Court Opinion

ID: 5195466
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:42:34.494453+00
Date Added: 2024-06-11T08:27:04.014717
License: Public Domain

Ingraham, J. (dissenting) :
I am unable to agree to the affirmance of this judgment. The cause of action which was submitted to the jury was based upon.a contract whereby it is alleged that the defendant promised to pay to the plaintiff for his services rendered to the defendant from the 1st day of November, 1898, to the 31st day of December, 1899, twenty-five per cent of the profits of the defendant’s business during the year ending on the 31st day of December, 1899. The ' plaintiff, who had acted as bookkeeper and general manager for the defendant, was called as a witness and testified to the making of the contract, and the jury having found a verdict in his favor, upon this appeal I will assume that the contract was made as alleged in the complaint. Under the contract,- however, the amount the plaintiff was entitled to recover depended upon the amount of profits that were realized by the defendant in his business for the year ending December 31,1899 ; the burden of proof was upon the plaintiff to show the amount of such profits, and that he undertook to do. He testified that he did not make up the statement of the profits for the year 1899; that the profit and loss account was contained in a private ledger in which was posted the balance of a number of accounts from the general ledger and thus the profits of the business were ascertained, but that at the time the plaintiff left in January, 1900, this profit and loss account had not been made up for the year 1899. The plaintiff then introduced a statement made by the defendant as to assets and liabilities of the firm on January 1, 1900. That statement was that the firm had merchandise on hand of the value of $460,000 and other items, making a total of *23$1,015,000, liability for merchandise $90,000, a surplus of $925,000 ; to this was added the surplus in the retail store of $125,000, making a gross total of surplus of $1,050,000. The plaintiff then read from the deposition of the defendant taken upon an examination before trial that the expenses for the year 1899 were $150,000. The plaintiff was then recalled and was asked to make up from these statements the amount of the profit for the year 1899. He made up such a statement based upon the admission of the defendant that the merchandise on hand on the first day of January was $460,000. He also testified that in ascertaining the profits for the year 1899 there was to be deducted from that amount $120,000 for unchecked and memorandum bills, leaving merchandise on hand of the value of $340,000; that there was to be added to this amount the sum of $40,000 on account of sales of merchandise, and from that amount there was to be deducted the expenses of the business, $150,000, which would make the profit for 1899 $230,000, and this appears to be the only evidence offered by the plaintiff upon which the jury could find the amount of the profits for the year 1899.
I think this was an incorrect method of ascertaining the profits of the business for a particular year. There is nothing to show that the amount of merchandise on hand on December 31, 1899, was paid for out of the profits of that year. Ordinarily the stock of a merchant would represent capital and not profits. The profits for the year were represented by the difference between the gross value of the merchandise sold less the cost of the merchandise and the expenses of conducting the business. An examination of the testimony has failed to disclose any evidence to show that the gross amount of this merchandise on hand on the 1st of January, 1899, had any relation to the profits from the business during the year 1899. There was no evidence of the total sales for that year, or of the cost of the goods sold, so that the profits would be ascertained by deducting from the difference between the gross sales and the- cost of the goods sold, the expenses of the business.
The plaintiff put in evidence the balance sheet of the year 1898. From this it appears that at that time there was merchandise on hand of $136,003.55, and there was also an item of “ Chambers St. Store ” $35,086.21. If these two items represented the amount of merchandise on hand on the first of January it may be that from this *24statement, in the absence of evidence that the defendant had contributed any capital to the business during the year, the difference between these two amounts and the amount of $460,000, being $288,910.24 was added to the merchandise account from the profits of the year and would form a basis from which such profits could be ascertained. Upon the trial, however, it was conceded by the defendant that the profits of the defendant’s business for the year 1899 were $101,000, and the jury having found that the contract was made as claimed by the plaintiff, the plaintiff was entitled to twenty-five per cent of that amount, which is $25,250. From that amount there must be deducted $13,937.65, the amount admitted to have been received by the plaintiff during the year, which would leave a balance due him of $11,312.35, and on the finding of the jury the plaintiff was entitled to a judgment for that amount; but I cannot find in this record any evidence to justify the jury in finding that the profits exceeded this amount admitted by the defendant.
My conclusion, therefore, is that the judgment must be reversed and a new trial ordered, with costs to the defendant to abide the event, unless the plaintiff stipulate to reduce the verdict to $11,312.35, and upon the plaintiff so stipulating the judgment should be reduced to that sum and affirmed, without costs of this appeal.
McLaughlin, J., concurred.
Judgment and order affirmed, with costs.