Henry v. Lind

• Decision Date: 05 June 1969
• Docket Number: No. 39566,39566
• Citation: 76 Wn.2d 199,455 P.2d 927
• Court: Washington Supreme Court
• Parties: Lavine HENRY, Appellant, v. R. J. LIND and Mary Lind, his wife, Respondents.

Page 199

76 Wn.2d 199

455 P.2d 927

Lavine HENRY, Appellant, v. R. J. LIND and Mary Lind, his wife, Respondents.

No. 39566.

Supreme Court of Washington, Department 1.

June 5, 1969.

Rehearing Denied Aug. 5, 1969.

Alec Duff, Seattle, for appellant.

Guttormsen, Scholfield, Willits & Ager, Frank D. Howard, Douglas K. Haughton, Seattle, for respondents.

HALE, Judge.

This case seems to prove the old saying that actions speak louder than words. Although the parties drew their own contract and now disagree as to its meaning, they did act it and we look to their conduct to ascertain their intentions.

Harvey and Lavine Henry sold their small advertising business and their home to the defendants, Reuben and Mary Lind, husband and wife, on a written agreement prepared by Mr. Henry. The typewritten contract said in part that Lavine Henry would retain a $275 per month salary from Firland Magazine during the 4-year term of the contract. ¹

For about a year after the parties had signed this agreement, Mrs. Henry received the salary and then was advised that Firland Magazine would discontinue its payments to her and would pay the Linds instead. She thereupon brought this action to recover the $275 per month for the remainder of the 4-year contract term, and now appeals the judgment of the trial court in favor of the defendants. We think Mrs. Henry is entitled to the money as a matter of law and reverse.

An examination of the record in detail shows that the court, although designating it as a finding of fact, concluded that the parties intended having Mrs. Henry receive the $275 per month only for such period as Firland Magazine or its publisher, Pep Publishing Company, would continue to pay it to her as its employee. We are in doubt, however, if the record shows substantial evidence to support such a conclusion, whether it be of fact or law.

Referring to the provision of the contract in issue, the court in its memorandum opinion said:

'The salary received by Lavine Henry From the Firland Magazine of $275.00 per month is to be retained by her, * * *.' (Emphasis supplied by the court.)

This part of the agreement in my opinion is clear and unambiguous; i.e., that Mrs. Henry was to receive $275.00 per month as long as the magazine paid the $275.00 per month to her. She received this amount for a year after the agreement was signed, and by the defendants' Exhibit 6, the Pep Publishing Co., the publisher of the Firland Magazine, cancelled this arrangement.

Thus, on the assumption that the Firland salary clause was clear and unambiguous, the court gave it a rigidly literal interpretation, so narrow, we think, as to be unwarranted by the circumstances proved.

The agreement appears to us to be unclear and ambiguous and, therefore, not susceptible of a literal construction. We are unable from the following language to determine precisely what the parties intended: 'The salary received by Lavine Henry from the Firland Magazine of $275.00 per month is to be retained by her, also 5% Of the gross sales of all advertising are to be paid to Lavine Henry each month.' To ascertain its meaning then, it must be read in pari materia with the whole contract and in light of all of the circumstances surrounding it, and, if it remains unclear, resort must be had to extrinsic interpretative aids, including the conduct of the parties under it.

Although the contract does say that Mrs. Henry should retain the $275, it does not specify whether that provision shall be coterminous with the remaining provisions or continue beyond the 4-year term of the contract, nor does the provision indicate what shall happen either if the salary were discontinued, or, as actually occurred, paid to the Linds instead. The contract does not prescribe what services, if any, Mrs. Henry should continue to perform or whether the sum were to be deemed earned by Mr. Henry's services nor does it show whether the right to $275 constituted a part of the consideration for the deal. It is as likely that the parties intended the $275 per month payable during the 4-year term of the contract to be part of the consideration for the sale of the business and residential realty as that it be deemed an earned salary for services performed. Thus, although the facts as to the execution of the written contract are not in substantial dispute, conclusions as to its meaning are. A more detailed review of the transaction, we think, will demonstrate the ambiguity.

The Henrys, as earlier noted, owned and operated the publishing business. Their principal customer was Pep Publishing Company which put out a magazine for the patients, staff and others associated with Firland Sanatorium. Under a 1959 written agreement with Pep Publishing, the Henrys received a 50 per cent commission for obtaining advertising for the Firland Magazine and under another, an oral agreement, the $275 per month for performing some services in connection with the printing and publishing of the magazine. Mr. Henry did most of the work; his wife, plaintiff here, assisted primarily with maintaining the office files. Editing of Firland Magazine and writing of articles were done chiefly by patients in the sanatorium and for the $275 per month, the Henrys did most of the work in arranging the mechanical details of printing and publishing the magazine.

The Linds purchased the business on March 10, 1964, signing the written contract prepared by Mr. Henry. According to the agreement, they were to act as managers and perform all work required to operate the business, receiving a percentage of its income for a term of 4 years commencing May 1, 1964, and to become sole owners May 1, 1968. They agreed that Lavine Henry would retain not only the $275 per month from Firland Magazine, but 5 per cent of the 'gross sales of all advertising * * * (were) to be paid to Lavine Henry each month.'

As a part of the deal, the Linds purchased the Henry residence apparently without a down payment--a transaction contemplated by the contract for the sale of the business in the following language: 'This agreement is contingent on the sale of the property of 18542 Ashworth Ave. * * * now owned by R. H. & Lavine Henry to R. J. and Mary Land.'

The Linds assumed in large part the management and operation of the business in May, 1964. Thereafter, Pep Publishing for 11 or 12 months sent the $275 check, less payroll deductions, to Mrs. Henry, payable in her name--all without any objections, protests or manifest disagreement from the Linds. The Linds also, during this period, regularly paid her a 5 per cent commission on advertising as specified in the contract.

Mr. Henry died in April, 1965, and Pep Publishing made the next check payable to and sent it to the defendant, Reuben Lind. Two weeks later, April 26, 1965, defendant Lind notified Mrs. Henry that her $275 salary check would be discontinued. Lind received the next succeeding salary check on April 30, 1965, and has received it regularly ever since.

Shortly after changing the check payment from Mrs. Henry to Lind, the chairman of the board of Pep Publishing, May 14, 1965, wrote to Mrs. Henry advising that, since the death of Mr. Henry, she had not personally participated in publishing Firland Magazine and that they were terminating their agreement and would no longer pay her the $275 per month. This letter, however, concerned the existing contract between the Henrys and Pep Publishing and it did not refer to--and, of course, as a matter of law could not affect--the agreement between Henrys and Linds.

In summary, for 11 or 12 months after the sale of the business, plaintiff received the $275 check (less payroll deductions) fro...