Case ID: ad_165/html/0044-01.html
Source: Caselaw Access Project
Author: {"author": "Laughlin, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Lloyd Stevens, Respondent, v. Van Wagoner-Linn Construction Company, Appellant.
    First Department,
    December 11, 1914.
    Principal and agent — action by agent .to compel his principal to account under an agreement to procure contracts for the sale and installation of electrical apparatus — contract construed — evidence.
    In an action on a contract by which the defendant, a manufacturer of electrical supplies, employed the plaintiff to solicit business for it, and agreed to pay him “ not less than two nor more" than five per cent of the money received " by defendant “ for the business procured by him,” the plaintiff alleged that he solicited and procured business for the defendant pursuant to the contract and “ has performed all the conditions and covenants of said agreement on his part to be performed,” and that the defendant transacted the business and received moneys therefor, upon which he is entitled, “pursuant to the provisions of the said agreement,” to commissions, and that it has, after demand duly made, refused and neglected to account to him therefor. The plaintiff demands that defendant account, pursuant to the contract, for the business procured and for moneys received. A schedule marked “S” was annexed to the contract containing names of construction contractors, architects and engineers from whom the plaintiff, who had had business relations with the defendant and its successor for many years, had procured business, so that they were regarded as customers; and the contract provided that on account of his relations with them he was to receive commissions upon any work done by the defendant for them or their principals, and that solicitation of work from them “ shall conclusively belong to him, provided slip is signed for each job by the company.”
    Evidence examined and contract construed, and held, that a judgment in favor of the plaintiff should be reversed, unless he stipulates to reduce the same as to certain items concerning which he had no right to recover.
    Appeal by the defendant, Van Wagoner-Linn Construction Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 22d day of November, 1913, upon the report of a referee appointed to take and state the account of the defendant herein pursuant to an interlocutory judgment.
    The judgment confirmed the referee’s report and overruled the defendant’s motion to vacate the interlocutory judgment.
    
      
      Wilbur F. Earp and Franz Neilson, for the appellant.
    
      George E. Blackwell, for the respondent.
   Laughlin, J.:

The defendant manufactured, sold and installed electrical equipment and supplies, and the plaintiff was engaged on a commission basis in soliciting, for such manufacturers, contracts for the sale and installation of electrical apparatus and appliances.

This is an action on a contract in writing made on the 17th day of July, 1907, by which the defendant employed the plaintiff to solicit business for it, and it agreed to pay him “not less than two nor more than five per cent of the money received ” by defendant “for the business procured by him,” with certain exceptions not material to the questions presented for decision. He had had business relations with the defendant and the firm of which it was the successor for many years prior to that time. The contract was prepared by the parties, without the aid of legal advice, and in some respects it is quite indefinite; but in the light .of their prior business' relations, it may be understood and given effect. A schedule, marked “S,” was annexed to the contract, and it contained names of construction contractors, architects and engineers from whom the plaintiff had procured business for the defendant or others, so that they were regarded as his customers; and the contract provides that on account of his relations with them, he was to receive commissions upon any work done by the defendant for them or their principals, and that solicitation of work from them “shall exclusively belong to him, provided slip is signed for each job by the company.” It was further provided that the commissions claimed by plaintiff within the limits prescribed should be specified in a “written notification at the time of the report.” It is evident from the course of business • between the parties, and from their practical construction of the contract, that they contemplated that whenever the plaintiff obtained the consent of architects, engineers or others having charge of the letting of work, to receive bids or proposals from the defendant, he should turn in a memorandum in writing specifying the location of the work and the name of the owner or contractor or architect or engineer or other person who was to receive proposals, and the percentage to be paid to him, which the contract provided should “be determined ” by him in such written notification. It is manifest, therefore, that while the defendant agreed that the plaintiff should have commissions on all work done for or through the parties named in Schedule “ S, ” it was contemplated that, by the presentation, acceptance and signing of such slip notification in advance, the defendant would know that the plaintiff was to claim commissions and could be guided thereby in making its bid or proposal; and if that was not done the defendant was to be at liberty to present bids or proposals even to undisclosed principals of those named in Schedule “ S ” free from any claim by the plaintiff under his contract with it. The contract further provided with respect to commissions to the plaintiff as follows: “ He shall also be entitled to commission in cases where he obtains permission to bid or estimate from parties not mentioned in schedule and a report of obtaining permission followed by a request to estimate make him so entitled, provided slip is signed for each job by the company. After such report, all further communications from such parties shall be turned over to him for attention and the names of such parties shall be placed on Schedule ' S ’ with like effect as if they had been there before.

“ As heretofore, the written acceptance of the company of reports made by said Stevens shall be final that he is entitled to commission in that case.”

It was further expressly provided in the contract that “ Upon demand, the company will account to said Stevens for all business transacted and referred to in this agreement,” and it was also provided that the commissions should be payable, one-third upon the making of each contract, one-third upon the receipt of the first payment, and one-third upon final payment; and that the first two payments should be based on the estimate and price, and that if such estimate should be less than the actual amount received, including extra work, the percentage on the excess should be paid with the final payment. With respect to the period the contract was to run,, it was provided that it should continue in force until after written notice by either party to the other.

