Carpenter v. Chicago, Milwaukee & St. Paul Railway Co.

1875, maturing July ».l, 1905, and which contained the .following, provision The obligor also agrees to transfer to the bearer at Ins option ten shares of One hundred dollars each of its preferred stock at any .time within ten days after any dividend shall have been declared and become payable on. said preferred stock upon the delivery to the ' obligor in the-city of New York of this, bond and the unmatured coupons.”- '. The last dividend upon, the' preferred stock- of the defendant, prior to the maturity of the bonds, was declared March 8, 1905, and became payable on the twenty-fourth of the following . April. Oñ'tíie 28th of Juné, 1905, three days prior to the maturity of the bonds., and upwards of sixty days after the last-dividend on the preferred stock had become payable, the plaintiff tendered to the. defendant the bonds in question-and demanded the issuance to him, in exchange therefor, of twenty shares of its- preferred, stock, which was refused upon the ground that the tender and demand had not been made within.ten days after the dividend on the preferred-stock , had been ■ declared or become payable. When the bonds matured on the 1st of July, 1905, ’tlie defendant provided funds with which to pay the same» and it has ever since kept such funds at the place where the bonds were payable and has been ready to pay them. The bonds have never been presented for payment, nor have they been paid.. The last coupons attached to the bonds matured on the 1st of July, 1905, and these- were presented and paid on- or about that daté. Some timé subsequent to the 1st of July, and prior to .the 1st of October, 1905, just when does not appear, there was declared, th,e first dividend On the preferred stock after the-maturity of’the bonds and the same was made.payable on the lOfh of October, 1905, to stockholders of record at the close of business on the 23d of August, 190,5. ‘ On. the 11th of October, 1905, plaintiff again ' tendered the bonds to the defendant and demanded that twenty ■ shares of its preferred stock be issued to him. The demand was ■ again refused and the plaintiff now seeks; by this submission, upon surrendering the bonds in question, to recover from the defendant the sum of $3,720, the value of the twenty shares: of the preferred stock on the 28th Of Jiine, 1.905, together with the.-interest thereon from that date. . - • ■

The defendant-denies" that the plaintiff is entitled to the relief • asked,-or to any-relief.. ■ ¡ '

I am of the opinion that the defendant is entitled to judgment dismissing the plaintiff’s claim. The plaintiff did not bring himself within the provision of the bond which entitled him to make the exchange. There is nothing ambiguous in the language used. It is plain and specific. The bonds may be converted into stock “ at any time within ten days after any dividend shall have been declared and become payable on said preferred stock, upon the delivery * * * of this bond and the unmatured coupons.” To entitle one to an exchange the bonds had to be presented within ten days after a dividend had-been declared and become payable, and there must then be unmatured coupons attached thereto. They could not be presented after the bonds had matured and the coupons all been paid. Therefore, when the presentation and demand were made in June, it was too late, because more than sixty days had elapsed after the dividend declared had become payable. The presentation and demand in October were ineffectual because all of the coupons had become.payable and in fact had been paid sometime previous thereto. What the defendant agreed to do was to pay the bonds on the 1st of July, 1905, or to accept them before that date in payment of preferred stock, providing certain conditions specified were complied with. The plaintiff did not comply with these condition's and the defendant has been and now is ready to pay its bonds. Plaintiff is entitled to the payment of the bonds, but is not entitled to exchange them for stock. To hold otherwise would be construing.the agreement between the parties in a manner which the language used does not justify.

A similar question was presented in Loomis v. Chicago, Milwaukee & St. Paul Ry. Co. ( 102 Fed. Rep. 233 ), and the conclusion reached by the Circuit Court of Appeals sustains the above view.

It follows, therefore, there must be judgment for the defendant dismissing the plaintiff’s claim, with costs.

Patterson, P. J., Houghton, Scott and Lambert, JJ., concurred.

Judgment ordered for defendant, with costs. Settle order on notice. ■ , .