Middendorf, Williams & Co. v. Alexander Milburn Co.

Adkins, J., delivered the opinion of the court. This is the second appeal in this case. The judgment was reversed before mainly because of erroneous rulings as to the proper measure of damages. The former appeal is reported in 134 Md. 385 .

According to the testimony offered in behalf of appellee, appellant, an incorporated firm of investment brokers, agreed to “undertake to make the issue of the $44,000 or $46,000 seven per cent, preferred stock of the above company (the appellee) within a reasonable time and charge usi (appellee) the sum of $5,000’ cash for so doing.” The above quotation is from the evidence of Jenkins, the president of appellee, as to the contents of a letter from him to appellant, written the day after the oral agreement was reached, and which Jenkins says Mr. J. W. Middondorf, the officer of the appellant company with whom the negotiations were had, admitted embodied the terms of the oral agreement. Middcndorf, in addition to his charge of $5,000 for disposing of this issue of stock, required certain other things to be? done. “Lie said he would require two directors to be placed upon the board of his nomination, that he required me to assign a large number of the patents and patent applications which I had to the reorganized corporation, that he would require me to serve the corporation for quite a period of time * * Mr. Middendorf said that certain changes would have to be made in the by-laws and charter of the corpora.tion, and that he would wish to approve such changes; these changes included the increased directorate and the larger ⁵⁹⁰ issue of stock for his financial purposes. * * * Mr. Middendorf said that he could sell this stock. He said that he had an opportunity just then between other operations, and he urged me to complete the change in the constitution and charter, because it wus a very opportune time for it. Middendorf expressed no doubt at all about selling the stock. * * * jn fac^ pjg concluding statement after saying he would make the offer to sell it was, ‘Oh, I can sell this very easily.’ ” Witness accepted this offer first orally and then confirmed it by letter on or about May 15th, 1914.

Messrs. WMtelock, Deming & Kemp acted as attorneys for both parties, and all the things required by Middendorf were done, and approved iby .bim. Afterwards, about tbe middle of June, witness called to see Middendorf, who told him that he had received a report from Mr. Page, the accountant employed by appellant, and that the report was unsatisfactory to- him. It appears that appellee at the beginning of negotiations submitted to appellant a statement of its condition as made out by Max Teichmann & Ob., accountants'.

Jenkins testified that there was no substantial difference -in the figures of the two reports, but that P'age’s unfavorable report was based on erraneous conclusions drawn by him not justified by the figures, and further, that certain figures used by Page in making up his report were erroneous. A number of attempts were made to induce Middendorf to investigate this matter, but he failed to meet appointments after making them. Middendorf said he was very busy on a large undertaking that had come from the south and could not he bothered with this small matter, and asked Jenkins to lay it aside for-the present. On July 15th, 1914, appellee wrote Middendorf as follows: “Baltimore, July 15th, 1914. “Mr. J. W. Middendorf, “Care of Messrs.

Middendorf, Williams & Co., “Munsey Building, City. “Dear Sir: “Referring to the matter of the issue of our preferred stock, I wish to thank you for the very kindly ⁵⁹¹ interest you have taken in this matter, and also wish to assure you that I thoroughly understand the position in which you are placed at this time owing to general market conditions. It is my desire, however, to wait until you think the time is propitious to make the right effort. “It has occurred to me that in the interim it is possible that we might be able to place a little stock through some of our friends or customers who are familiar with our apparatus and our methods of doing business. I presume that should we be able to do anything of this kind that it would not interfere with your arrangements and that you would have no objection to our so doing. “Yours very truly, “The Alexander Milburn Company, “A. F. Jenkins, President.” And Middendorf replied as follows on July 21st, 1914: “July 21st, 1914. “A. F. Jenkins, Esq., President, “The Alexander Milburn Company, “1420 ~W. Baltimore St., City. “Dear Sir: “I have before me your favor of the 15th inst., contents of which has been noted. “Aside from the general market conditions, you remember, of course, that the report of the operations of your company as made by Mr. Howard P. Page, did not verify the statement of operations put before us at the outset, as I had hoped, which will make it necessary when business conditions improve to deal with the proposition on a different basis. “I feel that you have a splendid opening, and that it should prove attractive to the individuals who we propose to invite to participate. Meanwhile, if you can place a little stock through some of your friends or customers, who are familiar with your apparatus ⁵⁹² and mode of doing business, I would have no objection. “Very truly yours, “J. Vm.

