On appeal from former Bergen County Circuit Court.
For affirmance: Chief Justice Vanderbilt and Justices Heher, Oliphant, Wachenfeld, Burling, and Ackerson. For modification: Justice Case. The opinion of the court was delivered by Burling, J.
This is an appeal from the judgment of the former Bergen County Circuit Court in favor of the plaintiff in the amount of $1850.39 plus costs.
The case was tried without a jury by Circuit Court Judge J. Wallace Leyden, upon an agreed statement of facts stipulated by and between the parties and found accordingly by the Court. Insofar as they are pertinent to this appeal they are as follows:
On December 31, 1940, the parties entered into an agreement in writing pursuant to which all stock owned by the defendants in Walter S. Platt, Inc., a New Jersey corporation, and all right, title, interest and good will in that corporation, together with all the assets and good will of a business owned by the defendants under the trade name of Suburban Fuel Oil Co., with the exception of certain specified accounts receivable and judgments, were sold and transferred to the plaintiff.
The agreement in question contained the following clause:
"5. The Sellers agree individually and as stockholders of the Corporation to pay all outstanding accounts or bills payable against the corporation accruing up to December 31, 1940, within one month from the date of the execution of this agreement, except those in dispute which are hereto set up and called to the attention of the Purchaser. (See affidavit attached.)"
On April 18, 1945, the Collector of Internal Revenue asserted a claim against Walter S. Platt, Inc., for Federal income and excess profit tax for the years 1938 to 1940 inclusive. This claim was in the amount of $2411.75. Plaintiff engaged counsel and an accountant and appealed the assessment to the Tax Court of the United States. Before the case was heard, the matter was compromised between the plaintiff and the Collector in the amount of $1094.48 which amount was then assessed against the corporation and paid by the plaintiff. In so doing the plaintiff incurred an expense in the amount of $500 representing the fees of his counsel and of his accountant. The defendants had notice of the claim by the Collector but took no part in the negotiations with the Internal Revenue Bureau or in the proceedings and refused a demand by plaintiff that they pay him the amount claimed or any part of it.
Based upon these facts, the trial court found for the plaintiff and judgment was entered in the amount of $1850.39, which included the sum of $1094.48 for which the claim in question was settled, together with $500 for the said attorney's and accountant's fees, which costs were found by the trial court to be reasonable, and interest in the amount of $255.91. From this judgment the defendant prosecuted this appeal.
The main dispositive question concerns the interpretation of the quoted clause in the contract.
The function of the Court is to ascertain and give effect to the intention of the parties as of the time the contract was made. Corn Exchange Bank v. Taubel, 113 N.J.L. 605 (at p. 608) (E. & A. 1934); Basic Iron Ore Co. v. Dahlke, 103 N.J.L. 635 (at p. 638) (E. & A. 1927); Clott v. Prudential Insurance Company of America, 114 N.J.L. 18 (at p. 21) (Sup. ...