Donnellan v. Halsey

• Decision Date: 10 January 1935
• Docket Number: No. 36.,36.
• Citation: 176 A. 176
• Parties: DONNELLAN v. HALSEY et al.
• Court: New Jersey Supreme Court

176 A. 176

DONNELLAN

v. HALSEY et al.

No. 36.

Court of Errors and Appeals of New Jersey.

Jan. 10, 1935.

Appeal from Supreme Court.

Action by Michael Donnellan against Van R. Halsey and others, trading as C. D. Halsey & Co. From a judgment for defendants, plaintiff appeals.

Affirmed.

Richard Doherty, of Jersey City, for appellant.

Applegate, Stevens, Foster & Reussille, of Red Bank (John Milton, of Jersey City, of counsel), for respondents.

PERSKIE, Justice.

This is a suit by an employee against his employers for services rendered based on a claim for a percentage of profits. The gravamen of the complaint is set forth in paragraph 2 thereof. It is as follows: "January 1st 1027, and hitherto, the plaintiff was employed by the defendants as general manager of their business and their main office located at the City of New York, County and State of New York, upon the terms, relating to his compensation, that he would be paid for such service a salary of $7,000.00 per year and a commission and percentage of the profits of the said partnership, as earned through the plaintiff's management of said New York office, at the rate of 3% of said profits, payable respectively on the thirtieth day of June and the thirty-first day of December, in each year."

Among the several defenses filed by the respondent, in addition to the denial thereof, it was alleged (first separate defense), in substance, that the employment on January 1, 1927, was for an indefinite period of time, and that it was verbally agreed that respondents would pay appellant at the rate of $7,000 n year, plus 1 1/2 per cent. of the net profits of respondents' business earned during the period of appellant's employment; that the contract of employment was made in the city of New York, and therefore governed by the laws of the state of New York; that the contract was wholly performed until the partnership was dissolved, at or about March 1, 1929; that, in effect (second separate defense), on July 1, 1929, the respondents again employed appellant under the same terms set out under the first separate defense, except that the rate of the net profit was reduced to three-fourths of 1 per cent; that this contract was also wholly performed on their part until the same was terminated by the appellant in July of 1932.

The proofs adduced disclosed that respondents' firm (a partnership) was engaged in the business of stockbrokers; that appellant was first employed in 1896 by the then respondent firm as a runner, He was advanced from time to time, and In 1922 was employed as a general manager. His compensation was then fixed at a definite sum, plus 3 per cent of the net profits; this arrangement continued until it was changed in 1927 and 1929, as more fully detailed, under the first and second separate defenses, by the respondents.

The personnel of the firm changed several times during the period that appellant worked for respondents. Van R. Halsey succeeded his father, Charles D. Halsey, as head of the firm, and was the spokesman for his copartners. Thus it appears that late in 1926 Halsey talked with appellant (referred to in the testimony as "Matt"), and said: "Matt, my partners are making a kick because you are getting nearly as much as they are. My brother Charlie and Leslie claim they have got their money in the firm and that you are getting nearly as much out of it on your three percent interest as they are, and I am going to cut your percentage to one and half per cent." Appellant complained that it was unfair, but Halsey replied: "Well, I am going to cut it to one and half. When I can fix it up with my brother Charlie and Leslie, I will see that you get it back." The court then said: "You accepted that proposition, did you?" and the witness replied: "With the provisions that I was to get it back when he fixed up with his brother Charlie and Leslie, his partner." The court then asked: "Then you accepted the proposition of one and a half per cent for how long?" and the witness replied: "That was until 1929."

Mr. Halsey testified that at the close of the conversation between the plaintiff and himself, with relation to the first reduction in percentage, the plaintiff said to him: "Well, if you are going to do it, that is all I can do about it," and Halsey replied: "I guess that is so."

As to the second reduction, the plaintiff testified that Halsey "told me that his partners are of the opinion not to give me any percentage at all. They were dissatisfied with me." The plaintiff further testified "even when in 1927, you cut me to one and a half percent, you were going to get it back for me," and that Halsey...