{ "id": 8628396, "name": "ANDERSON COTTON MILLS, a Corporation, v. ROYAL MANUFACTURING COMPANY, a Corporation, W. G. ACKERMAN, DAVID JOSEPH and IRA A. STONE", "name_abbreviation": "Anderson Cotton Mills v. Royal Manufacturing Co.", "decision_date": "1942-06-24", "docket_number": "", "first_page": "500", "last_page": "511", "citations": [ { "type": "official", "cite": "221 N.C. 500" } ], "court": { "name_abbreviation": "N.C.", "id": 9292, "name": "Supreme Court of North Carolina" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "47 S. E., 438", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "135 N. C., 419", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8659592 ], "opinion_index": 0, "case_paths": [ "/nc/135/0419-01" ] }, { "cite": "81 S. E., 936", "category": "reporters:state_regional", "reporter": "S.E.", "opinion_index": 0 }, { "cite": "166 N. C., 20", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11268520 ], "opinion_index": 0, "case_paths": [ "/nc/166/0020-01" ] }, { "cite": "83 A. L. R., 1502", "category": "reporters:specialty", "reporter": "A.L.R.", "opinion_index": 0 }, { "cite": "86 P., 792", "category": "reporters:state_regional", "reporter": "P.", "case_ids": [ 2238162 ], "opinion_index": 0, "case_paths": [ "/or/48/0351-01" ] }, { "cite": "142 Okla., 272", "category": "reporters:state", "reporter": "Okla.", "case_ids": [ 6719135 ], "opinion_index": 0, "case_paths": [ "/okla/142/0272-01" ] }, { "cite": "62 A. L. R., 71", "category": "reporters:specialty", "reporter": "A.L.R.", "opinion_index": 0 }, { "cite": "62 A. L. R., 54", "category": "reporters:specialty", "reporter": "A.L.R.", "opinion_index": 0 }, { "cite": "259 P., 218", "category": "reporters:state_regional", "reporter": "P.", "opinion_index": 0 }, { "cite": "70 Utah, 203", "category": "reporters:state", "reporter": "Utah", "case_ids": [ 8868901 ], "opinion_index": 0, "case_paths": [ "/utah/70/0203-01" ] }, { "cite": "22 N. Y., 327", "category": "reporters:state", "reporter": "N.Y.", "case_ids": [ 2026270 ], "opinion_index": 0, "case_paths": [ "/ny/22/0327-01" ] }, { "cite": "152 U. S., 673", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 3575038 ], "weight": 3, "opinion_index": 0, "case_paths": [ "/us/152/0673-01" ] }, { "cite": "27 L. Ed., 401", "category": "reporters:federal", "reporter": "L. Ed.", "case_ids": [ 3500221 ], "opinion_index": 0, "case_paths": [ "/us/107/0174-01" ] }, { "cite": "106 U. S., 432", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 3499010 ], "opinion_index": 0, "case_paths": [ "/us/106/0432-01" ] }, { "cite": "186 U. S., 279", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 3622929 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/us/186/0279-01" ] }, { "cite": "218 N. C., 560", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8622454 ], "opinion_index": 0, "case_paths": [ "/nc/218/0560-01" ] } ], "analysis": { "cardinality": 1091, "char_count": 30796, "ocr_confidence": 0.489, "pagerank": { "raw": 3.368999784935359e-07, "percentile": 0.87570356418463 }, "sha256": "551d274eb4f42b772738878e1343b0db6a0a1fb2aed36e986f1f6c8e3bdd38ee", "simhash": "1:93caf5a9ec204658", "word_count": 5203 }, "last_updated": "2023-07-14T17:01:36.695844+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "ANDERSON COTTON MILLS, a Corporation, v. ROYAL MANUFACTURING COMPANY, a Corporation, W. G. ACKERMAN, DAVID JOSEPH and IRA A. STONE." ], "opinions": [ { "text": "Seawell, J.\nWe endeavor to avoid repetition in the discussion of principles closely interrelated in considering the two appeals. For convenience, we discuss defendant\u2019s appeal first.\nDEFENDANT\u2019S APPEAL.\nThe defendant\u2019s objections to the evidence relate principally to the methods adopted by plaintiff in establishing the quantum of recovery for tbe value of tbe goods sold by defendant under tbe agency, or tbe proportionate amount of recovery tberefor.\nWe tbink, in tbe main, that these objections are rendered untenable, or at least made legally harmless to defendant, by reason of tbe findings of fact based upon competent evidence.