FIRST DEPARTMENT, MAY TERM, 1893.

a royalty to plaintiff and in addition a commission to Mr. Mann separate and distinct therefrom, as contended upon the trial and this appeal, is conclusively shown by the testimony, and were it not for the language used, "a commission of five per cent to you," there would be no room for argument. But with this in the case all the other facts appearing, and more particularly the fact that the defendant did not agree or intend to pay a royalty to anybody but Mann, whom defendant assumed owned the patent rights, are consistent only with an entire contract, under which the defendant was to pay to whoever was entitled thereto royalties to be made up in the manner indicated in the letter of July seventh.

While, therefore, we differ with the view of the referee that the commissions in question were originally agreed to be paid the plaintiff, yet, we think, that the contract made with Mann inured by the operation of law to the benefit of the plaintiff. Mr. Mann was assuming to act for himself, and the defendant was treating with him as the principal. But does it not become evident that where it turns out that both are mistaken, and where, as here, a contract is made with respect to the use of patents which were then owned by the plaintiff, that the defendant, after using the same, would be obliged to pay to the owner thereof, when, as here, it is evident who such owner is, the price agreed to be paid for the use of the inventions covered by such letters patent?

We think that the conclusion of the referee was right, and that the judgment should be affirmed, with costs and disbursements.

VAN BRUNT, P. J., and FOLLETT, J., concurred.

Judgment affirmed, with costs and disbursements.

FIRST DEPARTMENT, MAY TERM, 1893.

HENRI SCHORESTENE, Plaintiff, v. ADRIAN ISELIN, Defendant. Offer to exchange stock of a railroad company formed by reorganization, for stock of the original company failure to comply with the conditions of the offer. Iselin, who had purchased the property of a railroad company on foreclosure, published an offer to exchange stock in a new company which was to be organized, for such stock in the old company as should be deposited, before a date named, with a transfer and power of attorney signed in blank, in a certain trust company, which would issue receipts therefor. Schorestene, who had a certificate for stock in the old company in the name of James Champ, upon which there was a transfer and power of attorney in blank purporting to be signed by Champ, presented it to the trust company, before the expiration of the time stated in Iselin's offer, but the trust company declined to take it, saying it was not good.

Schorestene did nothing more until after the expiration of the time mentioned in the offer, and then brought an action against Iselin to recover damages for the breach of an express contract which he claimed had been created by Iselin's offer and by his acts.

Held, that the action was not maintainable;

That a contract with Iselin could be created only by a compliance with the terms of his offer, by depositing stock with the trust company and receiving its receipt therefor;

That the plaintiff's inability to comprehend the objection of the trust company to receiving the certificate without some proof of the genuineness of the signature of Champ on the back of it, which might have been obviated, did not excuse his laches.

MOTION by the plaintiff, Henri Schorestene, for a new trial, upon exceptions directed to be heard at the General Term in the first instance, by an order made at the New York Circuit on the 14th day of May, 1891, upon the dismissal of the complaint.

J. Van V. Olcott, for the plaintiff.

Wheeler H. Peckham, for the defendant.

O'BRIEN, J.:

On a trial at the close of plaintiff's case, the complaint was dismissed and certain exceptions of the plaintiff ordered to be heard in the first instance at the General Term.

Plaintiff sued for a breach of contract that he alleges was made between him and defendant.

Defendant, on October 31, 1885, advertised an offer in the following language:

FIRST DEPARTMENT, MAY TERM, 1893.

"To the stockholders of the Rochester and Pittsburg Railroad Company:

"At the recent foreclosure sale, I purchased the property of the Rochester & Pittsburg Railroad Company, covered by its second mortgage. I have organized two companies, one in New York and one in Pennsylvania, and they are about to be consolidated. To such stockholders of the Rochester & Pittsburg Railroad Company as shall on or before the 20th day of November, 1885, deposit their certificates of stock, with transfer and power of attorney to transfer on the books signed in blank, with the Union Trust Company of New York, I will, upon the organization of such consolidated company, give one share of the common stock of such consolidated company for every four shares of the stock of said Rochester & Pittsburg Railroad Company so deposited, said Trust Company will give its receipt for stock so deposited as being deposited pursuant to this offer; and to be delivered to me, on receipt from me, for the depositor, of one share of such common stock of such new consolidated company for every four shares of Rochester & Pittsburg Railroad Company stock so deposited. In case if the stock of such consolidated company is not ready for delivery within forty days after the organization thereof, said depositors to have the right to withdraw the stock so deposited by them.

