American Dealers Trading Corp. v. Link

The plaintiff seeks to recover on a written contract made with the defendant, in which he agreed to pay $200 to the plaintiff for the purpose of forming or establishing a clearing-house for trading in flour. The money was to be paid when twenty-four bakers of Pennsylvania signed the agreement. It is alleged in the statement that twenty-four bakers did sign it, and that demand was made upon the defendant, who refused to pay it.

The defendant filed an affidavit of defence raising a question of law, in which it is contended that the statement is not sufficient to entitle the plaintiff to recover, because it does not set forth “that a clearing-house for the trading in flour was ever formed or established.”

An examination of the written contract, which is attached to and made part of the statement, does not make the formation and establishment of such a clearing-house a condition precedent to plaintiff’s right to recover. By its terms, the amounts were subscribed for the purpose of raising money to form or organize such a clearing-house, so that until they were paid it could not be formed or organized. If the defendant’s contention that he is not liable for its payment until the clearing-house is formed or established is sustained, the whole object of the subscribers to the contract would be defeated, as such clearing-house can only be formed or organized with the money subscribed. The question of law raised in the affidavit of defence is decided against the defendant, and he is allowed fifteen days to file an affidavit of defence.

From George Ross Eshleman, Lancaster, Pa.