Court Opinion

ID: 5440454
Source: CourtListenerOpinion
Date Created: 2022-01-08 18:02:06.329385+00
Date Added: 2024-06-11T08:31:59.379436
License: Public Domain

Thornton, J., dissenting:
The plaintiffs Gower and Gilman were partners, doing business as warehousemen in the City of San Francisco, and defendant Andrew was in their employment, to some extent in a confidential relation, and in receipt of a compensation paid to him by plaintiffs monthly. While Andrew was so employed by the plaintiffs they were occupying and using a lot and the building on it, in the city above named, in their business, known as the Front Street Warehouse. This was held *125by them under a lease from defendent Hopkins, which expired on the 1st day of November, 1879. While Andrew was in the employment of the plaintiffs on the 29th of September, 1879, he obtained from Hopkins a lease, to himself and defendant Ross, of the lot and building above mentioned, for a term of four years, at a monthly rent of four hundred and fifty dollars. The plaintiffs instituted this action, alleging that Andrew was in their employment and holding confidential relations as regards them, when he obtained this lease, and that Ross was aware of all these facts when he became a party as co-lessee with Andrew, and asking for a judgment that Andrew and Ross hold the lease in trust for them, and that they be decreed to assign it to them, and also that defendants Andrew and Ross be enjoined during the pendency of this action from commencing any action at law to recover possession of the premises, or in any manner interfering with the quiet use and enjoyment by the plaintiffs of said premises, and that such injunction be made perpetual by the judgment of the Court.
A motion was made for an injunction pendente lite, which came on to be heard on the complaint, answers of Andrew, Ross, and Hopkins, and various affidavits which were read by the parties at the hearing. The Court below refused to make the restraining order, and from this order of refusal an appeal was prosecuted by plaintiffs to this Court.
Among the affidavits produced and read at the hearing of the motion, was one made by the defendant Hopkins, from which it appears that the lease to plaintiffs.was executed by him (Hopkins) on the 28fch of October, 1878, for the term of one year from the 1st day of November, 1878, at the rent of four hundred dollars per month; that early in September, 1879, prior to the 12th day thereof, Hopkins met Gilman, one of the plaintiffs, and a conversation ensued in regard to plaintiffs’ leasing the premises again; that Gilman complained of the depression in business, and that they could not afford to pay so much rent as they were then paying, and stated that there were other warehouses to be had; that Hopkins did not agree to any reduction nor intimate any intention to raise the rent; that prior to this time Andrew had called on affiant and had stated that plaintiffs would probably give up *126said warehouse, and if so, that he (Andrews) would like to take it, and would be willing to pay four hundred and fifty dollars rent; that affiant (Hopkins) postponed further consideration of the matter until he could ascertain what plaintiffs proposed to do, expressing an inclination to give them the preference, as they were tenants in possession; that in consequence of these conversations with Gilman and Andrew, Hopkins wrote and sent to the plaintiffs a letter as follows:
“San Francisco, September 24th, 1879.
“Messrs. Gilman and Gower.
“Gents.: Since the conversation had with Mr. Gilman, about the 10th or 12th of this month, concerning the rent of the Front-street warehouse, I understand that in your judgment the rates of storage do not warrant you in undertaking the' present rate of rent for another lease.
“Will you let me know at your earliest convenience, say by Monday next, what is the highest sum you will pay per month for another term of one to four years ? Respectfully,
“Theron R. Hopkins.”
To which letter deponent received from plaintiffs the following reply:
“San Francisco, September 29th, 1879.
“The. R. Hopkins, Esq., 614 Lombard Street.
“Dear Sir: In reply to your favor of yesterday, we would beg to call your attention to the following undoubted facts:
“1. Business has long been and continues depressed.
“2. Several parties who have obtained large reductions in rents, have an immense advantage over us in competing for the little business there is going.
“3. We see but little hope of any permanent improvement, as the existence and probable continuance and extension of the system of railway contracts will enable importers to supply all their wants as required, thereby doing away with the necessity of.keeping large stocks, and steadily, lessening the demand for storage accommodations.
