APPENDIX A - MEINHARD V. SALMON 249 N.Y. 458 (1928)
Published online by Cambridge University Press: 24 July 2009
Summary
Cardozo, Chief Judge
On April 10, 1902, Louisa M. Gerry leased to the defendant Walter J. Salmon the premises known as the Hotel Bristol at the northwest corner of Forty-second Street and Fifth Avenue in the city of New York. The lease was for a term of 20 years, commencing May 1, 1902, and ending April 30, 1922. The lessee undertook to change the hotel building for use as shops and offices at a cost of $200,000. Alterations and additions were to be accretions to the land.
Salmon, while in course of treaty with the lessor as to the execution of the lease, was in course of treaty with Meinhard, the plaintiff, for the necessary funds. The result was a joint venture with terms embodied in a writing. Meinhard was to pay to Salmon half of the moneys requisite to reconstruct, alter, manage, and operate the property. Salmon was to pay to Meinhard 40 per cent. of the net profits for the first five years of the lease and 50 per cent. for the years thereafter. If there were losses, each party was to bear them equally. Salmon, however, was to have sole power to “manage, lease, underlet and operate” the building. There were to be certain pre-emptive rights for each in the contingency of death.
They were coadventurers, subject to fiduciary duties akin to those of partners. King v. Barnes, 16 N. E. 332. As to this we are all agreed.
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- Principles and Methods of Law and EconomicsEnhancing Normative Analysis, pp. 323 - 331Publisher: Cambridge University PressPrint publication year: 2005