Twohy v. Harris
| Decision Date | 10 September 1952 |
| Docket Number | No. 3941,3941 |
| Court | Virginia Supreme Court |
| Parties | JOHN TWOHY, II v. H. H. HARRIS. Record |
Ashburn, Agelasto & Sellers, for the appellant.
Shapero & Shapero and William L.
Parker, for the appellee.
In April, 1948, H. H. Harris, sometimes hereinafter referred to as the complainant or the plaintiff, filed a bill in equity against John Twohy, II, sometimes hereinafter referred to as the defendant, alleging in substance that from January 1, 1930, until December 28, 1946, the complainant was employed by the defendant and a number of corporations in which the defendant had a controlling interest and in which the complainant was an officer and director, namely, Commonwealth Sand & Gravel Corporation, Interstate Sand & Gravel Corporation, Aberdeen Sand Company, Inc., Transit Mixed Concrete Corporation, Ready Mixed Concrete Corporation, Angerona Corporation, Regal Realty Corporation, and Enterprise Drug Company, Inc.; that on or about March 1, 1940, the complainant told the defendant that he, the complainant, 'could no longer afford to continue' such employment for the amount of the compensation which he was then receiving and that he would seek other employment; that the defendant promised the complainant, in consideration of the complainant's agreement to remain in the employ of the defendant and these corporations, that he 'would make over to' the complainant ten per cent of the capital stock of each of these corporations, and that if in the future the employment of the complainant with the defendant and these corporations should be terminated, he, the defendant, would then 'pay to the complainant in cash the book value of said ten per cent of the capital stock of said corporations, or the appraised value thereof, whichever might be higher;' that relying upon this promise of the defendant, the complainant remained 'in the employ of the defendant and * * * as officer and director of the corporations,' and continued to perform the services for them until December 28, 1946, when he, the complainant, was 'summarily dismissed as of January 1, 1947,' by the defendant, and 'requested to terminate his employment by resignation;' that the defendant 'has not had transferred to the name of your complainant any stock in any of the corporations * * *, nor has he paid to your complainant either the book value of such ten per cent of such stock or the appraised value thereof;' and 'that the defendant ought in equity and good conscience be compelled to perform his promise hereinabove set out and to pay to your complainant either the book value or appraised value of ten per cent of the outstanding capital stock of all of said corporations mentioned above, whichever may be the higher.'
The prayer of the bill was that the contract between the complainant and the defendant be specifically enforced; 'that the defendant be compelled to pay to your complainant the book value or the appraised value, whichever may be the highest (sic), of ten per cent of the outstanding stock' of the named corporation; 'that the defendant be compelled to give an accounting to your complainant disclosing the amount of the capital stock in each one of said corporations * * *, the book value thereof per share, and the appraised value thereof per share;' and that the complainant be awarded 'such other and further relief, both general and special, as the nature of his case' might require.
The defendant filed a special plea of the statute of limitations and an answer, the latter denying that he had entered into the contract alleged in the bill, or that he was indebted to the complainant or obligated to him 'in any form whatsoever in money or stock or otherwise.'
Over the objection of the defendant the complainant was permitted to file an amended bill of complaint in which the allegation in the original bill that the defendant agreed to 'make over to' the complainant ten per cent of the capital stock of each of the corporations was changed to read that the defendant agreed to 'hold for the benefit of the complainant' the same percentage of the stock of each of the corporations.
To the amended bill the defendant pleaded the statute of limitations and denied by answer the making of the promise or undertaking alleged.
After issue had been joined the lower court on its own motion and without objection by either party entered a decree directing an issue out of chancery for a jury trial to ascertain and decide the following questions:
'Whether or not the defendant on or about the first day of March, 1940, promised the plaintiff, in consideration of plaintiff's agreement to remain in the employ of the defendant and of' the named corporations, 'that defendant would hold for the benefit of the plaintiff ten per cent of the capital stock of each of said corporations in which plaintiff was an officer and director, by which he was employed, and for which he had been and was performing services; that, if in the future the employment of the plaintiff with the defendant and said corporations should be ended, he, the defendant, would pay to the plaintiff in cash the book value of ten per cent of the capital stock of all of said corporations or the appraised value thereof, whichever might be higher.'
