Strong v. Repide

Facts

Mrs. Strong owned 800 shares of the Philippine Sugar Estates Development Company, Limited, which were held by her agent F. Stuart Jones. Repide was a director and owned 30,400 of the company’s 42,030 shares and served as administrator general with exclusive management powers. The company’s primary asset was friar lands in the Philippines that the United States government sought to purchase. In 1903, negotiations for the sale were ongoing, with Repide as the chief negotiator representing the company and effectively controlling whether the sale would proceed. In September 1903, while negotiations were advancing and before the final offer was made, Repide employed intermediaries to purchase Mrs. Strong’s 800 shares for $16,000 Mexican currency, concealing his identity and the state of negotiations from Jones. Repide knew the lands were nearly worthless without government protection but would become extremely valuable if sold to the government. He alone held the power to accept or reject the government’s offer. Jones sold the shares without knowledge of the negotiations’ status or that Repide was the purchaser. In December 1903, Repide signed the contract selling the lands to the government, making the 800 shares worth approximately $76,256 United States currency within two and a half months of the purchase.