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dissents in a memorandum as follows: In 1941, Charles L. McGuire, Theodore A. Schmidt and Max Levy became shareholders in C.L. McGuire & Co., Inc., pursuant to an agreement apparently drafted by the law firm of Lindenaur and Rosiny. Edward Rosiny, the plaintiffs’ father, was a member of that firm. C.L. McGuire & Co. operated an automobile repair business in a building located at 14-16 West End Avenue in Manhattan ("the premises”). In 1957, an opportunity arose to purchase the premises, and Ched Realty was formed for that purpose. The initial shareholders of Ched were Edward Rosiny, who owned 20 shares; and Charles McGuire and Theodore Schmidt, who owned 10 shares apiece. Edward
On January 24, 1957, the shareholders entered into an agreement which provided as here pertinent that none of them could sell or transfer their shares without first offering the remaining shareholders the option to purchase at the price of $100 per share or the book value thereof, and in such case the purchasing shareholders would also have to pay back the corporation’s loan indebtedness to the retiring shareholder. Upon the death of any shareholder, the representative of his estate was required to offer his shares for sale to the remaining shareholders under the same terms, and the offeree shareholders were obligated to purchase the shares. The automobile repair business continued to operate on the premises until it ceased to do business in 1963.
The original shareholders continued their ownership in Ched until 1964, when plaintiffs’ father Edward Rosiny transferred his 20 shares to his wife, Annabelle Rosiny. There is no documentation or testimony to show that there was formal compliance with the provision of the original agreement that the shares had to be offered to the other shareholders before a transfer could be made to a third party. Nevertheless, Charles McGuire and Theodore Schmidt executed a new agreement on October 19, 1964 with Annabelle Rosiny, who signed it as the holder of 20 shares. The 1964 agreement differed from the initial agreement in that the offering price for the sale of shares was modified to provide that "any real property owned by the corporation shall be evaluated at the then fair market value of such real property in place and instead of the value ascribed thereto on the books of the corporation.”
The next change in the Ched shareholders arose from the death of Theodore Schmidt. The Surrogate found that while it was "not definitively established” that Edward Rosiny represented Theodore Schmidt’s widow Jeannette Priddy (then Schmidt) with regard to her husband’s estate or his interest in Ched, four letters on Edward Rosiny’s legal stationery dealing with Schmidt’s interest in Ched were introduced in evidence. A new shareholders’ agreement executed on June 10, 1971 listed Jeannette Schmidt as owner of the shares previously held by her husband. The 1971 agreement differed from the 1964 agreement in that the price at which the shares had to be offered reverted back to the 1957 provision of "book value” which, I note, was not defined in any of the shareholders’ agreements, past or future. When Edward Rosiny forwarded
At this point in relating the background to the instant litigation, it is important to identify Jacob Kwalwasser, Ched’s accountant. Kwalwasser was a friend of the plaintiffs, Allen and Frank Rosiny, and their parents, Edward and Annabelle Rosiny, since the 1940’s, and was a distant relative of the Rosiny family. He performed accounting services for Edward and Annabelle Rosiny, and from the 1970’s until his death in 1985, he managed Ched, collecting rents, and paying bills and taxes. He negotiated a lease with Ched’s only tenant, and that lease was drafted by Allen Rosiny. Frank Rosiny drafted Kwalwasser’s will, and either the plaintiffs’ law firm, Rosiny & Rosiny, or Frank Rosiny individually, was the attorney for the executrix of Kwalwasser’s estate. The Surrogate concluded that Kwalwasser’s "primary allegiance was to plaintiffs’ family,” rather than to Charles McGuire and Jeannette Priddy.