"The stock of such consolidated company will be six millions of dollars preferred six per cent. noncumulative stock, and six millions of dollars common stock.

"This offer is limited strictly to the stock deposited on or before the 20th November, 1885.

"The Union Trust Company will be prepared to receive deposits. of stock on or after Nov. 6.

"Oct. 31, 1885.

ADRIAN ISELIN."

Defendant, on December 14, 1885, advertised a further offer in the following language:

"NEW YORK, December 14th, 1885. "To the Stockholders of the Rochester and Pittsburg Railroad Company:

"A considerable number of Rochester and Pittsburg stockholders naving stated that they had not seen my circular on the 31st Octo

FIRST DEPARTMENT, MAY TERM, 1893.

ber, and have not, therefore, deposited their stock in accordance with its conditions, I have decided to give all outstanding stockholders another opportunity to deposit their stock with the Union Trust Company, and receive therefor receipts entitling them to one share of stock of the consolidated reorganized company for every four shares deposited by them.

"This offer is limited strictly to the stock deposited on or before the 31st December, 1885.

"(Signed.)

ADRIAN ISELIN.”

The plaintiff, as shown by the testimony, never saw either of these notices until after December 31, 1885, but as the result of information received, either by himself personally, or by his brother from a broker, the brother, prior to December 31, 1885, took a certificate of stock for 100 shares, which was in the name of one James Champ, and upon the back of which was indorsed a transfer and power in blank purporting to be signed by James Champ, to the office of the defendant, and was there referred to the trust company. What then occurred at the trust company is thus detailed by the plaintiff's brother:

"I at once went, in accordance with this direction, to the office of the Union Trust Company and presented the same certificate to a clerk or employee at a window, made the same request, saying that I had been directed there by the office of Adrian Iselin to make the exchange in question. I handed the certificate through the window to this clerk, who took it, looked at it, went off with it to some other part of the office, and returned in a few minutes and pushed the certificate back to me through the window with the response that it was no good. To the best of my remembrance the words, This is no good,' were the words employed. I asked him to explain why, but he gave no intelligible explanation; to the best of my remembrance merely stated that he had nothing to say about it; it was no good. I thereupon took said certificate, came back to our office and locked it up in the safe."

This visit to the trust company he fixes at some time between the 10th and 20th of December, 1885; and from that time nothing was done by either the plaintiff or his brother until 1886, when, through the intervention of a friend and by letters directed personally to the defendant, the plaintiff sought to avail himself of the

FIRST DEPARTMENT, MAY TERM, 1893.

terms of the offer, and his efforts having failed, this suit was commenced.

The plaintiff's theory is, that the offer presented by the published notices made a contract between the parties, and that for a breach thereof the defendant was liable in damages. Upon the theory, however, that the offer of the defendant and a strict compliance therewith by any stockholder would constitute a contract

which

is doubtful we fail, upon the testimony, to find evidence that the plaintiff complied with the terms of such offer. The offer was to give one share of the new stock for four shares of the old to such stockholders as should before the date fixed in the notice deposit their certificates of stock, with transfer and power of attorney, with the Union Trust Company of New York, for which the latter was to issue its receipts. The plaintiff failed to make the deposit within the time fixed; and the only justification for laches in this regard was his brother's inability to apprehend the objection of the trust company to receiving the certificate without some proof of the genuineness of the signature of Champ on the back of it. This objection of the trust company was capable of being intelligently communicated, and could then have been obviated by having the certificate transferred on the books of the company in plaintiff's own name, indorsing the same in blank and depositing it with the trust company. Instead, however, of doing this, or in fact of doing anything, the plaintiff allowed the time to go by, and, upon the theory that the defendant in some way was responsible for the action of the trust company, brought this suit to recover damages upon an express agreement.

From the reference already made to the testimony, we think that the error in this contention is manifest, for whatever grievance the plaintiff may have against the trust.company, we fail to see how the defendant is to be held responsible therefor. The defendant's offer was to exchange the stock of the reorganized company for such stock as was deposited by holders, and for which they were to receive the receipts of the trust company. In the very nature of things it would have been impossible for the defendant to ascertain how many stockholders had deposited their stock or what amount of stock had been deposited, except from evidence furnished by the trustee, and while it is true that to some extent the trust company