Boardman v. Cutter

Ames, J. The defendant’s promise was in substance a contract, in a certain contingency, to purchase the stock of the plaintiff. The company was about to be formed and organized as a corporation, and the defendant was desirous, in order to complete the organization, to prevail upon the plaintiff to be one of the stockholders, to the extent of one thousand dollars. Among the inducements to the plaintiff to subscribe to that extent was the assurance of the defendant that he would purchase the shares at cost, less the interest, at any time that the plaintiff should be desirous to sell them. The plaintiff accordingly subscribed and paid for the shares, and they stood in his name as one of the stockholders for somewhat more than three years. At the end of that time, the plaintiff offered to transfer the stock to the defendant, and demanded of him the fulfilment of his promise. It has been decided by this court that shares in a corporation are “ goods, wares, or merchandise,” within the statute of frauds. Tisdale v. Harris, 20 Pick. 9. Baldwin v. Williams, 3 Met. 365. There is some conflict in the decisions of other courts upon this point, (see Somerby v. Buntin, 118 Mass. 279,) but we do not feel called upon to overrule the two decisions above cited. As the defendant’s contract in this case was not in writing, we see no ground upon which any action can be maintained upon it, without violating the statute of frauds. Gen. Sts. c. 105, § 5. The fact that the plaintiff was induced to become one of the stockholders by the defendant’s promise that he would at some future time buy the stock of the plaintiff at a specific price, does not change the essential character of the transaction. Exceptions sustained.