The plaintiff alleges that he solicited and procured business for the defendant pursuant to the contract from the 17th day of July, 1907, to the 17th day of November, 1911, and “has duly performed all the conditions and covenants of said agreement on his part to be performed,” and that the defendant transacted the business and received moneys therefor, upon which he is entitled “pursuant to the provisions of the said agreement” to commissions, and that it has after demand duly made refused and neglected to account to him therefor. The judgment demanded is that defendant account pursuant to the provisions of the contract for the business procured by the plaintiff, and for moneys received by it from such business, and that it be adjudged and decreed that the defendant pay to the plaintiff such sum as may be due under and by virtue of the contract.

There was no appearance by the defendant in the action until after the entry of the interlocutory judgment, when it appeared by counsel on the accounting before the referee. On the motion for the confirmation of the report of the referee, counsel for defendant moved to vacate the interlocutory judgment and all proceedings taken thereunder, on the ground that the complaint fails to show facts entitling the plaintiff to an accounting, or sufficient to constitute a cause of action; and upon the further ground that the interlocutory judgment is irregular and of no legal effect in that it grants plaintiff relief not demanded in the complaint. The motion was denied, and the making of the motion is recited in the final judgment. The defendant regarded the final judgment as overruling its motion to vacate the interlocutory judgment, and states in its notice of appeal that it appeals therefrom. It is argued on the appeal in behalf of the defendant that the interlocutory and final judgments are void for the reason that the plaintiff failed to show a cause of action for an accounting, or any cause of action, and on the ground that the interlocutory judgment, which was entered by default, contravenes the provisions of section 1207 of the Code of Civil Procedure in that it is more favorable than was prayed for in the complaint. The last contention is made on the assumption that the interlocutory judgment does not limit the accounting to the demand in the complaint or confine it to the contract. It requires an accounting for all moneys received by the defendant on business transacted by it “ and referred to in the agreement of July 17th, 1907,” between that date and November 17, 1911, “with persons whose business was solicited ” by the plaintiff, or was transacted with any of the parties named in Schedule “S,” or their principals, or with parties not named in Schedule “S” “in cases where plaintiff obtained permission to bid or estimate upon work which estimate was made, ” without limiting the accounting by the provisions of the contract with respect to the written reports or slips, and the acceptance thereof, or limiting it to the business procured by the plaintiff. I am of opinion, however, that the interlocutory judgment is to be construed in connection with the complaint and contract, and that as so construed it required an accounting pursuant to the provisions of the contract, and, therefore, does not entitle the plaintiff to recover in disregard of any of the express provisions of the contract.

Under the complaint, however, the plaintiff is limited to a recovery on the basis of performance of and compliance with all the provisions and conditions of the contract for he alleges performance. Where, therefore, the signing of a slip was required of the defendant by the contract, the plaintiff cannot recover without showing that he procured one to be signed. Doubtless he would have a right to recover if he were entitled to have a slip signed and the defendant unreasonably refused to sign it, or if the defendant waived the signing thereof; but it would be necessary for him both to allege and prove those facts. (Weeks v. O’Brien, 141 N. Y. 199; Granger Co. v. B. K. Iron Works, 204 id. 218; Smith v. Wetmore, 167 id. 234.)

It is also quite clear that the complaint states a cause of action. It shows that some commissions have been earned by the plaintiff, and that the defendant has failed to account. The defendant is, therefore, guilty of a breach of the contract, which entitles the plaintiff in any event to nominal damages. Moreover, if it be regarded as an action at law, a recovery of the commissions to which the plaintiff is entitled will not contravene the provisions of said section 1207 of the Code of Civil Procedure, for the judgment demanded is for the amount due the plaintiff to be ascertained in accordance with the provisions of said contract. It is also quite clear that .the defendant having seen fit to allow judgment to go by default, cannot be heard to claim that the plaintiff is not entitled to an accounting, which by the contract it expressly stipulated to give him. The court has merely decreed what the defendant contracted to give. It is a peculiar contract. The plaintiff is not suing for commissions in the ordinary sense. With the exception of the provision with respect to part payment, he is entitled to recover only after the defendant has been paid under each contract upon which he is entitled to commissions, and the contract is capable of the construction that the plaintiff was to have part of the money received by the defendant and not an amount equal thereto. That would explain the provision by which defendant agreed to account to the plaintiff. There is no merit, therefore, in any of these preliminary contentions made by the appellant. The real question presented by the appeal is whether the recovery was warranted by the evidence. We have not been materially aided by the briefs in deciding the questions already discussed, and with respect to the facts the briefs fail to point out by folio references, as required by the practice, the evidence in support of the respective contentions.

The referee found that the plaintiff was entitled to commissions aggregating $1,864.35 on the amounts received by the defendant under thirty-one contracts. It may well be that by the omission to incorporate in the interlocutory judgment the provisions of the contract with respect to the reports in writing or slips and acceptances the referee was misled, for it appears that in some instances he has allowed commissions in disregard of those provisions of the contract.

