author: Steere, J.

text:
    MICHIGAN CROWN FENDER CO. v. WELCH.
    1. Master and Servant — Contracts—Master Entitled to All of Servant’s Time — Profits Belong to Master.
    Where defendant, by his contract of hiring, agreed not to engage in. any other business which would in any way conflict with his duties as manager of plaintiff’s plant, part of his duties being to purchase steel for plaintiff's use, profits made in the purchase and resale of steel to other manufacturing companies, held, to belong to plaintiff.'
    2. Principal and Agent — Profits Belong to principal.
    The efforts and activities of an agent in the line of his employment should be for the benefit of his principal,, and he is not at liberty to deal in the business of his agency for his own benefit.
    3. Same — Duty of Agent to Disclose.
    It is the duty of an agent to communicate to his principal facts relating to the business which ought in good faith to be made known to the latter.
    On right of principal or employer to earnings by agent or servant who undertakes extraneous work, see notes in 5 L. R. A, (N. S.) 1154; L. R. A. 1916D, 782.
    On liability of promoters of corporation for secret profits, see note in 18 L. R. A. (N. S.) 1110.

      4. Same — Profits Belong to Principal Whether Result of Performance or Violation of Duty.
    All profits made and advantage gained by an agent in the execution of the agency belong to the principal, and it matters not whether such profit or advantage be the result of the performance or of the violation of the duty of the agent if it be the fruit of the agency.
    5. Contracts — Construction — Master and Servant — Contract of Hiring — Issue of Stock.
    Where defendant was induced to leave lucrative employment and enter the service of plaintiff corporation at a less salary than he was then receiving under a contract of employment for five years, by the terms of which the day that he began his employment he was to be issued ?10,000, par value, of plaintiff’s stock, the same, on its issue, became his, and on his discharge by plaintiff, for cause, before the termination of the five years, said stock was not subject to be divided on the basis of the time served under the agreement, there being no such conditional provision in the contract and none will be read into it by the courts.
    6. Same — Written Contract — Oral Testimony — Evidence — Admissibility.
    Testimony touching the circumstances attending the making of the contract was competent, not to contradict the written agreement, but as an aid to its interpretation, its • language being obscure.
    7. Corporations — Contracts—Cancellation of Stock — Evidence —Burden of Proof.
    On a bill by plaintiff corporation seeking cancellation of certain stock issued to defendant in connection with his contract of employment with plaintiff, the burden of establishing its right to relief, under its contract, rests upon plaintiff.
    Appeal from Washtenaw; Sample (George W.), J.
    Submitted April 7, 1920.
    (Docket No. 4.)
    Decided July 20, 1920.
    Bill by the Michigan Crown Fender Company against John R. Welch for an injunction, an accounting, and other relief. From a decree for plaintiff, defendant appeals.
    Modified, and affirmed.

      Lucking, Murphy, Helfman, Lucking & Hanlon, for plaintiff.

      John P. Kirk (McGregor & Bloomer and Seth J. Wicker, of counsel), for defendant.
   Steere, J.

Plaintiff is a Michigan corporation organized in August, 1914, with its principal office at Ypsilanti, Michigan, since its organization there engaged in the manufacture of fenders, hoods, running-boards and other sheet metal parts for automobiles and motor trucks. Defendant is by occupation a mechanical and productional engineer of experience in automobile production and for some time before his connection with plaintiff was employed as superintendent of the sheet pressed steel department in the Dodge Brothers automobile factory at an annual salary of $6,500.. Negotiations were had between the parties looking to the employment of defendant as plaintiff’s general manager, which reached a state where, as appears from plaintiff’s minute book, the following action was taken at a meeting of'.the directors on December 14, 1915:

“Voted to enter into a contract with J. R. Welch, beginning February 1, 1916, at a salary of not less than $400 per month, and that as part consideration for his services for five years, $10,000 worth, of the increase of stock be issued to him.”

Their negotiations were consummated six days later and a contract was entered into as follows:

“Memorandum of agreement, made this twentieth day of December, A. D. 1915, by and between the Michigan Crown Fender Company, a corporation under the laws of the State of Michigan, of the city of Ypsilanti, in the county of Washtenaw, State of Michigan, party of the first part, and John R. Welch, of the city of Detroit, in the county of Wayne, State of Michigan, party of the second part.
“Witnesseth that for and in consideration of the covenants and agreements herein contained as follows:
“1st. The party of the first part agrees to employ the party of the second part and the party of the second part agrees and hereby accepts the position of general manager of the Michigan Crown Fender Company for the period of five years from the first day of February, 1916, at a salary of not less than four hundred dollars ($400) per month for the first year, and in proportion to the net profits for the second, third, fourth and fifth years not to exceed eight hundred dollars ($800) per month unless the profits should be so much greater, then the party of the first part will consent to the greater amount.
“2d. The first party agrees to issue to the second party one thousand (1,000) shares of the capital stock of the said Michigan Crown Fender Company at the par value of ten dollars ($10) per share on the first day of February, 1916, provided said second party assumes his duties on said date. ,
“3d. The second party agrees to devote all his time to the interests of and for the benefit of the first party for the full period of five years from the first day of February, 1916, and not to engage in any other business during said period which would in any way conflict with his duties to the first party, the first party to be the judge in the matter.
“4th. The second party agrees not to offer for sale his one thousand (1,000) shares of Michigan Crown Fender Company or any part thereof, to any parties until he first offers such stock for sale to said first party or to some member of the board of directors of said company.
“In witness whereof, the parties hereto subscribe their names.
“Michigan Crown Fender Co.,
“By Lewis McLouth, ■
“President.
“Frederic F. Blodgett,
“Secretary.
“John R. Welch.
“In presence:
“W. K. Genman,
“F. F. Bennett.”

As contemplated by said agreement defendant entered plaintiff’s employment about February 1, 1916, and soon thereafter plaintiff issued to him 1,000 shares of its capital stock with a par value of $10 per share, which he received and yet retains. He was also thereafter chosen as a member of plaintiff’s board of directors and its secretary.

At a meeting of plaintiff's board of directors at which defendant was present, held October 25, 1917, said board passed a resolution discharging him from plaintiff’s employment because of claimed insubordination and activities against its interest, particularly in a certain secret transaction through which he profited to the disadvantage of plaintiff by the sale of a quantity of steel purchased from the Troy Manufacturing Company of Ohio to the Ford Motor Company of Detroit.

Soon thereafter, on November 8,1917, plaintiff filed this bill of complaint stating in detail the circumstances of defendant’s employment, discharge and reasons therefor as claimed; alleging as ground for a requested injunction that lie refused to leave plaintiff’s premises and kept the office keys, persisting in occupying a desk therein and assuming to give orders to the detriment of plaintiff’s organization and business; that plaintiff was apprehensive he would dispose of the thousand shares of stock transferred to him pursuant to his contract of hiring, to which it is alleged he is not entitled by reason of his breach of said contract; and for final relief praying annulment of the certificate so issued him for said stock; an accounting, decree for profits shown to have been taken by him while in plaintiff’s employ on resales connected with the Troy steel transaction, and that the same b¿ declared a lien on any stock issued by plaintiff found belonging to him.

Defendant answered, denying in detail all charges of insubordination, and other misconduct charged as justification for his dismissal; alleged that the stock issued to him when he entered plaintiff’s employment then became his absolutely, admitted that he had profited by the Troy steel transaction, claimed to have been purely a personal matter, and denied that the same was secret, against plaintiff’s interests, in conflict with his duties or contrary to the terms of his contract of employment.

The case was heard upon pleadings and voluminous proofs, oral and documentary, taken in open court. An opinion with findings was filed following the hearing and decree rendered sustaining in the main plaintiff’s contentions. The court held defendant’s conduct was such as to justify his discharge, and found, which is not disputed, that he made a profit of $5,116.28 on re-sales of Troy steel to the Ford and Cadillac motor car companies; and that he did so secretly, engaging in “other business” in violation of his contract of employment, the findings and conclusions of the court upon that issue being in part as follows:

—“that he purchased of 20- and 22-gauge steel from the Troy company for the Ford Motor Car Company, and the Cadillac Company at the same time that he purchased for the plaintiff company. That it was done 'without the knowledge or consent of the plaintiff company; that he engaged in business which had a tendency to put him in direct conflict with the interests of the plaintiff company; that there was testimony to show that the plaintiff company was to receive out of the purchase from the Troy company 20-gauge steel, but that instead of receiving 235 tons of 20-gauge steel, it, in fact, only received 92 tons and that in order to supply the Ford company with its demands for 20-gauge steel, the plaintiff company was compelled and did take a different gauge for the balance of the* 235 tons.”

The profits derived by defendant from so “dealing secretly” in steel while in plaintiffs service were held by the court as rightfully belonging to his employer, and a decree granted plaintiff against him for the $5,116.28 so obtained, with legal interest from the time he received it. Of the $10,000, par value, of stock issued to him when he assumed his duties on February 1, 1916, and entered upon performance of his contract, the court construed the contract as meaning that the “stock was to be earned in the five-year period of his services, if such services had been satisfactorily and properly rendered to the plaintiff company,” held he had proportionately earned $3,500 worth, par value, at the time of his rightful discharge, ordered surrender and cancellation of the remaining $6,500 worth, par value, and gave plaintiff a lien upon his earned $3,500 worth as security for the amount of the retained profits decreed against him.