The heart of this dispute had its genesis in the following events which occurred in 1981. At that time, Allen Rosiny was 36 years old. He had been practicing law for 11 years, after graduating Harvard Law School with honors, and he had been an associate in several prestigious law firms from 1970 to 1979. Frank Rosiny was 41 years old. He had been practicing law for 17 years, after graduating Columbia Law School, and he was formerly a partner at a prestigious law firm. By contrast, Charles McGuire was 80 years old. He had a grade school education, had been retired for 17 years, and had been drinking liquor at the rate of a bottle a day for some years. His mental condition was "not good”. Jeannette Priddy was 74 years old. She had a partial high school education, had worked as a waitress, and a bookkeeper, and was preoccupied with the death of her second husband, Harry Priddy, on April 25, 1981.
In the spring of 1981, Kwalwasser telephoned Allen Rosiny and asked if Allen or Frank would be interested in acquiring their mother’s shares of Ched stock if the consent of the other shareholders (Priddy and McGuire) could be obtained. Allen testified that Kwalwasser made this suggestion "for income tax reasons, my mother being a very high marginal rate, it would make sense to shift that income [then $2,400 annually] from my mother to my brother and I [sic]. ” Allen and Frank
It does not require a great deal of acumen to understand the significance of what occurred when Jeannette Priddy and Charles McGuire executed the new shareholders’ agreement on June 30, 1981. At the time the agreement was signed, Priddy’s and McGuire’s interests were each worth in excess of $42,000
Returning to the chronology of events, on September 27, 1986 Mary Jane Lidaka, an attorney for Mrs. Priddy, wrote to Allen Rosiny requiring information regarding the net value and corporate assets and liabilities of Ched. Allen Rosiny forwarded to Ms. Lidaka the U.S. income tax return for the corporation for the year 1985. It appears that Mrs. Priddy had been exploring the possibility of transferring her shares in
In January, 1987, Cushman & Wakefield indicated that it had a buyer who was willing to purchase the premises that Ched owned for $1,250,000. As a result of this offer, a shareholders’ meeting was held at Charles McGuire’s home in the Bronx on January 31, 1987. Mrs. Priddy did not attend the meeting, but her son Ted, her son-in-law Bob Robinson (who was a real estate broker) and her attorney attended the meeting on her behalf. Both of the plaintiffs were present, as well as Mr. McGuire, his daughter, and his attorney. A letter dated February 4, 1987 from Mrs. Priddy’s attorney to Mr. Robinson contains the opinion that "Frank was particularly abrupt and argumentative” and "Allen was equally evasive, but more pleasant.” Plaintiffs testified that they did not express an opinion relative to the Cushman & Wakefield offer, and this is consistent with the statement in the February 4, 1987 letter of Mrs. Priddy’s attorney that he did not know their position on the offer. The witnesses who testified about the events at this meeting confirmed that Mr. Robinson suggested that an appraisal be obtained for the property, and when the Rosinys refused to contribute toward the cost of an appraisal, it was agreed that he would either obtain it at no cost to the corporation, or any cost would be shared by Mrs. Priddy and Mr. McGuire. The outcome of the meeting was a general agreement that if Cushman & Wakefield made , any further inquiries of Allen Rosiny, he would refer them to the attorney for Mr. McGuire, and the parties would await the appraisal before taking any further action. The appraisal was never obtained, and Cushman & Wakefield did not take any additional action toward effecting a sale of the premises. The attorney for Mrs. Priddy apparently believed that the plaintiffs had some hidden agenda, and in a February 5, 1987 letter to the attorney for Mr. McGuire stated that he was "exploring the possibility of a judicial dissolution of the corporation if the stockholders cannot agree to sell the property at a reasonable price.”
