Case Name: George A. Varney, Appellant, v. Isaac E. Ditmars, Respondent
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1916-02-22
Citations: 217 N.Y. 223
Docket Number: 
Parties: George A. Varney, Appellant, v. Isaac E. Ditmars, Respondent.
Judges: 
Reporter: New York Reports
Volume: 217
Pages: 223–235

Head Matter:
George A. Varney, Appellant, v. Isaac E. Ditmars, Respondent.
Contract—evidence — executory contracts must be certain and explicit, and if vague or indefinite cannot be explained by parol evidence — when contract for employment at certain price per week and fair and reasonable percentage to be thereafter fixed cannot be enforced.
1. For the validity of an executory contract, the promise or the agreement of the parties to it must be certain and explicit, so that them full intention may be ascertained to a reasonable degree of certainty. Their agreement must be neither vague nor indefinite, and, if thus defective, parol proof cannot be resorted to.
2. The plaintiff, an architect and draftsman, was employed by defendant at a salary of thirty-five dollars per week. While so employed defendant said to plaintiff and another employee: “ I am going to give you $5 more a week; if you boys will go on and continue the way you have been and get me out of this trouble and get these jobs started that were in the office three years, on the first of next January I will close my books and give you a fair share of my profits.” Plaintiff continued in defendant’s employment and was paid forty dollars a week until he was discharged therefrom later in the year for alleged disloyalty and insubordination, some of the work referred to having been completed in the meantime. Defendant denied that he had any agreement with plaintiff and refused to permit him to continue in his service. Plaintiff seeks to recover in this action for services from just prior to the time of the alleged discharge until January first next thereafter at the rate of forty dollars per week and also for a fair and reasonable percentage of the net profits of the defendant’s business from the time of the conversation above referred to up to the same date. Held, that the statement alleged to have been made by the defendant about giving the plaintiff a fair share of his profits is vague, indefinite and uncertain, and the amount cannot be computed from anything that was said by the parties or by reference to any document, paper or other transaction. The minds of the parties never met upon any particular share of the defendant’s profits to be given the employee or upon any plan by which such share could be computed or determined. The contract so far as it related to the special promise or inducement was never consummated; further, that on the testimony as it appears before the court it properly refused to leave to the jury the question whether the plaintiff was entitled to recover anything at the rate of forty dollars per week, and the complaint was properly dismissed. (United Press v. N. Y. Press Go., Ltd., 164 N. Y. 406, followed.)
Varney v. Ditmars, 159 App. Div. 911, affirmed.
(Argued December 15, 1915;
decided February 22, 1916.)
Appeal from a judgment of the Appellate Division of the Supreme Court in the first judicial department, entered December 5, 1913, affirming a judgment in favor of defendant entered upon a dismissal of the complaint by the court at a Trial Term.
The nature of the action and the facts, so far as material, are stated in the opinion.
Benjamin Reass and Max Teff for appellant.
The contract was enforceable. (King v. Broadhurst, 164 App. Div. 689; Donovan v. Harriman, 139 App. Div. 588; Howie v. Kosnowitz, 83 App. Div. 295.)
Harry N. French and Frederick Hulse for respondent.
There was no contract between the parties other than one continued from week to week as long as the plaintiff was willing to work for the defendant and the defendant was willing to employ the plaintiff. (United Press v. N. Y. Press Co., 164 N. Y. 406; Mackintosh v. Kimball, 101 App. Div. 494; Bluemner v. Garvin, 120 App. Div. 29; Lambert v. Hays, 136 App. Div. 574; Butler v. Kemmerer, 218 Penn. St. 242; Seebeh v. American M. & M. Co., 32 N. Y. S. R. 1051; 128 N. Y. 619.) The plaintiff was not entitled to recover for unpaid salazy from November 11 to December 31, 1911. (Howard v. Daly, 61 N. Y. 362; Weed v. Burt, 18 N. Y. 191; Prior v. Flagler, 13 Misc. Rep. 115; McGarrigle v. McCosker, 83 App. Div. 184.)

Opinion:
Chase, J.
