75 N.Y.S. 987 | N.Y. App. Div. | 1902
The appellant is an actress and the respondent is a theatrical manager, both of many years experience. ' The action was; brought to recover a balance of commissions on the “ profits ” of 'two theatrical seasons under the following contract, to wit:
“ July 25th, 1898. . 5 Norfolk Street,
“ Park Lane, W.
“ Mr Dear Marcus Matér ■;
“ The arrangement between us is, that you shall act for me as my American Manager for two Seasons in" America to commence on November twenty-first, 1898, at a weekly salary of one hundred dollars during each Season. In addition, you are to receive as commission on my profits of each season twenty-five per cent of the first five thousand dollars; after the first twenty thousand dollars profit,, thirty per cent of the next five thousand dollars and thirty-five per cent of everything over said amounts. Should I take a partner for my forthcoming London Season, you are to receive, in lieu of the above commission for the American Tours, seventeen per cent of the five first thousand dollars after the twenty thousand dollars aforesaid, .and twenty per cent of all profits over twenty-five thousand dollars and a weekly salary of $100.
“ My American Tours are to be advertised as follows:
“ Olga Nethersole’s Compart,
“ Direction
“ Marcus R. Mater.
“ You are to give your personal and exclusive attention, and I am to charge to the expenses of my tours three, hundred dollars per week for my personal expenses.
“Yours truly,.
“OLGA NETHERSOLE.
“ I accept the above,
Marcus R. Mater.”
The appellant, through her brother who was her treasurer, kept two separate accounts, one a “ production ” account involving the items heretofore indicated as embraced in that term, and the other an account of running expenses including the items heretofore indicated as embraced in those terms and the receipts of the business. A copy of the account of the receipts and running expenses, which did not include any of the items of the “ production ” account, was given to the respondent weekly and the items of this account are not involved in the appeal. A statement of the production account was furnished to the respondent, about a month after the opening of each season. When the first statement of the production account was given to him, according to his testimony, he said to the treasurer, “ That has got nothing to do with me. That comes under the $20,000 allowed;” to which Mr. Xethersole replied, “Well, I just gave you the account to tally with our books.”
The appellant’s counsel has stipulated that only the exceptions to the disallowance of certain specified items included within the cost
For the first season.
“ Six months’, hire of Carmen costumes..........$980.00
Nov. 29, Carl Mayer for wigs............... 18.00
Dec, 12, Mr. Herman, on account of costumes for Camille........500.00
Jan. 27, Mr. Herman balance account..............1,427.50
Feb. 9, Wardrobe trunks...............59.00
Feb. 15, Herman further costumes.........12.00
Dec. 3, Mr, Frohman for Carmen scenery and dresses and properties..........600.00
Gratuity to Porter........................3.00
Termagant, Scenery, and costumes and properties..........7,220.00”
For the second season.
“ Carmen wardrobe......... $475.00
Wigs....................................57.50
Trip to Paris.......60.00
Profligate scenery................ 181.75
Scenery ................... 1,342.15
Carpenters..............................1,722.52
Costumes.................................... 450.00
Wardrobe.................................... 1,595.62
Furniture bought of Mr. Seidle..................... 1,048.50
Miss Nethersole’s dresses............ 4,150.00 ”
The principal, plays.produced by the appellant; during;- these, twd' seasons were “¡The /Termagant*” “The- Profligate,” “Carinen,” “ Camille;”, and: “ Sapho.” : Theappellant had-, prior to the execution of the contract, produced “Carmen.” in London, and .had purchased the “scenery-and dresses and-properties.” second hand*, although it, .appears that her tain costum'es were hired for, the-folio wing, season in America. Before the;¡contract, went into: effect*:¡“The--Termagant”- had-been played by appellant for ¡six .weeks..,and a half: in. London-, .and she Was.the.:¡owner of • the scenery properties;and costumes therefor. Evidently this was within the contemplation of the-
It was; conceded that it was the custom in the theatrical-profession, “where the equipment was paid out of the profit account to divide it-after the season closes * * according to the terms of their agreement.” The respondent testified, without objection, that at the time of making the agreement the appellant spoke of having to produce -the plays and that he said, “ there should be a certain amount allowed for the production before any profits were to be divided ; I said, will $20,000 be enough, and she agreed that it would be sufficient.” The appellant was asked if there was
This .question was objected to, and the referee stated that if any evidence had been received on that subject he was not aware of it, and should not regard it as binding upon him in the construction of the contract, and she was asked no further questions.
