182 Pa. 463 | Pa. | 1897
Opinion by
The plaintiff company, prior to the making of the contract now sued on, had an authorized capital of $50,000, divided into five hundred shares of $100 each. This was owned by three men, Kenderdine, Kitson and Weidershime. The first contributed the patent for the burners which constituted the property of the company. The second contributed services of some sort. The third contributed more services. Neither paid a farthing in money, but together they held the entire stock as fully paid, and subject to no further assessment. The only asset of any value belonging to the company was the mere right to make and sell burners. To test the value of this asset it was necessary to find some one who would furnish .the money needed for this purpose, and place the manufactured burner upon the market. Plumb, the defendant, undertook to do this. On the 6th of July, 1892, he entered into a contract with the plaintiff company, by the terms of which he was to act as treasurer and manager of the company; pay its debts not exceeding $1,000 contracted in the attempt to manufacture some of its burners ; manufacture Kenderdine burners for the company at his place of business, and furnish them to it at the actual cost of manufacture; and provide the money needed for purposes of manufacture, and the employment of salesmen to advertise and sell their burners, not to exceed $10,000, inclusive of the debts of the company he had undertaken to pay. He agreed also to employ Kenderdine at $30.00 per week, his son George at $15.00 per week, and his brother-in-law Yerkes as a salesman for not less than one half his time, paying all his traveling expenses and a suitable salary therefor. In consideration of all this he was to receive two hundred shares of the paid up stock, and the prospective dividends they could be made to yield from the profits realized by
Whether the plaintiff, if entitled to recover, should be allowed more than nominal damages must depend on whether the manufacture and sale of the burners was, or could reasonably be made to be, a profitable business to carry on. If the jury could, on the evidence before them, find that the business would pay a net profit, then the answer to the third question is very plain. The measure of the plaintiff’s damages would be the probable profits over all expenses that would fall to it from the sale of the burners, after the reimbursement of the defendant for his advances. He had undertaken to make advances, for the purpose of testing the value of the business, up to $9,000, in addition to the payment of $1,000 indebtedness of the company. But he was to repay himself these advances out of the sales before any division of profits could be made. The contract proceeded upon the assumption that profits would be made, and to an extent sufficient to repay Plumb all advances made in developing the business before the company or its stockholders could receive anything. Did the experiment justify this as
The judgment is reversed and a writ of venire facias de novo is awarded.