The last communication between the plaintiffs and the other shareholders prior to their respective deaths related to satisfying an obligation of approximately $38,000 owed to Goldome Bank which was secured by a mortgage on Ched’s real property. In December, 1987, Allen Rosiny was able to obtain a commercial loan from Banco Central to pay the
Charles McGuire died on June 19, 1988, and Jeannette Priddy died on July 25, 1988. Allen Rosiny advised their estate representatives that Ched had a negative book value and referred them to the 1981 agreement for the purchase price, which was specified in the agreement as "the book value thereof * * * or $200.00 per share, whichever amount is greater.” When the estate representatives protested that the agreement was unconscionable (the fair market value was then $41,500 per share), the plaintiffs commenced the instant litigation to compel the estates to transfer the shares for $200 apiece. By December 1989, the premises had increased in value to $2,500,000, and each share was worth over $60,000.
It may be noted, since this is an action in equity, that aside from the Ched stock, the defendant estates are meager; neither deceased shareholder had any other stock, bonds or real estate, except for the residences in which they respectively lived. It bears repeating that the plaintiffs’ mother, Annabelle Rosiny, was permitted by the deceased shareholders to obtain ownership of 20 shares, without reference to the buyout provisions of the agreement then in force. Likewise, in 1981 the plaintiffs obtained ownership of their 10 share interests without a word of protest from the deceased shareholders, or any reference to the buyout provisions of the agreement then in force. Nevertheless, the plaintiffs find nothing unconscionable in their obtaining nearly the entire corpus of the decedents’ estates, worth over $800,000 at the time of their deaths, for $4,000. The Surrogate disagreed, and so do I.
At trial, Jeannette Priddy’s son and Charles McGuire’s daughter testified in support of their respective positions that their parents were unsophisticated, that they had trusted the Rosinys, and that they had not understood that they could not freely leave their interests in Ched to their children upon their deaths. Jeannette Priddy’s son testified that his mother had worked as a waitress, that his father had worked as an automobile mechanic until he retired in the early 1960’s, that
Charles McGuire’s daughter had lived with him in his house in the Bronx for over 40 years. She testified that after his wife had died, and during the 1970’s until the early 1980’s, he often drank a bottle of alcohol a day, and was frequently drunk. On one occasion he told her that he would sign anything that the Rosinys sent. She recalled that Frank Rosiny had assured her father that everything would be okay when her father appeared concerned at the shareholders’ meeting that was held in his home in January, 1987.
Two of the central issues presented in this case concern the doctrine of unconscionability, and whether there was a breach of a fiduciary relationship which existed among the parties. The Surrogate stated the plaintiffs’ position on these issues as follows: "Plaintiffs’ interpretation of the proof is that their lack of involvement with the other shareholders precludes applying any principle of law based upon an attorney/client relationship. Turning around the admonition that the sins of the fathers may be visited upon their sons, they assert that even if their father had at one time or another acted as the attorney for the other shareholders, which they are not willing to concede, this has no bearing on their obligation to the other shareholders. The plaintiffs contend that the doctrine of unconscionability is inapplicable because their lack of involvement in the events leading up to the signing of the 1981 agreement precludes finding the existence of high pressure tactics and that without such a finding there was no procedural unfairness which must be established together with substantive unfairness before an agreement can be held to be unconscionable (Sablosky v. Gordon Co., 73 NY2d 133). Their final argument is that the other shareholders, at least by 1986 or 1987 when they obtained independent counsel relative to the affairs of the corporations, eventually had to have been
In analyzing the various actions and shifting relations among the parties past and present, it is apparent that insofar as their interests were adverse, the Rosiny family and their friend and accountant Jacob Kwalwasser were aligned on one side, while Theodore A. Schmidt, Jeannette Priddy and Charles McGuire stood on the other. The plaintiffs’ attempt to distance themselves from the consequences of any actions of Kwalwasser and their predecessors in interest prior to 1981 simply does not withstand analysis in the circumstances presented herein.
