Appellant employee challenged the judgment of the Superior Court of Sacramento County (California) that sustained respondent partners' demurrer to the employee's complaint alleging breach of contract wherein the employee was to become a co-partner.
The partners entered into an agreement with the employee that allowed the employee to become a co-partner when the employee had secured an equal interest through his employment and his third interest in the profits. The agreement provided that when the employee's third interest in the profits accrued, he would be granted a co-partnership. On the month that the employee would be granted such a co-partnership, the partners terminated the agreement. The employee through his attorneys filed suit with the help of experienced attorneys. The partners demurred to the complaint, alleging that the parties' agreement called for liquidated damages that did not amount to the minimum jurisdictional amount. The trial court agreed, and the employee appealed. On review, the court found that the employee did nothing to cause his termination, and that he should not be deprived of the profits of work done as he suffered substantial damage by his loss of the contingent interest in the profits of the business due to his wrongful dismissal.
The court reversed the judgment of the trial court and remanded, instructing the trial court to overrule the partners' demurrer.
