100 Tenn. 366 | Tenn. | 1898
Complainants, who are wholesale merchants at Cincinnati, Ohio, filed this bill in the Chancery Court of Davidson County against the defendants, who are manufacturers of cotton clothesline and rope, at Lawrenceburg, Tenn., to recover damages for the breach of two contracts. A recovery is asked against the defendant, in the first instance, for the breach of a contract to ■ deliver to complainants five thousand dozen cotton clotheslines, ■ and, in the second, for a failure to deliver three thousand reels of cotton rope. The Chancellor found the contracts as alleged, and awarded damages for their breach. ■ The Court of Chancery Appeals modified and affirmed the decree of the Chancellor. The result of this decree was a recovery in favor of complainants for |137 for breach of the clothesline c’ontract, and SI, 302.75 for breach of the contract
Defendants wrote, viz.: “July 9, 1892. We would like very much to sell you the rope, but cannot sell you coil rope at your offer. Will take your order for 2,500 reels for 10 cents, 60 days, 2 per cent, off for cash.”
Complainants replied: “July 13, 1892. We accept your offer of the ninth for the reel rope. You will therefore enter our order for 3,000 reels for J, TV) t: and \r cotton rope at your price of 10' cents per pound. Deliver at all common points, as talked with your Mr. Dustin. Terms, 60 days, or 2 per cent, off for cash on receipt of goods. Shipments to be made as ordered by us, and to commence in November, the whole amount, however, to be ordered out by March, 1893.”
Defendants reply: “July 16, 1892. ' We enter order with thanks. As we will have to commence on the order soon, please let us have the assortment of sizes at once, and oblige.”
In reply, two days later, complainants say: “July 18, 1892. Please ship us, as soon as convenient, 75 reels J rope, 15 reels and 10 reels cotton rope..” And again, on July 19, they ordered 5 reels of cotton rope.
However, upon receiving these reels, the complainants wrote, to defendants, with respect thereto, July 28, 1892, viz.: “Your first shipment of cotton rope on reels just to hand. Upon examination, we find you are putting in a 4-pound reel. This seems to us to be scandalous, as we have bought thousands and thousands of reels of rope, and never thought of putting in a reel that would weigh more than 2J pounds, which is fully as heavy as any firm in the country put in their rope. Please let us hear from you in regard to this.”
On July 30, 1892, the defendants replied, viz.: “Your favor of twenty-eighth, complaining of the weight of our reels, to hand. In answer, we will say we have sold thousands on top of thousands of our reel rope in your city, and this is the first complaint. We are to-day shipping a firm in your city, whom we have sold for years, and we are yet to receive the first complaint, and they are paying us more money -for the rope than you are. If you will take the trouble to weigh one of January & Woods’ or Pierce, Atkins & Co.’s reels, you will find their reels as heavy, if not heavier, than ours, and the rope not as good as ours by twenty per cent. We are satisfied you will not have any trouble
Complainants, on August 3, 1892, replied, viz.: “Your favor of the thirtieth ult. to hand and noted. We still think that your reels are entirely too heavy, .and they will cause us lots of trouble. If, however, ■our trade takes them all right, it will be satisfactory .to us, but if they make complaint and claim reduction, we shall expect you to stand whatever loss you have caused on this account.”
Defendants, on August 4, 1892, replied, viz.: “ Your favor of the third to hand and noted. In .answer will say that we cannot agree to same, for we cannot be responsible to you for what your trade may claim. All we can say is this, we are using the same weight reel we have used for years, and never had any trouble as to weight of same. Sold last season, in your city alone, 4,000 reels, and today we are having a better trade on our rope than we have had in years, at this season of the year, and all from a trade we have sold ten to fifteen years.”
Complainants replied, on September 22, 1892, viz.: We have not replied to your letter of August 4, regarding rope reels, because we have' been waiting to see whether the heavy reels would be satisfactory ■or not. We find now that they will not suit us, and you will therefore please cancel our order of ■July 13.”