It is well established in New York that fellow shareholders in a closely held corporation owe each other, and where applicable their estates, those duties and responsibilities found in fiduciary relationships, which include "a duty to deal fairly, in good faith, and with loyalty.” (Benson v RMJ Sec. Corp., 683 F Supp 359, 375 [SD NY 1988]; see also, Matter of Public Relations Aids, 109 AD2d 502, 511.) "[I]n a close corporation, the relationship between the shareholders vis-á-vis each other is akin to that between partners [citations omitted]. The law exacts a high degree of fidelity and good faith in dealings between partners in the conduct of the affairs of the partnership. The same obligations are likewise applicable to shareholders in a close corporation.” (Matter of Ronan Paint Corp., 98 AD2d 413, 421; see also, 2 O’Neal & Thompson, O’Neal’s Close Corporations § 8.12 [3d ed].)
In Matter of Gordon v Bialystoker Ctr. (45 NY2d 692, 698), the Court of Appeals reiterated the longstanding principle that "where a fiduciary relationship exists between parties, 'transactions between them are scrutinized with extreme vigilance, and clear evidence is required that the transaction was understood, and that there was no fraud, mistake or undue influence. Where those relations exist there must be clear proof of the integrity and fairness of the transaction, or any instrument thus obtained will be set aside or held as invalid between the parties’ (Ten Eyck v Whitbeck, 156 NY 341, 353).” Even in the absence of a fiduciary relationship, where one party to a transaction deals from a position of " 'weakness, dependence, or trust justifiably reposed, unfair advantage in a transaction is rendered probable, there the burden is shifted,
These rules are closely related to the salutary and far-reaching principle that he who seeks equity must do equity. With regard to that principle as it affects a party’s right to specific performance of a contract, which is an equitable remedy, Pomeroy states: "The great and most beneficial principle, to which I have referred, extends far beyond these features which affect the validity and very existence of agreements; it applies to contracts which are valid, and which confessedly create legal obligations; it is developed in its practical operation, so as to resist and counteract every possible circumstance and incident of unfairness, inequality, and inequity. The doctrine that he who comes into the court seeking equity—that is, seeking to obtain an equitable remedy —must himself do equity, means not only that the complaining party must stand in conscientious relations towards his adversary, and that the transaction—be it a contract or not— from which his claim arises, must be fair and just in its terms, but also that the relief itself must not be oppressive or hard upon the defendant, and must be so modified and shaped as to recognize, protect, and enforce the latter’s rights arising from the same subject-matter, as well as those inhering in the plaintiff. It is by virtue of this principle that the specific performance of a contract will be refused when the plaintiff has obtained the agreement by sharp and unscrupulous practices, by overreaching, by concealment of important facts, by trickery, by taking undue advantage of his position, or by any other means which are unconscientious; and when the contract itself is unfair, one-sided, unconscionable, or affected by any other such inequitable feature, and where the specific enforcement would be oppressive or harsh upon the defendant, or would prevent the enjoyment of his own rights, or would in any other manner work injustice.” (Pomeroy, Specific Performance of Contracts § 40, at 120-121 [3d ed 1926].)
Pomeroy further observes that in certain circumstances, which are presented in this case, the defendant need not demonstrate that the plaintiff was guilty of intentional dishonesty or unfairness: "Although the very terms of an agreement, taken by themselves, may be unobjectionable, the circum
"Whenever the defendant, against whom a specific performance is asked, has fallen into a mistake, which the plaintiff, by his acts or omissions, either intentionally or unintentionally, induced or made probable or even possible, or to which the plaintiff contributed, such error, by the plainest principles of equity, prevents an enforcement of the agreement.” (Id., § 244, at 589.)
In judging the nature and effect of an agreement, the court may be incidentally aided by knowledge of the circumstances attending its inception, which "even though wholly free from wrong or blame, may furnish a clue for the right understanding of the agreement, a light in which its provisions must be read. Among these attending facts, which ordinarily aid the court in testing the fairness of the contract, and which may, therefore, be shown by extrinsic evidence, are the mental feebleness of a party, although not amounting to a legal incapacity; the age, poverty or ignorance of the parties; the manner of entering into the contract; the want of advice; the inadequacy of the price, and many other analogous circumstances.” (Id., § 179, at 459-460.)
