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Durkee-Thomas Corp. v. Doherty

Supreme Court of Arizona

January 26, 1931

DURKEE-THOMAS CORPORATION, a Corporation, Appellant,
v.
C. W. DOHERTY, Appellee

APPEAL from a judgment of the Superior Court of the County of Maricopa. M. T. Phelps, Judge. Judgment reversed and cause remanded for new trial.

Messrs. Armstrong, Lewis & Kramer, for Appellant.

Messrs. Stockton & Perry, Mr. E. G. Frazier, Mr. Stanley A. Jerman and Mr. Thomas P. Riordan, for Appellee.

OPINION

LOCKWOOD, J.

C. W. Doherty, hereinafter called plaintiff, brought suit against Durkee-Thomas Corporation, a corporation, hereinafter called defendant, [37 Ariz. 458] for an alleged breach of a contract for the employment of plaintiff by defendant for the term of one year. The case was tried before a jury which returned a verdict in favor of plaintiff in the sum of $1,900, and, from the judgment and the order overruling the motion for a new trial, defendant has appealed. The facts necessary for the determination of this appeal are not in serious conflict and may be stated as follows:

Defendant is engaged in the business of selling automobile batteries. Its general headquarters are at San Francisco, California, but on December 1st, 1928, it maintained two branch offices, one in Southern California, and the other in Arizona. George A. Davis was the manager of the Southern California branch, and J. C. Edwards was the manager of the Arizona branch. The latter branch had been established but a short time, and plaintiff was working under Edwards as a salesman. Each branch manager had the right to employ and discharge help in his own district, and to fix their compensation, subject to review from the home office in San Francisco, but neither had any authority over the actions of the other.

Page 303

On the date stated Edwards and plaintiff were compensated by commissions on the amount of business done, but had a drawing account for expenses, to be charged against commissions, in the sum of $200 per month. The commissions earned by Edwards and plaintiff did not equal their drawing account, and plaintiff informed Edwards that he could not continue to work for the amount he was then receiving. Edwards then wrote to Davis in Los Angeles, and in the letter in question stated:

"Just a line to let you know that we are expecting you around the first of the year, and also to give you my opinion as to the situation here.

"I have a lot of confidence in the deal, but it is no set up, and we have plenty of competition, most of which has sprung up within the last sixty days.

[37 Ariz. 459] "What I would suggest, in order to make this deal workable, is that Doherty and myself be allowed a drawing account of $125.00 on the 1st and 15th of each month. This drawing account to be figured as a guarantee, regardless of what the commissions run. . . .

"So see what you can do Geo. Doherty is a valuable man on the territory and I don't want to lose him right now, as he is holding a lot of good accounts, even in the face of keen competition."

Immediately thereafter Davis replied:

"Regarding your deal Jack, I would suggest that you and Doherty go right ahead and draw your $125.00 on the 1st and 15th of every month, and I will take this up with San Francisco, but in the meantime go right ahead. I appreciate what you fellows are up against in starting this deal and rest assured I will write to San Francisco explaining this and telling them that your deal has changed and that you have started drawing ...


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