Industrial America, Inc. v. Fulton Industries, Inc.
Delaware Supreme Court
285 A.2d 412 (1971)
Industrial America, Inc. (Industrial) (plaintiff) was a broker specializing in the sale or merger of businesses. Bush Hog, Inc. (B-H) was a farm machinery company wishing to be involved in a merger with another business. B-H hired Industrial to help with the merger. Industrial approached two companies about the merger. Neither was interested. Following these unsuccessful negotiations, B-H decided to no longer work with Industrial, but did not communicate this to Industrial. In fall 1965, Industrial saw an advertisement placed in the newspaper by Fulton Industries, Inc. (Fulton) (defendant). Fulton was seeking a merger with another business. At the end of the advertisement, Fulton said that all brokers would be fully protected. On October 7, 1965, Industrial contacted Fulton and provided details about B-H and its desire for a merger. Fulton responded that it was very much interested in B-H, and asked Industrial to arrange a meeting between Fulton and B-H. Industrial contacted B-H and shared Fulton’s interest in the merger. Fulton’s president then independently contacted B-H and set up a meeting on November 4, 1965. Industrial was unaware of this meeting until it called B-H on November 3, 1965 to inquire about its failure to respond to Industrial’s offers to assist with the Fulton merger. Despite Industrial’s repeated offers to assist with the merger, neither Fulton nor B-H communicated further with Industrial. B-H and Fulton continued negotiations with each other until March 11, 1966, when they completed their merger. Industrial brought suit against B-H and Fulton in Delaware state court. The trial court awarded Industrial its $125,000 broker’s commission against B-H. Industrial was unsuccessful in obtaining a judgment against Fulton. The trial court held that Industrial had never accepted Fulton’s “offer” in its advertisement. Industrial appealed.
Rule of Law
Holding and Reasoning (Herrmann, J.)