Rosenthal v. Ostrow

The defendant, Ostrow, being engaged in the sale of intoxicating liquor at wholesale, as claimed for non-beverage purposes, at 300 Federal Street, Pittsburgh, entered into a written contract with the plaintiff, Rosenthal, on April 26, 1920, inter alia, as follows: "That the said party of the second part [Rosenthal] shall enter the employ of the said party of the first part [Ostrow], commencing the second Monday of May, 1920, and continue for a period of one year; during which time the said party of the first part agrees to pay him the sum of one hundred ($100.00) dollars per week and ten per cent. (10%) of the net profits of said business, to be determined at the expiration of said year, and to be paid to the said party of the second part provided he, at that time, still is in the employ of the said party of the first part." Owing to delay in closing up his private business plaintiff did not enter upon his duties until June 1st of that year and ended the same with defendant's consent on May 14, 1921. Plaintiff was paid the $100 a week and $5,000 on account of profits and brought this suit for the further sum of $45,000, claimed as the balance of his share thereof. An affidavit of defense was filed and the trial resulted in a verdict and judgment for plaintiff for $9,273.75; defendant has appealed.

The judgment cannot be sustained. Defendant had no state license until October 25, 1920; prior thereto his business was wholly illegal, of which fact plaintiff admits he had personal knowledge as early as July of that year. He therefore cannot recover for the profits of an illegal business to which he was a party. In Hazle Drug Co., Inc., v. Wilner et al., 284 Pa. 361, it is held that a wholesale dealer in intoxicating liquors must have a state license or the business is unlawful and he cannot recover for liquors sold. The status of the plaintiff there was like that of the parties here prior to taking out a license. It is a familiar rule that the law will not aid him who bases his claim on an illegal transaction (Walcofski v. Lehigh Val. Coal Co., 278 Pa. 84; Vandegrift v. Vandegrift,226 Pa. 254; Johnson v. Hulings, 103 Pa. 498; Fowler v. Scully,72 Pa. 456; Columbia Bank Bridge Co. v. Haldeman, 7 W. S. 233; Swing v. Munson, 191 Pa. 582; Seidenbender v. Charles, 4 S. R. 151; Conemaugh Brewing Co. v. Bennett, 60 Pa. Super. 543; 13 C. J. 421), or enable him to recover for work done knowingly in an illegal business: Badgley v. Beale, 3 Watts 263. Plaintiff does not controvert this rule but it is urged that he may recover his share of the profits for so much of the year as the place was licensed. The answer to this is an entire lack of evidence as to what if any profits were made during that part of the year. The only proof tending to sustain plaintiff's claim of profits is an alleged admission of defendant, denied by him, that he made $500,000 during the year; but nothing indicates how much if any of it was made while the business was licensed, and Ostrow testified that the profits for the year were less than $75,000. Plaintiff has received his share of a $50,000 profit and that more was legally made does not appear; for so far as the proof shows the gain may have accrued while the business was conducted unlawfully. The contract was entire and there was no data by which the jury could separate the good from the bad. True, plaintiff is not required to establish the amount of his claim with entire exactness, but the evidence must be such as to enable the jury to make a reasonable approximation thereof, otherwise the verdict is a mere guess. See Osterling v. Frick et al., Exrs., 284 Pa. 397; Zimmerman v. Weinroth, 272 Pa. 537. "A verdict or finding must rest upon facts proved, or at least upon facts of which there is substantial evidence, and cannot rest upon mere surmise, speculation, conjecture, or suspicion. There must be legal evidence of every material fact necessary to support the verdict or finding, and such verdict or finding must be grounded on a reasonable certainty as to probabilities arising from a fair consideration of the evidence, and not a mere guess, or on possibilities": 23 C. J. 51. There is nothing to indicate that the profits were made uniformly each month throughout the year; so, to conclude that more than the $50,000, accounted for, was made under the license, would be a mere guess. According to plaintiff's testimony, the admission as to profits was made during the business year; but there must have been some loss in the end, as the stock was confiscated.

Defendant testified that the books, such as they kept, were lost while he was in jail under sentence for violation of the liquor laws. There was no attempt to disprove this or to offer secondary evidence of their contents. The nonproduction of the books, while a circumstance against defendant, cannot, without more, supply the entire absence of proof necessary to sustain plaintiff's case.

As to other questions suggested in the record we express no opinion.

The judgment is reversed and is here entered for the defendant non obstante veredicto.