Bernstein v. Sirotta

SEAWELL, J.

Henry N. Sirotta, doing business under the name and style of Queen Ribbon Company, appealed from a judgment for plaintiff, Julius H. Bernstein, in the sum of $2,619.63. Pending said appeal Sirotta died and Dorothy Sirotta, administratrix of his estate, has been substituted as defendant and appellant. References hereinafter made to the “defendant” are intended to apply to said Henry Sirotta, rather than to the substituted defendant and appellant.

By a contract entered into on January 20, 1926, defendant, the owner of a wholesale business dealing in laces, ribbons and handkerchiefs, employed plaintiff, who then was and for a long time prior thereto had been in his employ, as a buyer and salesman for an additional period of two years, terminating on December 31, 1927, and plaintiff agreed to accept such employment. By the terms of the agreement plaintiff was to receive as compensation for his services $10,200 in cash, payable in semi-monthly installments of $212.50, and, in addition thereto, “twenty per cent of the net annual earnings or profits of the above business, same to be based on a statement of account covering the annual fiscal years of said business, beginning January 1st, ending December 31st”, said statement to be made and submitted by a certified accountant not later than January 31st of each year. The paragraph relating

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to plaintiff’s right to a twenty per cent share in the profits further provides: When the amount of the above said twenty per cent of the net annual earnings or profits shall have been ascertained, at least three-fourths thereof shall be set aside and remain in said business until the time of the termination of this agreement, at which time it shall be due and payable to the party of the second part [plaintiff], . . . The other one-fourth may, at the election of the party of the second part, be drawn out at any time.”

The agreement also recites that in accordance with an accounting had between the parties as of the date thereof, it was agreed between them that there was due plaintiff the sum of $1,000 on account of his share of the profits of the business accumulated prior to December 31, 1925, but that said $1,000 should remain in the business until the termination of the contract of employment. Should the parties agree to -form a partnership said sum, together with the three-fourths of plaintiff’s share of the profits which was not to become due and payable until the termination of the contract of employment, was to be applied by plaintiff as a payment for a one-fourth interest in the business.