Opinion
34387.
DECIDED MARCH 19, 1953.
Action on contract; from Fulton Civil Court — Judge Lowe. October 10, 1952.
Frank A. Bowers, for plaintiff in error.
Charles O. Baird Jr., contra.
Where it was alleged, in a suit by a principal against his agent to recover money advanced to the agent on a drawing account against commissions to be earned by the agent in selling insurance for the principal, that the agent had agreed to repay any money advanced or loaned to him by the principal, and that the commissions earned by the agent did not amount to the sum advanced by the principal, the petition set out a cause of action for the recovery of the excess of the advances over the commissions earned; and the court did not err in overruling the general demurrers to the petition.
DECIDED MARCH 19, 1953.
Augustus T. Naumann brought suit on an account for $1575.92 against John G. Wilson, and alleged substantially the following: The plaintiff is doing business as The Gus Naumann Agency in Atlanta, Georgia, and is engaged in selling insurance and bonds for insurance companies. On or about February 1, 1950, the defendant Wilson came to the plaintiff's office, asked for employment, and stated that he was qualified and willing to sell insurance. The plaintiff told Wilson that he did not have enough money to pay a salary or wages, but Wilson, said that he needed money and would sell insurance for the plaintiff and repay any money the plaintiff advanced or loaned him. The defendant proposed to sell insurance for 50% of the commission earned by the agency on each sale made by the defendant. The plaintiff said that all losses or cancellations on sales made by the defendant would be charged back against any commissions thus earned. The parties agreed to these terms, in addition to agreeing that the arrangement would be on a trial basis, that Wilson was to sell only through the Naumann Agency, and that the plaintiff would then loan Wilson money to help him in his financial plight. On February 17, 1950, the plaintiff gave the defendant a check for $25 which the defendant cashed. On February 20, 1950, the plaintiff asked the defendant to give his note as security for the money to be advanced according to the agreement, and the defendant gave his note to the plaintiff for $150. By March 3, 1950, the plaintiff had given and advanced to the defendant $150. The defendant started to sell insurance for the plaintiff on February 17, but on April 1, 1950, the plaintiff told Wilson that he had sold very little insurance and was considerably in debt to the plaintiff, that the trial arrangement would not work, that they should end the working arrangement and that the plaintiff needed the money he had advanced to the defendant and did not have sufficient money to continue the agreement. The plaintiff asked the defendant to settle up his account. (The attached account showed advances of $149.90 against earnings of $45.27 at this time.) The defendant reminded Naumann that he had his note for security on the money advanced, and said that he had considerable insurance business in the closing stage and needed a little more money to enable him to close it. The defendant asked to continue working according to the agreement. The plaintiff agreed to this, and the parties further agreed that Wilson would have a drawing account with the plaintiff against the defendant's commissions. There was no definite amount for the defendant's drawing account, but it was to be arranged from time to time by the parties. Wilson expressly understood that the money advanced by the plaintiff would be charged against his commissions from month to month and year to year. This suit is not brought on the note above mentioned. (Credit for the amount of the note was given in the statement of the account attached.) The defendant continued to sell insurance for the plaintiff for the remainder of the year 1950, at which time the defendant's drawing account exceeded his earned commissions by $620.51. At the end of 1951, the defendant's drawing account exceeded his earned commissions in the sum of $772.01. In May of 1952, the plaintiff went over the account with the defendant and informed him that his drawing account so exceeded his earnings that the plaintiff could no longer advance the defendant money against his commissions. The plaintiff requested the defendant to settle his account by payment or by giving him another promissory note, and the plaintiff would not allow the defendant to draw any more money against his earned commissions until the large unpaid balance was paid. The defendant quit working for the plaintiff on June 20, 1952, and the defendant's drawings, as of May 30, 1952, exceeded his commission earned in 1952 up to that time by $183.40. The defendant refuses to pay the total of $1575.92 by which his drawing account exceeded his commissions earned.
The defendant's general demurrers to the petition were overruled; and he excepted.
Both parties have cited Smith v. Franklin Printing Co., 54 Ga. App. 385 (2) ( 187 S.E. 904), as setting forth the law applicable to the present case. It was there ruled: "Where a principal advances money to his agent on a drawing account against his commission to be earned as a salesman for selling merchandise, and his commission does not amount to the sum advanced, the employer cannot, in the absence of an express or implied agreement, or promise to repay any excess of advances over the commissions earned, recover such excess from the employee. [Citations.]"
The question raised by the demurrer is whether the petition, construed against the pleader, shows that the advances sued for in excess of commissions earned were chargeable only against commissions, or whether the petition, properly construed, shows that they were made as loans or advances which were to be repaid under an express or an implied agreement. It is alleged in the petition that the defendant, needing money, came to the plaintiff to obtain employment; that the plaintiff could not afford to employ the defendant at a salary; and that the defendant promised to repay any money the plaintiff advanced or loaned to him and promised to go to work selling insurance on a commission basis. This was an express promise to repay any amounts loaned or advanced to the defendant, whether or not the defendant earned any commissions.
It is also alleged that, on April 1, 1950, when the plaintiff proposed to terminate the employment and when the defendant asked to continue working according to the original agreement, the parties further agreed at that time that Wilson was to have a drawing account against commissions, the amounts drawn to be agreed on from time to time, and that Wilson understood the advances were to be charged against his commissions. This allegation is not that the advances were to be chargeable only against commissions earned by the defendant, so as to change the previous agreement that the defendant himself was obliged to repay such advances. This further agreement only gave the plaintiff an additional source of payment for the advances or loans by allowing him to charge them against the defendant's earned commissions.
The petition set out a cause of action, and the court did not err in overruling the general demurrers thereto.
Judgment affirmed. Felton and Worrill, JJ., concur.