Appeal from Sixth Judicial District Court, Humboldt County; John S. Orr, Judge, presiding.
William S. Bonnifield and Summerfield & Curler, for Appellant.
J. A. Callahan, for Respondent.
By the Court, Norcross, J.:
Plaintiff, respondent herein, brought his action against appellant to recover judgment for an alleged balance due him of $1,640.38, by virtue of the provisions of a written contract entered into between the parties, and reading as follows:
This agreement made, this 17th day of June, A. D. 1907, between W. C. Pitt the party of the first part and W. H. Goodin the party of the second part. Witnesseth: That the above named parties have this day entered into agreement as follows: W. C. Pitt agrees to pay to W. H. Goodin $125 per month wages commencing from the 15th day of June, 1907. That said Goodin shall work for said Pitt in the business of flour manufacturing and selling flour, buying and selling grain, etc. And it is further agreed that commencing on the first day of July, A. D. 1907, and in further consideration of services performed by said Goodin for Pitt, that after said Pitt shall receive from said milling business $3,000 profit per year that said Goodin shall receive one-half of the profits above that amount. Except that if over $12,000 shall be invested in the business outside of the costs of the milling plant, said Pitt shall receive 8% on amount above that which shall be considered as part of the expense. [Signed] W. C. Pitt. [Signed] W. H. Goodin.
The complaint alleged that in pursuance of said contract, plaintiff entered into the employ of defendant on the 15th day of June, 1907, and so continued until the 30th day of June, 1908; that the profits of said business during said time, after allowing defendant the exemption mentioned in the contract, amounted to $4,398.15. The answer, in addition to other denials not material upon this appeal, denied that the profits amounted to $4,398.15, or any other sum whatever, in any money or currency. The answer further alleges: That at the end of the year referred to as aforesaid, there was a large lot of unsettled accounts and bills owing to said business and to defendant, amounting to over $3,500, and which at the time of the commencement of this action had not been collected, which has not yet been collected, and some parts of which, defendant alleges, may never and probably never will be or can be collected; that aside from these uncollected accounts and bills, all of which were made in the course of the business carried on as referred to in the complaint, there were no profits at all, and there
are no profits yet, and without the collection of said bills and accounts there can be no profits, as referred to and intended and meant in said contract and agreement; * * * that at the end of said year there were on hand and undisposed of a lot of the articles dealt in in the said business, referred to in said contract and agreement; that aside from these unsold and undisposed of articles there was no profit whatever in the said business for the said year; that a large lot of such articles are yet unsold and undisposed of; that at the time of the commencement of this action there were a large lot of such uncollected bills and accounts, and a large lot of such unsold and undisposed of articles; and that, aside from these said accounts and bills and unsold articles, there was not, and there never has been, either at the commencement of this action, or at any time before that since the expiration of said year, or at the expiration of said year, any profits whatever. * * * And defendant hereby sets up, pleads, objects to, and demurs to plaintiff's pretended cause of action on the ground, and for the reason, that no cause of action whatever was accrued, or due, or owing from defendant to plaintiff at the time of the commencement of this action, and at the time there were no profits whatever, under and by virtue of the said contract and agreement, or anything else.
The defendant alleged a violation of the contract, upon the part of plaintiff, to his damage in the sum of $3,000.
A referee was appointed to take the testimony and report the facts, and the following extracts are from his report: That the plaintiff received his salary of one hundred and twenty-five dollars ($125) per month, provided in said contract during said time, and in addition thereto received the sum of five hundred and fifty-eight dollars and sixty-nine cents ($558.69) from the profits of the business mentioned in the contract, accruing during the time covered by the contract; that there remained due the plaintiff under the contract at the time this was instituted (excluding a consideration of the issue of law hereinafter mentioned) the sum of $1,396.56. It appeared
in the evidence that the profits, or a portion thereof, covered by the contract consisted in merchandise on hand and book accounts. Such accounts as were shown by the evidence, in my judgment, to be worthless were by me deducted from the total accounts before figuring profits. I deem the issue made by the pleadings in this cause as to whether the cause of action had accrued at the time of the institution of the suit, by reason of the book accounts having been at that time uncollected, to be an issue of law, and do not report upon that issue.
The court adopted the findings of the referee, and the judgment recites that the cause was submitted to the court for consideration and decision, and * * * the court finds that the report of the referee should be and the same ...