Kanavos v. Hancock Bank & Trust

395 Mass. 199, 479 N.E.2d 168 (1985).

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Nature of the Case

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Facts

Hancock Bank & Trust Co. (D) gave Kanavos (P) the right to acquire all the stock of 1025 Hancock, Inc. before the bank sold the stock to anyone else on the same terms. Brown, the executive vice-president of the bank, gave P a letter in which the bank agreed to pay him $40,000 for surrendering the option to purchase the stock. He further gave P the option to match the price of sale of property owned by the bank. The bank then sold the stock to a third person for $760,000 without giving P notice and opportunity to buy the stock. The balance on the first mortgage was $2,500,000. The jury, in response to a special verdict question, concluded that the apartment complex was worth $4,000,000. Contract damages were determined by subtracting from $4,000,000 the balance due on the mortgage ($2,500,000) and the sale price of the stock ($760,000). They determined that $740,000 equaled the amount by which the fair market value of the stock exceeded the price at which it was sold. The $40,000 option surrender payment was then added to arrive at a final judgment of $780,000. D challenge to the special verdict and resulting judgment in that the judge failed to instruct the jury that P had to be ready, willing, and able to pay D $760,000 (i.e., within the sixty days, to match the offer the bank received and accepted). The judge ruled that P's ability to pay $760,000 was not material to this case.