As the pleadings and testimony present the case and counsel argue it the right to discharge defendant underlies and is primarily stressed as a material issue for its bearing upon the two questions of who is entitled to this disputed block of stock and the profits on sale of steel made by defendant while in plaintiff’s service» It would profit nothing to follow at length the often conflicting testimony detailing in this record of over 500 pages the business relations and activities of these parties terminating in defendant’s discharge at the directors’ meeting of October 25, 1917, which a sensitive member termed “this terrible session down there.” At that meeting the directors sought to interrogate defendant in regard to the Troy steel purchase and sale of which there were reports that he had realized private profits. When asked as to the details of it by a member of the board he became very angry, informed them it was none of their business, refused to discuss the matter and defied them, with recriminations in caustic phraseology impugning their veracity and capacity. Amongst the “terrible” things of that session, as the directors relate, he called them “liars” and “little men * * * not fit to run this kind of business,” and said he had been “continually hampered and obstructed in his work by these little cusses who interfered with everything he did and he didn’t propose to stand it.” Defendant denied using insulting language, but said that when asked by a director how much steel he bought for the Ford motor company, “I answered him by saying it was a personal matter and I refused to answer. I thought his questions were insulting and not decent for anybody.” Eliminating the matters in dispute as to what occurred at that meeting, it is clearly shown that when quietly asked without accusation, by some members of the board at least, for his version of the transaction he replied it was his private matter, none of their business, and declined to explain or disclose the facts.

It is urged for defendant that the testimony of plaintiff’s own witnesses shows the conduct and management of the business by defendant prior to this meeting was efficient and satisfactory, and any disrespectful conduct on that occasion, if shown, furnished no legal excuse for his dismissal, in support of which attention is called to the testimony of Charles Bennett, president of plaintiff, himself manager of another manufacturing company and instrumental in securing defendant’s services, wherein he stated his belief that defendant was “a high-class steel man and good engineer,” saying, “up to the time the gentleman made the remark to me his services were satisfactory to me. I would have been satisfied if he had behaved at the two meetings of which I spoke. I would have voted for him as general manager,” and other answers to like effect. This witness, however, further said of the October meeting and defendant’s services:

“He absolutely would not make any reply to our question. There was nothing said or done to Mr. Welch that night aside from the questions to him about his individual transaction with the Troy Manufacturing Company, that would provoke him. He never told me or any of the other officers that he bought steel there on his own account. * * * The man was insubordinate, insulting and abusive to the directors and we had the right to discharge him for that cause. * * * I was trying to fix it up so that Mr. Welch could do his own questioning and satisfy us this was or was not done to keep us from trouble and not to make money. I did not say that if it was true, we were going to vote to discharge him. If I had known he had made the purchase without our knowledge or consent, I suppose that I would haye voted to discharge him. I don’t consider he had made a success of the company. He had failed to do many things he said he would. The company was in better condition than when he took it. I said I believed in Mr. Welch’s honesty and integrity up to the very last minute. * * * When I got that information (of his secret profits) that was the first thing that shook' my belief in his honesty. * * * I would not say that I was perfectly willing to have him continue as general manager after that was brought to my attention.”

As the testimony of plaintiff’s directors outlines the causes of friction which culminated in defendant’s discharge at the October meeting, he early assumed a dictatorial attitude towards them, objected to and pronounced unnecessary so many meetings of the board, saying, “if he needed the diréctors he could send for them,” at times disregarded instructions of the board and evaded questions put to him by members, emphasized that he “was used to doing business with large men,” and other things which one of the members designated as “minor differences” which were “ironed out” at the time. In May, 1917, he asked for an increase of salary which was not granted owing to the then financial condition of the company which had not yet paid any dividends, resulting in his becoming angry, at which time, as the president of the company testified, he called them “d — d little people, and said to never mind he would get it any way.” It is charged in plaintiff’s bill and testified to by W. R. Brace himself, that defendant soon thereafter and while yet in plaintiff’s service told Brace, who was plaintiff’s other experienced man in sheet metal work, and in charge of manufacturing under defendant, with whom he was then very friendly, that he might leave the company in the near future, and asked if Brace would quit with him.

Much space in the record and briefs of counsel is devoted to testimony and argument relating to the Troy steel transaction, which in comparatively brief outline is as follows: On June 18, 1917, plaintiff took a contract to supply the Republic Motor Truck Company of Alma with auto parts which required over $800,000 worth of material. It was defendant’s duty to secure this material to the best advantage possible for his company. He told its directors that they needed 200 tons of 20-gauge steel and was authorized to procure it. He had visited over 20 mills during the latter part of June and fore part of July without success, when he learned that the Troy Manufacturing Company, of Troy,» Ohio, had a supply. He telegraphed them on the subject and then went to Troy, on July 7th, where he found they had 700 tons of 20- and 22-gauge steel, which they would sell as a whole at a stated price but declined to split the lot and sell him the quantity he wanted for plaintiff. He advised them he would look for some one to take the balance which his company would not need. He returned to Ypsilanti where he rejected about 150 tons of steel shipped to plaintiff by another manufacturing company on account of alleged defects, went to Detroit where he interviewed a steel salesman of his acquaintanee named Love and through him was introduced to the purchasing agents of the Ford and Cadillac companies with whom he negotiated a sale of the surplus Troy steel at an advanced price, by which he realized the profits stated and $562 which went to Love for assisting him. He negotiated the deal with the Ford company on his individual account and for his sole profit. Love testified the steel could have been sold as easily for plaintiff as for defendant. There was a shortage of steel, the price advancing, and it was easy to sell it. He took the Ford order on July 17th and wired the Troy company he was ready to close the deal. There was considerable correspondence and telegraphing on the subject in arranging details and making the deals. Defendant worked at this during business hours, using plaintiff’s stenographer at its office whom he told to keep quiet about the transaction and destroyed some of the stenographer’s notes on the subject. He also corresponded with Love indicating that he had other large deals on hand and as a matter of fact he did on the side a gross steel business in his own name of over $100,000. Plaintiff’s officers claim that had they been advised their company was financially able and they would have approved handling the deal with the Troy concern through defendant for the benefit of the company. While they knew of the Troy transaction in a way and understood defendant as their manager was working to get what steel their company wanted to the best advantage, as they supposed, the officers of the company were not advised of the opportunity of which defendant availed himself until later. While there is some controversy upon that point, this is. made plain in defendant’s brief, where it is said:

“He did not inform his directors of the purchase by himself and since his purchase of the balance of the 700 tons of steel, released the steel required by plaintiff for its immediate needs to go on with contract No. 251 with the Republic Motor Truck Company,” etc.

The steel wanted by plaintiff in July, 1917, for its Republic contract was 200 tons of 20-gauge steel which is a thicker sheet metal than 22-gauge, and the quoted finding of the trial judge as to defendant favoring the Ford and Cadillac companies to plaintiff’s disadvantage in that particular is borne out by the testimony.

Defendant was not only in the service of plaintiff, employed as its general manager, one of his duties as its agent being to purchase steel for its use, but he was also a director and officer of the corporation. It was his duty to make the best bargains possible for his company. By the terms of his contract of hiring he expressly agreed “to devote all his time to the interest of and for the benefit of” plaintiff, and while in its service “not to engage in any other business * * * which would in any way conflict with his duties” to it, as to which matter plaintiff was “to be the judge.” In the Troy steel transaction, where he admittedly made a profit of over $5,000, he assumed to be the judge of whether his interests conflicted with his duties, refused to discuss the question with plaintiff’s directors and told them it was none of their business.

But independent of the express terms of his hiring, as to engaging in other business, it is an elemental rule of agency that his duties required his efforts and activities in the line of his employment should be for the benefit of his principal, and he was not at liberty to deal in the business of his agency for his own benefit. It was his duty to communicate to his principal facts relating to the business which ought in good faith to be made known to the latter. This subject is quite fully covered in the annotations to Leathers v. Canfield (117 Mich. 277), found in 45 L. R. A. 33, and further authorities need not be cited. The corollary to that fundamental rule is thus concisely stated in 1 Mechem on Agency (2d Ed.), § 1224:

“The well settled and salutary principle that a person who undertakes to act for another shall not, in the same matter, act for himself, results also in the other rule, that all profits made and advantage gained by the agent in the execution of the agency belong to the principal. And it matters not whether such profit or advantage be the result of the performance or of the violation of the duty of the agent if it be the fruit of the agency.”

Where the agent is also an officer of a corporation for which he is acting there is added reason for rigidly adhering to the rule. This court recently had occasion to apply it in Garber v. Town, 208 Mich. 1. Much there said and held is well in point here. The trial court rightfully decided that defendant’s discharge was justified and the conceded profits made by him in the Troy deal 'were made in connection with and execution of his agency, and belonged to plaintiff.

