SUPREME COURT Appeal Over Commission From Handbag Firm

Press, Issue 30997, 1 March 1966, Page 14

SUPREME COURT Appeal Over Commission From Handbag Firm

Although a Wellington man’s sales promotion had put new impetus into a Christchurch handbag framemaking company, when “at a very low ebb” in 1962, the chief shareholder and director, Carl Julius Berger, had “dodged out” of letting him have shores, and the company had failed to pay him commission, it was said during

an appeal in the Supreme Court yesterday. For Leopold Friedlander, Mr R. G. Blunt submitted that the acquisition of shares from Berger, and 5 per cent commission on turnover, were the terms of an implied contract under which he was sales manager of the company from July, 1962 to February, 1963. Friedlander, an importer, was appealing before Mr Justice Macarthur against a Magistrate’s dismissal of his suit against the Carlton Manufacturing Company, Ltd., for £365 16s commission for this period (on a turn-over of £7316), or, alternatively. £3OO on a quantum meruit basis. For the company, which opposed the appeal, Mr E. J. Somers submitted that there was never any agreement between it and Friedlander—which lack of agreement went both to the shares and salesmanship. After hearing submissions and legal argument for four hours, his Honour reserved decision. Friedlander’s suit was heard in the Magistrate’s Court in May last—being a two-day case in which 90 pages of evidence were recorded—but a decision was not given until November 23, which delay somewhat detracted from the magistrate’s advantage of seeing and hearing the witnesses, Mr Blunt submitted. “A Lot Of Work”

It was clear from the evidence, said Mr Blunt that Friedlander had done a lot of work in promoting the interests of the company as regard sales. He and another man Honkys, a Czechoslovakian immigrant, had worked together to develop handbag frames which would be readily saleable, the fancy clasns being an important factor. By nersonal visits to clients. Friedlander had rejuvenated business that was falling away.

“He put new impetus into the company, which it would seem had reached a very low ebb just before,” said Mr Blunt. This was more than the ’’exploratory work” that the defence claimed, said Mr Blunt. Friedlander’s evidence, Mr Blunt said, was that he was to have got 5 per cent on the gross sales, plus some shares. In fact, Friedlander and Honkys were to have had 51 per cent of the shares, sufficient for a controlling interest.

The facts showed the implication of a contract, said Mr Blunt, for which he cited legal authority. But Berger then changed his mind, and with a marked improvement in the company’s turn-over, put obstacles in the way of Friedlander. “It is submitted that Mr Berger dodged out of letting him have the shares,” said Mr Blunt.

His Honour said he thought it proved that there had been “almost a dramatic betterment” in the company’s affairs.

However, an implied contract was divisible, Mr Blunt said, and apart from the question of the shares, there were Friedlander’s services to the company.

“He was not doing this for fun, or as exploratory work, but, he claims, under an agreement to be paid,” said Mr Blunt. Defence Case

Mr Somers said that perusal of the correspondence in the matter showed there had never been any agreement between the company and Friedlander. There have been draft agreements, but the parties had always been at variance on points in them.

On the allegation of the 5 per cent commission on turnover, Mr Somers said that there w-as reference in a letter to 5 per cent commission on sales up to £25.000, and thereafter 2j per cent.

“It is irrelevant that Mr Berger changed his mind,” said Mr Somers. “The question is what was in the minds of both parties.” As .to an implied contract.

it was not something one could “just pluck out of the air” to reward Friedlander. Berger, in his evidence, said he had never given Friedlander instructions about selling, “or anything.” As to the argument of quantum meruit, the broad head of that was request for work done—but here there was no request, Mr Somers submitted. The facts of the case did not bring it within tiie head of any leading case on the subject. And of w'hat work Friedlander had done, most orders he had obtained in the relevant period were from existing customers of the company.