TOLEDO MACHINE & TOOL CO.
v.
BYERLEIN.

H. W. Fraser, of Toledo, Ohio (Fraser, Hiett & Wall, of Toledo, Ohio, on the brief), for appellant.

Thomas G. Long, of Detroit, Mich. (Leo M. Butzel, of Detroit, Mich., on the brief), for appellee.

Before DONAHUE, MACK, and MOORMAN, Circuit Judges.

*280 DONAHUE, Circuit Judge (after stating the facts as above).

While there are discrepancies between the testimony of Hinde, president of the machine company, and Byerlein, in reference to their conversation on or about March 20, 1923, we do not think there is any substantial conflict in matters material to the issue in this case. Hinde testified that on the 20th of March, 1923, Byerlein told him that his contract had expired, and that he (Byerlein) thought he ought to have more salary; that, after talking the matter over a short while, Hinde agreed to the extension of the previous contract for another year at a salary of $6,000; that Byerlein accepted this, and said it was satisfactory, and that nothing further was said in reference thereto until some two or three months later when Byerlein told him that he did not like the idea of getting a slip in his envelope stating that his salary would be increased until further notice; that Hinde then explained to him that this meant merely that Byerlein's salary could be adjusted, as in the past, to their mutual satisfaction whenever the occasion required it. Byerlein testified, in reference to this conversation with Hinde on March 20, 1923, that the only thing Hinde said to him was that he had increased his (Byerlein's) salary $50 per month; that this took Byerlein somewhat by surprise, and he was unable to say any more than "Thank you, sir," and following this conversation Byerlein continued in the employ of this company until the 13th of the following September.

The original contract called for a yearly salary payable in monthly installments. It is not of much importance whether Hinde said to Byerlein that his salary would be increased to $6,000 per year, or increased $50 per month. In either event, the amount to be paid each month would be the same, and this was paid to Byerlein so long as he continued in the employ of the company. In view of the fact that this cause does not involve the question of the right of Byerlein to leave the company's employment or the right of the company to discharge Byerlein, it is not of the slightest importance whether it was then agreed that Byerlein's employment should continue for a year, or from month to month only. Byerlein left the employment of the company about the middle of the month of September following. It is conceded that he developed this patentable idea or invention prior to that date, although he claims to have done this at nights.

From the evidence of both Hinde and Byerlein it is conclusive that some agreement was made by which Byerlein was to continue in the employ of the company at an increased salary for either a definite or indefinite term of service. The only question is as to the terms and conditions of the contract under which he continued in its employ. At the time this conversation was had, Byerlein had been in the employ of this company for 5 years and 20 days, performing a definite service in a definite way. A part of this service was the development of patentable ideas that might come to him in the course of his employment, and to assign such ideas, patents, or patentable features so developed by him to the Toledo Machine & Tool Company. Both parties must have had in mind just what service Byerlein had been performing for the company; therefore, in the absence of any evidence in this record tending to prove that either one suggested a change in the nature or requirements of the service and obligation that Byerlein was to perform, the presumption necessarily obtains that both parties understood that Byerlein was to perform the same service, duties, and obligations, and in the same way that he had theretofore been performing, under the written contract that had just expired.

If Byerlein, when informed that his salary would be substantially increased, had any mental reservation when he said, "Thank you, sir," that he would not perform the same service that he had theretofore been performing, including the development of patentable ideas and the assignment of same to his employer, then was his time to speak. To permit him to assert such a claim now, after continuing in the employment and receiving the increased salary during the period in which he developed these patentable ideas, would be wholly unfair and unjust to his employer. There is no theory consistent with honesty and fair dealing, upon which Byerlein could reasonably have believed that his employer was offering him an increase in salary for the performance of less service than he agreed to perform in the original contract, and which he had faithfully performed for its full term. It necessarily follows that, when Hinde said to him that his salary would be increased, either $50 a month or to $6,000 a year, he knew that Hinde was offering to him the proposition to pay this increased salary for the performance of the same service, and when he said, "Thank you, sir," and continued in plaintiff's employ, he accepted this proposition as clearly as if Hinde had stated to him *281 in detail the services that would be required of him, word for word as it was written in the original contract, and he had replied, "I accept your proposition."

For the reasons stated, it is unnecessary to consider the effect of Byerlein continuing in the employ of the company for 20 days after the expiration of the original contract without any new arrangement in reference thereto; but the authorities cited in support of the appellant's contention that a contract would be implied thereby for another year at the same yearly salary are equally applicable to the principle, above announced, that in the absence of any change or suggestion of change by either party, when Byerlein's salary was increased, that both parties must have understood and intended that Byerlein would perform the same services in the future that he had performed in the past under his written contract.

We do not consider the claim made by Byerlein that he developed this patentable idea at nights as of the slightest importance. His salary was paid either for the year or for the month. Certainly under the written contract it would make no difference what time in the day or night such ideas were developed, and in the opinion of this court the terms of the oral contract under which Byerlein continued in the company's employ are exactly the same, except as to the duration of the employment and the salary to be paid.

The decree of the District Court is reversed, and cause remanded, with instructions to enter a decree in accordance with this opinion.