Robbins v. Frank Cooper Associates, 19 N.Y.2d 903 (1967)

When parties negotiate for the use of property but fail to reach an agreement, and the property is subsequently used and made valueless, the law implies a contract obligating the user to pay the reasonable value of the property where the parties contemplated payment for its use.

Summary

Robbins sued Frank Cooper Associates for the reasonable value of Robbins’ property after negotiations for its use failed, but Cooper still used it, rendering it valueless. The trial court found an implied contract and awarded damages. The Appellate Division reversed, but the New York Court of Appeals reversed the Appellate Division and reinstated the trial court’s judgment, holding that an implied contract existed and the proper measure of damages was the reasonable value of the property. The court found sufficient evidence to support the jury’s verdict on value.

Facts

The parties negotiated for the conveyance of Robbins’ property, but they did not agree on the terms. Frank Cooper Associates nevertheless took the property and made it valueless for Robbins. Robbins then sued, seeking compensation for the reasonable value of the property.

Procedural History

The Supreme Court, New York County, entered judgment for Robbins. The Appellate Division reversed. The New York Court of Appeals reversed the Appellate Division’s order and reinstated the Supreme Court’s judgment.

Issue(s)

Whether, in the absence of an express agreement, the use of another’s property after failed negotiations for its conveyance gives rise to an implied contract requiring the user to pay the reasonable value of the property.

Holding

Yes, because when parties deal with each other in the context of an intention of payment for use of property, and negotiations fail but the property is still used, the law implies an obligation to pay its reasonable value.

Court’s Reasoning

The Court of Appeals held that the Trial Judge properly submitted a single issue to the jury: whether there was a contract implied in fact. Because the property was taken and made valueless after failed negotiations, “the law imposes an obligation to pay its reasonable value where the parties dealt with each other in the context of an intention of payment for its use.” The court cited Healey v. Macy & Co., 251 App. Div. 440, affd. 277 N. Y. 681; La Varre v. Warner Bros. Pictures, 282 N. Y. 68; cf. Grombach Prods. v. Waring, 293 N. Y. 609; see Desny v. Wilder, 46 Cal. 2d 715. Further, the court determined that opinion evidence of the property’s value was properly admitted, citing Sheldon v. Metro-Goldwyn Pictures Corp., 106 F. 2d 45, affd. 309 U. S. 390; Duane Jones Co. v. Burke, 306 N. Y. 172, 192; Stanley v. Columbia Broadcasting System, 35 Cal. 2d 653; see, also, Grombach Prods. v. Waring, 267 App. Div. 986, revd. on other grounds 293 N. Y. 609. The court concluded that the opinion evidence, taken together with the defendants’ evidence, sufficiently supported the verdict and found no reversible error in the court’s charge.