Eulenberg v. Torley's Inc.

BARNARD, P. J.

This is an action for declaratory relief, for possession of certain premises and for damages. Torley’s Inc. operated a store, consisting of several departments, in Ontario. T. L. Eulenberg went to work in the drug department of this store with an agreement that if he were satisfied he should have the right to purchase the merchandise in that department, with a lease for the space occupied by it. Shortly thereafter, the parties entered into a memorandum of agreement which provided that these plaintiffs were to buy from Torley’s Inc. the stock of goods in this department not exceeding a value of $3,000; that the stock was to be inventoried at present cost prices; that the plaintiffs would pay for this merchandise $500 in cash at the time of signing a lease; that they would pay the balance at $200 a month, plus interest, the instalments to begin one month after the date the lease was signed; that the deferred payments were to be evidenced by a promissory note and secured by a chattel mortgage on fixtures reasonably worth $2,500 to be installed by the plaintiffs; that a bill of sale of the merchandise was to be given when such mortgage was recorded; that the mortgage was also to secure the performance of all of the terms of the lease which was to be executed; that the term of the lease was to be two years from the date the lease was executed; and that the contemplated lease should contain certain other provisions which are immaterial insofar as this appeal is concerned.

On June 14, 1939, Torley’s Inc. served upon these plaintiffs a written notice which recited that because of their failure and refusal to consummate the agreement with respect to the purchase of the stock of goods, the agreement therefor and for the furnishing of a lease was rescinded, with a demand for the possession of the premises in question, and which further notified the plaintiffs that they might, within 24 hours, remove any merchandise or fixtures which they had installed. The plaintiffs refused to vacate the premises or remove any articles, and on June 15, 1939, Torley’s Inc. took possession and stored all such personal property in a warehouse in the names of the plaintiffs.

On July 13, 1939, these plaintiffs brought an action against Torley’s Inc. asking damages for unlawful eviction,

[655]

it being alleged that these plaintiffs were the owners of a leasehold interest in the premises in question under the terms of the memorandum agreement above referred to, a copy of which was set out in the complaint. In a second cause of action it was alleged that Torley’s Inc. had converted to its own use the stock of merchandise in this drug store to plaintiffs’ damage in the sum of $4,300. At the trial of that action the court held that the written agreement upon which the action was based did not constitute a lease. Thereupon, the court granted a motion for a nonsuit as to the first cause of action. The plaintiffs then stated in open court that they abandoned their second cause of action and moved for its dismissal. This motion was granted. A judgment was then entered in favor of the defendant, no appeal was taken and that judgment has become final.