HOLLIDGE v. GUSSOW, KAHN & CO., Inc., 67 F.2d 459

ANDERSON, Circuit Judge. The appellant was adjudicated a bankrupt on April 12, 1932. On July 29‘, 1932, he filed an offer of composition which was confirmed on August 9,1932. This appeal presents the question as to whether the creditor’s claim should be allowed for $940 only, as the referee held, or for $4657.84, as the court below held. The controlling facts are as follows: Late in 1931, or early in 1932, Kahn, for the creditor, began negotiations with the bankrupt for the publication by the appellee of an illustrated leaflet to advertise the merchandise of the bankrupt’s store in New York City.

The negotiations resulted in the execution by the bankrupt’s duly authorized agent of a document, as follows: “To Gussow, Kahn & Co. Incorporated Advertising “13 West 36th Street, New York City “January 28, 1932. “For Kurzman C.

Crawford Hollidge 661 Fifth Avenue New York City “Please enter our order for: 160,000 copies of the Kurzman Courier as per dummy submitted — divided into (8) issues of 20,000 per issue — Editorials to be set in News type with two columns (as per dummy) devoted to water colored illustrations. “Date of Delivery: One issue for each of the following months of 1932: February, March, April, May, June, September, October and November inclusive. “Price $940 per issue (including envelopes) $7,520 Complete for eight (8) issues. “Remarks: Paper stock subject to okay. Envelopes subject to okay.

All art work, copy, editorials and proofs subject to okay before each issue goes to press — after original typewritten copy sheets are okayed, any major changes will be subject to an author’s correction charge. “Subject to Approval of your Credit Department. “Representative - “[Signed] Charlina Davenport. “(This order is non-caneellable)” Thereafter, several conferences were held between Kahn and representatives of the bankrupt for the purpose of getting the leaflet into proper shape for publication.

About April 1, 1932, the ereditor delivered to the bankrupt’s store 20,000 copies of the “Kurzman Chatterer,” which were entitled “Volume 1, No. 1,* dated March, 1932.” This was the first of the eight issues contemplated in the order supra. As bankruptcy came on April 12, no other issues were printed by the ereditor. The referee finds that the creditor’s profit on the other seven issues, if they had been printed and paid for, would have been $3,717.84.

He also finds: “There was no acceptance of the order by Gussow, Kahn & Co., Inc., either in writing or orally.” Learned counsel for the bankrupt has argued, with much ability and ingenuity, that this contract was not an entire contract, but was simply “an offer for several unilateral contracts to be formed upon the delivery of each 20,000 copies of the ‘Courier.’ ” But we think the court below was right in holding the contract an entire one, and that it was effectively accepted.

In the light of the finding of conferences between the creditor and the bankrupt as to the form and substance of the leaflet, and the actual furnishing of the first of the eight issues, this finding of no oral or written acceptance must be narrowly construed. It obviously means merely that there was no written or oral technical and formal acceptance of the order. The order reads “for 160,000 copies.” Part of the consideration having been furnished, there was an acceptance of the order. The undertaking was between business men; legalistic formalities are not to be expected.

But when the order for 160,000 copies was made and acted upon by the offeree, we think it clear that both parties regarded themselves as bound to the whole scheme of advertising.

The ease falls under the doctrine laid down in the Restatement of Contracts, § 45, as follows: “If an offer for a unilateral contract is made, and part of the consideration requested in the offer is given or tendered by the offeree in response thereto, the offeror is bound by a contract, the duty of immediate performance of which is conditional on the full consideration being given or tendered within the time stated in the offer, or if no time is stated therein, within a reasonable time.” .

If there is any difference (which we need not determine) between the law of New York and the general law of contracts, undoubtedly the question is to be determined by the law of New York. Mendell v. Willyoung, 42 Misc. 210, 85 N. Y. S. 647; Post v. Albert Frank & Co., 75 Misc. 130, 132 N. Y. S. 807; Butchers’ Advocate Co. v. Berkof, 94 Misc. 299, 158 N. Y. S. 160, 161. See, also, North Side News Co. v. Cypres, 75 Misc. 129; 132 N. Y. S. 806.

The fact that the bankrupt naturally reserved the right of approving the character and quality of advertising matter of each issue of the leaflet does not prevent the contract from attaching nor from being an entire one. This was merely a term of performance. The contractual relation was to be established before the proposed issues of the Kurzman Courier were submitted to Hollidge for approval; in other words, the submission for approval would be made, and as to the first issue was made, in performance of an existing contract. Compare Allegheny College v. National Chautauqua County Bank of Jamestown, 246 N.

Y. 369, 378, 159 N. E. 173, 57 A. L. R. 980, a learned and interesting opinion by Chief Judge Cardozo. The decree of the District Court is affirmed, with costs to the appellee in this court.