Seemann v. Eneix

• Decision Date: 05 July 1930
• Citation: 272 Mass. 189,172 N.E. 243
• Parties: SEEMANN v. ENEIX et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

272 Mass. 189

172 N.E. 243

SEEMANN

v.ENEIX et al.

Supreme Judicial Court of Massachusetts, Bristol.

July 5, 1930.

Appeal from Superior Court, Bristol County; Dillon, Judge.

Suit by Barnhardt R. Seemann against Donald A. Eneix and another. From a decree for plaintiff, defendants appeal.

Affirmed.

R. B. Heavens, of Plymouth, for appellant Eneix.

E. F. Thayer, of Attleboro, for appellee.

FIELD, J.

By this suit in equity the plaintiff seeks to recover from the defendant Eneix, hereinafter called the defendant, money alleged to be due from him to the plaintiff by reason of business dealings between them during the period from 1922 to 1928, in connection with the sale of goods manufactured by the defendant L. G. Balfour Company, hereinafter called the defendant corporation, and to reach and apply in satisfaction of a debt certain stock of the defendant corporation. The defendant filed an answer and a cross-bill. The case was referred to a master who made a report. The evidence is not reported. The defendant filed objections to the master's report and a motion to recommit. A decree was entered, overruling the objectionsto the master's report, denying the motion to recommit, confirming the report, denying the defendant's requests for rulings, ordering payment by the defendant to the plaintiff of the sum of $1,081.35 with interest and costs, and restraining the defendant corporation from redeeming the shares of its stock in the defendant's name without deducting from the amount otherwise payable to the defendant an amount sufficient to satisfy his obligation to the plaintiff, and directing the defendant corporation to pay such amount to the plaintiff. The defendant appealed.

The decree went upon the theory that the plaintiff and the defendant were not partners. It was based upon a finding by the master, to which the defendant objected, that ‘no partnership was ever entered into between * * * [the plaintiff and the defendant], but that the arrangement between them was one intended to give the * * * [defendant] added incentive to sell more of the * * * [defendant corporation's] goods by offering him a greater share of the profits of the Pittsburgh office than he would ordinarily receive.’ The questions argued before us were (a) whether, as the defendant contends, the plaintiff and the defendant were partners during the period in question and (b) whether evidence offered by the plaintiff and admitted by the master over the objection of the defendant should have been excluded.

1. The plaintiff and the defendant were not partners. The finding of the master that ‘no partnership was ever entered into between * * * [them]’ must stand. Whether there was a partnership was a question of ‘mixed law and fact well within the master's authority to have decided.’ Lindsay v. Swift, 230 Mass. 407, 412, 119 N. E. 787, 789. This finding is not inconsistent with the other findings or plainly wrong. See Glover v. Waltham Laundry Co., 235 Mass. 330, 334, 127 N. E. 420;Jacobs v. Anderson, 244 Mass. 125, 126, 138 N. E. 314.

The master found the following subsidiary facts: Prior to 1922, the defendant corporation, ‘a concern engaged in the manufacture of jewelry and novelties' in Massachusetts, was maintaining an office in Pittsburgh, Pennsylvania, ‘paying the rent and all operating charges.’ The plaintiff was in charge of this office ‘as district manager.’ He made an agreement with the defendant, as the result of which the defendant purchased merchandise from the defendant corporation which was sent to him direct from the manufacturer. ‘It was purchased at a net price and 10% of said net price was paid to the * * * [plaintiff]. This merchandise, together with merchandise of other manufacturers, was sold by the * * * [defendant].’

In 1922 ‘a new policy in reference to maintaining the Pittsburgh office was adopted. This policy provided that the rent and operating charges should no longer be borne by the * * * [defendant corporation], and that the Pittsburgh office should be paid 30% of the amount of the sales secured through that office to be apportioned as the office manager saw fit. The * * * [plaintiff], as office manager, acquainted the * * * [defendant] with the details of the new arrangement, and offered a proposition to the * * * [defendant] whereby * * * [they] were to share equally all the expenses of the Pittsburgh office, and * * * were to receive 20% of the amount of their own respective sales * * * and in addition thereto the remaining 10% of the 30% paid the office was to be divided between them in the proportion of the first 5% to the * * * [defendant] and the second 5% to the * * * [plaintiff], and if other salesmen were hired through the office * * * the salesmen were to be paid 20% of the amount of their respective sales and the remaining portion of the 30% paid by the * * * [defendant corporation] to the Pittsburgh office * * * was to be divided between the * * * [defendant] and the * * * [plaintiff] * * * The expenses to be borne included the entire maintenance costs of that office, as well as the deficits sustained by the salesmen of that office, who failed to earn commissions in excess of the advances made them by the home office * * * plus charges made for losses in the samples assigned to the salesmen and charges for uncollectable accounts secured by them and also losses in samples provided by the * * * [defendant corporation] * * * This was known as the 20-5-5 agreement and was accepted by the * * * [plaintiff] and * * * [defendant], and was renewed yearly for two or three years. This agreement, as well as all subsequent agreements, was made and performed in Pittsburgh in the State of Pennsylvania. Although at the time of making this agreement there were no other salesmen, * * * the * * * [defendant], subject to the approval of the * * * [plaintiff], proceeded to secure salesmen * * * and from such salesmen * * * secured their signature on contracts with the * * * [defendant corporation]. As many as six or seven salesmen were selling at one time during this period, and a force of four or five was usually maintained, some being hired by the * * * [plaintiff] and some by the * * * [defendant]. All salesmen, however, being subject to the control and direction of the * * * [plaintiff] as district manager * * * Subsequently another contract, similar to the 20-5-5 agreement, was entered into by the * * * [plaintiff] and * * * [defendant], alike in all terms and conditions with the previous contract with the exception that the * * * [defendant] was to receive twenty-two per cent. of his sales as salesman instead of twenty per cent. as formerly; and was to receive four per cent. of the sales of the other salesmen, * * * [the plaintiff's] sales included, instead of five per cent. while the * * * [plaintiff] was to receive four per cent. as his share instead of five per cent. as formerly. This contract called the 22-4-4 agreement was renewed yearly until 1928.’

In 1928, the defendant's ‘connection with the * * * [plaintiff and the defendant corporation] was severed.’ Although the defendant corporation ‘customarily insisted’ that salesmen sign contracts of employment and furnish bonds, and ‘most of the salesmen in the Pittsburgh office’ had done so, the defendant never signed such a contract or furnished a bond. He ‘did not think himself as in the employ’ of the defendant corporation ‘in spite of the fact that he used printed cards as representing that company’ and subscribed for stock therein, ‘according to the terms of which could only be issued to employees.’

As the controlling agreements were made in Pennsylvania to be performed there, their ‘meaning, force and effect’ are to be ascertained according to the law of that state. John B. Frey Co., Inc., v. S. Silk, Inc., 245 Mass. 534, 539, 140 N. E. 259, 261;Montreal Cotton & Wool Waste Co. Ltd. v. Fidelity & Deposit Co. of Maryland, 261 Mass. 385, 390, 158 N. E. 795. Before the passage of St. 1926, c. 168 (amending G. L. c. 233 by...