Meinhard v. Salmon

Salmon (defendant) leased the Bristol Hotel for twenty years to convert into retail space and formed a joint venture with Meinhard (plaintiff), under which Meinhard funded half the operating costs in exchange for a growing share of the profits, with losses split equally. Near the end of the Bristol Lease, a new lessor who controlled adjacent land approached Salmon, as the managing party, about a broader twenty-year redevelopment lease, and Salmon secretly took that opportunity through his own company without telling Meinhard. When Meinhard learned of the new lease about a month later and demanded it be held in trust for the joint venture, Salmon refused, and Meinhard sued; the referee and the appellate division both ruled for Meinhard, eventually giving him a 50-percent interest in the new lease.