\nIt might be inferred from tbe evidence, and it is so found, that tbe defendant attempted to become tbe purchaser of plaintiff\u2019s commodity in violation of tbe trust relation existing between them; and having supposed itself to have achieved that result, concealed from tbe plaintiff tbe profits made out of tbe transaction. In accomplishing this, it commingled plaintiff\u2019s waste with tbe waste of some forty other mills, or, in legal effect, with its own property. Both in view of tbe wrong committed and because tbe facts were within tbe peculiar knowledge of tbe defendant, tbe burden was upon it to identify plaintiff\u2019s goods on demand, or, since this was impossible, at least, as we conceive tbe law to be, to show what proportion of tbe proceeds of tbe sale less than tbe whole was due tbe plaintiff, or run tbe risk of a greater recovery. Tbe defendant was not helpful in this respect, and plaintiff was forced to develop its case as best it could from defendant\u2019s records. It was content to demand only a proportionate part of tbe sales receipts or value of tbe product sold.\nIn this attempt, there were two lines of procedure: one based on tbe value of tbe waste from plaintiff\u2019s mills bandied by tbe defendant, supplemented by evidence as to tbe value of tbe waste sold; and tbe other based on tbe proportionate poundage of plaintiff\u2019s waste in tbe commingled product. Perhaps, neither could be held as strictly accurate in results, since there was evidence that tbe value of waste was unstable and varied greatly with tbe kind. Tbe objections, however, are more properly addressed to tbe effect of tbe evidence than to its competency.\nTbe method adopted in tbe investigation afforded as near an approximation to reality as could be expected under tbe circumstances; and defendant having declined tbe burden of proof which we tbink rested upon it, in view of its breach of tbe duty to keep plaintiff\u2019s property separate from its own, has no cause to complain.\nA careful review of tbe exceptions does not disclose any of sufficient merit to justify a new trial on defendant\u2019s appeal.\nPlaiwtiee\u2019s Appeal.\nWe are bound by tbe findings of fact where there is competent legal evidence to support them, and ordinarily we cannot require tbe finding of additional facts or conclusions unless tbe appealing party has specifically requested tbe finding. In this case, we do not tbink tbe findings requested by tbe plaintiff could alter the result, as they are sufficiently covered by those actually made in so far as might be necessary for final determination of the controversy.\nHowever, the plaintiff\u2019s appeal brings up for review conclusion of law No. 5, which fails to award to plaintiff return of the commissions paid defendant for its purported sales which were, in fact, made to itself, and allows commissions on sale on the cleaned waste, the expenses of\u2019 willowing, and denies to the plaintiff the item of interest demanded by it.\nPlaintiff\u2019s recovery cannot exceed the legal effect of the findings made by the court.\nIt is strongly urged upon us that throughout the transaction the defendant\u2019s conduct was tortious and that its legal liabilities are those of a trespasser. Apparently, when the case was heard before, Cotton Mills v. Manufacturing Co., 218 N. C., 560, 11 S. E. (2d), 550, the view presented by plaintiff would make the defendant a mere tort-feasor and trespasser from the beginning; and this Court understood the gravamen of the complaint to be that defendant obtained possession of the property through fraudulent devices with the purpose of committing the other wrongs subsequently practiced. Upon demurrer of the defendant, the Court sustained the complaint as properly presenting a cause of action in tort. That was the aspect of the case then presented. The trial, however, developed a contractual relation, in which the defendant was found to have departed from the duties imposed by his agency \u2014 in other words, committed breaches of trust in its contractual relation \u2014 and the findings of the court go no further.\nBecoming, or attempting to become, the purchaser of its principal\u2019s goods and accounting only on that basis, it transpired that in carrying out this transaction, defendant further violated its duty as plaintiff\u2019s agent by commingling the plaintiff\u2019s goods with its own and selling it at a profit which it did not reveal.