Evaluation of the underlying facts in this case in the light of the aforesaid principles confirms the correctness of the Surrogate’s conclusion that ordering specific performance of the 1981 agreement according to its literal terms would be inequitable, unduly harsh and oppressive upon the defendants, and unjust. Neither of the elderly lay shareholders was represented by counsel at the time the agreement was entered into, presumably because they trusted Kwalwasser, and the plaintiffs, whose father had served them as a counselor and advisor
A closely related issue is whether the buyout provisions carried forward in the several agreements were effectively abrogated by the conduct of the parties during the 30 years of Ched’s existence. "The rule is recognized that stockholders may by consent or by acts and conduct repeal or accomplish the modification or abrogation of a by-law, as fully and effectively as if done by them by formal action, and the by-law is deemed to have been repealed or modified, as the case may be; likewise, non-usage of a by-law, continuing for a considerable length of time, and acquiesced therein, will work its abrogation (Evans v. Southern Tier Masonic Relief Assn., 76 App. Div. 151; Bowler v. American Box Strap Co., 22 Misc. 335; Bay City Lumber Co. v. Anderson, 8 Wn. [2d] 191; Elliott v. Lindquist, 94 Pitts. L.J. 295; 14 C.J., Corporations, § 456, p. 359; 1 Cook on Corporations [8th ed.], § 4a, p. 37; 8 Fletchers’s Cyclopedia Corporations, § 4183; 1 Morawetz on Private Corporations [2d ed.], § 499; 2 Thompson on Corporations [3d ed.], §§ 1158, 1159; 1 White on New York Corporations [1929 ed.], p. 175).” (Pomeroy v Westaway, 189 Misc 307, 310, affd 273 App Div 760; see generally, Annotation: What Constitutes Waiver of Stockholder’s or Corporation’s Right to Enforce First-Option Stock Purchase Agreement, 55 ALR3d 723, § 3 [a].) Application of this principle is particularly appropriate in this case because it would be inequitable to allow the Rosinys to
Alternatively, even if we were to assume the continued viability of the buyout provisions despite the long history of their having been ignored, I would agree with the Surrogate’s conclusion that there was no meeting of the minds as to the meaning of "book value,” which as previously noted, was never defined in any of the agreements. Allen Rosiny conceded that he knew what book value meant when he signed the 1981 agreement, and it is clear from the surrounding circumstances that the now deceased shareholders did not know the meaning of book value when they signed the 1981 agreement. There was simply no imaginable reason for Priddy and McGuire to have considered plaintiffs as natural objects of their bounty, and both had expressed a desire that their Ched shares be inherited by their respective children. As articulated by the Surrogate: "It defies common sense that the elderly decedents knowingly and reasonably entered into an agreement which would require their estates to sell for $2,000 their respective interests in the corporation which were worth in the neighborhood of $40,000 at the time the agreement was signed. Under all of the circumstances of this case, the court finds that the plaintiffs reasonably believed that book value meant one thing while the decedents reasonably believed it meant another thing and, consequently, the lack of agreement as to this essential term results in a determination that no contract was ever created relative to the sale of shares upon the death of a shareholder.”
The Surrogate’s analysis is consistent with contract principles governing the legal consequences of mistakes as to the meaning given to words and expressions. As stated in Corbin on Contracts (§ 104 [1950]):
"A much more common form of mistake is as to the meaning of words and expressions. Both parties know with accuracy the words used but understand them differently. Either party may inadvertently or ignorantly use words that by common usage do not express his meaning and intention. Either party may inadvertently or ignorantly give to another’s words a meaning that the other did not intend or that may not accord with common usage. In such a case there is a misunderstanding of the terms used in making a contract, a misunderstanding that prevents a 'meeting of the minds’, that is, prevents a true agreement. Nevertheless, there may be a valid contract in spite of such a lack of true agreement * * *
*744 "If one of the parties gave a meaning to the language that is not the only reasonable one under the circumstances, and the other expressed his assent knowing that the first party was giving it this meaning, that is the meaning that the court should adopt, and there is a contract accordingly. But if the parties had materially different meanings, and neither one knew or had reason to know the meaning of the other, there is no contract.”