Defendants replied to this letter on same day, viz.:
Complainants replied on September 27, 1892, viz.: “Your favor dated 22d inst. to hand, and noted. We do not see how we can change our letter of 22d inst., and you will find that letter to be correct in every particular. If you will refer to our letter of July 28, you will see that we objected very seriously then to the weight of your reels, and stated then that they would not do us, and we find what we stated to you then is correct. You speak about rope having declined, etc. We wish to say to you right here that- we always live up to our con
Defendants replied to this letter September 29, 1892, viz.: “Your favor of 27th to hand, and in answer will again say we cannot permit you to cancel your order for reel rope. We shall . expect you to take the rope as per your contract. We also wish to say right here that we have never yet failed to stand to our contracts regardless how cotton should go.”
No further correspondence between the parties occurred until November 28, 1892, when complainants wrote defendants directing them to ship immediately 75 reels of cotton rope and 25 reels -fi; cotton rope, and referred to the same as being in the order now in controversy in this case.
Defendants replied November 29, 1892, viz.: “Your favor of the 28th with order for 100 reels of rope, to hand. Not having any order with us, having canceled same, we do not understand it. ’ ’
December 2, complainants replied: “You appear to be somewhat peculiar people. We wish you would take your letter of November 29, and then take your letter of September 29, and tell us just what you mean. In your letter of September 29, you advise us that you positively will not cancel our order, and that you expect us to take the rope. You also stated that you never failed to live up to your contracts, regardless of how cotton should go
December 3 defendants answered: “Answering yours of the second, will say, you not having any order with us for reel rope, do not know what you mean by filling contract. But you stated that our reel was heavy, your trade would not have them, etc., and canceled the same.”
No further communication passed until December 24, 1892, when on that day complainants wrote, viz.: ■“You will please ship us, immediately, 1,200 reels of cotton rope, assorted as follows: 500 reels of •£ inch, 500 reels Tg- inch, 200 reels f inch.”
January 16, 1893, complainants wrote defendants, viz.: “Please ship us immediately, under our contract, 300 reels J inch cotton rope, 500 reels x6-inch cotton rope, 200 reels -| inch cotton rope.”
Again on February 21, 1893, complainants wrote defendants, viz.: ‘ Please ship us immediately, on our contract, 400 reels J inch cotton rope, 300 reels xV inch cotton rope, 95 reels f- inch cotton rope.”
The Court of Chancery Appeals finds that none of these orders were filled, and that all shipments made on the contract were 100 reels specified in the letter of July 18, 1892, and five reels specified in the letter of July 19, 1892.
A brief summary of this correspondence shows
What, then, is the law governing this state of facts ? The Court of Chancery Appeals found that “defendants refused to agree to the rescission, and their failure in any way to indicate, before the time of performance began, that they elected to treat the complainants’ acts as a breach, left the contract in full force, and left to the complainants a locios peni-tentke, of which they availed themselves within the time fixed for performance — -that is, on the twenty-eighth of November. . . . Complainants, recognizing that their effort to rescind had proven futile, by reason of the defendants’ refusal to agree to it, began to perform the contract by ordering the goods” within the limits of time prescribed by
The first assignment of error made on behalf of defendants, is “that complainants did not comply with their part of the contract, by furnishing the assortment of sizes for the manufacture of the goods within the time contemplated by the . contract.” Upon this point the Court of Chancery Appeals say: “There was nothing in the, contract upon the subject, except such inference as may be drawn from the expression ‘ shipments to made as ordered by us. ’ If any inference can be drawn at all,” says that Court, “it would be that specifications were to be furnished with the orders, as they were in fact furnished.” It will be remembered that defendants, in their letter of July 16, acknowledging complainants’ order for 3,000 reels of rope, state that they would have to commence on this order soon, and request complainants to furnish at once the assortment of sizes. It is claimed that the defendants understood that the specifications were to be furnished at once, and that the goods were to be manufactured in advance of the time when orders were to be given for their shipment. It is, therefore, insisted that as complainants did not furnish directions for the manufacture of the goods until they gave their order for shipment, on November 28, of 75 reels, and on December 24, for 1,200 reels, they have failed to
Complainants, however, insist defendants cannot be heard now to raise this objection, since their refusal to fill complainants’ orders was expressly placed upon the ground that complainants had canceled their order, and had no contract with them, and that it was not suggested at that time that complainants had failed to comply with the contract in not furnishing specifications or assortments of sizes for the rope. Counsel cite, in support of this position, the rule, * ‘ that when a party gives a reason for his conduct and decision touching anything involved in a controversy, he is estopped, after litigation is begun, from changing his ground, and putting his conduct on another and different consideration.” Railway Co. v. McCarthy, 96 U. S., 258, page 36, citing Gould v. Banks, 8 Wend., 562; Holbrook v. Wright, 24 Wend., 474; Everett v. Sutton, 15 Wend., 474; Wright v. Reed, 3 T. R., 554; Duffy v. O'Donovan, 46 N. Y., 223; Winton v. Coit, 7 N. Y., 288.
