Giometti v. Etienne

ANDREWS, J.,

pro

tem.

On December 12, 1927, the parties to this action entered into a contract whereby defendant was to erect, upon land which plaintiffs would deed to him, buildings, machinery and equipment for the manufacture and sale of ice. Defendant was to sell this plant and equipment as finally completed to the plaintiffs for the purchase price of $65,000, of which $15,000 was to be cash, the balance to be paid from receipts for the sale of ice made in the plant. An accounting and payment was to be made each week. The balance due to defendant was to bear interest at eight per cent. Then appears this provision:

“The full purchase price shall be computed from the above stated price in paragraph IV, with the addition thereto of such sum as may be due on account of interest and bonus, if applicable and such other sums as may be due the seller on account of additional equipment.”

Title was to remain in defendant until the purchase price was paid in full and in cash. Then follows this language:

“Purchasers agree to pay seller a bonus of 75 cents per ton of ice manufactured in the plant until the full purchase price is paid to the seller. This bonus to be paid seller due to exceptionally favorable terms of purchase granted. Provided, however, if purchasers complete payment to seller of all sums of money due him prior to November 15, 1928, this provision as to bonus shall be null and void.”

Other provisions related to insurance, patents, acceptance, delivery, rights on default, and special provisions as to cost of buildings. Pursuant to the contract the plant was erected and turned over to the plaintiffs on the twenty-seventh day of April, 1928. Plaintiffs thereafter used the plant in

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the manufacture of ice and made payments from time to time on the contract.

On June 10, 1931, there was due defendant, according to his account, about the sum of $28,000. On that date he claimed to have discovered that plaintiffs had been guilty of dishonest violations of the contract by failing to account for and pay over several thousand dollars which had accrued from the sale of ice and which had not been reported. On July 10, 1931, defendant gave notice of default and demanded possession of the property. Thereafter on July 15, 1931, plaintiffs, claiming the contract to be usurious, brought this action to have the rights of the parties determined under the contract, for an accounting, for the settlement of adverse claims, for the conveyance of the property from defendant to themselves, and for other relief. Defendant interposed a cross-complaint setting out his rights under the contract, asked for possession of the property, confirmation to his title thereto, attorneys’ fees and damages. The trial court held the contract usurious and ordered the property conveyed to plaintiffs.