This is ah action brought for an alleged wrongful dischaz'ge of an employee. The defendant is an architect employing engineers, draftsmen and other assistants. The plaintiff is an architect and draftsman. In October, 1910, he applied to the defendant for employment and when asked what wages he wanted, replied that he would start for $40 per week. He was employed at $35 per week. A short time thereafter he informed the defendant that he had another position offered to him and the defendant said that if he would remain with him and help him through the work in his office he thought he could offer him a better future than anybody else. He continued in the employ of the defendant and became acquainted with a designer in the office and said designer and the plaintiff from time to time prior to the 1st of February, 1911, talked with the defendant about the work in his office. On that day by arrangement the two remained with the defendant after the regular office hours and the defendant said: " I am going to give you $5 more a week; if you boys will go on and continue the way you have been and get me out of this trouble and get these jobs started that were in the office three years, on the first of next January I will close my books and give you a fair share of my profits. That was the result of the conversation. That was all of that conversation." The plaintiff was given charge of the drafting. Thereafter suggestions were made by the plaintiff and said designer about discharging many of the defendant's employees and employing new men and such suggestions were carried out and the two worked in the defendant's office over time and many Sundays and holidays. At least one piece of work that the defendant said had been in his office' for three years was completed. The plaintiff on his cross-examination told the story of the employment of himself and said designer as follows: "And he says at that time ' I am going to give you $5 more a week starting this week.' This was about Thursday. He says 'You boys go on and continue the work you are doing and the first of January next year I will close my books and give you a fair share of my profits.' Those were his exact words."
Thereafter the plaintiff was paid $40 a week. On November 6,1911, the night before the general election in this state, the defendant requested that all of his employees that could do so, should work on election day. The plaintiff told the defendant that he wanted to remain at home to attend an election in the village where he lived. About four o'clock in the afternoon of election day he was taken ill and remained at his house ill until a time that as nearly as can be stated from the evidence was subsequent to December 1, 1911.' On Saturday, November 11, the defendant caused to be delivered to the plaintiff a letter in which he said:
"lam sending you herewith your pay for one day's work of seven hours, performed on Monday, the 6th inst. On Monday night, I made it my special duty to inform you that the office would be open all day Election Day and that I expected you and all the men to report for work. Much to my surprise and indignation, on Tuesday you made no appearance and all the men remained away, in obedience of your instructions to them of the previous evening. An act of this kind I consider one of extreme disloyalty and insubordination and I therefore am obliged to dispense with your services."
After the plaintiff had recovered from his illness and was able to do so he went to the defendant's office (the date does not appear) arid told him that he was ready, willing and able to continue his services under the agreement. The defendant denied that he had any agreement with him and refused to permit him to continue in his service. Thereafter and prior to January 1, 1912, the plaintiff received for special work about $50.
The plaintiff seeks to recover in this action for services from November 7, 1911, to December 31, 1911, inclusive,at $40 per week and for a fair and reasonable percentage of the net profits of the defendant's business from Eeb ruary 1,1911, to January 1, 1912, and demands judgment for $1,680.
At the trial he was the only witness sworn as to the alleged contract and at the close of his case the complaint was dismissed.
The statement alleged to have been made by the defendant about giving the plaintiff and said designer a fair share of his profits is vague, indefinite and uncertain and the amount cannot be computed from anything that was said by the parties or by reference to any document, paper or other transaction. The minds of the parties never met upon any particular share of the defendant's profits to be given the employees or upon any plan by which such share could be computed or determined. The contract so far as it related to the special promise or inducement was never consummated. It was left subject to the will of the defendant or for further negotiation. It is urged that the defendant by the use of the word " fair " in referring to a share of his profits, was as certain and definite as people are in the purchase and sale of a chattel when the price is not expressly agreed upon, and that if the agreement in question is declared to be too indefinite and uncertain to be enforced a similar conclusion must be reached in every case where a chattel is sold without expressly fixing the price therefor.
The question whether the words " fair" and "reasonable " have a definite and enforceable meaning when used in business transactions is dependent upon the intention of the parties in the use of such words and upon the subject-matter to which they refer. In cases of merchandising and in the purchase and sale of chattels the parties may use the words "fair and reasonable value" as synonymous with " market value." A promise to pay the fair market value of goods may be inferred from what is expressly agreed by the parties. The fair, reasonable or market value of goods can be shown by direct testimony of those competent to give such testimony. The competency to speak grows out of experience and knowledge. The testimony of such witnesses does not rest upon conjecture. The opinion of this court in United Press v. N. Y. Press Co. (164 N. Y. 406) was not intended to assert that a contract of sale is unenforceable unless the price is expi'essly mentioned and determined.
