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Business Associations Keyed to Coffee, 9th Ed.
Meinhard v. Salmon
Citation:
249 N.Y. 458, 164 N.E. 545 (1928)Facts
In 1902, Walter Salmon leased the Hotel Bristol in New York City from Louisa Gerry for a 20-year term. Salmon and Morton Meinhard formed a joint venture where Meinhard would provide half the funds needed to renovate and operate the property, and Salmon would manage it. Profits would be shared, with Meinhard receiving 40% for the first five years and 50% thereafter. As the lease neared expiration in 1922, the property owner, Elbridge Gerry (who now owned the original property and adjacent lots), approached Salmon about a new lease covering the entire expanded area. Salmon negotiated and signed this new lease through his company, Midpoint Realty, without informing Meinhard. The new lease was for a term of up to 80 years and required construction of a $3 million building. When Meinhard discovered this arrangement, he demanded a share in the new lease.
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