As to the $10,000 worth of stock, a somewhat more complicated question is involved. Counsel on both sides claim the contract is explicit, complete and unambiguous upon that subject beyond any question of construction or interpretation, but are at marked variance as to what it does mean. For defendant it is contended that by its terms he became absolute owner of the stock when it was transferred to him, being then of doubtful value and given as an inducement to abandon an assured position with higher pay and enter plaintiff’s employment; while it is urged for plaintiff the stock was conditionally transferred to him as advanced wages, or a part of his compensation for a five-year period of service. The written agreement contains but four contracting paragraphs. The first is in itself a complete contract of hiring in a stated employment, for a definite period at a specified minimum wage, with a stated maximum contingent on profits. No further direct mention of or reference to wages, or compensation for services, appears anywhere in the instrument. The second paragraph gives defendant this stock on one expressed condition. By it plaintiff—

“agrees to issue to the second party 1,000 shares of the capital stock of the said Michigan Crown Fender Company at the par value of ten dollars per ‘share on the first day of February, 1916, provided said second party assumes his duties on said date.”

The third is exclusively supplemental of the first paragraph, requiring defendant to devote his time to the interests of his employer and not engage in other business except as plaintiff might permit. The fourth and last paragraph, supplemental of the second, only specifies that before offering for sale his thousand shares of stock to others, in whole or in part, defendant shall offer it to plaintiff or one of its directors. No other named restriction on his ownership of this stock is to be found anywhere in the written agreement. If any appears it is a matter of inference and construction. In that field of inquiry the language employed, subject-matter and surrounding circumstances under which the parties entered into the agreement are all proper subjects for consideration as aids in determining their intent and mutual understanding.

Both parties have fully performed under the stated requirements of paragraphs 2 and 4. This stock is nowhere else mentioned. It is undisputed that on the date specified defendant assumed his duties, entered plaintiff’s employment, which he never voluntarily abandoned, and on or about the same date plaintiff issued the stock to him. No claim is made that he ever offered the stock for sale in violation of paragraph 4 and plaintiff alleges in its bill of complaint “that said stock is now in possession of said defendant and is now owned by him.” This at least fixes the title of the stock in him. Adverting to the surrounding circumstances and situation of the parties when the contract was made it appears undisputed that plaintiff’s officers sought out and induced defendant to give up an assured position paying him a larger salary to manage for it a comparatively new and as yet unprofitable business. He had made good in his position with Dodge Brothers, was' receiving $6,500 for that year, with a position open to him for the ensuing year at a salary of $8,500, as he testifies and is not denied. He was solicited to make the change personally, and by letter. As early as July, 1915, a proposition was made to him by plaintiff and he was asked, if not acceptable, to make a counter proposition. It is evident from the minutes of the directors’ meeting quoted they then had in mind that the stock they would issue defendant should be given as “part consideration for his services,” as is now urged the contract should be interpreted; but it is significant that the express provision to that effect which they took the trouble to enter in their minutes was entirely omitted from the written agreement soon thereafter prepared, accepted, and executed by both parties.

Pursuant to this agreement defendant in good faith gave up the position he had with its larger salary and opportunities, and assumed his duties, in plaintiff’s service on the date fixed where he remained for over a year and a half organizing and managing defendant’s business efficiently and successfully until it was developed past the experimental stage, and during his incumbency as manager experienced a marked growth and prosperity as a manufacturing institution. • In that particular it can fairly be said he made good, and accomplished the primary purpose for which his services were secured. The delinquency leading to his dismissal was aside from'this.

Throwing up a profitable position, changing his plans and casting his lot with plaintiff’s uncertain enterprise for a reduced wage was no small consideration in itself. While not directly in point, the importance of a radical change in situation and sacrifice of opportunity as a distinct consideration is emphasized in Welch v. Whelpley, 62 Mich. 15, where a father agreed with a daughter and son-in-law that if the latter would reject an offer of employment and they would move near him upon a tract of land he would give it to them. It was there said:

“This contract, which, for what was beyond doubt in the eyes of the parties an important and valuable consideration, called on complainants to fix their home on the land in question, was fulfilled when they did so in good faith.” <

A like thought is expressed in Russell v. Russell, 94 Mich. 122.

We cannot conclude that the contract yields to a construction authorizing the court to split, or divide up, this block of stock on the basis Of time served under the agreement. Defendant was given the entire thousand shares when he gave up his former position and took up the management and development of plaintiff’s business on a stated monthly wage. He then concededly had possession of and title to the stock, with no expressed restraint in the written agreement on his acts of full ownership except that if he desired to sell he must give plaintiff, or its officers, the first chance to purchase. It became his then or not at all.

When this suit in equity was begun plaintiff conceded and alleged that defendant was in possession of and owned the stock, voluntarily issued and turned over to him by plaintiff. The written agreement neither directly states, nor plainly makes absolute as plaintiff contends, that his ownership was to be or is conditional. Plaintiff is seeking cancellation of his title, and restoration to itself of possession and ownership. No complete failure of consideration is shown on which to base such claim. The burden of establishing its right to relief under this contract rests upon it. We find no sustaining inference in the contract itself imperative to enforce as a manifest equity. The testimony admitted by the court touching the circumstances attending the making of the contract was competent, not to contradict the written agreement, as plaintiff contends, but as an aid to its interpretation. For such purpose, when the language is obscure or the implications claimed not imperatively manifest, both preliminary negotiations and surrounding circumstances may be considered.

Plaintiff has not affirmatively established its right to the stock in dispute formerly issued by it to defendant. The decree will be modified to leave his ownership of the same undisturbed, all subject to plaintiff’s lien for profits as decreed against him, and otherwise stand affirmed with costs to appellant in this court.

Moore, C. J., and Brooke, Fellows, Stone, Clark, Bird, and Sharpe, JJ., concurred.


source: Caselaw Access Project

license: Public Domain

text:
    REINHARD v. GRAND RAPIDS SCHOOL EQUIPMENT CO.
    1. Contracts — Oral Contracts — Commissions—Evidence— Question eor Jury.
    In an action by a salesman on an oral contract for the payment of commissions on the sale of goods manufactured by defendant corporation, in addition to the salary paid, where the testimony was in dispute as to whether commissions were to be paid on other than school supplies and equipment, and as to whether the salesmen, one of whom was an officer and sales manager of defendant, were instrumental in securing government orders, the issues raised were properly submitted to the jury, as questions of fact.
    2. Same — Weight oe Evidence.

      Held, that the verdict in favor of plaintiff was not against the overwhelming weight of the evidence.
    3. Trial — Issues—Instructions.

      Held, that the issues raised were properly presented to the jury.
    4. Contracts — Payment — Commissions — Acceptance of Gratuity — Effect on Contract — Notice.
    A statement by defendant’s president, at a dinner given by the stockholders to the salesmen and bookkeeper, at which time checks were distributed to them as tokens of appreciation, with Christmas greetings, that no commissions were due the salesmen, if heard by plaintiff, would not have the effect of notifying him that if he accepted the cheek it was in payment of any claim for commissions he might have under his contract of hiring.
    5. Pleading — Payment—An Affirmative Defense.
    In an action for commissions on a contract of hiring, the affirmative defense of payment, in order to be available, . should be pleaded.
    6. Contracts — Government Contracts — Commissions — Public Policy.
    An agreement by a corporation to pay its salesmen, one of whom was its officer and sales manager, a commission for procuring government contracts, where it was not contemplated that any illicit methods or any corrupt influences were to he used, held, not void as against public policy.
    Error to superior court of Grand Rapids; Duiiham (Major L.), J.
    Submitted April 13, 1920.
    (Docket No. 51.)
    Decided July 20, 1920.
    Assumpsit by George F. Reinhard against the Grand Rapids School Equipment Company for commissions on the sale of goods. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Clapperton & Owen, for appellant.

      Knappen, Uhl & Bryant, for appellee.
   Steere, J.

Defendant brings this case here for review on numerous assignments of error against a judgment of some $16,000 obtained against it by plaintiff in the superior court of Grand Rapids, based on a claimed contract for commissions while a salesman in defendant’s employ during the year 1917. The controversy involves the nature, validity and performance of plaintiff’s contract of employment for that year. Defendant is a corporation owned and controlled by four stockholders, all officers and actively connected with it, named Schravesande, Fox, Fortier and Matheson. In 1913 the four men purchased a concern known as the Grand Rapids Screw Company, which was manufacturing a variety of special articles in the wood-working line, such as hand-screws, clamps, trucks, cabinet makers’ benches, kitchen cabinets, equipment for manual training schools, etc. After acquiring the screw company’s property and business the purchasers paid special attention to and developed a trade in school equipment machinery and furnishings for departments in manual training, drawing, laboratory work, etc. They later reorganized into a corporation known as the Grand Rapids School Equipment Company, dividing the' stock equally. Schravesandewas chosen president and financial manager; Fox, superintendent of manufacturing and general executive; Matheson, secretary, in charge of accounts and office work, and Fortier, treasurer, in charge of the sales department. Fortier himself was known as a good salesman and went upon the road more or less. He had under him, at the time to which this controversy relates, three salesmen, De Young, Mentzer and plaintiff, Reinhard. They were on the road much of the time, devoting their efforts mainly to selling school equipment in which defendant specialized. What other services they rendered is a matter in dispute. D.eYoung had been with defendant from the beginning. In January, 1915, plaintiff, who had previously worked for another factory at the same salary, was employed by defendant at $250 per month to help in-planning, bringing out and selling wood-working machinery and other equipment for manual training in educational institutions. In connection with Mentzer, who was then first employed, he designed and developed a lathe and forge which became- a part of their school equipment line. In 1915 defendant’s business reached $253,000 in school equipment with other work and sales amounting to $70,000 and the salaries of De Young and Mentzer were increased; but the world war was under way and business conditions became so disturbed that their school equipment line of trade, instead of increasing, fell to $218,000 in 1916, and other incidental work diminished, while De Young and Mentzer were asking for increased compensation.

