Noyes v. Marsh

A. agreed in writing with B. that if B. would buy certain shares in a corporation held by C., the company should employ him at a certain yearly salary; that if the company should fail or refuse to give him employment, A. would purchase the stock of him at a fair price; that if the parties could not agree as to what was a fair price, the same should be determined by arbitrators, whose decision should be binding. Held, that, even if the agreement was not void as against public policy, a bill in equity, by B. against A., for specific performance of the agreement, would not lie.

Bill in equity by William L. Noyes against John F. Marsh and William B. Smith, containing the following allegations: That on September 7, 1874, the plaintiff and the defendants made an agreement in writing as follows: “If the said Noyes shall purchase sixty-three shares of the capital stock of the Springfield Glazed Paper Company now held by George Fowler, the said Marsh and Smith agree to and with him that the said company shall give him employment at such service as the officers of said company may reasonably require at an annual salary of $1350 per year. They also agree with said Noyes that, in case the said company shall hereafter fail or refuse to give him employment as aforesaid, they will purchase of him the said shares of stock at a fair price. If the parties hereto cannot agree what is a fair price, it is further agreed that the same shall be fixed by arbitration, said Noyes to choose one arbitrator, said Marsh and Smith one, and the two so chosen shall select a third. And all the parties hereto agree that the decision of said arbitrators shall be binding, and said Noyes shall sell to said Marsh and Smith said stock, and they shall purchase the same of him at the price so fixed. But said Smith and Marsh shall not be obliged or holden to purchase said stock if said Noyes shall decline to accept said employment and pursue the same, or fail to hold himself in readiness to perform said service, nor if said Noyes shall fail faithfully and competently to discharge the duties of his employment. And it is further agreed that if any question arises as to the breach of said last proviso and condition, the same shall be settled by the aforesaid board of arbitrators. But if for any cause said Noyes shall cease to be employed by said company, and shall prefer to keep said stock without employment, he may do so.” That the plaintiff did, in accordance with the agreement, purchase said sixty-three shares of stock of Fowler, and had ever since held himself in readiness at all times to accept and pursue such employment as the company should require in accordance with the agreement, and continued in the employment of the company until January 4, 1876, when he was discharged from the employ of the company, although he had always faithfully and competently discharged the duties of his employment. That the plaintiff thereupon offered to sell his stock to the defendants at a fair price and requested the defendants to purchase the same, which, they declined and refused to do. That the plaintiff and the defendants could not agree what was a fair price therefor, and that the plaintiff had demanded the arbitration as provided for in the agreement, and had designated to the defendants his choice of an arbitrator, but the defendants neglected and refused to choose an arbitrator, as agreed, and to submit the matters in dispute to such arbitration as provided in the agreement. The prayer of the bill was for a specific performance of the agreement; and for general relief. A demurrer for want of equity was sustained by Colt, J.; and the plaintiff appealed.