\nWe apprehend that the consequences and penalties which attend this conduct of the defendant are somewhat different from those which the law visits on one who, a trespasser ab initio, having never acquired the right to the possession of the property, but takes it, converts it to his own use, changes it into a different form, and sells the property thus altered. The more heinous nature of the civil offense, together with obvious necessity of public policy to prevent both the invasion of the possession and the conversion of the property, makes such an offender a trespasser ab initio ad finem. We think the cases cited in plaintiff\u2019s brief denying credit for expenses incurred in improving the property or converting it into a more valuable form have application to such a case. Pine River Logging & Improvement Co. v. U. S., 186 U. S., 279, 46 L. Ed., 1164; Wooden-Ware Co. v. U. S., 106 U. S., 432, 27 L. Ed., 401. It ivas for the owner, according to its own desire and judgment, to handle its property as it thought best.\nIn tbe ease at bar, plaintiff was not injured by tbe cleaning or willowing of its waste in tbe bands of its agent \u2014 -it constituted an improvement wbicb produced a sale at a mucb bigber price \u2014 and sale of tbe product was tbe prime purpose of tbe contract. Tbe plaintiff now demands as its equitable right tbe payment to it of tbe secret profits realized on tbe purchase price of tbe improved property. -To disallow tbe expenses of tbe willowing would, in our judgment, be tbe infliction of a naked penalty, for wbicb we are unable to find precedent, and go beyond tbe rule wbicb permits tbe principal to recover tbe profits of tbe agent\u2019s transaction.\nPlaintiff, however, has raised a more serious question with regard to tbe allowance of commissions to tbe defendant on tbe sale of its waste. Speaking generally, when an agent, in a fiduciary relation, is guilty of disloyalty to bis principal and when by virtue of bis position be seeks to make profit to himself rather than promote tbe interest of bis principal, be is not entitled to compensation. Mecbem on Agency, sec. 1588; Restatement of tbe Laws, Agency, sec. 456.\nIt has been suggested that tbe allowance of commissions in tbe case at bar may be sustained because of an implied affirmance or ratification by tbe plaintiff through tbe institution of this suit and tbe relief demanded in it.\nTbe effect of tbe rule that a selling agent cannot become tbe purchaser of bis principal\u2019s property is to make such sale voidable 'by tbe principal, who may, at bis election, ratify or disaffirm it, whether injured by tbe transaction or not. Robertson v. Chapman, 152 U. S., 673, 38 L. Ed., 592; Gardner v. Ogden, 22 N. Y., 327; Tatsuno v. Kasai, 70 Utah, 203, 259 P., 218, 62 A. L. R., 54, Annotation 62 A. L. R., 71. If tbe principal disaffirms tbe sale of tbe agent to himself, be is entitled to have bis property back with tbe damages, if any, or to have tbe value thereof with incidental damages, if any, consequent upon tbe wrongful transaction. 2 Am. Jur., sec. 259.\nBut it is a recognized principle of law that tbe agent who thus violates bis duty may be regarded \u2014 at tbe election of tbe principal \u2014 as trustee with respect to tbe property and its proceeds, and if be has transferred it to a bona fide purchaser, be may be made to account not only for its real value, but for any profit made by him on a resale. Robertson v. Chapman, supra; 2 Am. Jur., Agency, sec. 259; Am. Inst. Restatement, Agency, secs. 399 (d) and 400 (c).\nIt is more logical and nearer reality to say that tbe plaintiff has been compelled to accept tbe situation thrust upon it by defendant\u2019s wrong and, by election of remedies, to work out its equities to tbe best advantage. It does not thereby necessarily condone everything tbe defendant has done. Equity will follow these transactions and give to them their proper significance and legal effect in applying the appropriate remedy when that remedy is pursued by the principal.\nThe rule which denies to the agent the right to purchase property of its principal which has been entrusted to him to sell to the best advantage, and thereafter to deal with it as his own, is firmly embedded in the law as an expression of public policy. The principle is said to be one of prevention, not remedial justice, which operates, however fair the transaction may have been, however free from every taint of moral wrong. National Fire Ins. Co. v. Llewellyn, 142 Okla., 272, 86 P., 792, 83 A. L. R., 1502; Am. L. Inst. Rest., Agency, sec. 389. However, in addition to this general rule of public policy, we think there is a reason of special application in the case at bar. To recover commissions the defendant must resort to its contract and to the performance of its conditions in hoc modo, and this defendant has not done. There is no compensation recoverable outside of the contract.