Either evaluation of the understanding of the parties should result in a determination in the defendants’ favor. The only reasonable interpretation of "book value” from McGuire and Priddy’s standpoint was that book value was equivalent to market value, and the Rosinys, both experienced attorneys, had every reason to know or at least suspect that such was the decedents’ understanding. Thus, if there was a contractual agreement as to the meaning of book value, that meaning should be deemed equivalent to market value. On the other hand, if the Rosinys did not know or have reason to know that Priddy and McGuire understood book value as equivalent to market value, there was no meeting of the minds, and no contract with respect to the provisions here at issue. There is simply no basis for our disturbing the conclusions of the fact-finding court in this regard, because before doing so it should appear "obvious that the court’s conclusions could not be reached under any fair interpretation of the evidence” (Claridge Gardens v Menotti, 160 AD2d 544, 545). That cannot be said in this case.
Plaintiffs contend that buyout clauses like the one here in issue are enforceable despite blatant unfairness of the option price, citing Allen v Biltmore Tissue Corp. (2 NY2d 534), a case involving not a shareholders’ agreement, but the bylaws of a corporation giving it an option to purchase a shareholder’s stock upon his death at the price originally paid. The Court of Appeals, while holding that the validity of the restriction did not "rest on any abstract notion of intrinsic fairness of price” (supra, at 543), was addressing itself to restrictions that are clearly set forth in the bylaws, noted on the face of the shares, and could serve as a "veto” of new members in a close corporation. The Court was not concerned with a case of gross disparity in price as indicative of overreaching, unconscionability, or an absence of mutual understanding regarding the terms of an agreement. The Court in Allen said that "[t]o be invalid, more than mere disparity between option price and current value of the stock must be shown” (supra, at 543). Surely, considerably more than mere
Gallagher v Lambert (74 NY2d 562), relied upon by the plaintiffs, is also distinguishable. There, a corporate employee, who was also a minority shareholder, was required to submit his shares to repurchase by the corporation at book value if he was terminated by a certain date. Plaintiff alleged that his employment was terminated for the sole purpose of allowing the corporation to buy back its shares at a reduced price. In holding that there was no breach of fiduciary duty in firing plaintiff under those circumstances, there was no suggestion that plaintiff was not fully aware of the significance and operation of the agreement into which he had entered. In fact, the Court in Gallagher specifically noted that "[pjlaintiff not only agreed to the particular buy-back formula, he helped write it and he reviewed it with his attorney during the negotiation process, before signing the agreement and purchasing the minority interest.” (74 NY2d, supra, at 567.)
Finally, the plaintiffs argue that at least in 1986 or 1987, the decedents could have dissolved the corporation, and that as a consequence of their not having done so, their estates should be estopped from claiming that the death buyout provision is unenforceable. This contention ignores the unique procedural history and fiduciary relationships developed over the years, the various equitable principles set forth at length earlier in this opinion, which clearly favor the defendants, and unjustifiably presumes that the aged and unsophisticated decedents had reason to believe that the plaintiffs would seek to strictly enforce against their estates a buyout provision that had been consistently ignored by all the shareholders over a period of 30 years.
