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KOUFMAN v. IBM

February 4, 1969

Manuel M. KOUFMAN, Plaintiff,
v.
INTERNATIONAL BUSINESS MACHINES CORPORATION, Benderson Development Company, Inc. and Jack Chesbro, Defendant


Wyatt, District Judge.


The opinion of the court was delivered by: WYATT

WYATT, District Judge.

This is a motion by defendant International Business Machines Corporation (IBM) for summary judgment in its favor as to the claim contained in count I of the complaint. Fed.R. Civ.P. 56(b).

 The action was commenced in this Court on March 29, 1966. There are three claims in the complaint set out in three separate counts. There are three defendants. Count I is directed against IBM alone, count II against the other two defendants, and count III against IBM alone.

 Jurisdiction as to count I is asserted by reason of diversity of citizenship. 28 U.S.C. § 1332. Plaintiff Koufman is said to be a "resident" of Massachusetts. This is not a proper averment of citizenship but for present purposes it will be assumed that he is a citizen of Massachusetts. The citizenship of IBM in New York is properly averred.

 Plaintiff has demanded trial by jury.

 The averments of count I are in substance that about June 25, 1963, Koufman and IBM made a written contract under which Koufman agreed to develop a tract of land in Cranford, New Jersey (including apparently the construction of a building on the land) and to lease to IBM "the building constructed on said land", with an option to IBM to buy the land and building; and that IBM broke the contract to the damage of Koufman. The obligations of IBM under the contract are not stated but one such may be assumed to have been that IBM would lease a building from Koufman. The complaint avers that after making the June 25, 1963 contract with Koufman, IBM notified him that it had made a contract with someone else for development of a tract in Cranford.

 Material facts as to which there is no genuine issue require that the motion of IBM be granted. Three propositions of law are established by the undisputed facts. There was never any agreement between the parties because IBM never accepted any offer of Koufman. If there was any agreement by IBM, it was not capable of enforcement because it was not sufficiently definite. Even if it was sufficiently definite, the claimed agreement would be bad under the statute of frauds.

 IBM wanted to arrange for some outside investor to buy a specific tract of land (about 6 acres) in Cranford, to erect a building on the land from plans and specifications done by an architect for IBM, and then to make a lease of all or part of the building to IBM.

 A deal was worked out by IBM with Benderson Development Company, Inc., one of the defendants in the second count, under which Benderson bought the land and agreed that if Benderson itself did not become the investor to erect the building then Benderson would sell the land to the investor to whom the "building" was "awarded" by IBM.

 Under date of May 23, 1963, Daly (in the Real Estate Department of IBM) sent to a number of possible investors, including plaintiff Koufman, an invitation to submit "a proposal for the construction and leasing to IBM of the proposed building".

 The proposal was to be on a form supplied by IBM. "General Conditions for Proposal" were sent also, as a memorandum of the same date (May 23, 1963). The estimated costs of land and building were given, the length of the lease to be taken, and other information. As to the "form" of lease to be taken by IBM it was stated: "Standard IBM form will be used as applicable". With respect to taxes and insurance it was stated that these were not to be considered in the proposal but that "responsibility for these items will be negotiated by the parties at a later date".

 The proposal was asked to be made in four different and alternate ways, evidently to allow IBM to choose one from the four alternatives. The different alternatives were called "Item I" and so on. The investors, however, could bid on as many or as few of the alternatives as they wished.

 The first alternative (Item I) was for an annual rental of the entire building and IBM would be responsible for maintenance.

 The second alternative (Item II) was for an annual rental of the entire building and the investor would be ...


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