\nIn selling to itself, the defendant attempted to act in the double capacity of agent and purchaser \u2014 a combination so incompatible and noxious to the fundamental rule of loyalty demanded of an agent to his principal, acting as a fiduciary, as to be intolerable to public policy. In selling plaintiff\u2019s waste to itself, the defendant must be considered as acting solely as purchaser and performing no compensable service for the plaintiff.\nIn the sale of the property thereafter, defendant did not purport to act as agent of the plaintiff, but sold to its own advantage and for its own profit. Defendant had become trustee of the property de son tort, a situation incompatible with a demand for commissions under the contract.\nConceding that in some instances a denial of commissions to a trustee may, under the circumstances of the case, become a matter of discretion with the trial court, we are of the opinion that here they were, as a matter of law, not recoverable and should not have been allowed.\nUnder C. S., 2309, all sums of money due by contract, except money due on penal bonds, bear interest as a matter of law. In Bond v. Pickett Cotton Mills, 166 N. C., 20, 81 S. E., 936, the law is said to apply to breaches of contract where the principal amount due can be ascertained \u201cfrom the terms of the contract itself, or from evidence relative to the inquiry.\u201d This language is somewhat confusing as indicating that interest may be had as a matter of law for all breaches of contract, whether liquidated or not; but, at any rate, we do not believe that the law permitting the recovery in this case is altogether based on breach of contract. Any principle justifying recovery \u2014 whether recovery of secret profit or otherwise- \u2014 is based on the theory of liability created by public policy, which superadds to the contract a right of an equitable nature which cannot be considered strictly damages for its breach or within its express or implied promise to pay. It is a right growing out of the relationship created by the contract, rather than the contract itself, and the methods hy which the amount of recovery is to be ascertained are not strictly those which apply to ordinary breaches of contract. The recovery of plaintiff in this case is not predicated on conversion of its property, or it would be limited to the damages immediately incident to the conversion, and, therefore, the demand made on the defendant by the commencement of the suit as fixing the date from which interest should be calculated is not of moment. Lance v. Butler, 135 N. C., 419, 47 S. E., 438.\nRecovery of profits on transactions involving disloyalty of agents acting in fiduciary relations is commonly referred to the principle of constructive trusts \u2014 a trust arising ex maleficio\u2022 \u2014 out of violation of the trust relation \u2014 and not subject to the incidents of contract. Bogert, Trusts and Trustees, sec. 543, p. 729; Underhill, Law of Trusts and Trustees, 9th Ed., p. 184, et seq.; Perry on Trusts, 11th Ed., sec. 206, p. 355, et seqLewin on Trusts, p. 166. We quote from the last cited text: \u201cThe principle on which a court of equity elicits constructive trusts might he pursued with numerous other instances; as if a factor, agent ... or other person in fiduciary positions acquire any pecuniary advantage to himself through the medium of his fiduciary character, he is accountable as a constructive trustee for those profits to his employer or other person whose interest he was hound to advance \u2014 but unless the money was originally that of his principal, it cannot be said to be his until a judgment or order has been obtained.\u201d\nRecovery in instances of this kind is not a matter of exact measurement under the terms of the contract, hut seems to be sui generis, and we are of the opinion that it does not come within the cited statute\u2014C. S., 2309\u2014so as to bear interest as a matter of law. We do not, of course, mean to say that interest is never recoverable except under the provisions of C. S., 2309, or that there are no conceivable instances in which interest might he recoverable in connection with the enforcement of a constructive trust; but upon the facts of this case, we approve the conclusion reached by the court below with respect to this item.