Ullman v. May

• Court: United States Court of Appeals (Ohio)
• Citation: 70 N.E.2d 507
• Parties: ULLMAN v. MAY.
• Decision Date: 20 May 1946

70 N.E.2d 507

ULLMAN
v.
MAY.

Court of Appeals of Ohio, Eighth District, Cuyahoga County.

May 20, 1946.

MORGAN, J., dissenting.

Action by Morton P. Ullman against George S. May to recover commissions allegedly due under contract of employment. From a judgment in favor of the plaintiff, 17 Ohio Supp. 85, the defendant appeals.-[Editorial Statement.]

Judgment modified and, as modified, affirmed.

[70 N.E.2d 507]

S. H. Moss, of Cleveland, for plaintiff appellee.

E. A. Plazer, of Cleveland, for defendant appellant.

SKEEL, Presiding Judge.

The plaintiff appellee was employed by the defendant appellant as salesman. The contract was in writing. By paragraph C of Provision II of the contract it is provided in part:

‘C. In addition to payment due under provisions above, commissions will be paid employee as shown below on all sums of money billed to and collected from each individual client personally procured by the employee; said commission to be paid only during the time this agreement remains in full force and effect.’ (then follows the schedule of commissions).

Paragraph (a) of Provision I of the contract provides: ‘A. This contract of employment may be terminated by either of the parties hereto upon giving to the other party not less than seven days written notice of the intention to cancel this agreement; provided however, that the restrictive covenants herein contained which are binding upon employees shall be effective for the period of time and in the territory hereafter set forth.’

The plaintiff received notice from the defendant which was in the form of a letter cancelling the contract on December 23, 1944. Prior to that time the plaintiff had personally solicited and procured sufficient business so that after the date of plaintiff's discharge and up and until the date of filing the third amended petition herein, the defendant had collected $79,000 upon which the plaintiff was not paid commissions.

The plaintiff's third amended petition alleges in the second cause of action that ‘defendant * * * without grounds therefor but in bad faith and with intent to defraud plaintiff of his commissions * * *’ caused his discharge by giving the written notice as hereinbefore referred to. The first cause of action claims said commissions

[70 N.E.2d 508]

under the terms of the contract above referred to and the third cause of action is based on quantum meruit for services rendered. Upon trial the court found for the plaintiff in the full amount prayed for.

There are two items about which there is no dispute, one for $22.50 and the other for $167 which amounts the defendant tendered the plaintiff before trial.

This appeal on questions of law is presented to this court upon the defendant's claims that the judgment is contrary to law. The trial below was had upon a stipulation as to the facts agreed to by the parties, which were as follows:

‘The parties to the above captioned action appear by their respective counsel and stipulate and agree that the following are the facts, together with the exhibits thereto attached upon which this case may be adjudged and determined:

‘(1) The proper parties are before this court. The plaintiff was the employee of the defendant, George B. May a non-resident of the State of Ohio, but who is properly before this court by virtue of attachment proceedings in which proceedings the defendant has posted a proper and sufficient undertaking according to law:

‘(2) The parties to this action, on or about January 31, 1944, entered into a written agreement, drawn by the defendant, the original or a true copy whereof is hereto attached.

‘(3) That pursuant to said agreement, the plaintiff entered into the employ of the defendant, and complied with all provisions of the agreement incumbent upon him to perform.

‘(4) That the plaintiff remained active in the employ of the defendant until Dec. 23, 1944, when plaintiff received a letter mailed to plaintiff by defendant dated December 19, 1944, a true copy of which letter is hereto attached.