The majority has reversed virtually every factual finding and legal conclusion reached by the Surrogate in his extensive and thoughtful opinion (NYU, Oct. 2, 1990, at 23, col 4), and in its place has constructed a scenario which is at odds with the evidence, and contrary to experience and common sense. The majority minimizes Priddy’s and McGuire’s lack of financial sophistication by pointing out that Priddy was once a bookkeeper (sometime before 1925), and an officer manager
The majority imputes to the decedents open-eyed knowledge of the legal significance of the 1981 agreement because "book value” is an unambiguous term. Interestingly, the first case cited by the majority in support of this proposition (People ex rel. Knickerbocker Fire Ins. Co. v Coleman, 107 NY 541) generally equates "book value” with "actual value”, that is, the value of assets less liabilities in connection therewith. Significantly, Frank Rosiny testified that he did not know Ched’s book value in 1981, and Allen Rosiny testified with regard to his knowledge of Ched’s book value, that "it was not knowledge that I had in '81 or indeed could have had prior to Mr. Kwalwasser’s death [in 1985].” (Emphasis added.) Are decedents to be faulted then for believing in 1981 that the book value of Ched’s property bore at least a reasonable relationship to its actual value?
To be sure, "book value” has a literal definition as "the value of something as shown by the books of account of the business owning it” (Webster’s New Collegiate Dictionary 127 [1973 ed]). But the central aspect of "book value” as pertinent to this case is its ordinary relationship to actual or market value, and whether there is anything in the record that would have led the decedents to suspect the extraordinary circumstance that Ched had a negative book value while its only asset had a substantial and increasing market value. The changes in past agreements from book value to fair market value and back to book value, far from demonstrating Priddy’s and McGuire’s understanding of the financial significance of those terms, rather suggest their understanding that the terms were almost interchangeable, and more procedural than substantive. I note that a recent New York Times article (May 9, 1992, section 1, at 50, col 1), reporting on the deficit of the Mutual Benefit Life Insurance Company, stated that "[t]he deficit is blamed on heavy investment in real estate, which is currently valued at about 20 percent less than book value.” On the west coast, the Los Angeles Times (Apr. 28, 1992, part D2, at 23) reported the book value to market value ratio of "the best performing companies in California”. Of the 25 companies listed in the article, only one had a book value more than 4% lower than its market value.
In Meinhard v Salmon (249 NY 458, 464), then Chief Judge Cardozo enunciated these ringing phrases that reverberate in our equity jurisprudence to this day: "Many forms of conduct permissible in a workaday world for those acting at arm’s length, are forbidden to those bound by fiduciary ties. A trustee is held to something stricter than the morals of the market place. Not honesty alone, but the punctilio of an honor the most sensitive, is then the standard of behavior. As to this there has developed a tradition that is unbending and inveterate. Uncompromising rigidity has been the attitude of courts of equity when petitioned to undermine the rule of undivided loyalty by the 'disintegrating erosion’ of particular exceptions (Wendt v. Fischer, 243 N. Y. 439, 444). Only thus has the level of conduct for fiduciaries been kept at a level higher than that trodden by the crowd. It will not consciously be lowered by any judgment of this court.”
The determination rendered by this Court today is not, in my view, faithful to these precepts. To the contrary, these precepts, and those stated by Pomeroy as quoted earlier in this opinion, point ineluctably toward an affirmance in this case, thus giving the Priddy and McGuire heirs that which any fair-minded person must conclude is rightfully theirs.
It is hornbook law that "[i]n the general juristic sense, equity means the power to meet the moral standards of justice in a particular case by a tribunal having discretion to mitigate the rigidity of the application of strict rules of law so as to adapt the relief to the circumstances of the particular case.” (McClintock, Equity, at 1 [1936].) Can it truly be said that this Court has vindicated the moral standards of justice by giving
I would accordingly affirm the Surrogate’s order entered November 19, 1990, which declared that plaintiffs have no right under the 1981 agreement to purchase the shares at issue for a total sum of $4,000, and that those shares should instead pass pursuant to the terms of the wills of the decedents.
The appraised fair market value of the premises owned by Ched was $235,000 as of June 30, 1981, and the mortgage balance was approximately $66,000. Dividing the $169,000 difference by 40, the number of outstanding shares, results in a per share price of $4,225.