The defendant filed an account with the referee to which the plaintiff interposed objections. The account filed showed that the plaintiff was entitled to commissions on ten items, but that he had been paid in full therefor with the exception of one dollar and ninety-two cents, being a balance of commissions due on one of them. The referee sustained the account as to commissions with respect to the items specified therein, with the exception that in addition to the conceded balance of one dollar and ninety-two cents he found that a payment of eighty-five dollars on another item, claimed to have been in full, was not in full, and that the plaintiff was entitled to further commissions thereon, which aggregate seventy-two dollars and seventy-four cents. The referee also allowed the plaintiff commissions on thirty other contracts or jobs, none of which were shown in the account filed by the defendant.

On the contract designated No. 79 the referee allowed com missions which aggregate seventy-two dollars and forty-two cents. That was for work on the Comedy Theatre. Neither he name of the architect nor of the contractor appeared in Schedule S,” nor were the conditions shown to exist which would entitle their names to be deemed added thereto under the contract, and the plaintiff did not procure or solicit the work or make a report in writing, or hand in a slip or procure the acceptance of a slip with respect thereto.

The plaintiff was also allowed commissions on contracts Nos. 58, 70, 71, 72, 83, 89, 92, 96, 97, 100, 101, 102, 106, 110, 112, 116, 120, 125, 126, 127, 128,129 and 131, aggregating, as I figure it, $791.30. He failed to show that he procured these contracts, and, with respect to most of them, the evidence affirmatively shows that he failed to procure a slip to be signed by the defendant, and with respect to the others he failed to show by satisfactory evidence that he procured a slip to be signed. If the work was let by any of the parties named in Schedule “S” or by their principals, or by any of the parties whose names the plaintiff would be entitled under the provisions of the contract to have added to Schedule S,” it was necessary for the plaintiff to show that he made a report stating the commissions claimed and procured the acceptance thereof by the defendant which in effect is what was intended by the slip mentioned in the contract; but in such instances it was not incumbent upon him to show that he negotiated the contracts. He was, however, entitled to commissions without procuring the signing of a slip upon moneys received pursuant to contracts negotiated by him at the rates specified in the report made by him on procuring them. He was also allowed commissions aggregating $258.92 on contract Ho. 114. With respect to that contract he showed that he procured two slips to he signed by defendant on the 31st of October, 1907, to the same effect, excepting that they bore different dates; but they specified only the name of the owner for whom the work was to be done. He procured two other slips to be signed for this work under date of “April,” 1909. One of these was signed by the defendant “ Accepted, For owners only; ” but the evidence does not clearly show which was signed last, and if the one without limitation was signed last, the plaintiff’s testimony shows that he failed to disclose to the defendant his purpose in procuring it to be signed, which was to remove the limitation “accepted for owners only,” and, therefore, it cannot be said that the defendant intended to sign the slips without limitation. Moreover, the plaintiff’s claim for commissions on this work is based upon the fact that the name of the architect was on Schedule “S.” The theory on which the defendant accepted the slip for owners only was that it expected that the work would be let by a firm of contractors with whom it had relations, and from whom it could obtain an invitation to submit a proposal, and it only intended to obligate itself to plaintiff in the event that the proposals were invited by the owner or the architect whose name was on Schedule “S.” I am of opinion that the claim of the defendant with respect to the construction of the contract in this regard was well founded, and that it would not-be hable for commissions if the work was let through the contractor whose name was not on, or entitled to be on, Schedule “S,” even though for an owner employing an architect named in Schedule “S,” where neither the architect nor the owner took part in letting the work.

The evidence satisfactorily shows that the plaintiff was entitled to the other commissions recovered, either on the ground that the work was done through one of the parties named on Schedule “ S,” or whose name the plaintiff was entitled to have deemed added thereto, or his principal, and that he procured slips to be accepted by the defendant therefor, or on the ground that he was instrumental in procuring the particular contract.

If there shall be a new trial, a question may arise, as it did arise before the referee, with respect to whether the plaintiff is entitled to have the name of an architect or contractor, through whom he had procured business for the defendant, or permission to estimate for the defendant, prior to the execution of the contract in suit, but whose name is not on Schedule “ S,” deemed added thereto. Manifestly, there is no merit in that contention, for when the contract was made the parties, by Schedule “S,” named and defined those who were to be regarded as plaintiff’s customers, and he is limited and confined by that schedule with respect to then existing or past customers.

If, therefore, the plaintiff sees fit to stipulate to reduce his recovery by the items we find he has not shown a right to recover and interest thereon, the judgment will be modified accordingly and affirmed, without costs; but otherwise it should be reversed and a new trial granted before another referee to be named in the order, with costs to the appellant to abide the event.

Ingraham, P. J., Scott, Dowling and Hotchkiss, JJ., concurred.

Judgment reversed, new trial ordered before another referee, with costs to appellant to abide event, unless plaintiff stipulates to reduce recovery as stated in opinion; in which event judgment as so modified affirmed, without costs. Order to be settled on notice.