In December of 1916 the outlook was such, especially in their school equipment line, that defendant’s officers concluded to make some special effort to meet the situation and keep their business going successfully for the ensuing year. They could forecast to some extent the prospects of school business, as prospective school buildings and large jobs in that line were published in what is known as the “Dodge Reports.” De Young, their oldest salesman, testified: “This we were able to get from the Dodge Reports list which we had, and we were able to tell almost a year in advance what the prospects were for business.” Schravesande, the president of the company, also stated school business did not look very good for possibly two years to come on account of the war, as materials were going in other directions. The previous year’s falling off and future prospects were discussed by the officers of the company among themselves and different plans suggested. The plan decided upon and presented to their sales force was for an increased effort to secure business, stimulated by a contingent increase of compensation. A meeting of the four members of the company and three salesmen was called early in January at which the situation was discussed, a proposition made by the company and an oral agreement for the ensuing year entered into, as is undisputed. The testimony of both sides harmonizes upon a contract under which the salesmen should remain for 1917 at their former salaries and a commission of 5% would be divided equally among the four members of the sales department, which included its manager, Fortier, on all sales made or orders taken during the year in excess of $200,000— either limited to school supplies and equipment only, as insisted by defendant, or upon anything which could be made or work which could be done at the factory in securing which the sales department was instrumental or had participated, as claimed by plaintiff.

Of an agreed contingent commission of 5% and to whom payable there is no disagreement. The distinct issues of fact are over what the commission applied to and what was done by the sales department. For-tier, the sales manager, testified that he was one of the parties who were to participate in that commission if any was earned, but that it covered only school business. The three other officers of defendant testified in substance to the same effect, while plaintiff and the two other salesmen testified to its broader application. The conflicting testimony of the respective parties upon that issue is extended by long direct and cross-examinations out of which affirming and refuting arguments are extracted by counsel. There was abundant testimony on the part of plaintiff to fairly carry that issue of fact to the jury, as the following brief excerpts from his evidence sufficiently indicate:

“Mr. Fox said they wanted to fill the factory full of work, it didn’t make any difference what it was, so long as they could make it in the factory. * * *
“Q. Work on what?
“A. Selling the product of that company and any special equipment that they could manufacture * * * anything that they could manufacture in that plant that the sales force worked on. Mr. De Young asked him about figuring special jobs, and he said we could go out and hustle for anything that they could manufacture in that plant; that he would figure on it and if necessary he would go out and help us get it; that we would be given full credit for any special job that he figured and got, or that he figured for us and that we got.”

De Young testified:

“Mr. Fox said they wanted to fill the factory with work, and ‘go as far as you like. * * * If we can not make it in this factory we will farm it out.’ * * * They would take anything that they could make in the factory.”
Mentzer testified:
“He says, ‘get all the business you can, and if we can’t make it here we will farm it out.’ There wasn’t any restrictions of any kind made on what the business was to be, whether it was bakoroasts, kitchen cabinets, or what it was, there was no restrictions. * * * No, to my knowledge, there wasn't a thing said about school equipment business; everything was talked of in general, to fill up the shop. * * * He told us that, practically one of the last things he said, ‘now fellows,’ he says, ‘go to it, go as far as you like, fill the old shop full; the more you make the more we make; the more we make the more you Jnake; there will be no hard feelings how much you make.’ ”

De Young testified:

“We was to have credit for anything the sales force could show they had spent any time on, written any letters, made quotations, called on customers or was in any way instrumental in landing the order. The', only’thing we were not to receive commission on was those orders that came in by mail unsolicited.”

While specializing in school equipment business for which its salesmen were sent out to obtain contracts and orders, the evidence is undisputed that defendant handled six or seven other lines of articles turned out by its factory, such as kitchen cabinets, running boards for automobiles, banquet tables, mirror frames, certain hotel equipment, hand screws, show cases, bakoroasts, etc.

When this country declared war, April 6, 1917, and was- proceeding to devote its. energies and resources to active preparation, defendant, like thousands of other manufacturing institutions, both great and small, first placed its “factory at the disposal of the government,” but without immediate results. Schravesande and Fox then went to Washington and, as For-tier testified, “laid out a line of work to follow up for them.” He went to Washington in May where he remained for some time, and, as. he states, “followed out the routine,” and war contracts followed eventually. He was there more or less in May, June and July, representing defendant, as he states, and on a trip “from May to June,” he says, “X got an order for arms chests.” The largest contract obtained by defendant was for 6,400 truck bodies at $195 each, not including crating which was for each body $6 additional. This was $12 a truck more than the International Harvester Company received on a large contract for all it was able to take. This truck body contract amounted to $1,248,000. Fortier testified that when figuring the cost the whole overhead for the year would naturally be figured in, but he had nothing to do with that. The orders received by defendant during 1917 amounted to $1,509,319. Plaintiff testified that Matheson in speaking of the matter stated in effect that the entire overhead for the whole year had been figured in on the truck contract.

It is claimed by plaintiff and denied by defendant that the sales department, or force, directly and indirectly worked upon and participated in securing the government orders, and that Fortier in particular, who was one of the four members of the sales department to whom the contract applied, effectually devoted much time and effort to the work of securing those large and profitable government jobs which filled the factory with business during that year, and longer. That question was also submitted to the jury by the court as an issue of fact. As to it defendant contends the testimony presented no legitimate issue for the jury within the purview of the contract even as testified to by plaintiff; and that as to both issues the verdict was against the great'weight of evidence.

Of the testimony relative to Fortier’s participation in securing the government contracts, defendant’s contention is summed up in the statement that the bids were' prepared by others, submitted according to department regulations and the fact that Fortier, an officer of the company—

“called at the quartermaster’s office in Washington, to inquire whether or not awards had been made on the bid filed, and when the bid was announced wired his company of the award, does not constitute ‘working’ to obtain the contract or make the sale.”

If he and defendant’s president are to be credited that falls far short of being all he did. Fortier was recognized by the other officers of the company as a good salesman and had at times gone out to get special jobs like the other salesmen. Other officers of the company had expressed a wish that he might get out on the road oftener. It is undisputed that defendant’s officers were anxious to secure sufficient government work to keep their factory busy. Schravesande stated he thought it would be a good thing to have Fortier “right down there” to see what he could get for the company, and in talking it over with plaintiff said, “We will send Fortier to Washington, let him stay down there and see what he can pick up.” They did send him and he was there much of the time during May, June and July, working earnestly and successfully on the mission for which he was sent, as asserted by him and other officers of the company before this litigation arose. While there he kept in frequent communication by wire and mail with Schravesande and other officers of defendant. In replying to a letter from their president which he apparently construed as containing some criticism he pointed out that he was “of mature age,” was there “to get business, not for pleasure,” and said:-

“When I left home you told me I was the man to do this job and get in. I am getting brand I want to say when I get to bed at night I am all in. * * * I assure you I am not spending any more than I have to as my habits are within the domain of conservative effort. * * * I feel I am giving every ounce of energy I have to this problem and if you think I am not proceeding in accordance with your wishes I will welcome your criticism.”

In a letter referring to arms chests orders and reporting one for over $17,000, he said: “I finally got this order through, the balance, which does not amount to much but will help.” In another letter written after the large truck contract was secured he criticized a notice of the fact published in a Grand Rapids paper as having called “attention to things like being $12 higher than the International Harvester” and said, “I had hard enough work to get this order through without there being any come-back and I hope no one here sees this paper.” Referring to an order for “the big field desk” which he understood from Fox they could “get out easily before the big contract started in 60 days,” he wrote: “I would like to pick this up-before coming in, and also a few others. Landed a contract for six tables yesterday at a good big price.”

Lauding the work done by Fortier in securing those orders, Schravesande wrote him shortly before his return :

“I am inclined to think tnat when you come home, if you will telegraph us, the entire city will meet you with a brass band at the depot. The Grand Rapids Showcase Company have been at me two or three times to know whether or not you would undertake to represent them in Washington, and other concerns have asked me, now that we are filled up, you would be willing to get them some business. I have answered all those_ fellows that you were just about through in Washington and that I did not think you would consider making any connection with any one else, because we would need you in the factory.”

This and other evidence as to what was said and done in that connection fairly raised an issue of fact for the jury as to whether Fortier worked upon and was instrumental in securing those war orders to which, their plant was almost exclusively given over thereafter. Plaintiff worked in the office while For-tier was away to secure the war orders, and attended to the correspondence usually handled by Fortier. He testified that later he worked on school equipment orders but was limited to machinery equipment, or stock business which was bought from other houses, saying, “They told me to go ahead and sell all that I could of that that didn’t have to be made at the plant but to shut off on the other.” De Young and Mentzer testified to similar instructions, and the latter, who was experienced and lauded as a “whirlwind” by Fortier, helped on the truck body contract. It was admitted that certain school equipment work was thereafter “farmed out” to another company.