\nThe defendant will not he allowed commissions on the sales transactions set out in the findings of fact; and plaintiff is entitled to recover commissions already paid to the defendant or retained by it. These may be computed by reference to the findings of fact.\nThe judgment of the court below will be modified in accordance with this opinion.\nOn plaintiff\u2019s appeal,\nModified and affirmed.\nOn defendant\u2019s appeal,\nAffirmed.", "type": "majority", "author": "Seawell, J." } ], "attorneys": [ "J ones <& Burwell and Robinson & J ones for plaintiff.", "Whitlock, Dockery & Shaw and Stewart & Moore, for defendant." ], "corrections": "", "head_matter": "ANDERSON COTTON MILLS, a Corporation, v. ROYAL MANUFACTURING COMPANY, a Corporation, W. G. ACKERMAN, DAVID JOSEPH and IRA A. STONE.\n(Filed 24 June, 1942.)\n1. Brokers and Factors \u00a7 9\u2014\nWhere a commission agent itself purchases the principal\u2019s goods, and commingles them with his own, the burden is upon the agent to identify the principal\u2019s goods upon demand, or if this is impossible because of a prior sale of the goods to a third person, the burden is upon the agent to show what proportion of the proceeds of sale was derived from the principal\u2019s goods.\n2. Same\u2014\nWhere the principal\u2019s evidence tends to show that defendant commission agent itself purchased the principal\u2019s goods, commingled them with its own and sold them, and the agent fails to assume the burden of showing what proportion of the sale price was derived from the principal\u2019s goods, the agent may not object to the principal\u2019s evidence upon this aspect tending to show the value of the goods and the proportionate poundage of principal\u2019s goods in the commingled product, even though the results may not be strictly accurate, since the agent in such case runs the risk of a greater recovery by failing to introduce such evidence itself.\n3. Appeal and Error\u2019 \u00a7 37e\u2014\nThe findings of fact by the trial court are conclusive when supported by competent evidence, and the Supreme Court may not ordinarily require the finding of additional facts unless they are specifically requested,' and even when additional findings are requested the cause will not be remanded when such additional findings cannot alter the result and the matter is sufficiently covered by the findings actually made so far as necessary for final determination of the controversy.\n4. Brokers and Factors \u00a7 9\u2014\nWhere the court finds from the evidence under agreement of the parties that defendant commission agent itself purchased the principal\u2019s goods and sold same at a profit without disclosing the facts, the principal itself introducing in evidence the contract between the parties, and there is no finding that the agent obtained possession of the goods through fraud, the principal\u2019s rights are delimited by the findings, and it may not contend that defendant was a trespasser ab initio.\n5. Brokers and Factors \u00a7 8\u2014\nWhere a commission agent itself purchases the principal\u2019s goods, commingles them with its own and has the commingled goods processed and sells them at a profit, the agent, in the principal\u2019s action to recover the profit, is entitled to credit for the cost of processing the goods.\n6. Principal and Agent \u00a7 6\u2014\nOrdinarily, when an agent makes a profit to himself by virtue of his position instead of promoting the interest of his principal, he is not entitled to compensation.\n7. Broker\u2019s and Factors \u00a7 8\u2014\nWhen a selling agent itself purchases the principal\u2019s goods the sale is voidable, and the principal at his election may ratify or disaffirm it, whether injured by the transaction or not.\n8. Same\u2014\nIf the principal elects to disaffirm the purchase of the principal\u2019s goods by its selling agent, the principal is entitled to have his property back with damages, if any, or to have the value thereof with incidental damages, if any, consequent upon the wrongful transaction.