Herrick

Plaintiff is a corporation that in January 1966 or earlier had entered into an agreement to lease from the owner Capital Services (Capital) a building to be constructed by Capital to house medical offices. The building would form a second unit (Unit Two) to an existing building *427 (Unit One) in which the officers of plaintiff, who were physicians, had their offices along with others, and in which the individuals who were officers and shareholders of plaintiffs also carried on a medical laboratory under the name Alvarado Medical Group (Alvarado) for their own use and as convenience for other tenants.

Defendant and Howard Ball (Ball) were physicians who, as partners, confined their practice to laboratory medicine. Some of their business came from doctors in Unit One and from the laboratory in Unit One. In 1965 there had been discussion with Dr. Roy Ouer (Ouer), then president of plaintiff and a member of Alvarado, looking toward the purchase by defendant and Ball of the laboratory facilities and practice of Alvarado. Those negotiations fell through.

With the projected construction of Unit Two presented to them, defendant and Ball on January 26, 1966 signed and delivered…