“In the face of these facts, carefully considered, we think that three hundred dollars ($300) per month for the Front Street warehouse would be as much as we could afford to pay.
“We trust your ideas may coincide with ours, and we shall *127be glad to hear your views in the matter as early as convenient to you.
“We remain, dear sir, yours, obediently,
“Gower & Gilman.
“P. S.—We have just heard, confidentially, that Mr. Staunch has got a reduction of two hundred and fifty dollars per month on his lease, which has still two years to run.”
That on receipt of this letter, Hopkins informed Andrew, when he called to learn the result of the correspondence with the plaintiffs, that plaintiffs had declared themselves unable to pay over three hundred dollars per month; that he was unwilling to rent it at so low a price; that he inquired of Andrew if he would stand to his offer of four hundred and fifty dollars per month, to which he replied he would; that Andrew mentioned to him that Ross was going into partnership with him in the warehouse business.
Under these circumstances the lease was executed to Andrew and Ross on the 29th of September, 1879, as above stated.
Andrew, in his affidavit, which was also read at the hearing, states the circumstances from which he had concluded, when he spoke to Hopkins in August about renting the premises, that the plaintiffs intended to give up the premises when their lease expired, and there was evidence to support his statements. Andrew stated to Hopkins that he did not wish to have the premises unless the plaintiffs gave them up.
Conceding that Andrew had occupied such a relation towards the, plaintiffs, that any lease obtained by him from Hopkins would be held by him in trust for Gower and Gil-man, we are of the opinion that no reason existed after the letter of the 29th of September, above given, had been written and sent by them to and received by Hopkins, and communicated to Andrew, why such a consequence should follow. Hopkins concluded from the statements in that letter, and we think he had sufficient reason to conclude, that the plaintiffs no longer desired to lease the premises unless at such a rent as he would be unwilling to accept. The same reasons why the plaintiffs were unwilling to take a lease except at a re*128duced rent, were urged in the letter as in the previous conversation had been put forth by Gilman. They were urged, too, more specifically and at greater length. We can not perceive that this conclusion on the part of Hopkins was not reached on sufficient grounds, in consequence of the remark ■with which the letter closes. Why should Hopkins present his views to the plaintiffs as to their ability to pay more than three hundred dollars per month? That was a subject of which they were more competent and better judges than he. They had been for some years engaged in the business, and had before them all the facts on which they could form a correct judgment as to what they were able to pay. The request was singular and unusual, and Hopkins no doubt deemed it useless to negotiate with them any longer. Deeming it, as he properly might, a refusal to concede to what he considered a fair rent for the premises, he acted on it as such, and executed the lease to Andrew and Boss.
How it is contended, that it is the duty of the employee to the employer to do everything to advance his employer’s interest, and to do nothing adverse to it while the relation continues. This may be considered to be a tenable position, sustained by the rules of law. But it can not be said that an employee is doing anything prejudicial or adverse to his employer’s interests when he takes a lease of premises, after the term of the employer has ended, at a rent which the employer states that he can not afford to pay. The more correct deduction is, that he is advancing the interests of the employer, that he is saving money to his employer, and is not doing anything by which he can suffer damage or hurt. This is nothing more than Andrew did. He waited until his employers had refused to accede to a contract, which they had in effect declared would be injurious to them, and then took the lease.
As soon as this declaration was made by the letter on the 29th of September, there was nothing in the relations between Andrew and the plaintiffs, which bound his conscience so that he could not in equity take the lease from Hopkins, nor did anything occur afterwards. The statement in the affidavits of plaintiffs, that they did not intend the.letter of the 29th of September as a refusal to take the lease at four hundred *129dollars a month, or even at four hundred and fifty dollars, is entitled to little weight when considered along with the deliberate statements made in that letter. There is no pretense in this case that Andrew ever was constituted, or ever held himself out, as an agent to procure a lease of the premises for the plaintiffs; therefore, no question arising out of such a state of facts, is before us here.
We find no error in the ruling of the Court below, and the order made by it should be affirmed.