\n9. Same: Trusts \u00a7 15\u2014\nWhere the purchasing agent itself buys the principal\u2019s goods and in turn sells to a bona fide purchaser, the principal, at his election, may hold the agent liable as a trustee eco maleficio, and make the agent account not only for the real value of the goods but also for any profit made by the agent on the resale.\n10. Brokers and Factors \u00a7\u00a7 8, 10\u2014\nWhere the selling agent itself purchases the principal\u2019s goods and resells them at a profit, the principal, by electing to sue the agent to recover the profit does not impliedly ratify or condone the agent\u2019s wrong, and the agent is not entitled to commissions on the sale to himself, or the sale to the third person, since the sale by the agent to himself is against public policy and since the agent did not perform the conditions of the contract in hoc modo so as to entitle him to commissions under the contract.\n11. Interest \u00a7 1\u2014\nMoney due by contract, except money due on penal bonds, bears interest as a matter of law. C. S., 2309.\n13. Same\u2014\nC. S., 2309, is not exclusive in prescribing instances in which interest is recoverable, and in proper instances interest may be recovered upon transactions not coming within the statute.\nIS. Interest \u00a7 1: Brokers and Factors \u00a7 9\u2014\nWhere a commission agent itself purchases the principal\u2019s goods and resells them at a profit, without disclosing the facts, the principal may recover the secret profit upon the theory of liability created by public policy, which right is equitable in its nature and strictly is neither damages for the breach of contract nor recovery on an express or implied promise to pay, and the principal is not entitled to interest upon the recovery, O. S., 2309, not being applicable.\nAppeal from Johnston, Special Judge, at October, 1941, Special Term, of MeceleNburg. Tbe plaintiff and tbe defendant Royal Manufacturing Company appealed.\nModified and affirmed.\nTbe case was tried before Judge Jobnston, upon consent of tbe parties, without a jury.\nTbe evidence tends to sbow tbat tbe plaintiff and appealing defendant bad entered into a contract, subsisting at tbe time of tbe alleged transactions, whereby defendant agreed to receive and sell as agent of tbe plaintiff all tbe cotton waste from plaintiff\u2019s mills. Tbe waste was produced by tbe mills in large quantities, and was of various kinds, designated by technical or trade names. Tbe defendant was to receive as compensation an agreed percentage of tbe sales price \u2014 in some instances 5%, and others 6%. Tbe defendant at tbe time was a large operator in the sale of waste, handling tbe product from a great many mills in an aggregately large amount.\nTbe evidence further tends to show tbat over a number of years tbe defendant bad caused tbe plaintiff to ship such waste principally to River Mills at Greenville, S. C., a plant largely engaged in cleaning cotton waste by a process known as \u201cwillowing.\u201d Tbe defendant caused plaintiff\u2019s waste to be commingled with tbe waste from other mills, sometimes as many as forty, and cleaned or willowed after such, commingling, and then sold the product to various purchasers.\nThe defendant made return to the Anderson Mills upon the basis of its raw product; and it may be inferred from the evidence that the defendant itself became the actual purchaser and accounted to the plaintiff on that basis, retaining upon the transaction the sales commissions fixed by the contract and retaining the profits upon the transaction, without making a full disclosure to the plaintiff of the facts or that it had become the purchaser.\nUpon discovery of these facts, the plaintiff brought this action for the recovery of the profits alleged to have been realized by the defendant\u2019s breach of trust, together with the commissions formerly paid to the defendant as commissions upon its sales.\nIn the development of the case, the defendant made numerous exceptions to the evidence, which, as necessity may require, will be considered in the opinion.\nA motion for nonsuit made in behalf of the individual defendants was sustained.\nUpon hearing the evidence, the judge made findings of fact and conclusions of law, and entered judgment thereon, as follows:\n\u201cFINDINGS of Fact.\n\u201cI. That during the years 1933 to 1936, inclusive, the defendant, Royal Manufacturing Company, was commission agent to sell the entire output of the plaintiff\u2019s waste under a contract, the terms of which are contained in the letter of April 28, 1931, Exhibit B, attached to the complaint.