In the case of a contract for the sale of goods or for hire without a fixed price or consideration being named it will be presumed that a reasonable price or consideration is intended and the person who entez-s into such a contract for goods or service is liable therefor as on an implied contract. Such contracts are common, and when there is nothing therein to limit or prevent an implication as to the price, they are, so far as the terms of the contract are concerned, binding obligations.
The contract in question, so far as it relates to a share of the defendant's profits, is not only uncertain but it is necessarily affected by so many other facts that are in themselves indefinite and uncertain that the intention of the parties is pure conjecture. A fair share of the defendant's profits may be any amount from a nominal sum to a material part according to the particular views of the person whose guess is considered. Such an executory contract must rest for performance upon the honor and good faith of the parties making it. The courts cannot aid parties in such a case when they az*e unable or unwilling to agree upon the terms of their own proposed contract.
It is elementary in the law that, for the validity of a contract, the promise, or the agreement, of the parties to it must be certain and explicit and that their full intention may be ascertained to a reasonable degree of certainty. Their agreement must be neither vague nor indefinite, and, if thus defective, parol proof cannot be resorted to. (United Press v. N. Y. Press Co., supra, and cases cited; Ruling Case Law, vol. 6, 644.)
The courts in this state, in reliance upon and approval of the rule as stated in the United Press case, have decided many cases involving the same rule. Thus, -in Mackintosh v. Thompson (58 App. Div. 25) and again in Mackintosh v. Kimball (101 App. Div. 494) the plaintiff sought to recover compensation in addition to a stated salary which he had received and which additional amount rested upon a claim by him that while he was employed by the defendants he informed them that he intended to leave their employ unless he was given an increase in salary, and that one of the defendants said to him that they would make it worth his while if he would stay on, and would increase his salary, and that his idea was to give him an interest in the profits on certain buildings that they were then erecting. The plaintiff further alleges that he asked what would be the amount of the increase and was told, "You can depend upon me; I will see that you get a satisfactory amount." The court held that the arrangement was too indefinite to form the basis of any obligation on the part of the defendants.
In Bluemner v. Garvin (120 App. Div. 29) the plaintiff and defendant were architects, and the plaintiff alleged that he drew plans for a public building in accordance with a contract held by the defendant and pursuant to a special agreement that if the plans were accepted the defendant would give him a fair share of the commissions to be received by him. The court held that a good cause of action was stated on quantum meruit, but that the contract was too vague and indefinite to be enforced.
A similar rule has been adopted in many other states. I mention a few of them. In Fairplay School Township v. O'Neal (127 Ind. 95) a verbal contract between a school trustee and a teacher, in which the latter undertook to teach school for a term in the district, and the trustee promised to pay her '" good wages," it was held that the alleged contract was void for uncertainty as to compensation, and that the school township was not liable for its breach.
In Dayton v. Stone (111 Mich. 196) the plaintiff had sold to the defendant her stock of goods and fixtures, and by the contract of sale the undamaged goods were to be inventoried and taken at cost price, and the damaged goods at prices to be agreed upon. In an action for breach of contract it was held that the contract was an entire one, and that so far as it left the price of the damaged goods to be fixed and determined it was uncertain and incomplete, and not one which could be enforced against the defendant.
In Wittkowsky v. Wasson (71 N. C. 451) it was held that where the price of certain property was to be fixed by agreement between the parties after the time of the agreement and they did not agree upon the price that the title to the property did not pass.
In Adams v. Adams (26 Ala. 272) a promise by a defendant for a valuable consideration to give his daughter a ' ' full share of his property " which then and there was worth $25,000 was held to be too indefinite and uncertain to support an action.
In Van Slyke v. Broadway Ins. Co. (115 Cal. 644) a contract between an insurance agent and the insurance company for a contingent commission of 5% which did not give the facts upon which the contingency depended nor state the sum on which the 5% was to be computed was held unenforceable and also that it could not be aided by parol.