Fortier was concededly a good salesman, at the head of the sales department and a member of the sales force, one of the- four to work for and participate in whatever commission its combined efforts earned under the contract in question. The questions of what the disputed provision of the otherwise conceded contract was and in what manner or to what extent performed, were clearly made issues of fact by the conflicting testimony. Regarding those issues we cannot find as a conclusion of law that the verdict was against the overwhelming weight of evidence. '

Defendant’s lengthy and varied series of assignments against refusal of the court to charge as requested and failure to sufficiently instruct as to the elements of a contract, and proper construction of the contract under consideration cannot within reasonable bounds be reviewed in detail. In general it may be said that the burden of defendant’s complaint and argument is that the charge was too general and meager of details as to the essential elements of the claimed contract, and in leaving it to the jury “to vaguely grope and guess” without proper instructions as to the “facts and circumstances to be taken into consideration in determining the intent of the parties.” The court did not elaborate in technical definitions or review the evidence to the jury, but did distinctly point out and plainly tell the jury what the disputed facts for them to decide were. The charge covers between 5 and 6 pages of the printed record, plainly states the nature of the litigation, the claims of the respective parties, the portion of the contract as to which they disagree, that the burden of proof rested upon plaintiff to establish his claim, and the duty of the jury to decide the concisely stated issues of fact submitted to them.

After stating one of the issues of fact to be, “Did the minds of the parties meet in mutual understanding or agreement?” And, if so, the proper “construction of such agreement in the light of the subject-matter,” it is said in defendant’s brief:

“We submit there can be no question under the evidence as to the understanding of these four men that the commission was to be based upon the volume of school business, and that the plaintiff and his associates so understood it. * * *
“The entire case rests upon the proposition to so construe an oral agreement for a commission, intended to be earned by plaintiff in the sale of school equipment, as to apply solely to a government contract unanticipated by the parties at the time of the agreement, no part of which commission was or could have been earned by claimant, and which bears no relation whatever in the nature of earning to a government contract.”

Those contentions and many others argued for defendant are tinctured with the assumption that the facts are as defendant claims, seemingly ignoring the few but distinct and important issues of fact arising from the conflicting testimony of the parties present and participating in making the contract. Their disagreement is not as to whether the minds of the contracting parties met, but upon what they met. The testimony of each side is positive, and as given leaves no room for misunderstanding as to what was said and agreed to. The issues of fact were clean-cut in that respect, and plainly presented to the jury in oart as follows:

“If the plaintiff has not proven this contract to have been made as he claims, and by a preponderance of the evidence, that will be the end of this case and your deliberations therein and you will return a verdict of no cause of action. * * * It will be necessary for you to determine just what the contract was between these parties. * * * Upon what did the minds of these two contracting parties meet there upon that occasion? * * * Was it confined to school equipment or was it all orders for the manufacture and sale of products that these salesmen obtained or worked upon? In determining just what this contract was, whether as claimed by the plaintiff or as claimed by the defendant, you determine, what the evidence shows took place between these men at the time that that contract was made. What was said by them? What was the understanding between them? You not only consider that, but you will also consider anything that was said after that by any of the parties there who took part in making said contract, as bearing upon what their understanding of it was, if there was anything afterwards said by any of them, that will aid you in determining just what these men agreed upon there at that time; and how these parties themselves construed that contract.”

There was testimony for plaintiff tending to show how the parties themselves construed this contract after the matter of war contracts arose and efforts of the company were diverted from its regular lines. Shortly before this large truck order was obtained Schravesande said to plaintiff, “Just think, George, if we get this contract for trucks we will all be rich,”— and on at least two separate occasions Fortier told Mentzer, who had bought a home on time and was struggling to pay for it, that his commission from the truck job alone would be enough to complete the payments on his home “and then some”; and towards the end of the year both Mentzer and De Young were told, “Don’t be in a hurry. You won’t get that commission until after this truck job is done.”

The understanding of the parties to an oral contract is shown by the evidence of what was said at the time by the parties who made it — not by their secret thought but by their expressed intention. When their testimony conflicted it remained for the jury to determine what the contract was. Durgin v. Smith, 133 Mich. 331; Hudson v. Transfer Co., 137 Mich. 255.

Shortly before Christmas, 1917, a dinner of rejoicing, attended with much hilarity and expressions of good fellowship, was given one evening at the Peninsular Club by the stockholders of defendant to its salesmen and bookkeeper. Envelopes containing Christmas greetings and a check for $500 each were placed at the plates of plaintiff, De Young and Mentzer, with one containing a $200 check at the plate of the bookkeeper. These they accepted as gifts and kept, being told as claimed by plaintiff’s witnesses that the checks were given them as tokens, of appreciation, both For-tier and Matheson saying, as Mentzer testified, “When this truck job is finished up you will be well taken care of.” Defendant claims the gifts were qualified by a statement of Schravesande that no commissions were due the salesmen, which plaintiff and the other salesmen deny having heard. Error is urged on refusal of the court to instruct the jury that, if they found such statement was made by Schravesande, then—

“having accepted on that occasion $500 without objection, such acceptance is binding upon the plaintiff and must be considered an acceptance and payment of any amount which he might claim was due him for commissions, there can be no recovery and your verdict must be no cause of action.”

Not only was no affirmative defense of payment pleaded, but if Schravesande, who stated the occasion was accompanied by “a lot of joshing,” did make the statement claimed it would not if heard.by plaintiff inform him the token of appreciation was on condition that he accept it as a payment in settlement of any claim for commissions under his contract of hiring.

It is further contended for defendant that orders for war work were not within the purview of the contract and the minds of the parties could not have met upon that subject since this country had then neither declared nor was making preparation for war; that the term “orders” in connection with defendant’s business at that time could not legally be construed to include “war contracts,” and if so intended an agreement to pay a commission for procuring the same was illegal as against public policy and void, for which reasons its motion to strike out all testimony relating to government contracts and direct a verdict for defendant was erroneously denied. It is not shown or claimed by plaintiff that these parties at the time -the agreement was entered into specified or had in mind government contracts, or any other definite contracts, jobs or sales. What they did have in mind and contract in relation to, according to plaintiff’s evidence, was orders and contracts of any and every kind which would fill the factory with work and keep it running upon anything they could make in it. It certainly cannot be successfully contended that orders after-wards. secured and accepted within the year which met those conditions, were outside the contract because not in mind or in sight at the time of the agreement.

Upon the proposition that an agreement to compensate for procuring government contracts is against public policy and void, defendant’s counsel cite Tool Co. v. Norris, 2 Wall. (U. S.) 45, an early extreme authority to that effect, and Crocker v. United States, 240 U. S. 74 (36 Sup. Ct. Rep. 245), which applies the rule stated in the Norris Case to a situation where a corrupt secret agreement was made with a superintendent in the mail service in relation to procuring a government contract for letter carriers’ satchels. Other Federal decisions are to be found somewhat along the same line; but that court has recognized the distinction between employment for services of a legitimate character in transacting business with the government and a contract to improperly influence government agents in the performance of their public duties (Stanton v. Embrey, 93 U. S. 548), and an examination of Beal v. Polhemus, 67 Mich. 130, with numerous other decisions in various jurisdictions, indicates as well supported the statement in 13 Corpus Juris, p. 435, that—

“this extreme doctrine (as stated in the Norris Case) is not generally followed, and the right of all persons to be heard before an officer or department of government through agents has been affirmed, and the legality of contracts for the employment of legitimate agents for negotiating business with the government has been sustained where no corrupt' influences were to be used by the agent, and the agency is. disclosed, even though compensation is contingent on success.”

There is no proof or claim here that the contract of hiring contemplated any illicit methods or that any corrupt influences were used in securing government contracts. Fortier was not only the disclosed agent and sales manager but an officer of the defendant corporation, which could only transact business through its officers and agents. The parties to this contract saw fit to let it rest in parol subject to the memory and credibility of those who made it. Their conflicting testimony as to certain of its provisions raised issues of fact controlling in this, contention which in their final determination were strictly within the province of the jury to decide. The case was well tried by counsel and fairly submitted to the jury upon the facts in dispute.

The judgment is affirmed.

Moore, C. J., and Brooke, Fellows, Stone, Clark, Bird, and Sharpe, JJ., concurred.


text:
    OGOOSHEVITZ v. SAMPSON.
    1. Frauds, Statute or — Contracts—Lard Contract — Validity.
    A memorandum agreement for the execution of a land contract containing all of its essential elements, viz., property, price, terms, and limit of time for full performance, signed by the vendor, held, to comply with the requirements of the statute of frauds, and to be valid and bind- ■ ing upon the parties.
    2. Evidence — Parol Evidence — Written Contracts — Contradicting Written Contract.
    In an action for damages for the breach of a memorandum agreement to execute a land contract, complete in itself, where it specified no necessary or desired feature of a land contract left open for future agreement, it was error for the trial court to admit oral evidence contradicting its provisions, or that it did not contain all agreements of the parties.
    Error to Wayne; Mandell (Henry A.), J.
    Submitted April 20, 1920.
    (Docket No. 103.)
    Decided July 20, 1920.

