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Borrowdale v. Sugarman

OPINION FILED JUNE 18, 1952

RUSSELL W. BORROWDALE, APPELLEE,

v.

BENJAMIN SUGARMAN, TRADING AS CONSOLIDATED PHOTO ENGRAVERS EQUIPMENT COMPANY AND CONSOLIDATED PHOTO ENGRAVERS EQUIPMENT COMPANY, AN ILLINOIS CORPORATION, APPELLANTS.



Appeal by defendants from the Superior Court of Cook county; the Hon. DONALD S. McKINLAY, Judge, presiding. Heard in the third division of this court for the first district at the December term, 1951. Reversed and remanded for new trial. Opinion filed June 18, 1952. Rehearing denied and opinion modified July 16, 1952. Released for publication July 17, 1952.

MR. JUSTICE LEWE DELIVERED THE OPINION OF THE COURT.

Rehearing denied and opinion modified July 16, 1952

Defendants appeal from a judgment entered on the verdict of a jury in an action to recover damages for breach of an alleged oral contract. Defendants' motions for judgment notwithstanding the verdict and for a new trial were overruled and judgment entered accordingly.

Plaintiff filed a second amended complaint consisting of two counts. The first count alleges that on April 1, 1945 plaintiff and defendant Sugarman entered into an oral contract which provided that plaintiff would build and produce "as soon as possible" a commercial camera for the printing industry known as the "consolidated 24" precision camera" with attachments; manage defendants' organization so that it could produce one hundred such cameras for sale within one year, if defendant could furnish the necessary capital; that defendant would furnish plans and specifications for such camera; and that in consideration of these services defendant would pay plaintiff the sum of $25,000.

Count 1 also alleged that after plaintiff had built the "consolidated 24" precision camera" and the production line for building one hundred of such cameras for sale, the parties entered into another oral contract about August 1, 1945, which provided that plaintiff would continue to supervise the production of the "consolidated 24" precision camera" disregarding the goal of one hundred cameras annually; that plaintiff would build and produce another commercial camera for the printing industry known as the "consolidated 24" standard camera" with attachments, and organize defendant's facilities to build twenty-five of this model for sale; that defendant would furnish plans and specifications; and that defendants would pay to plaintiff for such services an additional $25,000.

Count 1 further alleged that on November 1, 1945, plaintiff and defendant Sugarman entered into another oral contract which provided in substance that plaintiff would "build and produce" two additional commercial cameras for the printing industry known as the "consolidated 31" precision camera" and "consolidated 31" standard camera" with attachments, for which plaintiff was to receive the sum of $25,000 for each model; that plaintiff performed all of the terms and conditions of the "agreements" by building and producing the four models of cameras and "gearing" defendants' organization to build them.

In the second count of the second amended complaint plaintiff claims compensation for services rendered as manager of defendants' business; for moneys advanced to defendants for operating capital; for obtaining credit for defendants; for securing new quarters and remodeling them; for moving defendants' office and experimental laboratory; for developing and producing for sale the four models of industrial cameras described in the first count; for building a competent organization of highly skilled craftsmen to produce the cameras; for setting up experimental shops; and for designing, engineering and building all types of other photographic equipment and etching machines. Plaintiff says that the fair and reasonable value of the foregoing services was $100,000.

Defendants answered denying that they entered into the oral agreements with the plaintiff as alleged in the first count of the second amended complaint and aver that plaintiff was paid an agreed weekly salary as shop superintendent during the term of his employment.

As to the second count defendants deny that the services rendered by plaintiff were of a value in excess of the amount paid him as a weekly salary.

In 1942 defendant Sugarman acquired a small engraving establishment. Shortly thereafter he also engaged in the business of buying, rebuilding and selling small cameras and equipment. Some time in August 1944 Sugarman began the development of a large commercial camera used primarily in the printing business. He employed one Max Sussin, an experienced designer of commercial cameras. The first camera produced by Sussin, called the "consolidated precision 24" camera," weighs about 2400 pounds, is approximately 16 feet long and contains about 800 parts. Early in April 1945 plaintiff placed an advertisement in a newspaper seeking employment. Sugarman responded to this advertisement and plaintiff came to his place of business where they discussed the terms of plaintiff's employment. Plaintiff and Sugarman testified to diametrically opposite versions. During these conversations between plaintiff and Sugarman relating to the terms of plaintiff's employment no one else was present. It is uncontroverted that when plaintiff first met Sugarman, plaintiff had had no experience in the design or manufacture of cameras.

There is testimony tending to prove that when plaintiff was employed by Sugarman in April 1945 the design and patterns of the "consolidated precision 24" camera" were substantially completed, and that Sussin in designing this camera had invented certain improvements which were later patented by him.

Afterwards, during the period of plaintiff's employment, three other large commercial cameras were developed and produced. According to plaintiff's testimony he was discharged by Sugarman without just cause on February 17, 1947.

It is undisputed that plaintiff received $100 weekly from April 5, 1945 to May 3, 1945; $125 weekly from May 3, 1945 to November 8, 1945; $135 weekly from November 8, 1945 to June 1946; and $165 weekly from June 20, 1946 until the termination of his employment; and that the federal income taxes and social security taxes were deducted from each weekly check.

The cause was submitted to the jury on both counts. The jury were also given a special interrogatory which read: "Was plaintiff hired by defendant at a weekly salary and for no other remuneration?" This interrogatory was answered in the negative. The jury were instructed that any verdict for plaintiff had to be on one or the other of the two counts of the second amended complaint and could not be on both. The jury returned a general verdict for plaintiff and assessed the damages at $86,415. The trial judge stated that, "the jury, apparently found on the so-called oral contract for ...


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