Berger v. Bright

LENNON, J.

Defendants appeal from a judgment for plaintiff in an action to recover the sum of $750 alleged to have been received by defendants for the plaintiff’s use.

Gilbreth and Company entered into a contract with the Los Angeles School District whereby the company agreed to erect a school building to be known as the Amelia Street School. In consideration of defendants’ promise to become sureties on its bond, the company assigned to defendants, as trustees, the right to receive all moneys due from the school district and to disburse all moneys owing laborers and materialmen. The company at the time owed plaintiff the sum of one thousand dollars. Plaintiff’s attorney having threatened to put the company into bankruptcy, defendants, after figuring that there would be a profit of at least two thousand dollars on the erection of the school building, promised to pay plaintiff out of the payments received from the school district. After some preliminary discussion, defendants signed" an agreement ■by which they promised to pay to plaintiff the sum of $250 on the date of the agreement, and, in addition, “such sum of money as shall amount to eight per cent of all future payments

[156]

made by the owner of said Amelia Street School for the construction thereof, until said indebtedness is satisfied in full. ’ ’ Although about ten thousand dollars was received under the contract for the construction of the school building, defendants have made no payment to plaintiff other than the initial payment of $250. The work, on its completion, showing a deficit of four thousand dollars, defendants refused to make any further payment to plaintiff, who thereupon bro'ught this action.

In their answer, and in a cross-complaint praying a.reformation of the written agreement, defendants admitted the signing and execution of the agreement, but alleged that it did not express the real intent of the parties, which was that plaintiff should be paid only out of the profits, if any, realized on the work.

One of the main contentions of defendants on this appeal is that the trial court failed to find upon the issues presented by this allegation in the answer and cross-complaint. The court, however, found that defendants signed and executed and