      Assumpsit by Isaac Ogooshevitz against George L. Sampson for breach of a land contract. Judgment for plaintiff for an insufficient amount. He brings error.
    Reversed.

      Friedman & Meyers, for appellant.

      Welsh, Bebout & Kahn, for appellee.
   Steere, J.

Plaintiff brought this action in assumpsit to recover damages from defendant for breach of a land contract. He recovered a verdict and judgment in the circuit court of Wayne county in the sum of $260 which he brings to this court for review on assignments of error claiming an inadequate verdict resulted from prejudicial admission of incompetent testimony and other errors.

The following writing concededly signed by defendant resulted from negotiations between the parties on the date shown:

“Detroit, Mich., March 2, 1916.
“Received of I. Ogooshevitz $100 as first payment on lot known as westerly 18 feet of lot (7) seven and easterly 34 feet of lot 8 being 52 feet on the south side of Palmer avenue west of Beaubien street for the sum of $5,720, terms as follows: $620 more on delivery of land contract or deed and. the remaining $5,000 on or before (1) one year from the date of contract, purchaser to receive an abstract brought down to date before contract is made to show free and clear title. Six per cent, interest.
“George L. Sampson.”

The paper was copied at the time by plaintiff's nephew from a similar writing defendant had just entered in a book which he kept. After observing some slight variations in the copy which he regarded as immaterial defendant added the last sentence, “six per cent, interest,” and signed it. Plaintiff then paid defendant $100 as first payment on the described lot and subsequently received from him an abstract of the property. They met at the office of plaintiff’s attorney to close up the transaction, and defendant produced a land contract for the property drafted in harmony with the original writing, with a clause added reserving five feet of the lot along its east side as part of a 10-foot driveway, giving plaintiff an easement to use the same. Plaintiff objected to this clause, his attorney informing defendant that their preliminary contract, contained no such provision, but defendant declined to proceed further without such reservation. Several letters were thereafter sent defendant by plaintiff’s attorney advising him that plaintiff was ready and willing to perform on his part according to their written agreement and demanding performance by defendant. Finally, on August 4, 1914, he wrote him that plaintiff would allow defendant to reserve the 5 feet for a driveway, and pay him for the remaining 47 feet proportionally, with a demand for performance of their agreement and threatening legal proceedings if defendant failed to comply within a stated time. Defendant did not comply. The property being in the name of defendant’s wife, precluding enforcement of specific performance, this action was begun on September 9, 1916. The parties thereafter negotiated an adjustment by which the agreement was to be carried out with defendant’s clause for a driveway conceded as he wished without reduction of purchase price.

Defendant then had a contract prepared in duplicate by his own attorney, which, contained in legal form and phraseology the substance of the original writing of March 2, 1916, and a provision relative to the driveway upon which he had insisted. As prepared it was acceptable to plaintiff and the parties met at defendant’s home where they signed it, defendant signing for his wife as he testified. The produced instrument which they concededly signed is dated September 29, 1916. Plaintiff then paid defendant the $620 as the contract specified. Shortly thereafter defendant’s attorney came in and a controversy arose between the parties as to a building restriction upon the property, which defendant claimed had been agreed upon and should be inserted in the contract, but which plaintiff and his nephew, who. had participated in the negotiations and signed the contract as a witness, strenuously denied and objected to any change in the contract. Plaintiff claimed his copy of the contract was handed him when it was signed, and was in his pocket when the attorney arrived, to whom he handed it when- requested. Defendant claimed both copies yet lay upon the table. Be that as it may, it is undisputed that the papers were signed and payment made when the attorney arrived and he thereafter, against plaintiff’s protest, inserted in the contract a provision that “the front part of the lot facing on Palmer avenue shall be used for dwelling or apartment house purposes.” Plaintiff insisted upon the contract as drawn and signed without the restrictive clause defendant’s attorney had inserted, which was refused him. He then erased his signature from the changed contract, pr had it done, and received back the $620, but refused the $100 paid on the agreement of March 2, 1916.

The block containing this lot was without restrictions, and plaintiff contended he had so purchased the lot from defendant, who on his part claimed plaintiff had agreed from the beginning to the restriction he sought to impose. Although testifying he was experienced in real estate transactions and drafting papers in relation thereto, he stated as his reason for not putting the claimed restriction in the agreement before was, “I didn’t think there was any question about it.”

Much of this record is devoted to testimony as to talks, negotiations, understandings and oral agreements between these parties upon that subject, permitted by the court against timely protest and saved objections of plaintiff’s counsel. At close of the testimony plaintiff’s counsel moved the court to strike out all evidence as to conversations and verbal agreements between the parties prior to or at the time the writing sued upon was signed, and to direct a verdict in plaintiff’s favor for whatever damages the jury found he had suffered, filing written requests to the same effect. These were denied and the case submitted to the jury in a lengthy charge permitting them to take into consideration such testimony. A motion was thereafter made for a new trial upon the ground that the verdict was inadequate, owing to refusal of plaintiff’s request to charge on the subject of damages, and prejudicial admission of testimony to vary the terms of the written agreement.

In charging the jury the court read and apparently took as a text the following excerpt from Mull v. Smith, 132 Mich. 618:

“Our statute does not make all contracts for the sale of land void. It excepts those where the contract itself or some note or memorandum thereof is in writing and signed by the vendor. When the contract itself is in writing and signed by both parties, the writing is the contract. When the memorandum of the oral contract is in writing and signed by the vendor, it is not the contract, but a memorandum, which makes it binding upon him if accepted by the vendee.”

In that case plaintiff sued to recover $100 which he had paid on a land purchase, evidenced by a scant memorandum which defendant had signed and the question involved was whether it contained sufficient essentials of a land contract to take it out of the statute of frauds. The court held that it did and further said of it:

“Here, then, was a valid contract for the sale of land. Defendant is proven to have made it by his writings signed and delivered. The plaintiff is shown to be a party to it by oral proof of his acceptance of defendant’s memoranda, and payment of $100 upon it. He cannot recover the $100 as money paid for his use.”

The attitude of the court in admitting and submitting to the jury the oral testimony objected to is, we think, fairly disclosed by the following extract from the portion of the charge dealing with the subject:

“The plaintiff has asked me to direct you to return a verdict in favor of the plaintiff for such a sum in dollars and cents as you may find that he was harmed or injured by the default as he claims it of the defendant. That I decline to do. I decline to do it because of the rule that I have read to you, and also because of the position taken by the defendant. I charge and instruct you as a matter of law therefore that these two papers taken together and properly construed from a legal point of view are clearly memoranda indicating that the parties would get together and make a contract; that the contracts were not construed or considered by either the plaintiff or the defendant as a complete land contract or a land contract complete in its terms and therefore it will be for you to determine whether anything was said between the plaintiff and the defendant at the time these memoranda were signed and indicated what the contents of the paper would be that should be executed as a land contract between the plaintiff and the defendant.”

This memorandum of March 2, 1916, is more complete in essentials than that held a valid contract in the Mull Case. It was given to and accepted by plaintiff manually and orally, by payment according to its terms and in writing by offer to comply with all its requirements with demand of performance on defendant’s part. It contained the essential elements of a valid land contract. Property, price, terms, and limit of time for full performance are definitely stated. It specifies no necessary or desired feature of a land contract left open for future agreement. Any agreement to enlarge or restrict its provisions would be an agreement to alter it, which cannot be done by a previous or contemporaneous oral understanding, or contract.

Apparently the court was led to the view that it was not a binding contract by the reference in it to a contemplated future contract which the court instructed the jury indicated that it was “not construed or considered by either the plaintiff or the defendant as a complete land contract or a land contract complete in its terms.” Whatever the parties may have considered or said upon the subject, they did not specify in writing the terms or particulars as to which they thought it incomplete, and it was error for the court to receive oral evidence contradicting its provisions, or that it did not contain all agreements of the parties. Smith v. Mathis, 174 Mich. 262; Ogooshevitz v. Arnold, 197 Mich. 203; Walsh v. Oakman, 199 Mich. 688. These cases and others to which they refer fully discuss and dispose of this question. In each of the Smith and Arnold- Cases the memorandum of agreement held to be a valid land contract makes reference to a future contract, as in the instant case.

Both parties to this litigation claim to be experienced operators in real estate in the city of Detroit. The avidity and volubility with which they directly contradict and in effect accuse each other of wilful perjury as to matters of understanding and claimed parol agreements relating to this transaction is a sermon on the wisdom of the statute of frauds and its strict application. Opening the door for such incompetent testimony to dominate the controversy and divert the attention of the jury prejudicially tended to confusion of the legitimate issue. It put into the case an illegitimate element or issue for the jury to debate and compromise on. The court gave the jury no instructions as to the $100 which plaintiff paid defendant on the contract. What basis they made an award of $260 damages on is mere conjecture. It is not in harmony with the testimony of either side, and a compromise verdict is indicated, of which there is plausibility in the suggested conjecture that the relative value of the testimony of the respective parties as to their oral agreements figured as a test.

The judgment is reversed, with costs to plaintiff, and retrial granted.