In Everett v. Satters, 15 Wend., it was said that “a party who, being called upon to account for goods which have come to his hands, sets up title in himself independent of the lien, cannot afterwards, when an action is brought against him, defeat a recovery by setting up at the trial a right to detain the goods on account of the lien. In suits on policies of insurance the rule is enforced that a refusal to pay on any other ground, or a denial of liability without giving reasons, waives the furnishing of proofs, pr defects in them if they have been furnished.” 2 May on Ins. (3d Ed.), Sec. 469; Insurance Co. v. Thornton,
We are of opinion the Court of Chancery Appeals made an erroneous application of this principle in the present instance. We fail to perceive wherein the claim that complainants had failed to furnish specifications for the manufacture of the rope is inconsistent with the claim originally made that complainants had canceled their contract. If defendants had declined to comply with original contract, and refused to make shipments, for the reason that complainant had breached any specific stipulation in the contract, we can see some reason why defendants should not be permitted, on the trial, to rely upon some other and different breach. In this case, however, defendants did not refuse to make shipments on account of any specific breach of the contract by complainants, but upon the broad ground that complainants had canceled and repudiated the entire contract, which was equivalent to a charge that they had breached all the stipulations of the contract. Defendants did not thereafter assume an inconsistent position when they claimed, on the hearing, as a reason for not complying with the last orders of complainants, that the latter had not furnished specifications in a reasonable time for the rope to • be
The next assignment is that the Court erred in holding that the notice of complainants to cancel the contract, and continued without retraction to November 28, was not a breach of the contract, and that the refusal of defendants to rescind held the contract open for performance by complainants.
Prof. Keener, in his Selections on Contracts, Vol. II., page 924, says: “If before the time appointed for performing the contract has arrived, the promisor refuses to perform it, but the promisee refuses to treat such refusal as a breach, and continues to insist upon a performance of the contract, he is precluded from afterwards treating such refusal as a breach.”
