Williams v. Herring
| Decision Date | 11 December 1917 |
| Docket Number | 32145 |
| Citation | 165 N.W. 342,183 Iowa 127 |
| Parties | J. E. WILLIAMS, Appellee, v. C. L. HERRING et al., Appellants |
| Court | Iowa Supreme Court |
REHEARING DENIED MARCH 15, 1918.
Appeal from Polk District Court.--T. H. GUTHRIE, Judge.
ACTION at law to recover compensation upon a contract, and damages for an alleged violation thereof. Defendant moved to transfer the trial to equity, and this appeal is from the judgment of the district court overruling said motion.
Affirmed.
Clark & Byers, for appellants.
George A. Wilson, and Ayres, Strauss & Shaw, for appellee.
I.
Plaintiff's petition, which is in two counts, is based upon the alleged violation by defendant of certain terms of a written contract, entered into on the 21st day of March, 1913, between the parties hereto, by the terms of which the defendant agreed to establish a wholesale and retail oil and gasoline business, as a department of the business at that time conducted by him in the city of Des Moines, for the purpose of handling oils and gasoline of all kinds and description at wholesale and retail, same to be conducted as a branch to the principal business of defendant. All necessary capital up to $ 50,000 was to be furnished by the defendant, the business to be located, so far as possible, in the buildings then occupied by defendant, the office facilities, credit rating, and other branches thereof to be employed and used in the conduct thereof without charge, except a pro rata charge for overhead expenses, based upon the actual cost to defendant of the items of rent, light, heat, office expenses, and materials furnished. Plaintiff agreed to devote his entire time and attention to the management of the department of the business referred to in said contract, for which it was agreed that he should receive as full compensation $ 125 per month, payable monthly, and in addition thereto, 30% of the net profits of said business, to be determined annually as of the 31st day of December of each year, and to be divided and distributed as soon thereafter as convenient. It was further agreed that said contract should be in full force and effect for a term of five years, and plaintiff was therein given the option personally to, at any time during the life of said contract, purchase any part of the said business covered by said contract, up to 30% of the actual amount invested therein, without any addition for good will, the purchase price thereof to be the cash value of the amount purchased, to be determined by the net charge upon the books of defendant to the department covered by said contract, showing the actual amount invested therein.
Plaintiff, in Count 1 of his petition, alleges that he entered into said business and continued therein until on or about April 1, 1917; that he has received as compensation $ 125 per month only; and that the net income of said business, during the time he conducted same, was $ 40,000: and he prays judgment against the defendants for 30% thereof, or $ 12,000. For a second cause of action, he alleges that, on or about the 15th of March, 1917, and during the life of said contract, and while he was yet in the employ of defendant, he sought to exercise his option, under the terms thereof, to purchase 30% of the value of the department of defendant's business covered thereby, but that defendant refused to convey same to him, or carry out the terms thereof in relation thereto; that the value of said business exceeded the actual amount invested therein in the sum of $ 45,000: and he prays judgment upon this count of his petition for $ 13,500, and in the full sum of $ 25,500.
The defendant, for answer to plaintiff's petition, admitted the execution of the contract, and the payment of $ 125 per month, and denied the remaining allegations thereof. Defendant, for further answer, alleges that defendant entered into contracts and leases for the right to use and occupy the real estate necessary for the conduct of said business; that same extends over a long period of years that defendant contracted for and erected large buildings, oil tanks, and other equipment for the handling and conduct of business covered by said contract; that defendant purchased a large stock of oil and other products, which was continuously replenished, from time to time, in the conduct of said business; that defendant employed a large force of salesmen, stockmen, bookkeepers, and other employes, and expended large sums in advertising and placing the products of said business on the market; that the business was conducted by plaintiff as manager; that the books showing the transactions of said business were kept under the direction of plaintiff; and that same are in the possession of the department of defendant's business covered by said contract; that the same contain a vast number of items of debit and credit; that said business should be charged with the expense of buildings, leases, tanks, and equipment of every kind, together with the numerous items of expenses incident to the carrying on of said business; and that, in determining whether said business yielded a net income, it will be necessary to examine and go over all of the items upon said books, and the transactions of said business, and also the question of depreciation of the value of buildings and equipment; and that same can only be properly and efficiently done by an accounting: and he moved that this cause be transferred to equity for trial, which motion...
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