Moore, C. J., and Brooke, Fellows, Stone, Clark, Bird, and Sharpe, JJ., concurred.


author: Bird, J.

text:
    PEOPLE v. ROBERTS.
    1. Constitutional Law — Murder—Confession—Determining Degree — Statutes.
    In a prosecution for murder, where defendant pleaded guilty, under 3 Comp. Laws 1915, § 15194, the trial court properly proceeded, by examination of witnesses, to determine the degree of the crime, and defendant was deprived of no constitutional right by the court’s refusal to call a jury, since, had a jury determined its degree, they would have done so under the instruction of the court.

      2. Homicide — Poisoning—Statutes.
    Where defendant mixed paris green with water and placed ■ it within reach of his wife to enable her to put an end to her suffering by putting an end to her life, which she did, he was guilty of murder by means of poison within the meaning of the statute (3 Comp: Laws 1915, § 15192), even though she requested him to do so.
    Authorities passing on the question of’ inciting or abetting suicide are collated in notes in 66 L. R. A. 304; 22 L. ,R-, A. (N. S.)- 243.

      3. Indictment and Information — Homicide—Unnecessary to Set Out Means Used.
    Under 3 Comp. Haws 1915, § 15739, it was not necessary to set out in the information the means by which the death of deceased was accomplished.
    Error to Isabella; Hart (Ray), J.
    Submitted April 16, 1920.
    (Docket No. 110.)
    Decided July 20, 1920.
    Frank C. Roberts was convicted of murder in the first degree, and sentenced to imprisonment for life-in the State prison at Marquette.
    Affirmed.

      James H. Pound, for appellant.

      Alex. J. Groesbeek, Attorney General, and Virgil W. McClintic, Prosecuting Attorney, for the people.
   Bird, J.

Defendant was adjudged guilty of murder in the first degree in the Isabella circuit court on his plea of confession and on the testimony which was taken by the court. Several errors are now assigned on the proceedings in behalf of defendant. Some of the errors assigned render it necessary to set out the proceedings at some length. Following the death of defendant’s wife he was arrested on a charge of murdering her. A complaint was made in due form, on June 14, 1919, a warrant issued thereon, and defendant was apprehended and brought before the justice, on June 25th, where he waived a preliminary examination. Subsequently, on July 12th, he was taken before the circuit court in pursuance of his own request and arraigned. After the information was read to him he was interrogated by the court as to whether he understood the charge and whether he understood it to be murder. He replied that he did. He indicated that he would like to have counsel, whereupon the court appointed Mr. Dusenberry, an experienced attorney, at his request. Later in the day the defendant and his counsel came into court and the following took place:

“The Court: You have had an attorney appointed. Are you present with that attorney, and are you ready to plead now?
“Mr. Roberts: Yes, sir.
“The Court: Do you wish to plead to the information?
“Mr. Roberts: Yes, sir.
“The Court; What is your plea?
“Mr. Roberts: Guilty.
“The Court: Guilty as charged?
“Mr. Roberts: Yes, sir.
\“Mr. Dusenberry: I am going to ask your honor. His father is here and I wish you would talk to him, and then you can talk to respondent in private.” ■

Dr. Michael Bronstetter was then called by the people and testified as follows:

'“I am coroner of Isabella county. I presided at the inquest upon the body of Katie Roberts, who I knew in her life. The body over which I held the inquest was her body. I knew her as the wife of Frank Roberts. I was the surgeon who opened up the body, and I examined her stomach, and other intestinal organs.

“Q. In what condition was the stomach, as you found it?

“A. The stomach was greatly dilated with gas, and partly with fluid, in the amount of eight oz. Otherwise it was in a good state of preservation.
“Q. Did there seem to be any other substance in it when you took it out of the body?
“A. There was a. greenish substance in the stomach and some in the esophagus.
“Q. What did you do with the stomach?
“A. I tied it at both ends, before removing it, so as not to spill the contents, placed it in a glass container, and personally took it, with the other organs, to the State board of health at Lansing.
“Q. Have you had any return from the analysis of . that stomach, as made there?
A. X listv©
“Q. What did that show?
“A. The stomach showed on analysis at Lansing 84-100 of an ounce of paris green. * * *
“Q. At the time you held the post mortem did you examine the other organs in the body? That is, the heart and lungs and things of that sort?
“A. I did.
'‘Q. Did you find any trace of any organic trouble, inside there, other than in the stomach?
“A. I did not.
'‘Q. From ¿the condition of the body, as you found it, and the -amount of paris green sb found in the stomach, what would you say as to what was the cause of death?
“A. Acritic arsenical poison.
“Examined by the court.
“Q. Doctor, did you identify the body as that of Katie Roberts, wife of Frank Roberts? ,
“A. I did.
'“Q. You identified it as being the wife of defendant here?
“A. Yes, sir.
“Q. Doctor, did you talk with the defendant about this matter?
“A. No, I have not. This is the first time I have seen him, since her death.
“Q. Did you ever treat him?
“A. I treated Mr. Roberts’ wife. I sent her to Ann Arbor.' !
“Examined by Mr. Dusenberry.
“Q. You had reference to a time you had sent Mrs. Roberts as a patient?
“A. Yes, sir.
“Q. When was that, Doctor?
“A. I could not say just when. * * * About three or four months before her death. * * * I saw her at her home where they lived. She was a bed patient, or practically so at that time. She was in bed, and I believe she said she was unable to do any kind, of work. Whether she could get up, and around or not, I don’t know. Her body was considerably wasted. She showed evidence of a long drawn out sickness. She showed symptoms of, a multiple sclerosis. ■ ■
“Q. What is that?
“A. It is a disease of the central nervous- system, affecting both the brain and cord. The causes of these • patches in the brain and cord is unknown. This condition I found with this patient. She had the outward signs of multiple sclerosis, the rapid pulse, hesitating, singsong speech. And from these signs you diagnose the multiple sclerosis.
“Q. Was she practically helpless?
“A. I should say practically. Just how specifically, I could not say.
“Q. Basing your answer upon your observation, at that time, did you consider her a hopeless patient, or did you consider she might possibly recover?
“A. I considered her case as incurable.
“Q. Did you advise that she go to the hospital?
“A. I don’t know whether I did or not, or* whether that was suggested by some one else. That might have been suggested by some one outside. But I consented to send her.
“Q. Did you send her to the hospital?
“A. I believe I made the motion that she be sent at the county’s expense. It at least had my sanction.
(Coroner’s findings, marked Exhibit A.)
“Mr. McClintic: I offer Exhibit A in evidence.
“Mr. Dusenberry: I want to have the record show, in justice to my client. He says that he paid the expenses to the hospital himself. And that it wasn’t at the county’s expense.
“The.'Court: I think I said I would accept his plea, I think I will accept his plea anyway.”

Defendant Roberts then took the stand and was interrogated by counsel, as follows:

"Examined by Mr. Dusenberry:
“Q. Your wife was sent to the hospital at Ann Arbor?
“A. I took her myself. * * She was there thirty days, I think. I did not stay there at Ann Arbor while she was there. I took her. myself, and made three trips down to see her while she was. there, and I brought her back myself. I paid the expenses incident to her going to the hospital, and staying there •fche thirty days. It wasn’t paid by the county. I paid it out of my own pocket.
“Examined .by Mr. McClintic:
“Q. On May 23d, 1919, Mr. Roberts, I understand, you told me that you had mixed a quantity of paris green in a cup?
“A. Yes, sir.
“Q. At your wife’s request, and placed that on a chair near her side?
“A. Yes, sir.
“Q. Is. that right?
“A. Yes, sir.
“Q. You did that?
“A. Yes, sir.
“Q. And that she had requested you to do that, so she could drink it. Is that right?
“A. Yes, sir.
“Q. And that subsequently she did take that?
“A. Yes, sir.
“Q. And a few hours after that she died. Is that right?
“A. Yes, sir.
“Examined by Mr. Dusenberry:
“Q. Had she ever tried to commit suicide before?
“A. Yes, sir.
“Q. When was that?
“A. Last summer.
“Q. What means did she try to use?
“A. Carbolic acid.
“Q. So that by her previous actions you knew that she was desirous of dying?
“A. Yes, sir.”

The court, after having a private conference with defendant, proceeded to sentence him in the following language:

“After hearing your plea of guilty, as charged in the information in this case to killing, and murdering your wife, Mr. Roberts? and after hearing the testimony and evidence introduced in court bearing upon the degree of the crime charged, the court hereby determines that you have committed murder in the first degree, and' judgment will be rendered accordingly, by the order of the court. Under the finding of the court there is only one sentence that can be pronounced upon you, and that is the severer one, of course.. The statute provides that where murder shall he perpetrated by means of poison, that shall be murder in the first degree, and the punishment shall be confinement in the State’s prison.
“It is beyond my comprehension how a human being of normal conditions at least, or apparent normal conditions, can commit such a crime, as you have in this case, lay placing poison within reach of your Wife or giving it to your wife with the intention as you claim. It doesn’t make any difference whether she had that intention or not, of committing suicide. You are a principal, under the law of the State to committing the crime of murder. It was, indeed, an inhuman and dastardly act. The sentence of the court is that you be confined to the State’s prison, located at Marquette, for the period of your natural life, at hard labor, and in solitary confinement, in accordance and with section 15192 of the Compiled Laws of 1915.”

