Case Name: Joseph Beck & Sons, Appellant, v. John E. Danaher, Respondent
Court: New York Supreme Court, Appellate Term
Jurisdiction: New York
Decision Date: 1916-02
Citations: 93 Misc. 537
Docket Number: 
Parties: Joseph Beck & Sons, Appellant, v. John E. Danaher, Respondent.
Judges: 
Reporter: New York Miscellaneous Reports
Volume: 93
Pages: 537–540

Head Matter:
Joseph Beck & Sons, Appellant, v. John E. Danaher, Respondent.
(Supreme Court, Appellate Term, First Department,
February, 1916.)
Contracts — of employment — performance of — cancellation and annulment of — intention of parties — when terminated.
Where in the course of the performance of a contract it is rescinded, any claim in respect of performance or of what has been paid or received thereon will ordinarily be referred to the agreement of rescission and no such claim may be made unless expressly or impliedly reserved upon the rescission.
Where, notwithstanding that a superseding contract of employment with defendant as a salesman provides for the cancellation and annulment of a prior agreement between the parties and that the last contract is a substitute for the first, and the only agreement between the parties, the proof shows that the first contract was terminated because plaintiff was dissatisfied with the amount of business done by defendant thereunder and that defendant thereupon asked to be given another trial claiming that he would make good the amount due from him to plaintiff under the original, contract, it is plainly apparent that it was the intention of the parties that the rescission was to relate only to the further execution of the first contract but not to a relinquishment of defendant’s debt to plaintiff thereunder.
Appeal from a judgment of the City Court of the city of New York, dismissing plaintiff’s complaint at Trial Term.
Leon Sanders (Leon Sanders and L. E. Schlechter, of counsel), for appellant.
J. Cotter Connell (J. Cotter Connell and Richard S. Holmes, of counsel), for respondent.

Opinion:
Delehanty, J.
On February 21, 1914, a written agreement was entered into between the parties- hereto whereby defendant was engaged as a salesman, the contract containing the following provisions:
' ' Second. The parties of the first part agree to pay to the party of the second part one hundred dollars per week during the continuance of this agreement, which sum shall include all expenses and disbursements incurred by the party of the second part.
" Third. As a condition precedent to the party of the second part receiving the sum above mentioned he agrees to sell for the parties of the first part, goods, wares and merchandise of the amount not less than six hundred dollars per week. If the said party of the second part does not sell the amount specified above per week, the parties of the first part may cancel this agreement, and terminate the employment of -the party of the second part hereunder, without any notice at the end of any calendar week, but if the parties of the first part keep the said party of the second part in their employment, after such default or defaults, then and in that event at the end or sooner termination of this contract, the party of the second part shall re-pay to the parties of the first part a sum of money equivalent to 16% per cent, of the amount of goods that the party of the second part agreed to sell as per the terms of this agreement. ' '
Upon the termination by mutual consent of this contract on June 6, 1914, there was concededly due plaintiff $661.22, same being sixteen and two-thirds per cent of the difference between $9,000, the amount of goods required to be sold by defendant under said contract and the sum of $5,032.69, the amount actually sold by him. Two days later, on June 8,1914, the parties entered into a new agreement which provided among other things as follow's,: ' Third. The party of the first part may, from time to time, advance to the party of the second part sums of money on account of commissions earned or to be earned by the party of the second part. The amount of such advances and whether such advances are to be made shall be entirely optional with the party of the first part, and if so made, the same shall be deducted from commissions earned, by the party of the second part and at the termination of this agreement if the amounts so advanced shall exceed the amounts to which the party of the second part shall become entitled to in commissions, then the party of the second part shall repay to the party of the first part, such excess. ' '
" Ninth. If any agreement heretofore existed between the parties hereto, either in writing or orally, the same is hereby cancelled and annulled, and the agreement contained herein is the substitute therefor, and is in any event, the only agreement existing between the parties hereto."
In the first place it is- contended by defendant that the second agreement constituted a waiver and release of plaintiff's right under the first agreement, and therefore that the complaint was properly dismissed as to same. Whether or no that is so depends on the intention to be deduced from the agreement of annulment construed in the light of the attending circumstances. In McCreery v. Day, 119 N. Y. 1, it is held that where a contract is rescinded while in the course of performance, any claim in respect of performance, or of what has been paid or received thereon, will ordinarily " be referred to the agreement of rescission, and in general no such claim can be made unless expressly or impliedly reserved upon the recission." Leake Cont. 788 and cases cited. While the superseding contract herein provides for the cancellation and annulment of the prior agreement between the parties- and that the superseding one is the substitute therefor, and is in any event the only agreement existing between the parties thereto, yet the proof shows that the first contract was terminated because plaintiff's president was dissatisfied with' the amount of business-done by defendant thereunder, and that defendant thereupon asked to be given another trial claiming that he would make good the amount due from him . under the original contract.
Construing this situation as it then existed, followed by the making of the superseding agreement, it is plainly apparent that the parties intended that the rescission was to relate only to the further execution of the first contract, but not to a relinquishment of defendant's debt thereunder. Michaels v. Fischel, 169 N. Y. 381; Hurst v. Trow Printing S Book Binding Co, 2 Misc. Rep. 361.
Under the superseding contract, when defendant resigned his position on the 28th of June, 1914, there •had been received by him in the shape of advances the sum of $150, and he had earned in commissions only $33.45. For the difference between these amounts, I think the defendant liable, not alone by virtue of the provision of the contract requiring the repayment of such excess, but upon the broad principle that by severing his agreement with plaintiff he disqualified himself from earning enough commissions to repay such excess as contemplated by the contract in question. Kupfer v. Holtzmann, 88 N. Y. Supp. 362.
Lehman and Weeks, JJ., concur.
Judgment reversed, new trial ordered, with costs to appellant to abide event.