If we had before us the parol communications leading up to the contract, the sense in which the word “ profits ” was used would doubtless clearly appear, and it is by no means certain that the contract was not sufficiently ambiguous on this subject, to justify parol evidence to show the sense in which the word “ profits ” was used by the. parties. (Manchester Paper Company v. Moore, 104 N. Y. 680; Flagler v. Hearst, 62 App. Div. 18.) The ruling of the referee, however, that there was no ambiguity relieved the appellant of proving the conversation 'between the parties, and this ruling seems to have been acquiesced in by both parties. We are, therefore, required to interpret the contract from the language employed.
The respondent was given no voice in deciding what plays should be. produced and whether they should be produced with the appellant’s own equipment, with equipment to be purchased or with stock scenery and hired costumes. Nor does it appear, except as to certain items, whether the necessary equipment could have been hired. Ho provision was made for a division or sale of the equipment or capital remaining at the end of the contract period, according to the. conceded custom of the profession^ where the expense of production is first deducted from the profits. The respondent was an employee, technically speaking, but he was also in a sense jointly interested in the venture. It is reasonable to suppose that had it been contemplated that the cost of production was to be deducted from the returns before there were to be any profits for division some .agreement would have been made on the subject. In manufacture, agriculture and ordinary business, the word “ profit ” ordinarily means the excess of returns- over expenditures and may or may not, according to circumstances, include in the returns any increase in value of the capital and in the expenditures any depreciation of capital. In a more scientific sense it relates to that excess which remains after deducting from the returns not only the operating expenses and depreciation of capital, but also interest on the capital
The transaction appears to have been a limited joint enterprise. The appellant was to contribute her time, talent and necessary equipment to produce the plays, and the respondent was to contribute his time and skill as manager. The sum of $20,000 was fixed as a proper compensation for the excess of her investment and hazard, to be first deducted from the profits; then the parties were to share in the remaining profits according to the percentage specified. We think the proper construction of the contract is that she was to bear the expense of production and that it was within the contemplation of the parties that this would be covered by the $20,000.
Each case of this character must be decided upon its own peculiar facts. We find no authority directly in point, but these views are supported by analogous decisions. (Eyster v. Centennial Board of Finance, 94 U. S. 500 ; Rubber Co. v. Goodyear, 9 Wall. 788, 804; Park v. Grant Locomotive Works, 40 N. J. Eq. 114; affd., 45 id. 244; Tutt v. Land, 50 Ga. 339 ; People ex rel. Farnum v. Savings Union, 72 Cal. 199, 202; Connolly v. Davidson, 15 Minn. 519, 530; Braun’s Appeal, 105 Penn. St. 414; Proudfoot v. Bush, 7 Grant’s Ch. [U. C.] 518, 523; Bates Part. §§ 229, 230; Lind. Part. 8 [2d Am. ed. p. 12] ; Bouvier’s Law Dict. [Rawle’s Rev.], titles “Profits” and “ Net Profits.”)
The case of Eyster v. Centennial Board of Finance (supra) is quite in point. There the government advanced $1,500,000 for the purpose of building the buildings for the Centennial Exhibition which the statute required to be repaid “ in full * * * before any dividend or percentage of profits shall be paid to the holders ” of stock in the corporation. The corporation sought to deduct the amount of subscriptions from the assets out of which the advance was payable. The court said, “ the capital stock of this corporation was not employed in but to prepare for, the business of the contemplated exhibition ; and.
This seems also to be the practical construction which the parties themselves placed on the contract. The-appellant kept- the production account entirely separate and distinct,, and -although settlement of - the other accounts was ¡regularly made this was allowed, to- 'stand unadjusted, and- the respondent had, notified the appellant’s treasurer that it, did. not concern him. The appellant. assumed to retain and utilize the equipment as her own and the respondent seems to have made.nó'objection-thereto,. . The language employed will bear this, construction andtit seems equitable.
If it were not for .the fact that purchase of the costumes for “ Carinen ” during the second season was made at, a figure very low m- comparison with its rental for the prior..season^ which indicates an understanding that it was to be purchased, it might be doubted whether the item of §980 was not a proper expense to be deducted before paying the respondent’s commissions;: but it is apparent 'on examination of the decision of the. referee that he , erroneously allowed the appellant for insurance and other items, of expense properly belonging to the production account in excess of this amount.
Therefore, on a -review of the whole case, we find no reversible error, and the judgment should be affirmed, with costs. ,
Van Bbunt, P. J., and Pattebson,- J., concurred; O’Bbi-en, 3., dissented.
Judgment affirmed, with costs.