\n\u201c2. That during the years 1935 and 1936, the defendant, Royal Manufacturing Company, instructed the plaintiff to ship to River Mills at Greenville, S. C., a total of 802123 pounds of waste of certain grades, and said waste was shipped and invoiced to Royal Manufacturing Company by Anderson at prices fixed by said defendant and designated in the shipping instructions, less commissions at the rates provided in the contract between the parties.\n\u201c3. On said shipments the plaintiff paid the defendant, Royal Manufacturing Company, commissions totaling $934.14.\n\u201c4. That without the knowledge or consent of the plaintiff the defendant, Royal Manufacturing Company, caused the waste so shipped to it at River Mills to be mixed with large quantities of waste from other sources and put through a process known as willowing and then sold the finished product as its own, making a profit thereon, in addition to the commission received by the defendant from the plaintiff, for which profits defendant has not accounted to its principal, the plaintiff.\n\u201c5. That the sales value of the plaintiff\u2019s waste shipped to River Mills during 1935-1936, based on the sales made by the defendant, Royal Manufacturing Company, to its customers, was $21,485.46, and said defendant, Royal Manufacturing Company paid to the plaintiff therefor $15,432.37, less the commission mentioned in finding of fact # 3, and that, in addition to said commissions, the said defendant made a gross profit on said waste of $12,053.09.\n\u201c6. The defendant, Royal Manufacturing Company, had expenses in connection with said waste and the resale thereof totaling $5,567.94, leaving the said defendant a profit after deducting said expenses of $6,485.15.\n\u201c7. That the commissions allowable to the defendant, Royal Manufacturing Company, under the contract based on the final sales value of the waste as set out in finding of fact #5 would amount to $714.99 in addition to the commissions actually paid, as set out in finding of fact #3.\n\u201c8. The plaintiff had no knowledge that the Royal Manufacturing Company was purchasing said waste, nor that it was making a profit thereon in addition to the commissions paid to it under the terms of the contract until the Spring of 1939.\n\u201c9. This action was instituted on the 12th day of May, 1939.\n\u201c10. During the years 1933 and 1934, the plaintiff shipped to River Mills at Greenville, S. C., on instructions of the defendant, Royal Manufacturing Company, a total of 689,784 pounds of waste, and the plaintiff paid said defendant for selling said waste commissions totaling $573.19. That by reason of absence of records of the defendant it is impossible to ascertain what was done with said waste, or how much profit, if any, the defendant made thereon.\n\u201c11. That during the four years in which said contract was in effect, the corporate defendant instructed the plaintiff to ship certain grades of its waste to certain individuals in care of Von Dohlan Steamship Company, Charleston, S. C., giving such instructions as to all of the shipments of said nature referred to in the complaint.\n\u201c12. That from the records available, the plaintiff has been able to trace and show evidence of what became of only a part of said shipments, but from the ones traced the court finds that, in addition to commissions paid, the corporate defendant made a profit on said transactions of $675.35.\n\u201c13. That the individuals to whom the shipments referred to in the preceding paragraph were made were employees of the corporate defendant, and that the corporate defendant purchased said waste for its own account without the knowledge or consent of the plaintiff, and that the plaintiff had no knowledge that said defendant was purchasing said waste for its own account, or that it was making a profit thereon in addition to commissions until the Spring of 1939.\n\u201c14. That on the shipments to Charleston, S. C., in care of Yon Nohlan Steamship Company, referred to in finding of fact #11, purchased by Royal Manufacturing Company for its own account without the knowledge of the plaintiff, the plaintiff paid said defendant commissions amounting to $637.86, of which amount the sum of $187.67 was commissions on the shipments which the plaintiff was able to trace, and to show that the defendant made a profit in addition to said commissions.