Again, he says: “A refusal to perform a contract, made by a party at any time before the performance on his part is due, if not treated by the other party as a breach of the contract, is, in effect, merely an expression of an intention to break
In the case of Johnstone v. Milling, L. R., 16 Q. B. D., 460-467, Lord Esher, in reviewing the cases on this subject, said, viz.: “I think that in all of them the effect of the language used with regard to the doctrine of anticipatory breach of contract is that a renunciation of a contract, or, in other words, a total refusal to perform it by one party, before the time for performance arrives, does not, by itself, amount to a breach of contract, ‘but may be so acted upon and adopted by the other party as a rescission of the contract as to give an immediate right of action.' When one party assumes to renounce the contract — that is, by anticipation refuses to perform it — he thereby, so far as he is concerned, declares his intention then and there to rescind the contract. Such a renunciation does not, of course, amount to a rescission of the contract, because one party to a contract cannot by himself
It is insisted, however, on behalf of defendants, that this was not a sale of goods' in esse, but a contract to manufacture goods; that after a person ordering goods has given the manufacturer notice not to proceed with his work, the party so notified has no right to proceed with the manufacture. ! £ The principle is universal that while a contract is ex-ecutory a party has the power to stop performance
In the case of Davis v. Bronson, 50 N. W. Rep., 836 (S. C., 16 L. R. A., 655), it appeared that the defendant, having refused to perform a contract for the erection of a creamery by plaintiffs before they had entered upon the performance thereof, held that an action to recover .the contract price would not lie, although .plaintiff had, notwithstanding defendant’s refusal to perform, completed the creamery according to contract. Plaintiffs had no right to go
The Court then, proceeds to lay down the following important principle, to wit: “It may well be true that where the performance by the party notified not to perform consists of a single act, as the tender .of a deed, notice before the time for such delivery will not warrant an action for damages; but where the final act of tender is the culmination of other acts, which, in the nature of the case, must precede it, as where the party is to manufacture or build the thing to be delivered, then it is quite clear that the conduct which, before the time of delivery, prevents the taking of the preliminary steps — the manufacture of the article or the erection of the building — as effectually prevents, before the day of tender arrives, the possibility of delivery, as though that day had in fact arrived, and a tender of the
A breach of the contract takes place when the promisee disables the promisor from performing. Thus, where the promisor agrees to saw a certain number of feet of lumber, according to specifications, to be furnished by the promisee, the failure to furnish the specifications is a breach warranting the promisor in abandoning the contract and enabling
This Court is of opinion that the principles laid down in the cases last cited are applicable to the facts of the present case. The fundamental error, as we conceive, in the opinion of the Court of Chancery Appeals, is in ignoring the fact that the rope in question had to be manufactured, and that as early as July 16, 1892, when Dustin & Co. entered complainants’ order for three thousand reels of rope, the latter were notified that defendants would “have to commence on the order soon,” and complainants were requested ‘ ‘ to send assortments of sizes at once.” Complainants failed to do this except as to one hundred reels which they wished to use as samples, and, when this sample shipment was received the complainants commenced a controversy in respect of the size of the reels used. Defendants protested that the four-pound reel used was customary, and in compliance with the contract. Complainants insisted it was too heavy, and that a two-pound reel was sufficient. Finally, on the twenty-second of September, complainants notified defendants to cancel their order of July 13. Defendants replied: “We- cannot permit you to cancel balance of your order.” -September 28 complainants again wrote, refusing to withdraw their previous order of cancellation. September 29 defendants replied, again declining to cancel order, and notifying complainants that they were' expected to take the rope as per
The contract in this case was for the manufacture of rope of. different sizes, and, since delivery was to commence in November, it was within the contemplation of both parties that the specifications should be furnished in advance of that time. It is ■shown that the manufacture of 3,000 reels of rope, estimating thirty pounds to the reel, by a mill with a daily capacity of 800 pounds, would require nearly four months. It will be observed that complainants’ ■order of November 28 was only for seventy-five 'reels, and the next order for 1,200 reels was not given until December 24. Only a little over ■ two months was left within which to manufacture the rope. It was not contemplated that defendants should be required to abandon all other work upon which they might be engaged and give exclusive precedence to the orders of complainant. We ar.e constrained to believe that complainants, by failing to retract their order of cancellation until it was
It is true that defendants refused to agree to a rescission, and notified complainants they would .insist on a performance of the contract. But since defendants could not prevent a rescission of the contract by complainants, and could not compel a specific performance, their position simply amounted to a notification that they did not consent to a- rescission of the contract, and would hold complainants liable in damages for the breach.
The decree of the Court of Chancery Appeals is reversed, and complainants’ bill is dismissed so far as it seeks relief for the alleged breach of the reel rope contract. The costs will be divided.