
    Myron H. Barlow, Respondent, v. Edmund P. Platt and Smith L. De Garmo, Appellants.
    Second Department,
    June 4, 1909.
    Master and servant — contract of employment—percentage of profits — account stated.
    Accounts settled between parties will not be opened except for duress, fraud or mistake; the.practice of opening such accounts is not to be encouraged, and ' after the lapse of considerable time the evidence must be strong and conclusive.
    Where,- in a suit to open six annual statements of account- the plaintiff, who was employed to manage a department of the defendant’s store ata compensation of a percentage of the profits of the department, seeks to have certain discounts allowed for cash included in the profits, and it appears that the profits were computed by the defendants in good faith and accepted by plaintiff without objection; that he never demanded his share of the cash discounts, although he ■ knew of them, and that he had access to the books and a right to see them, which was never denied him, and it is undisputed that there is a well-established and known rule and custom among merchants that cash discounts are not considered a part of the pirofits of the different departments, a judgment in favor of the plaintiff will be reversed and a new trial granted. '
    Appeal by the defendants, Edmund P. Platt and another, from an interlocutory judgment of the Supreme Court in favor of the plaintiff, entered in the office| of the clerk of the county of Dutchess on the 28th day of December, 1908, upon the decision of the court, rendered after a trial before the court with out a jury at the' Dutchess County Trial Term, opening settled accounts between the parties and appointing a referee to take an account.
    
      W. E. Hoysradt, for the appellants.
    
      Charles F. Cossum, for the respondent.
   Gaynor, J.:

The defendants keep a department store. -The plaintiff was employed by them by a written agreement for three years from February, 1 1902, as manager of their furniture department, at a compensation of “one-tliird of the actual net profits” of such department. At the end of that period a new contract in writing was made for three years more at a compensation of one half of such profits; and at the end of that period, the plaintiff continued for three months at $150 a month. At the end of each year a statement was made up of the business of the plaintiff’s department, and showing the profits thereof, and he was paid thereon. “ They calculated it”, says the plaintiff, “and I accepted it”. This is a suit to open all of these annual "settlements, and make the defendants account to him for discounts which they received on goods purchased. The department was charged with all goods at cost price. The evidence shows that all time discounts were deducted by the plaintiff himself in marking the cost price of the goods in his department. He made all purchases, received all the goods and the bills, kept an invoice book of the bills, and marked the cost price on the goods. Time discounts are those allowed if payment be made in 30 days or by some fixed period. Cash discounts are discounts allowed by the seller if payment be made at once in cash. Sometimes the seller may allow them and again not. The defendants did from time to time, each year, discount some of their hills in this way, i. e., by paying at once instead of at the end of the period of credit allowed. Such discounts were sometimes 2, per cent, and sometimes 1 per cent. These discounts were not included in the defendants’ account with the plaintiff, and the dispute is in respect of them only.' All discounts allowably appeared on the bill heads. ' The plaintiff never demanded his share of tlie cash discounts, or made any claim or objection concérning them. He did point out other errors from time to time and have them corrected. He had a right to see the' books, and did have access to them. The ledger showed •all discounts, and the plaintiff testifies that he was aware and assumed all the while that the defendants were in the habit of discounting their bills for cash. There is no evidence that any of the defendants ever denied him access to the books, or that he ever made any request or complaint to them that he could not see the books, or was denied access to them. He says in his evidence that at some time or another he"asked an employe named Smith to let him see a.“certain” book—-when, or what book, does not appear — and was told by him he could not see it. The said employe was not the bookkeeper, nor does it appear what position he held. The plaintiff never reported any such thing to the defendants, and testifies of the said employe that, “ he. did not have anything to do with the books”. In fine, the.evidence.shows that the right of the plaintiff to examine the books was never denied to him by the defendants, and that he never claimed that it was. The defendants admit that they discounted some of their bills at 1 or 2 per cent, for cash, but claim that the plaintiff was not entitled to share in such discount — that.it was only an equivalent for the use of the money if they had retained it and used it some other way. Moreover, the uncontradicted testimony is that the established and known rule and custom among merchants is that such discounts are not considered a part of the profit of the different departments, or to establish the profit thereof.

The evidence shows that there was no fraud by the defendants or mistake- of "the parties. The defendants acted, in good faith. The rule is that accounts settled between parties will not be opened except for duress, fraud or mistake, that the practice of opening such accounts is not to be encouraged, and that after the lapse of considerable time the evidence must be strong and conclusive, (Wilde v. Jenkins, 4 Paige, 481; Augsbury v. Flower, 68 N. Y. 619; Wahl v. Barnum, 116 id. 87).

The judgment should be reversed.

Woodward, Jenks, Burr and Miller, JJ., concurred.

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