Bloom v. Nathan Vehon Co.

• Decision Date: 25 October 1930
• Docket Number: No. 20195.,20195.
• Citation: 173 N.E. 270,341 Ill. 200
• Parties: BLOOM v. NATHAN VEHON CO.
• Court: Illinois Supreme Court

341 Ill. 200

173 N.E. 270

BLOOM

v.NATHAN VEHON CO.

No. 20195.

Supreme Court of Illinois.

Oct. 25, 1930.

Error to First Branch, Appellate Court, First District, on Appeal from Municipal Court of Chicago; Harry Olson, Judge.

Action by Philip S. Bloom against the Nathan Vehon Company. Judgment for plaintiff was affirmed by the Appellate Court, and defendant brings certiorari.

Reversed and remanded.Miller, Gorham & Wales and Koven & Rappaport, all of Chicago (Herbert C. De Young, of Chicago, of counsel), for plaintiff in error.

Short, Rothbart, Willner & Lewis, Dwight McKay, and Walter H. Shurtleff, all of Chicago (John L. Fogle, of Chicago, of counsel), for defendant in error.

HEARD, J.

This cause is here on certiorari to the Appellate Court for the First District. In the municipal court of Chicago defendant in error, Philip S. Bloom (called plaintiff), recovered a judgment for $25,701.19 against plaintiff in error, the Nathan Vehon Company (called defendant). This judgment was affirmed by the Appellate Court.

Plaintiff filed a second amended statement of claim, in which he alleged substantially that he was employed by defendant prior to January 1, 1926; that defendant agreed to pay him a salary for the year 1926 in the sum of $10,000; that he received on account thereof the sum of $3,130, leaving a balance due in the sum of $6,870; that he was employed by defendant for the year 1927 at an agreed salary of $15,000 for the year; that he received the sum of $4,700 on account of salary for the year, and that there was due him the sum of $10,300 as salary for the year 1927; that defendant agreed to pay him as salary for the year 1928 the sum of $15,000; that he worked for defendant from January 1, 1928, to November 10, 1928, and received on account of salary for said period the sum of $4,385.47, and that there was due him on account of salary for the year 1928 the sum of $8,531.19, and that the total amount due him is the sum of $25,701.19.

A bill of particulars filed herein alleged that during the month of January, 1926, Nathan Vehon, as president of the defendant company, verbally agreed to pay plaintiff a salary of $10,000 a year for the year 1926; that during the month of January, 1927, Vehon, as president of the corporation, verbally agreed to pay plaintiff a salary of $15,000 for the year 1927; that Vehon, as president of the corporation, during the month of January, 1928, verbally agreed to pay plaintiff a salary of $15,000 for the year 1928.

An affidavit of merits was filed to plaintiff's second statement of claim as amplified by the bill of particulars, denying that the president of the company made any of the salary contracts specified in the bill of particulars; alleging that plaintiff had been employed at a salary of $50 for the first five weeks of 1926, at a salary of $60 a week for the remainder of 1926, at a salary of $75 a week for 1927 and a part of 1928, and at a salary of $100 a week for the remainder of the time of his employment, and that he had been paid in full for his services. The affidavit of merits further alleged that plaintiff on the 22d day of January, 1925, became a director of defendant; that on the 12th day of January, 1927, plaintiff became the de facto secretary of defendant; that as such director and de facto secretary plaintiff is not entitled to the amounts claimed, except upon the lawful adoption of resolutions by the board of directors of defendant authorizing the payment of the sums claimed by plaintiff, and that no such resolutions were ever adopted by the board of directors of defendant.

The cause was tried before the court without a jury, and the issues were found for plaintiff. Defendant submitted propositions of law, which were refused, to the effect that an officer of a private corporation is not entitled to compensation for services rendered unless such compensation be fixed by a by-law or resolution adopted before the rendition of the services; that a director of a private corporation is not entitled to compensation for services rendered unless such compensation be fixed by a by-law or resolution adopted before the rendition of the services; that every stockholder of the corporation has a right to be present at the annual meeting for election of directors, and that such meeting cannot be legally held until after notice of the time and place has been given in an authentic and legal mode unless all stockholders were present and consenting in person or by proxy, and that, if a single stockholder having the right to be present and to vote is not duly notified and is absent, or, being present, refuses to consent to the holding of the meeting, its proceedings will be void, and that a salary voted to a director of the corporation is illegal if the resolution fixing the compensation is carried by his own vote. The court overruled defendant's motions for a new trial and in arrest of judgment and entered judgment for the full amount claimed.

[1] It is claimed by plaintiff that the issue made by the pleadings in the municipal court was not whether a valid enforceable contract was entered into between the parties, but only whether such contract was for the amount claimed by plaintiff; that this issue having been found for plaintiff and the judgment affirmed by the Appellate Court, this issue of fact is settled. In this contention as to the issues plaintiff is in error. The validity of the contract was specifically put in issue by the averments of the bill of particulars and the affidavit of merits. Under the pleadings in the case three questions arose: First, was there a contract for compensation entered into between plaintiff and Nathan Vehon, the president of defendant? Second, had Vehon authority to enter into the contract and bind defendant? Third, what was the amount of the compensation to be paid plaintiff? While under the law we are precluded from examining and weighing the evidence to determine where the preponderance of evidence lies or how the case should have been decided on the evidence, yet it is our duty, on a record like the present, to examine the evidence for the purpose of determining whether, when all the evidence is considered, together with all the reasonable intendments to be drawn therefrom, in its aspect more favorable to plaintiff, there is a total failure to prove any one or more of the elements necessary to be proven to maintain the cause of action alleged in plaintiff's statement of claim as amplified by his bill of particulars. (Coal Creek Drainage District v. Sanitary District, 336 Ill. 11, 167 N. E. 807;Sterling-Midland Coal Co. v. Great Lakes Coal Co., 334 Ill. 281, 165 N. E. 793); and, in so doing, we must examine and consider the evidence itself, and not the statements in the opinion of the Appellate Court as to what facts have been proven.

The defendant was a private corporation organized under the laws of this state. Its capital stock consisted of 1,005 shares of $10 each, of which 670 were issued. Nathan Vehon owned 650, plaintiff 10, and Lena Vehon, wife of Nathan, 10 shares. Plaintiff became a director and secretary of the corporation on January 22, 1926.

Plaintiff testified that in January, 1926, he went to Vehon and told him that he (plaintiff) wanted a salary of $10,000 a year, and that Vehon replied that that was all right with him-that he (Vehon) would also take a salary of $10,000 a year, and that he wanted Mrs....