agreement in writing was duly made and executed between Dewey and defendant, bearing date March 15, 1907, as a result of plaintiff's efforts as broker, by which agreement the tenant agreed to lease the premises for a period of twenty-one years at a rental of $50,000 per annum, commencing May 1, 1908, and as an additional rent to pay all taxes, assessments and water rents during said term, the tenant further agreeing to erect a store and loft building twelve stories in height, covering substantially both lots, from plans and specifications representing both owner and tenant; that it was further agreed that the owner should furnish four-fifths and the tenant one-fifth of the contract cost of said building, with the proviso that the owner's contribution should not exceed $250,000. It was further alleged that the agreement provided, among other things, that it should be subject to mutually satisfactory arrangement respecting the contract cost of the building, and that immediately that was agreed to, the final form of lease as described in said agreement should be signed by the respective parties thereto.

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The complaint then sets forth that subsequent to the execution of said agreement between the defendant and Dewey, plans and specifications were prepared by the architects and approved by both the defendant and the tenant, and the contract cost of the proposed building was agreed upon by them.

Further, it was averred, 'That after the defendant and the said tenant had agreed upon the terms for the construction of a new building, in accordance with said agreement, the defendant unlawfully refused to carry out the terms thereof, although the said tenant was able, ready and willing to carry out the said agreement in accordance with all the terms and conditions thereof.' Defendant's agreement to pay plaintiff a commission of one per cent on the rental for the term of the lease was then pleaded, making an amount due of $10,500, which had been duly demanded, but none of which had been paid.

The answer puts in issue substantially all the allegations of the complaint except the ownership of the property and the failure to make any payment to plaintiff, and sets forth in effect that plaintiff, knowing that defendant desired to obtain a responsible tenant for the premises in question, pecuniarily able to perform the terms of the lease and to contribute a portion of the money necessary to improve the property, and knowing generally the character of the improvements which defendant intended to make on these premises, and the provisions of the contemplated agreement, introduced William C. Dewey to defendant through her brother, thereby representing to him that Dewey was a responsible person, pecuniarily able to perform on his part the agreement in question. That relying upon the representations so made, which were communicated to her by her brother, defendant entered into the agreement of March 15, 1907, with Dewey, called by her a tentative agreement, but that she thereafter discovered that Dewey was not a responsible man, and was not pecuniarily able to carry out the agreement on his part, and that when plaintiff introduced Dewey as a responsible person there were judgments of record against him to the amount of $79,000, on some of which executions had been returned unsatisfied; also that Dewey had been or was about to be examined in proceedings supplementary to

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execution and that when plaintiff introduced Dewey, the latter was wholly irresponsible financially; and further that when the defendant learned of Dewey's financial irresponsibility, what is termed the tentative agreement of March fifteenth was not carried out and fulfilled, and the same was thereupon abandoned and canceled. This is not the ordinary case of a lease being obtained by a broker for an existing building. The defendant desired to improve her property and she wanted a reliable tenant for that purpose, who was to put up the building and take the lease. She desired to realize $35,000 clear as ground rent, and was to get six per cent upon her investment in the total cost of the building (in which her share was to be $250,000), making the total net return to her $50,000.

The plaintiff had produced one Cohen and one Fleischman as prospective lessees, but no agreement was reached with them. Then he suggested Dewey as one who would meet defendant's requirements. He admits that defendant's brother, who represented her throughout this transaction and with whom alone his dealings took place, had told him that he (Cameron) must be very careful that the person with whom he dealt was financially responsible; that he wanted a tenant who was able to contribute a part of the cost of the new building; that he wanted a man who would be able to furnish a bond sufficient to make secure the performance of the provisions of the lease. He admits that Cameron asked him, referring to Dewey, 'Is he financially responsible?' To which plaintiff replied, 'He has good credit.' Cameron then inquired, 'He is financially responsible, is he?' to which plaintiff answered, 'Yes.' When these replies were made plaintiff knew that defendant desired a responsible tenant, who would contribute at least, $62,500 towards the cost of the new building to be erected, who would incur a liability for $50,000 rental per annum for a period of twenty-one years besides taxes, assessments and water rates, and who could give a bond ...

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