
    Edward W. Brown and James W. Shaw, Respondents, v. Retsof Mining Company, Appellant.
    Second Department,
    June 29, 1908.
    Principal and agent — contract construed — discretionary power to discharge — motives of principal immaterial.
    Where on the expiration of á contract employing the plaintiffs as sole selling agents, the principal writes that the agency may continue under the same conditions “ as long as you conduct the business in a manner satisfactory,” and that a formal contract for a specified time is not deemed necessary, the principal may discharge the agents in its discretion without assigning any cause, for the original contract was modified by the new provision that the conduct of the business must be satisfactory to .the principal.
    Under the modified contract the principal’s right to discharge the agents in its discretion is absolute. It 'is immaterial that it is actuated by an ulterior motive to appoint another agent, or that the former agents have for a series of years worked up a profitable business for their principal.
    Appeal by the defendant, the Retsof Mining Company, from a judgment of the Supreme Court in favor 'of the plaintiff Edward W. Brown, as surviving partner of the firm of Brown & Shaw (the plaintiff James W. Shaw having died after the action was begun), entbred in the office of the clerk of the county of Richmond on the 29th day of October, 1907, upon the verdict of a jury, and also from an order entered in said clerk’s office' on the 30th day of October, 1907, denying the defendant’s motion for a new trial made upon the minutes. ’
    
      John B. Stanchfield [Henry B. Twombly and Louis H. Hall with him ou tlie brief], for the appellant.
    
      John A. Garver [George M. Pinney, Jr., with him on the brief], for the respondents.
   Hooker, J.:

The plaintiffs, copartners, have had a judgment in this action for damages for a breach of a contract- of employment. The defendant was a miner and manufacturer of salt and the plaintiffs sold it. On May 23,. 1899, the parties entered into a contract by the terms of which the plaintiffs agreed to act as sole selling agent for the defendant within certain specified territory. After defining the obligations and the rights of the parties to the contract, it provided : “ This contract shall continue until June 30th, 1900, unless a change in the firm of Brown & Shaw shall occur by which it is rendered inefficient in the opinion of the Betsof Mining Company to properly and satisfactorily carry oiit said firm’s part of the contract; in that event the Betsof Mining Company may, at its option, terminate this agreement.” On May 17, 1900, the plain tiffs wrote to the defendant in respect to a renewal of the contract, reminding it of the promise that a letter was to be sent them stating that in the matter of the contract between them for the future it was to he understood that the plaintiffs were to be the selling agents of the Betsof Mining Company “ under same conditions as we now are, as long as we continue to conduct the business in as satisfactory a manner as we have done heretofore.” On May 21, 1900, the defendant wrote to the plaintiffs, referring to the contract: “ I desire to say that your relations as sales agents of the Betsof Mining Company will continue under the same conditions as outlined in your contract as long as you conduct the business in a manner satisfactory to the Betsof Mining Company. In view of this fact I do not think it at all necessary that any formal contract for a specified time be entered into.” Under this arrangement the plaintiffs acted as selling agents for the defendant until December 19, 1903, on which day they were notified hy letter that the relations existing between them and the defendant would terminate on the 31st day of December, 1903. The reason assigned was the conduct of the plaintiff Shaw in using intoxicating liquors too freely. The plaintiffs, claiming that under the obligations of the contract their discharge as selling agents was unreasonable and without warrant, brought this action to recover damages on account of defendant’s breach of contract.

The case turns principally upon the question whether under the contract the defendant had the right to discharge the plaintiffs without assigning any cause; or, in other words, whether the contract did not provide that the personal taste, fancy or interest of the employer should be satisfied rather than • that of a court or a jurJ«

The formal contract of May 23, 1899, provided for a definite term - of employment, namely, until June 30, 1900, with only one condition named for its prior amendment, which contemplated a change in. the firm of the plaintiffs, a change that the defendant might deem would render the firm inefficient properly and satisfac-' torily to carry out its part of the contract.' The subsequént correspondence, however, between the parties was such as to change the terms of this contract somewhat in respect to the duration of employment after the expiration of the former contract. ' The' defendant wrote that the plaintiffs would continue under the same conditions as outlined in the contract “ as long as you conduct the business in a manner satisfactory to the. Betsof Mining Company; ” this letter was received by the plaintiffs and no reply was made thereto;' the plaintiffs continued to represent the defendant as formerly, and must, of course, be held to have assented to the conditions expressed in this letter.. The former contract did not refer to the manner in which plaintiffs should conduct the business, except as incident tó a change in the plaintiffs’ firm. This clause of the letter of. May twenty-first engrafted upon the contract a new and distinct provision to the effect that the contract would be continued as long as ■the plaintiffs conducted the business “ in a manner satisfactory” to the defendant.