In Marvel v. Standard Oil Co. (169 Mass. 553) a contract by which the defendant agreed to sell the plaintiff its oil on such reasonable terms as to enable him to compete successfully with other parties selling in the same territory was held to be too indefinite and too general to be enforceable as a contract.
In Burks v. Stam (65 Mo. App. 455) a contract for the sale of two race horses for a specified sum and providing for a further payment of a fixed sum by the purchaser if he did well and had no bad luck with the horses was held too vague to admit of enforcement.
In Butler v. Kemmerer (218 Pa. St. 242) the plaintiff was in the employ of the defendant at a regular salary and the defendant promised him that if there were any profits in the business he would divide them with the plaintiff " upon a very liberal basis." The action was brought to recover a part of the profits of the business and the court held that the contract was never made complete and that there was no standard by which to measure the degree of liberality with which the defendant should regard the plaintiff.
The only cases called to our attention that tend to sustain the appellant's position are Noble v. Joseph Burnett Co. (208 Mass. 75) and Silver v. Graves (210 Mass. 26). The first at least of such cases is distinguishable from the case under consideration, but in any event the decisions therein should not be held sufficient to sustain the plaintiff's contention in view of the authorities in this state.
The rule stated from the United Press case does not prevent a recovery upon quantum meruit in case one party to an alleged contract has performed in reliance upon the terms thereof, vague, indefinite and uncertain though they are. In such case the law will presume a promise to pay the reasonable value of the services. Judge Gray, who wrote the opinion in the United Press case, said therein: "I entertain no doubt that, where work has been done, or articles have been furnished, a recovery may he based upon quantum meruit, or quantum valebat; but, where a contract is of an executory character and requires performance over a future period of time, as here, and it is silent as to the price which is to he paid to the plaintiff during its term, I do not think that it possesses binding force. As the parties had omitted to make the price a subject of covenant, in the nature of things, it would have to be the subject of future agreement, or stipulation." (p. 412.)
In Petze v. Morse Dry Dock & Repair Co. (125 App. Div. 267, 270) the court say: " There is no contract so long as any essential element is open to negotiation." In that case a contract was made by which an employee in addition to certain specified compensation was to receive 5% of the net distributable profits of a business and it was further provided that "the method of accounting to determine the net distributable profits is to be agreed upon later when the company's accounts have developed for a better understanding." The parties never agreed as to the method of determining the net profits and the plaintiff was discharged before the expiration of the term. The court in the opinion say that "the plaintiff could recover for w'hat he had done on a quantum meruit, and' the employment must be deemed to have commenced with a full understanding on the part of both parties that that was the situation." The judgment of the Appellate Division was unanimously affirmed without opinion in this court. (195 N. Y. 584.)
So, in this case, while I do not think that the plaintiff can recover anything as extra work, yet if the work actually performed as stated was worth more than $40 per week, he having performed until November 7, 1910, could, on a proper complaint, recover its value less the amount received. (See Bluemner v. Garvin, supra; S. C., 124 App. Div. 491; King v. Broadhurst, 164 App. Div. 689.)
The plaintiff claims that he at least should have been allowed to go to the jury .on the question as to whether he was entitled to recover at the rate of $40 per week from November 7, 1911, to December 31, 1911, inclusive. He did not perform any services for the defendant from November 6 until some time after December 1st, by reason of his illness. He has not shown just when he offered to return. It appears that between the time when he offered to return and January 1st he received $50 for other services.
The amount that the plaintiff could recover, therefore, if any, based upon the agreement to pay $40 per week would be very small; and he did not present to the court facts from which it could be computed. His employment by the defendant was conditional upon his continuing the way he had been working, getting the defendant out of his trouble and getting certain unenumerated jobs that were in the office three years, started. There was nothing in the contract specifying the length of service except as stated. It was not an unqualified agreement to continue the plaintiff in his service until the first of January, and it does not appear whether or not the special conditions upon which the contract was made had been performed. Even apart from the question whether the plaintiff's absence from the defendant's office by reason of his illness would permit the defendant to refuse to take him back into his employ, I do not think that on the testimony as it appears before us it was error to refuse to leave to the jury the question whether the plaintiff was entitled to recover anything at the rate of $40 per week.
The judgment should be affirmed, with costs.