‘(5) That on December 23, 1944, and thereafter, the defendant was servicing certain clients procured for the defendant by the plaintiff, to-wit: Cleveland Trencher Co. and Buckeye Brass Company, both procured by plaintiff many weeks prior to December 23, 1944 and upon whose payments plaintiff received commissions prior to December 15, 1944;

‘(6) That subsequent to December 15, 1944, and up to and including the period of time covered by the third amended petition, the defendant made additional collections from said clients in the sum of Seventy-Nine Thousand Dollars ($79,000.00) no part of which was ever paid to plaintiff;

‘(7) That the commissions on said collections are to be computed at 5% in the event plaintiff prevails in this action;

‘(8) That in addition to the foregoing clients serviced, the plaintiff had obtained a survey for the defendant in the Continental Lithograph Company for which plaintiff is entitled to receive the sum of Fifty Dollars ($50.00) for his commission;

‘(9) That the defendant tendered to the plaintiff on January 10, 1945, and on January 27, 1945, respectively, the sums of Twenty Two and 50/100 Dollars ($22.50) and One Hundred Sixty Seven Dollars ($167.00) respectively; that the checks with vouchers attached, representing said tenders, are hereto attached and that the plaintiff refused to accept said sums;

‘(10) That plaintiff has not been informed by the defendant of minimum or ‘must’ standards of employment of production;

‘(11) That all documents hereto attached to which reference is herein made, together with letters from defendant to plaintiff, dated December 19, 1944, January 10, 1945 and January 11, 1945 and copy of letter from plaintiff to defendant dated December 23, 1944 and statement prepared by defendant relating to receipts from clients are offered and may be received in evidence.’

The defendant's letter of December 18, 1944, advised the plaintiff of the cancelling of his contract of employment. It stated that the company regretted that the plaintiff's association with the company had not been mutually profitable; that the plaintiff's attitude toward his work had been excellent but that the company had ‘must’ performance standards which under the circumstances left them no other alternative.

The plaintiff's letter acknowledged receipt of defendant's letter cancelling the

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contract. The plaintiff claimed the contract could not be terminated until the 26th of December and submitted his expense account to that date. He next inquired as to whether provision was being made for commissions due him for the ‘Continental Lithograph Company, Carey Machine, and current billing on Cleveland Trencher’ and then added, ‘the least that you can do for a man when you let him go is to let him know how he stands financially’. He stated that he ‘talked with the regional manager ten days ago and was assured that if he came through with some business everything would be all right.’ That he secured two new deals but because he had been discharged he had protected himself regarding these deals. He further states that he considered that all the trouble causing unrest in the May Company should be put on Mr. Noonan, the regional manager; that his unseemly conduct in conferences with prospects absolutely destroyed every chance of getting a contract and that because of his conduct the plaintiff was afraid to take him any place where a deal was in prospect.

The plaintiff then referred to the paragraph of the defendant's letter of December 19, which directed plaintiff's attention to the ‘must’ standards of producing business, and then comments on the inability of the defendant's top officials to secure contracts in his district. He then states that high pressure methods cannot be used where business is managed by conservative men and concludes by saying that he does not want his job back but insists upon an immediate reply to his request about his financial standing.

The defendant's letter of January 11, states that the plaintiff will be credited with all accruals up to and including one week after December 19th and states that the answer as to the credits to become due him on the several jobs to which the plaintiff referred in his letter, is to be found in the working agreement. They expressed regret because of the plaintiff's attitude as expressed in his letter of December 23d and states that the New York representative had inquired about him and that they had heartily recommended him for employment by the New York office as they had heard that there had been some negotiations along that line.

The foregoing is all the evidence submitted to the court.

The provisions of the contract by which the plaintiff is not to receive comsions after the contract is cancelled, completely refutes the plaintiff's claim of the right to recover under his first and third causes of action. This leaves only the question as to whether or not there is any evidence to support plaintiff's contention under his second cause of action that the cancellation of this contract was ‘* * * without grounds therefor but in bad faith and with intent to defraud plaintiff of his commissions * * *.’ Such an allegation must be supported by clear and convincing proof. An examination of the record fails to disclose any proof that even remotely could be said to support such claim of fraud or bad faith. The most that can be said for the evidence upon which the plaintiff relies is that the plaintiff was not informed of any ‘must’ standard of producing business and that the use of such a reason points to his discharge without any actual grounds. But the contract did not provide that he was to be employed as long as he was giving satisfactory service or like circumstances. It simply provided that either party could terminate the relationship upon seven days' written notice. The plaintiff could quit without giving a reason for so doing and the defendant could likewise end the contract of...