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Howard v. Harwood''s Restaurant Co.

Decided: June 29, 1956.


Gaulkin, J.c.c.


[40 NJSuper Page 566] The petitioner was awarded workmen's compensation and the respondent appeals. The grounds of appeal are that the petitioner failed to prove the "necessary employment relationship between the parties," that she failed to prove "an accidental injury arising out of" the employment, and that the "Deputy erred in ordering the

respondent to provide nursing and medical care subsequent to the time the permanent disability became fixed."


The petitioner (who will hereafter be called Mrs. Howard) is the wife of Ralph O. Howard, president of the respondent corporation. She was secretary of the corporation and a holder of one share of stock. For approximately four years prior to the happening, she assisted in the management of the restaurant operated by respondent, managed the office, purchased some of the supplies, took care of the books, checked the waiters, made deposits, and carried out similar duties. That is not disputed. What is disputed is whether she did it for compensation.

At no time prior to the happening had she received any stated compensation in cash. During those four years she had received only meals and small sums for carfare and incidental expenses. However Mr. Howard testified that from "the first day she came * * * to 44 Commerce Street" which was the location of the restaurant, in 1950, there was an "understanding" between Mrs. Howard and him that she was to receive $50 per week. No such amount was ever paid, nor did the books reflect any such understanding, nor was her salary ever included in the payroll figures submitted to the insurance carrier.

However, early in January 1954, according to the testimony of Mr. Howard, Mrs. Howard became "a little bit concerned about her status -- social security, * * * she wanted to make sure she would be properly protected under social security. * * *" Consequently, said Mr. Howard, it was decided by Mrs. Howard and him "that something should be done to take care of the back pay that was due her in some form. Well, the company was in fair shape. It wasn't this good -- in good enough shape to pay an amount of $50 a week over a period of four years which ran into many thousands of dollars, so we decided and agreed that I would give her at least the equivalent of one quarter -- we would

wash away what accumulated and I would start her on the basis of a monthly salary every month, beginning on January 1st."

Pursuant to this arrangement he said he gave her a promissory note dated January 7, 1954 for $650 representing salary for the last 13 weeks of 1953. This note, which was marked in evidence, was typewritten, is to the order of Henrietta M. Howard, and is signed by Mr. Howard in ink, as president of Harwood's Restaurant Co. He said "I gave her 13 weeks of pay, which was a quarter, which she was supposed to set up on the books to put her under social security." No entry was made upon the books of the company to indicate the outstanding note or "to put her under social security."

On January 28, 1954 Mrs. Howard was brutally assaulted with a blunt instrument by one Luico Williamson, a porter and handy man about the restaurant. She was beaten so viciously that she was unconscious for approximately 50 days, remained at the hospital over 100 days, and then after a month and a half at home she was removed to a nursing home where she still remains. She underwent much surgery, including brain and plastic surgery, and tracheotomy. She had multiple skull fractures, a traumatic cataract, paralysis of her left arm and left leg, a fractured jaw and numerous other injuries which justify the statement of counsel "that mere recounting them causes a sense of horror and consternation."

At no time prior to January 28, 1954, the date of the assault, did Mrs. Howard receive any portion of the $50 a week. However, Mr. Howard says that some nine months after the assault he found the note in the office safe, in an envelope upon which there was written in Mrs. Howard's handwriting "Note for salary due H. Howard, last quarter 1953." An inspection of the envelope shows that the above statement was written in a firm even hand. The medical testimony, including the testimony of respondent's doctor, was that it was not possible for Mrs. Howard to have written this at any time after the assault, in view of her physical condition.

The respondent concedes that if this note was executed at the time and under the circumstances stated by Mr. Howard, it would be very strong evidence confirming the alleged salary arrangement, and if the salary arrangement be believed, the petitioner proved her employment. A strong attack was made upon Mr. Howard's credibility and a number of facts were developed, in addition to those mentioned above, which tend to cast doubt upon his veracity. No useful purpose would be served in enumerating those facts, for if it be believed that Mrs. Howard was physically unable to write the legend on the envelope containing the note after the assault, the envelope and note are mute but most persuasive evidence that the arrangement for $50 a week had indeed been entered into. The deputy director, who had the advantage of seeing and hearing the witnesses with all that that includes, believed Mr. Howard. My own reading of the record and examination of the envelope, fortified as it must be by the weight that I must accord to the findings of the deputy, leads me to the conclusion that the arrangement for $50 a week was established, and that the petitioner was an employee receiving that rate of compensation within the meaning of the Workmen's Compensation Act at the time of the assault.

The respondent points to that testimony of Mr. Howard which explained the failure to pay Mrs. Howard the $50 a week on the ground that "the agreement was that she would receive money if and when the company can afford to pay her." The respondent argues that obviously the corporation could not "afford to pay her" since she had not been paid, and there was no assurance that the corporation would ever be able to afford to pay her. Consequently, the respondent argues that the agreement was too uncertain to establish an employment for compensation. To this the case of Mahoney v. Nitroform Co., Inc. , 20 N.J. 499, at page 507 (1956), provides the complete answer. First, as that case says, "'the possibility that the condition may happen involves a chance of detriment which is sufficient to make the promise valid consideration.'" Second, the exhibits in evidence

show that the company at all times had enough money to pay her $50 a week. The company had other employees, operated a restaurant, and took in substantial sums. It may be that the parties tacitly agreed that the $50 a week was to "ride," to help the working capital position of the restaurant, but that does not destroy the agreement to employ at $50 a week. Third, Mr. Howard says Mrs. Howard was to ...

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