It is urged that the trial court was in error in not impaneling a jury to determine the degree of murder, that such right could not be waived by the defendant and that the statute directing the court to determine the degree in such event is unconstitutional. In determining the degree of murder the trial court followed the direction of the statute which provides that:

“The jury before whom any person indicted for murder shall be tried, shall, if they find such person guilty thereof, ascertain in their verdict, whether it be murder of the first or second degree; but, if such person shall be convicted by confession,, the court shall proceed by examination of witnesses to determine the degree of the crime, and shall render judgment accordingly.” 3. Comp. Laws 1915, § 15194.

Counsel argues that defendant’s constitutional right to have the jury determine his guilt was invaded when the court determined its degree. Defendant undoubtedly had the right to have a jury determine his guilt but his guilt had already been confessed. His plea of confession had made a trial unnecessary. There was nothing else to do but apply the statute and classify his crime. The fact that the court did this instead of the jury deprived defendant of no substantial right because had a jury determined its degree they would have done so under the instruction of the court. The constitutionality of such statutes has been directly passed upon by the Federal court, Hallinger v. Davis, 146 U. S. 314 (13 Sup. Ct. Rep. 105). In this case the New Jersey statute, which is similar to ours, was under consideration. Its constitutionality had been attacked for the same reasons that counsel has urged. It was there said in conclusion that

“Applying the principles of these decisions to the casé before us, we are readily brought to the conclusion that the appellant, in voluntarily availing himself of the provision of the statute and electing to plead guilty, was deprived of no right or privilege within the protection of the 14th Amendment. The trial seems to have been conducted in strict accordance with the forms prescribed by the Constitution and laws of the State, and with special regard to the rights of the accused thereunder. The court refrained from at once accepting his plea of guilty, assigned him counsel, and twice adjourned, for a period of several days, in order that he might be fully advised of the truth, force and effect of his plea of guilty. Whatever may be thought of the wisdom of departing, in capital cases, from time-honored procedure, there is certainly nothing in the present record to enable this court to perceive that the rights of the appellant, so far as the laws and the Constitution of the United States are concerned, have been in any wise infringed.”

The State of California has a similar statutory provision. Its validity was passed upon in People v. Noll, 20 Cal. 164, which is approved in the case cited. It is there said in part:

“The proceeding to determine the degree of the crime of murder, after a plea of guilty, is not a trial. No issue was joined upon which there could be a trial. There is po provision of the constitution which prevents a defendant from pleading guilty to the indictment instead of having a trial by jury. If he elects to plead guilty to the indictment the provision of the statute for determining the degree of the guilt for the purpose of fixing the punishment, does not deprive him of any right of trial by jury.”

The State of Ohio also has a similar provision, which was upheld in Dailey v. State, 4 Ohio St. 57.

Counsel’s objection based upon this part of the proceeding must be overruled.

The proceedings are further assailed by the claim that there is no evidence of the commission of the crime charged. In support of this counsel contends, in substance, that suicide is not a crime in Michigan. That defendant’s wife committed no offense in committing suicide, that if she, as principal, committed no offense, defendant committed none as an accessory before the fact. In short, that if the principal is not guilty the accessory is not. If we were living in a purely common-law atmosphere' with a strictly common-law practice, and defendant were charged with being guilty as an accessory of the offense of suicide, counsel’s argument would be more persuasive than it is. But defendant is not charged with that offense. He is charged with murder and the theory of the people was that he committed, the crime by means of poison. He has come into court and confessed that he mixed poison with water and placed it within her reach, but at her request: The important question, therefore, arises as to whether what defendant did constitutes murder by means of poison.

“All murder which shall be perpetrated by means of poison, or lying in wait, or any other kind of wilful, deliberate, and premeditated killing, or shall be committed in the perpetration, or attempt to perpetrate in arson, rape, robbery or burglary, shall be deemed murder of the first degree, and shall be punished by solitary confinement at hard labor in the State’s prison for life.” 3 Comp. Laws 1915, § 15Í92.

In considering the status of one who advises or aids another to commit suicide, 37 Cyc. p. 521, has this to say:

“Where one person advises, aids, or abets another to commit suicide, and the other' by reason thereof kills himself, and the adviser is present when he does so, he is guilty of murder as a principal, or in some jurisdictions of manslaughter; or if two persons, mutually agree to kill themselves together, and the means employed to produce death take effect upon one only, the survivor is guilty of murder of the one who dies. But if the one who encourages another to commit suicide is not present when the act is done, he is an accessory before the act and at common law escapes punishment because his principal cannot be first tried and convicted. The abolition of the distinction be-, tween aiders and accessories in some jurisdictions, has, however, carried away this distinction, so that a person may now be convicted of murder for advising a suicide, whether absent or present at the time it is committed, provided the suicide is the result of his advice.”

It is said in Tiffany on Criminal Law, p. 979, that:

“He who kills another at his own desire or command is a murderer as much as if he had done it of his own head; and the person killed is not a felo de se."

To the same effect, 1 McLain’s Criminal Law, § 290; State v. Ludwig, 70 Mo. 412; Commonwealth v. Bowen, 13 Mass. 356; Commonwealth v. Mink, 123 Mass. 422; Commonwealth v. Hicks, 118 Ky. 637 (82 S. W. 265); Burnett v. People, 204 Ill. 208 (68 N. E. 505, 66 L. R. A. 304); Blackburn v. State, 23 Ohio St. 146

In the last case cited the facts and questions raised bear a close analogy to 'the case we are considering. A like contention was made with reference to suicide, and in answering it the court said:

“It is said by counsel that suicide is no crime by the laws of Ohio, and that- therefore there can be no accessories or principals in the second degree in suicide. This is true, but the real criminal act charged here is. not suicide, but the administering of poison. And to this, criminal act there may be accessories, and principals in the second degree. If I furnish poison to a guilty agent, an accomplice, to be administered by him, and he administers it accordingly, I am an accessory before the fact; and if I stand by and counsel or encourage him in the act of administering the poison to another, I am a principal in the second degree. But no question of this kind arises in the present case, either upon the indictment' or in the evidence. There is no claim or pretense that there was any guilty third person participating in the transaction'. The charge is that the prisoner, as principal in the first degree, is guilty of administering poison, and thereby causing death.”

Whether the act of mixing the strychnine with wine and giving it to' the deceased to drink was administering poison within the meaning of the statute, the opinion says:

“We think also that the court was right in instructing the jury, as in substance and effect it did, that it is immaterial whether the party taking the- poison took it willingly, intending thereby to commit suicide, or was overcome by force, or overreached by fraud. True, the atrocity of the crime, in a moral sense, would be greatly'diminished by the fact that suicide was intended; yet the law, as we understand it, makes no discrimination on that account. The lives of all are equally under the protection of the law, and under that protection to their last moment. The life of those to whom life has become a burden. — of those who are hopelessly diseased or fatally wounded — nay, even the lives of criminals condemned to death, are under the protection of the law, equally as the lives of .those who are in the full tide of life’s enjoyment, and anxious to continue to live. If discriminations are to be made in such cases as to the amount of punishment due to offenders, they must be made by the exercise of executive clemency or legislative provision. Purposely and maliciously to kill a human being, by administering to him or her poison, is declared by the law to be murder, irrespective of the wishes, or the condition of the party to whom the poison is administered, or the manner in which, or the means by which, it is administered. The fact that the guilty party intends also to take his- own life, and that the administration of the poison is in pursuance of an agreement that both will commit suicide, does not, in a legal sense, vary the case. If the prisoner furnished the poison to the deceased for the purpose and with the intent that she should with it commit suicide, and she accordingly took and used it for that purpose; or, if he did not furnish the poison, but was present at the taking thereof by the deceased, participating by persuasion, force, threats, or otherwise, in the taking thereof, or the introduction of it into her stomach or body; then, in either of the cases supposed, he administered the poison to her, within the meaning of the statute.”

We are of the opinion that when defendant mixed the paris green with water and placed it within reach of his wife to enable her to put an end to her suffering by putting an end to her life, he was guilty of murder by means of poison within the meaning of the statute, even though she requested him to do so. By this act he deliberately placed within'her reach the means, of taking her own life, which she could have obtained in no_pther way by reason of her helpless condition.

Exception is taken to the information because it did not set out the means by which defendant accomplished the murder. This objection is sufficiently answered by the statute, which provides that:

“In all indictments for murder and manslaughter, it shall not be necessary to set forth the manner in which, or the means by which the death of the deceased was caused; but it shall be sufficient in any indictment for murder to charge that the defendant did wilfully, and, of his malice aforethought, kill and murder the deceased.” 3 Comp. Laws 1915, § 15739.

There are some other questions discussed, by counsel which we shall not consider because the basis for so doing does not appear in the record. So far as the record discloses defendant was dealt with fairly by the public authorities and his legal rights duly observed. Í

The judgment of conviction must be affirmed.

Moore, C. J., and Steere, Brooke, Fellows, and Stone, JJ., concurred. Clark and Sharpe, JJ., did not sit.