The decree further directed that in the trial of the issues the plaintiff should maintain the affirmative and the defendant the negative.
On the issue submitted the jury found for the complainant. The trial court overruled the motion to reject the verdict and decreed that the defendant present an accounting of the book value and appraised value of ten per cent of the capital stock of the several corporations as of January 1, 1947.
Subsequently the parties agreed on the total of $25,272.10 as the higher of the book or appraised value of such stock. Accordingly, it was decreed that the complainant, Harris, should recover of the defendant, Twohy, that amount with interest from January 1, 1947, until paid. From that decree the defendant, Twohy, has appealed.
Before considering the merits of the controversy we shall dispose of the two procedural questions raised by the assignments of error.
The first contention is that the lower court erred in allowing the filing of the amended bill because, it is said, it 'changed complainant's theory of his case' for the purpose of avoiding the plea of the statute of limitations which had been filed to the original bill.
As has been said, the original bill alleged that the defendant had promised, in consideration of the complainant's remaining in the employ of the defendant and the named corporations, that he 'would make over to' the complainant ten per cent of the capital stock of each of the corporations. In the amended bill the allegation was that the defendant agreed that he 'would hold for the benefit of the complainant' ten per cent of the capital stock of each of the corporations.
The amended bill contained the identical allegation found in the original bill, that the defendant further agreed that if the complainant would remain in the employ of the defendant and continue to perform the services for him and for the corporations the defendant would upon the termination of the employment 'pay to the complainant in cash the book value of said ten per cent of the capital stock of said corporations, or the appraised value thereof, whichever might be higher.'
The amended bill also contained the same allegations found in the original bill as to the performance of the agreement on the part of the complainant and the breach thereof by the defendant, in that he had not paid the complainant 'either the book value of such ten per cent of such stock or the appraised value thereof.'
The prayer of the amended bill was the same as that in the original bill, 'that the said contract between your complainant and the defendant may be specifically enforced and that the defendant be compelled to pay to your complainant the book value or the appraised value, whichever may be the highest (sic), of ten per cent of the outstanding stock' of the named corporations.
It will be observed that the promise sued on is not the obligation of the defendant to 'make over to' the complainant the stock as alleged in the original bill, or to 'hold for the benefit of the complainant' the stock as alleged in the amended bill. The promise sued on is the obligation of the defendant to pay to the complainant in cash 'the book value of said ten per cent of the capital stock of said corporations, or the appraised value thereof, whichever might be higher,' upon the termination of complainant's employment by the defendant and the corporations which the defendant controlled.
The decree appealed from constitutes a money judgment in favor of the complainant against the defendant for the value of the stock. There is no decree in favor of the complainant against the defendant for any stock in any of the corporations or any interest therein.
The obligation of the defendant that he would 'make over to' or 'hold for the benefit of' the complainant certain stock in the corporations was merely collateral to his promise to pay the complainant the value of the stock.
Thus, we think, there is no substance to the contention of the defendant that the allegations of the amended bill 'changed the complainant's theory of his case,' and permission to file it was clearly within the discretion of the trial court.
Complaint is next made of the action of the court in directing an issue out of chancery on its own motion. The argument is that no foundation was laid and no showing made by affidavits or otherwise that the case would be 'rendered doubtful by the conflicting evidence' of the parties as contemplated by Code, § 8-214, before the issue out of chancery was ordered.
The trouble with this position of the defendant is that he made no objection to the action...
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...169 Va. 574, 583-85, 194 S.E. 727, 731 (1938). The question of consideration in employment contracts also arose in Twohy v. Harris, 194 Va. 69, 72 S.E.2d 329 (1952), a decision which was affirmed in Twohy involved an employee who threatened to resign because of inadequate compensation. The ......
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