\n\u201c15. On the 30th day of October, 1934, the plaintiff shipped to Bladenboro Cotton Mills, Bladenboro, N. C., 15,250 pounds of waste upon instructions of the defendant, Royal Manufacturing Company, and, in accordance with said instructions, invoiced Royal Manufacturing Company for said waste at the rate of $10.94 per cwt. Royal Manufacturing Company had actually sold said waste to Bladenboro Cotton Mills at $12 per cwt., and that the difference between the amount paid plaintiff on said waste, and the amount received by defendant, Royal Manufacturing Company, amounts to $161.65. In addition thereto the plaintiff paid said defendant for making said sale commissions amounting to $80.06. The plaintiff had no knowledge that said waste had been sold for more than $10.94 per cwt., until the Spring of 1939.\n\u201c16. That the plaintiff\u2019s cause of action is not barred by the statute of limitations.\n\u201cCONCLUSIONS OF LAW.\n\u201c1. That the relation of principal and agent existed between the plaintiff and the defendant during the years 1933-1936, inclusive.\n\u201c2. That the plaintiff is entitled to recover of the defendant the sum of $5,770.16, representing the profits made by the defendant, Royal Manufacturing Company, on the River Mills transactions for 1935-1936, in addition to commissions.\n\u201c3. That the plaintiff is entitled to recover of the defendant the sum of $675.35, representing profits made by the defendant on shipments to certain individuals in care of Yon Dohlan Steamship Company, Charleston, S. C., in addition to commissions paid upon said transactions.\n\u201c4. That the plaintiff is entitled to recover of the defendant the sum of $161.65, representing profits on the Bladenboro transactions, in addition to commissions.\n\u201c5. That the plaintiff is not entitled to recover anything from the defendant, Royal Manufacturing Company, on account of commissions paid, nor on account of additional commissions allowed in arriving at the figure of $5,770.16 on the River Mills transactions, and is not entitled to recover anything on said River Mills transactions except as set out in conclusion of law #2. A. Hall Johnston,\nJudge Presiding.\n\u201cJudgment (of Johnston, J.).\n\u201cThis cause coining on t\u00f3 be heard at the 1941 Extra Term of Mecklenburg County Superior Court, before His Honor, A. Hall Johnston, Judge Presiding, and being tried by the Judge without a jury, pursuant to agreement of the parties embodied in the order signed by His Honor, S. J. Ervin, Jr., appearing in the record, and the Court having heard the pleadings and the evidence, and having sustained motion for a non-suit as to the individual defendants, and having made findings of fact and conclusions of law as between the plaintiff and the corporate defendant, Royal Manufacturing Company, which findings of fact and conclusions of law appear in the record, and it appearing to the Court that the plaintiff is entitled to a judgment against the defendant as hereinafter set out.\n\u201cIt is thereupon ORDERED, ADJUDGED AND DECREED that the plaintiff have and recover of the defendant, Royal Manufacturing Company, the sum of $6,607.16, together with the costs of this action to be taxed by the Clerk.\n\u201cIt is further ordered that an expert witness fee in the amount of $100.00 be allowed to A. E. Dichtenmueller, and an expert witness fee in the amount of $40.00 be allowed to W. F. Jackson to be taxed by the Clerk as a part of the costs of this action. This October 10, 1941.\nA. Hall JohNStoN,\nJudge Presiding.\u201d\nThe plaintiff excepted to the refusal of the court to adopt certain findings of fact and conclusions of law with respect to the commissions of the defendant, an item of expense with respect to willowing the cotton waste, interest upon the money alleged to be owed by the defendant to plaintiff, and excepted to the conclusion of law #5 as above set out, relating to the same matters. The defendant filed numerous exceptions to the findings of fact and conclusions of law, which, as far as necessary, will be covered by the opinion.\nBoth plaintiff and defendant appealed, assigning error.\nJ ones <& Burwell and Robinson & J ones for plaintiff.\nWhitlock, Dockery & Shaw and Stewart & Moore, for defendant." }, "file_name": "0500-01", "first_page_order": 536, "last_page_order": 547 }