It is important here to inquire in respect to-the nature of the services performed by the plaintiffs for the defendant to ascertain whether they were of such personal, confidential and peculiar character as to lead to. the conclusion that the parties meant to contract with a view of giving the defendant the absolute right, to terminate the relationship if its taste, fancy or satisfaction the plaintiffs did not meet. The plaintiff Brown himself gives the character of .the services his-firm rendered for the defendant in this wise : The plaintiffs and salesmen they employed sold the salt mined by the defendant to all purchasers they could find, traveling throughout their assigned territory looking for such customers and following up sales and prospective customers by correspondence; the plaintiffs’office staff attended to many of the details- of delivery; salt that was shipped .to Hew York city, where plaintiffs had their office, came largely in canal boats and the delivery thereof was rather a complicated questionthey found berths for these beata and hack them towed thereto; engaged stevedores to unload and deliver them and in some cases delivered the salt to the buyers; they insured cargoes and in the event of loss collected the insurance — adjusted the claims; they attended to a number of matters in the interest of the defendant other than selling salt; they went to Washington and appeared before the ways and means committee, advocating first the retention of the duty on salt and after the duty had been removed advocating its being put back; they drew up memorials and devoted a great deal of time to that particular subject; they investigated at the request of the defendant certain patents referring to purifying rock salt, and reported to it concerning them ; they visited Cuba with a view of ascertaining the possibility of defendant selling salt there, the expenses of which trip were paid by the defendant. r

The defendant was a large manufacturer and miner of salt with a growing output and a widening field- of business. It manufactured different grades of its products, which sold at different prices. Owing to a larger consumption by some dealers and for other reasons, different prices were made upon the same grade. Freight rates differed widely. Terms of payment by different purchasers varied. It was bound to and did adopt peculiar and specific measures for meeting competition. It was engaged in measures to protect the general business of the mining and manufacture of salt and in different lines of effort to create new markets for its product. With all of these matters and others the plaintiffs had to do, in a. measure, at leastthe plaintiffs maintained personal and confidential relations with the defendant, and the plaintiffs’ services were, therefore, such that the parties might well have contracted in respect to gratification of defendant’s taste and the serving of its convenience and individual preferences. And in my opinion that is exactly what . the contract purported to do, for it was distinctly provided that it was to continue as long as the plaintiffs conducted the business in a satisfactory manner. The language could not have been plainer. There was no limitation upon the term “ satisfactory ” as in Smith v. Robson (148 N. Y. 252).

In Tyler v. Ames (6 Lans. 280) the plaintiff was employed to sell engines and the term of employment was one year if plaintiff could fill the place “ satisfactorily.” It was' held that this word referred to the mental condition of the employer and not the mental condition of a court, or jury. The court said : lC The right of determining' whether the plaintiff filled' the place of agent satisfactorily must, from the nature and necessity of the case, belong to the person whose interests áre directly affected by the plaintiff’s action. To require the employer, under such a contract, to prove that plain- • tiff did not fill the place satisfactorily, would be to require of him an impossibility, unless his own oath was taken as to his mental status on the subject. If lie' is required to prove facts and circumstances that would justify him in feeling dissatisfied with the manner plaintiff filled his office, it would be annulling this clause of the contract, as, without such a clause, he would have the right to dismiss the plaintiff if he did not properly perform lii's duties.”

In Zeiss v. American Wringer Co. (62 App. Div. 463) the plain-' tiff was employed as managing agent for the defendant, for selling goods and obtaining leases in the -business conducted by the defendant ; the contract provided that it should continue for and during Such times .as the business relations between the parties shall, be mutually “ satisfactory.” This court held that it was for the defendant to determine when the plaintiff failed to fill the place as agent satisfactorily, and that no one was authorized to review its decision.

In Crawford v. Mail & Express Publishing Co. (163 N. Y. 404) the plaintiff was employed to write articles of .a certain character for two years provided 1ns services should be satisfactory ” to the defendant. It was held that if his services were unsatisfactory to the defendant for any reason it had the right to terminate the employment, and the defendant was sole judge as to whether the plaintiff’s work was satisfactory. (See, too, Brown v. Foster, 113 Mass. 136 ; Zaleski v. Clark, 44 Conn. 218.)

In view of the defendant’s absolute right to discharge the plaintiffs in the exercise of discretion which was not subject to review, it is clearly unimportant tó consider the question whether the defend- • ant was actuated by some ulterior motive such as its desire for the ultimate establishment of the International Salt Company as its selling agent. Mor is it material that the plaintiffs through a long series of years had worked up a profitable business as salt brokers; the plaintiffs voluntarily entered into this contract, whose legal effect they must be held to have known; as was said in Brown v. Foster (supra):Although the compensation of the plaintiff for valuable service and materials may thus be dependent upon the caprice of another who unreasonably refuses to accept the articles manufactured, yet he cannot be relieved from the contract into which he has voluntarily entered.”

The judgment appealed from stands upon the theory that .the defendant had no right to discharge at its own volition, and that the plaintiffs’ conduct would have been satisfactory to a reasonable principal or reasonable employer. As we have pointed out, the contract did not admit of that interpretation, and the judgment must, therefore, be reversed and a new trial granted, costs to abide the event.

Jenks, G-aynor, Bich and Miller, JJ., concurred.

Judgment and order reversed and new trial granted, costs to abide the event.  