"People are wonderful -- every one of them," says Joe as he sips champagne in "Nick's bar on the San Francisco waterfront.

And so they are to William Saroyan in "The Time of Your Life," the 1940 Pulitzer Prize-winning play that is being revived by the Source Theatre Company in its new home north of Thomas Circle.

Saroyan's play is a celebration of the innocence in spirit. The time is October 1939, and World War II in far-off Europe has not intruded into Nick's bar.The people who wander in and out are a collection of charming oddballs.

Joe sips champagne, orders toys and jelly beans on whim, and dispenses money and philosophy: "I believe in dreams sooner than statistics . . . . I don't do anything, just live all the time." There is a young prostitute who dreams of her childhood on a farm in Ohio. A hungry hayseed plays the piano while a fresh-faced young man tries comedy and dance routines. A morose Arab stares in his drink and mutters, "no foundation, all the way down the line" - his words for the week. A down-and-out drifter named Kit Carson wanders in to drink and tell stories. The Saroyanesque characters are still funny, even touching at times. But four decades later, these simple innocents no longer seem to touch the time of our lives today. The play has become a period piece.

The play does give Source the chance to show off its new theater space (it makes a fine barroom) and the members of the company in the play's cast of 22. The young troupe, now in its third season, brings its own spirit of innocence -- and energy and enthusiasm -- to Saroyan's world.

Under the direction of Prudence Barry, attention has been given to each role, down to the walk-on prostitutes and slumming society couple. In major roles, Al D'Andrea, Michaeleen O'Neil, Jonathan Ginsberg and Bart Whiteman are both funny and sad. There also are good performances from Charles A. Pereira, Robert Hunt, Ed Rejuney, Jake Stern, Ross Beatty and David Wildberger, all of whom make the most of their idiosyncratic characters.

The play will continue through Aug. 24 at the Source Theatre's new home at 1809 14th St. NW., just above S Street. Performances are at 8 p.m. Thursday through Sunday evenings.