Levine v. Tobin

BURKE, P. J.—

Plaintiffs brought this action for damages for breach of contract after defendants refused to perform an agreement to purchase certain corporate bonds. The court below found the purchase agreement lacked consideration and thereupon entered judgment for defendants. Plaintiff has appealed from said judgment.

The contract sued upon extended the time within which defendants were required, under an earlier agreement, to purchase certain debentures if the corporate maker failed to redeem pursuant to the terms of the bond agreement. It was in the form of a letter from defendants to plaintiffs and recites:

“March 30, 1959

Mr. and Mrs. Max Levine 161 South Detroit Avenue Los Angeles

Dear Mr. and Mrs. Levine:

Reference is made to your purchase of Six Per Cent. Debenture Bonds 6 to 10, inclusive, of Hoover House and Garden, Inc. (hereinafter referred to as ‘the corporation’), each having a face value of $1180. At the time you agreed to make the purchase, it was contemplated that said bonds would be redeemed within 12 months from May 30, 1955, on which date the sum of $5000 was paid by you. The undersigned agreed to purchase from you such of the bonds as were not redeemed by the corporation within eighteen months.

Unfortunately, the corporation was unable to redeem any of the bonds or to pay the interest thereon. You made demand upon us to purchase said bonds, but we were then unable to comply with said demand.

For a valuable consideration, we, the undersigned, do hereby agree, jointly and severally, as follows:

1. We will pay, or cause to be paid to, you 6% interest on the face amount of said bonds of $5900 for the period of

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June 1, 1955 to May 31, 1958, or the sum of $1062. A cheek for said sum is enclosed.

2. On and after April 1, 1960, if demand is made upon us or any of us, we, jointly and severally, agree to purchase from you such of the bonds as have not been redeemed by the corporation, and will pay you the sum of $1180 for each such bond, plus interest from June 1, 1958, to the date of purchase, at the rate of 6% per annum, less any interest which may have been paid you on the bonds of the corporation subsequent to the date hereof.