Middendorf.” There the matter appeal's to have rested until March 25, 1915, when appellee wrote appellant referring to its undertaking to sell the stock, and to the expense and trouble appellee had been at in complying with appellant’s requirements; also to Page’s erroneous report and requesting appellant to “give the matter of your imdertaking and the correction of Mr. Page’s report the serious attention which it rightly deserves and advise us what you propose to do.” The letter further said: “As the report of Mr. Page is not only incorrect but harmful, and we have sufficient reason to know both from your own statements and other causes that it has harmed us, we cannot under any circumstances allow the matter to remain unsettled.” The receipt of which letter appellant acknowledged on March 29th, 1915, and said: “In reply I beg to state that the matter in question does not interest us at this time.” In the meantime, acting apparently in accordance with the suggestion contained in its letter of July 15th, 1914, assented to by appellant in Middendorf’s letter of July 21, 1914, appellee entered upon an advertising campaign as a result of which it sold 588 shares of preferred stock par value ten dollars. In 1916 appellee went to a number of stock brokers and endeavored to malee arrangements for raising the balance of the $46,000, but did not succeed in reaching a satisfactory agreement until July, 1916, when the Industrial Corporation of Baltimore undertook to sell appellee’s six per cent, notes convertible into the seven per cent, preferred stock. The commission paid was six per cent., and a bonus of fifteen per cent, in preferred stock was given to subscribers and an additional one per cent, was paid for notes sold by outside ⁵⁹³ brokers. Besides there was an office fee of $250 paid the Industrial Corporation and there was an expense of $73.60 for cost of circular’s.

There were sold $40,000 of notes. So that the items in the bill of particulars for the costs of raising this $40,000 were as follows: Bonus in 7% preferred stock............... . .$6,000.00 5 % commissions, cash...................... 2,000.00 Cost of circulars........................... 73.60 1% commissions........................... 75.40 Industrial Corporation feo.................. 250.00 There were other items in the bill of particulars for expenses of selling the 588 shares of preferred stock, amounting in all to..................... 976.02 $9,375.02 Other items were charged in the bill of particulars, but were eliminated by instructions of the trial court. There was credited the amount to which appellant would have been entitled if it had performed its contract................................. 5,000.00 Leaving a balance of.......................$4,375.02 The verdict of the jury was for this balance plus two and one-half years’ interest, or $5,031.27. There are two preliminary questions to be disposed of before taking up> the bills of exception: (1) A motion was filed to dismiss the appeal because the draft of the proposed bills of exception was not submitted by appellant or its attorneys to the appellee or its attorneys within the time required by law; and because the bills of exception were improperly signed by the court below over the protest of the attorneys for the appellee.

The motion is based on Chapter 625 of the Laws of 1916, amending 'Section 316 of the Revised Charter of Baltimore City, which provides: ⁵⁹⁴ “Bills of exception may be signed in any cause pending in any of said courts at any time within the period that the parties, or any of them, shall have the right to file an appeal from the rendition of the verdict by the jury on the findings of the court upon the issue cf fact in said cause, and upon filing the order for such' an appeal, the time for signing said bills of exceptions shall thereby be further extended until ten days before the period within which it is required that the record shall be transmitted to the Court of Appeals; provided that the party appealing, or his counsel, shall submit the bills of exceptions to the appellee, or his counsel, not less than thirty days prior to the time that the record must be filed in the Court of Appeals, for the purpose of amendments or additions to the said bills of exceptions, and the appellee, or his counsel, within fifteen days after the bills of exceptions shall have been submitted to him, shall return said bills of exceptions to the appellant or his counsel, with such amendments or additions as he may desire. And upon his failure to return said bills of exceptions within said time, the bills of exceptions shall be signed by the court, as originally prepared by the appellant, or his counsel. If the said appellee, or his counsel, shall return the said bills of exceptions to the appellant, or his counsel, with his amendments or additions, as hereinabove provided, the said bills of exceptions with such amendments or additions shall forthwith be presented to the judge before whom the said case was tried, who shall settle the same wdthin five days thereafter.” The submission of bills of exceptions to attorneys for appellee was not within the time provided by the statute, but, nevertheless, they were signed by the court before the expiration of.the time limited by the statute, and it- does not appear that the appellee has suffered any injury thereby. Under the authority of Wegefarth v. Weissner, 132 Md. 595 , the motion to dismiss is overruled. ⁵⁹⁵ (2) After this ease -was remanded for a new trial an amended bill of particulars was filed, whereupon a plea of limitations was filed as follows: “That the alleged cause of action set forth in the plaintiff’s amended bill of particulars did not accrue within three years prior to the filing of said amended bill of particulars.” To this plea a demurrer was filed by plaintiff and sustained by the trial court.

We find no error in this ruling. The action was begun July 2nd, 1915, and the second amended seventh count of