Werner v. Finley

• Decision Date: 06 June 1910
• Citation: 129 S.W. 73,144 Mo. App. 554
• Parties: WERNER et al. v. FINLEY.
• Court: Missouri Court of Appeals

129 S.W. 73

144 Mo. App. 554

WERNER et al. v. FINLEY.

Springfield Court of Appeals. Missouri.

June 6, 1910.

1. DAMAGES (§ 79) — LIQUIDATED DAMAGES — BREACH OF CONTRACT.

Where defendant was employed to act as salesman for 160 weeks at $60 a week, a provision giving the employers the right to terminate the contract on breach of any covenant by the employé and on such termination to receive from the defendant as liquidated damages the sum of $10 per week for the unexpired term of the contract, is only for liquidated damages and not for a penalty.

2. DAMAGES (§ 85) — LIQUIDATED DAMAGES — RIGHT TO RECOVER.

Before liability to pay liquidated damages can attach, the party in default must have been guilty of a substantial breach of his agreement, which has resulted in more than mere nominal damage to the other party.

3. DAMAGES (§ 85) — LIQUIDATED DAMAGES — VALIDITY OF CONTRACT.

Though a contract contains several covenants, some important and some trivial, and attaches the same penalty to breach of any one of them, the contract is not necessarily void.

4. APPEAL AND ERROR (§ 260) — PRESENTATION OF QUESTIONS IN LOWER COURT — NECESSITY OF EXCEPTIONS.

Where no exception was taken to the exclusion of evidence when it was offered, the ruling will not be reviewed on appeal.

5. MASTER AND SERVANT (§ 65) — ACTION FOR BREACH OF CONTRACT — EVIDENCE — ADMISSIBILITY.

In an action for damages for breach by an employé of his contract of employment, evidence that his position with the employer was unbearable was properly excluded, where he had contracted with another party in violation of his former contract before his position with the employer became unbearable.

6. MASTER AND SERVANT (§ 65) — ACTION FOR BREACH OF CONTRACT — PLEADING.

In an action by an employer for breach of a contract of employment, the defense that defendant's position because unbearable was an affirmative defense which, if relied on, should have been specially pleaded.

7. MASTER AND SERVANT (§ 65) — ACTION FOR BREACH OF CONTRACT — ASSIGNMENT OF INTEREST.

In an action by members of a partnership for breach of a contract of employment, the contention that the cause of action is owned by a corporation to which the partners assigned their property cannot be sustained, where the breach occurred, and the action was commenced before the assets of the partnership were transferred to the corporation.

8. ASSIGNMENTS (§ 137) — CONSTRUCTION — CAUSE OF ACTION.

Evidence of an intention of partners to transfer the assets of a partnership to a corporation to pay up the capital stock, without evidence that such intention was actually consummated, does not show that the legal title to the claim was ever vested in the corporation so as to entitle it to maintain suit thereon.

9. MASTER AND SERVANT (§ 65) — BREACH OF CONTRACT — ACTION — DEFENSE.

That, after defendant violated his contract of employment by partners, they transferred the partnership assets to a corporation, and the corporation never offered defendant employment, is no defense to the plaintiff's action for breach of the contract, since the action accrued when the breach occurred.

Appeal from St. Louis Circuit Court; Jesse A. McDonald, Judge.

Action by Morris Werner and another, copartners under the first name of Werner Brothers, against Camillus Finley. From a judgment in favor of plaintiffs, defendant appeals. Affirmed.

On the 20th day of November, 1905, appellant and respondents entered into a contract in writing, by the terms of which appellant agreed to serve respondents, and respondents agreed to employ appellant, as a salesman in its retail clothing and furnishing goods store in St. Louis, Mo., for a period of 160 weeks at a salary of $60 per week. The contract, among other things, provided that, in case appellant should fail or refuse to perform any of the covenants on his part to be performed, the respondents should have the right to terminate the contract, and, on such termination, should receive from the appellant, and appellant agreed to pay respondents, as liquidated damages, the sum of $10 per week for the unexpired period of the contract. Appellant entered the employ of the respondents under the contract, and remained there until the 10th day of September, 1906, when, without notification, he left the employ of the respondents. Thereupon, to wit, on the 28th day of September, 1906, this suit was filed to recover of the appellant the sum of $1,180, being $10 per week for the period of 118 weeks, as provided by the contract.

The evidence adduced at the trial, in addition to the foregoing, showed that immediately after quitting the employ of respondents, to wit, on the 10th day of September, 1906, the appellant entered the employ of the Werner & Werner Clothing & Furnishing Goods Company, a rival corporation in St. Louis, Mo., engaged in the same line of business, but having no connection with the respondents. That appellant's employment with the latter company was under a written contract executed the 2d day of May, 1906, or four months prior to his quitting the employ of the respondents. This new contract called for his services for a period of three years from September 1, 1906. It thus appears that he left the service of respondents to carry out this contract made with the other firm four months prior to his quitting.

The defense was twofold: First, that the contract was one for a penalty; and, secondly, that at the time suit was filed the cause of action was not the property of the respondents, but had, prior thereto, been transferred to a corporation known as Werner Bros. Mercantile Company. On the question of transfer, the defendant introduced the articles of association of the Werner Bros. Mercantile Company, which said articles were dated September 10, 1906, and which stated that the capital stock of the corporation was paid up. Mr. Simon Werner, one of the respondents, testified that, while it was intended to pay up the capital stock with the assets of the partnership, the said assets had not been transferred at said time; that the assets of the partnership remained the property of the firm until October 25, 1906; that on that date they were acquired by the corporation, Werner Bros. Mercantile Company; that on that date a meeting of the shareholders of the corporation was held, at which said meeting a resolution was adopted by the shareholders providing for the purchase of said assets; that a record of said meeting was kept in writing and signed by all the shareholders; that prior to said meeting said corporation had no property at all; that prior to October 25th the said corporation did not acquire the property of said partnership; that said partnership continued in business in its own name until that date; and that prior thereto no change was made in its partnership business or in its books; but that on October 25th the transfer was made and the corporation began business. In connection with Mr. Werner's testimony, the plaintiffs offered in evidence the minutes of the said meeting, showing that the transfer was authorized and the purchase made on October 25, 1906, and also offered in evidence numerous insurance policies...