Bogdanich Construction Co. v. Semas

HANSON, J. pro tem.* The controlling question in this case, as we view it, is whether the trial court correctly interpreted the meaning of the language italicized in paragraph 6 of the contract (set forth below) entered into by and between Sernas on the one side and Bogdanich Construction Company and Bogdanich Building Company on the other.

The trial court found that Sernas, through weekly advances, had been overpaid the sum of $13,338.70 in excess of his one-third share of the net profits of Construction Company, but, by reason of the language italicized in paragraph 6, he was required to repay only one-fifth thereof. The paragraph reads as follows: “6. Construction shall pay to Sernas $250 at the end of each week of his employment, such payments to be on account of the compensation herein provided, and in the event such compensation shall be less than such weekly payments, reimbursement of the deficiency shall be required to be returned to Construction by Semas, and officers of Construction drawing salaries, to reimburse in equal amounts. All money paid by Construction to Sernas as salary from November 2, 1953, to date, shall be applied to the credit of Construction under the terms hereof.”

The material facts necessary to a decision on this point may now be stated. Bogdanich Building Company, a corporation, and Bogdanich Construction Company, a corporation, were two family corporations. Paul Bogdanich was president of and controlled both corporations. The family associates were officers of both. The Bogdanich Construction Company, a corporation, hereinafter referred to as Construction Company, or Construction, and the Bogdanich Building Company, a corporation, hereinafter referred to as Building Company or Building, were both engaged in commercial and residential construction, although Building Company was principally engaged in residential construction and Construction Company in commercial construction. Under the terms of a written contract of date June 23, 1952, Sernas, respondent herein, was employed as a construction superintendent for [114]Building Company. Under this agreement which, by its terms, was to run for a period of two years, it was agreed that a salary of $250 per week would be paid to Semas and in addition he was to receive 13 per cent of the net profit of Building less the advance salary which had been paid to him. Until November 2, 1953, Sernas continued to be employed by Building as superintendent of residential construction which employment, however, terminated as of November 2, 1953, when, through mutual agreement of the parties, he transferred to Construction as superintendent of commercial construction for that corporation. After the termination of Sernas’ employment as superintendent of Building, that company in payment of the percentages due gave him its promissory note dated January 2, 1954, for $17,000, payable 10 years after date or upon the sooner termination of his employment by Construction Company. While Sernas’ transfer from Building Company to Construction Company was agreed to take effect as of November 2, 1953, and seems actually to have taken effect on that date, the written agreement containing the terms agreed upon by the parties was not signed until June 30, 1954. It is not clear whether the note mentioned above was delivered prior to June 30, 1954, or not. The June 30, 1954, contract which was signed by Semas and the two corporations, expressly provided that the SemasBuilding contract of June 23, 1952, should terminate as of November 2, 1953, and, likewise, that the written agreement between the parties for the employment of Semas by Construction Company was to run from and as of the date of November 2, 1953.