Crome v. Allen

GRIFFIN, J. Respondents employed appellant as manager of the sport-goods department of their hardware store in 1935. An oral agreement was then made for the payment to appellant by respondents of a salary segregated as follows: $28.50 a week for his services in the sport-goods department, and $21.50 a week for his services as advertising manager of the entire store. In addition, Allen was to be paid a 10 per cent bonus which is based upon a sales quota of $20,000 a year and a gross profit margin of 27% per cent on sales from the sport-goods department. No bonus was to be payable unless the sales of his department exceeded the [139]quota o£ $20,000. If sales exceeded that minimum, Allen was to receive a bonus on the excess of 10 per cent if the margin of profit in his department was maintained at 27% per cent. If the margin between cost of doing business and the return therefrom (the margin of profit) either exceeded or fell below 27% per cent, the sales volume was to be adjusted to show a return of that arbitrary figure and the bonus was then to be calculated on the adjusted figure. About March, 1940, the relationship between appellant and respondents was terminated and a controversy arose out of the mutual accounts between the parties at that time. The solution of this controversy depends on the terms of the oral contract between the parties. Respondents’ complaint alleged that certain money was due under an ordinary money had and received count. Appellant answered, denied generally the allegations of the complaint, alleged payment, and by way of counterclaim and cross-complaint claimed that $4,619.09 was due him. The cross-complaint, in addition to many other claims, alleged that in computing the net profits of any given year, the cost of the goods to plaintiffs was the basis to be taken. Respondents answered the cross-complaint containing this allegation, admitted certain portions thereof, one of which contained this particular language in reference to the cost.

During the second day of trial respondents moved to amend their answer to the cross-complaint by interlineation and by permission of court added after the word cost, as italicized, the words “based on inventory value to cross-defendants” rather than “cost of the goods to plaintiffs.”

Appellant now claims that the court erred in allowing the amendment at that time to his prejudice because the allowance of the amendment removed an admission upon which he was entitled to rely under the pleadings, citing Bank of Woodland v. Heron, 122 Cal. 107 [54 Pac. 537], We see no merit to this point. This amendment was offered after testimony was taken on the question of how the cost was to be determined. The admission in the pleadings, if it constituted such, was only an admission as to the facts set forth, but was not an admission as to the method by which the cost was to be determined. The effect of the change was to charge to appellant his share of any depreciation in price of the merchandise in the sport-goods department because of goods be