Bigelow, Davidson and McLean. The opinion of the court was delivered by Bigelow, J.A.D.
The question is whether the Chancery Division should have dismissed the complaint because it did not show a sufficient basis for equitable relief. These are the facts that the complaint discloses:
The defendant Dolan wished to lease certain land from the plaintiff, East Newark Realty Corporation. To that end, he entered into negotiations with the other plaintiff, Pommer, who had authority from the company to negotiate, but not to reach a final agreement, and Dolan was so advised. On January 27, 1950, Dolan paid the company $250 and was given a paper writing, reading as follows:
"Received from Thomas J. Dolan the sum of two hundred fifty dollars ($250.00) of which one hundred twenty-five dollars ($125.00) is to be applied for rent for the month of February, 1950, and the sum of one hundred twenty-five dollars ($125.00) to be applied for security, under a lease for parking lot on Passaic Avenue, East Newark, N.J., said parking lot being owned by East Newark Realty
Corporation. The above money is received by East Newark Realty Corporation subject to the terms and conditions of a lease for said parking lot, to be signed by Thomas J. Dolan and East Newark Realty Corporation.
East Newark Realty Corporation."
A day or two after the date of the payment, the company received certain information about Dolan from which it concluded that he would be an undesirable tenant, and the company thereupon refused to go further in the matter. The transaction never progressed beyond the stage of negotiation; no lease or binding agreement for the renting of the premises was ever entered into by the parties. Upon termination of the negotiations, the company tendered repayment of the sum of $250 and demanded a return of the receipt, but Dolan refused.
Dolan, in April, 1950, instituted an action against the company and Pommer in the Essex County Court. His complaint contains two counts, in one of which he alleged the making of a lease between himself and the company, the payment of $250 pursuant thereto, a demand that the company let him into possession, and a refusal, for which he demands judgment for damages. The second count asks damages from Pommer because he had in fact no authority to enter into a contract of lease on behalf of the company. The Chancery complaint alleges that Dolan intends to offer the receipt in evidence in support of his action against the company.
The complaint in the Chancery Division further charges that:
"The defendant (Dolan), despite the fact that no lease or agreement to lease had been entered into, and despite the fact that plaintiff, Horace Pommer, was not authorized by the plaintiff company to make a lease or an agreement to lease, and that he had never represented that he was so authorized, nevertheless fraudulently instituted the said action at law, to the harassment and vexation of the plaintiffs."
Such is the case made by the complaint in the Chancery Division. Upon it judgment is asked ...