111 A.D. 294

Jennie W. Babcock, Appellant, v. William D. Leonard and Sarah F. Sperry, as Executors, etc., of John J. Sperry Deceased, Respondents.

Second Department,

March 2, 1906.

Partnership to speculate in lands •— injunction — when carrying out of contract of sale made by one partner will not be enjoined.

When a contract to speculate in- lands constitutes a partnership, and-one party thereto holding title in his own name has entered into an executory cpntract to sell partnership lands at their fair market value, a temporary .injunction restraining such sale will be refused -in án action by the other partner brought to obtain a permanent injunction prohibiting such sale. ' - - /

Appeal by the plaintiff, Jennie W. Babcock, from an order of -the Supreme Court, made -at the Kings County Special Term and éntered ip. the office of the clerk of the county of Queens on the 10th day of October, 1905, vacating an injunction, restraining the *295defendants from selling or disposing of certain real estate described in the complaint.

William R. Adams, for the appellant.

Robert E. L. Lewis, for the respondents.

Woodward, J.:

The rights of the respective parties to this action are derived from certain contracts set forth in the pleadings, and we are persuaded that the learned justice presiding at Special Term has correctly construed these instruments and that the plaintiff is not entitled to the injunction which she seeks to have restored during the pendency of the action.

Briefly, one John J. Sperry entered into a contract with Hamlin Babcock, husband of the plaintiff in this action (the latter coming, into her interest by an assignment from Hamlin Babcock), for the purpose of engaging in a real estate speculation in Queens county, this State. The contract was reduced to writing on the 17th of March, 1897, and was subsequently modified by two written agreements relating to the same subject, and which concededly are to be read and construed together. In pursuance of the original contract Mr. Sperry purchased a certain tract of real estate of one Daniel G. Thompson, consisting of about twenty-one acres, and paid for the same, .partly with $11,000 of his own money, partly with certain real estate owned by Mr. Babcock and valued at $3,000, and partly by taking'Said property subject to a mortgage. The title to this property was taken by Mr. Sperry, who subsequently and during his lifetime sold three acres of the same, leaving about eighteen acres, and this real estate constituted the capital of the copartnership which unquestionably existed between Hamlin Babcock and Mr. Sperry. Mr. Sperry during his lifetime expended considerable sums of money upon this property, and his executors, since his death, which occurred on the 4th of December, 1903, have continued to spend money in carrying the same. On the 4tli day of May, 1905, William D. Leonard, as sole acting executor of Mr. Sperry, sold one-half- of the remaining eighteen acres of land, and-at the same time gave to the purchaser an option on the balance, and afterward, and on the 1st of June, 1905, rendered an account *296and statement, of said sale, and the proceeds therefrom, to.plaintiff’s attorney, William R. Adams. It is.alleged that this statement came into the hands of the plaintiff, who'made no complaint at the price realized, but on the contrary made use of the.same as the foundation for a considerable loan.. On the fourteenth day of June, the option having been exercised, the said Leonard, as exécutof, contracted to sell the remaining half of the premises described, in the complaint, the title, to which was to beclosed on the 20th day-of September, 1905. Plaintiff brought her action and .procured a temporary injunction restraining the defendant from, completing the sale on the grounds that under the contract between Sperry and • Hamlin Babcock of March 17, 1897, as modified by those of May 28, 1898, and July 29, 1898, the said Sperry had no real interest in the land,, but was only an' equitable mortgagee for the .amount of money Sperry had advanced in the purchase from Thompson of the twenty-one acres, and that the price which the said Leonard was to-receive for the remainder was grossly inadequate. Hpon an order, to show cause the temporary injunction was dissolved and the plaintiff appeals to this court. '

It does.not seem to be necessary to go into a detailed analysis of-these various contracts; it is apparent from the reading of them that Babcock and Sperry were‘copartners and that Sperry held the title to the real estate as trustee for. such- copartnership. It is true, as between themselves, Sperry had contracted to limit his liabilities, but it cannot be successfully contended that the elements-of a partnership did not exist, and the law is well established that under such circumstances real estate purchased for the partnership- is- held by one of the partners, where the title is in him,'as the trustee of the partnership. This is clearly the -case here; and as it appears that' the price which the property is to bring is the fair'market value of the same, it is not the province of this court to disturb the. order appealed from. All of the rights of the plaintiff can he protected in the orderly administration of -the law without the interposition of an injunction.

The order appealed from should be affirmed, with costs.

Hibsohbebg-, P. J., Rich and Milleb, JJ., concurred.'

Order affirmed, with fen dolíais costs and disbursements,

Babcock v. Leonard
111 A.D. 294

Case Details

Name
Babcock v. Leonard
Decision Date
Mar 2, 1906
Citations

111 A.D. 294

Jurisdiction
New York

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