Hinchman v. Matheson Motor Car Co.

Grant, C. J. (after stating the facts). The most-important question arises upon the construction of the contract. The learned counsel for the defendant insists that the clause “I will undertake to dispose of approximately $100,000 of the preferred stock,” is an absolute agreement; that he failed to perform it, and therefore cannot recover for his services as treasurer. We think counsel in error. Plaintiff agreed to do two things, neither of which was dependent upon the performance of the other. He agreed to act as treasurer for one year for which he was to receive a monthly compensation. He also was to undertake to dispose of a certain amount of the stock. The disposal of the stock was certainly not a condition precedent to his appointment as treasurer and director and the performance of the duties which those two offices imposed upon him; otherwise the defendant would not have paid plaintiff monthly for six months. Furthermore, the correspondence between the parties clearly shows that plaintiff’s employment as treasurer was not understood to be dependent upon his disposal of the stock. Seymour v. Rolling Mills, 56 Mich. 117. [219] controls this feature of the case. In that case this court said: “The agreement consists of two contracts, severable and independent of each other, and have so been treated by the parties.” It therefore becomes unnecessary to determine whether the word “undertake” imported an absolute agreement to sell, or simply a faithful endeavor on his part to sell. That plaintiff made faithful endeavors to sell the stock is established by the evidence. In these endeavors he was assisted by the manager of the defendant; but notwithstanding the efforts of both, no stock could be disposed of in the city of Detroit. The contract was one of employment for a year as treasurer at a stated compensation, and plaintiff was subject to discharge only for cause. On November 1st another treasurer was appointed, and plaintiff notified that his successor had been elected. Mr. Matheson, the manager of the defendant, testified that technically plaintiff was the defendant’s treasurer as late as October. In fact he was the only treasurer defendant had and performed all the duties required of him. 2. The court correctly instructed the jury that the burden of proof rested upon the defendant to show sufficient cause for plaintiff’s discharge from its employment. Milligan v. Furniture Co., 111 Mich. 629; Bolt v. Frederick, 56 Mich. 20. 3. Defendant also insists that it should have been permitted to introduce evidence of false representations made by the plaintiff as to his ability to dispose of this stock, and as showing a reason for his discharge. It could not make that defense without a rescission of the contract. Defendant made no offer to show that it had placed the plaintiff in statu quo by tendering to him the money received for the stock he had purchased. When one rescinds a contract on the ground of fraud it is his duty to restore to the other party the property he has received. [220] 3 Current Law, p. 844; 9 Cyc. p. 433. There was therefore no rescission. Furthermore, defendant gave no notice of a defense on the ground of fraud. This evidence was therefore properly excluded. 4. It is also urged that there was some evidence of a discharge of the plaintiff in July, which should have been submitted to the jury. The main ground for this contention is found in a letter written to plaintiff by defendant on June 30, 1905, in which defendant’s manager, Mr. Matheson, refers to negotiations to secure capital stock in the East which would result in the retention of the plant at Holyoke. The letter further stated that that would involve the reorganization under Massachusetts law and the transfer of the Michigan company to a Massachusetts corporation; that if the negotiation went through it would enable the company to retire its outstanding bank line and relieve plaintiff as well as the rest of the board from other indorsements. The letter then stated that in that event plaintiff’s services would be no longer required, and would mean the termination of his “service contract,” and asked an “ expression concerning same ” from him. To this plaintiff replied asking further information and promising to answer as soon as he was able to give the matter a little consideration. On July 8th plaintiff wrote defendant evidently in reply to Mr. Matheson’s letter of the 30th: • “I will be pleased to send you my resignation when the loans at The American Exchange National Bank at Detroit have been fully paid up, so as to relieve me of my indorsements, and upon receipt of the amount of my investment, viz., $2,500 in the stock of the Matheson Motor Oar Company.” This offer was not accepted. There is nothing in this correspondence to indicate any discharge of the plaintiff as treasurer. Neither is there anything in the correspondence following until his discharge November 1st. 5. It is also urged that the plaintiff’s form of action is not appropriate to recovery after his discharge, the claim [221] being that he should have brought suit for breach of contract. The declaration we think is in the usual form for actions of this kind, alleging as it does, that— “Defendant disregarding its obligation, * * * neglected and refused to pay the plaintiff’s salary, although the plaintiff was at all times prepared and ready to continue to discharge the duties of the office of treasurer to which he had been elected.” The declaration is not for services rendered, but for services he did not render but was ready and willing to perform. The special count sets forth the contract in full; that the plaintiff entered upon his duties; that he was paid to July 1, 1905;‘that he was at all times prepared and ready to continue to discharge the duties of the office; and its refusal to pay. Had plaintiff brought suit simply for work and labor performed, as was the case in Moore v. Nason, 48 Mich. 300, plaintiff could not have recovered for the last two months of the contract period. Judgment affirmed. Blair, Moore, Carpenter, and Me Alva y, JJ., concurred.