221 Mass. 406 | Mass. | 1915
The circumstances which gave rise to this action and cross action were in substance as follows. For convenience we shall speak of Fillmore and Slade as the plaintiffs and Johnson as the defendant, although Johnson is the plaintiff in the cross action and Fillmore and Slade are in that action the defendants.
Before the contract hereinafter stated between the plaintiffs and the defendant the plaintiffs were the owners of a mill at which they manufactured tissue out of which "toilet” paper was made. The tissue (which was the product of their mill) was manufactured in large sheets called jumbo or parent rolls. These parent rolls of tissue theretofore had been sold by the plaintiffs to manufacturers, who reduced them to the size and condition in which they were sold to retail dealers who again sold it for use as “toilet” paper. By an agreement between the plaintiffs and the defendant dated October 5, 1908, but in fact signed on January 15, 1909, the defendant agreed to take the entire product of the plaintiffs’ mill, “finished in tissue toilet paper, rolls and packages, made and put up in such regular standard marketable shapes
At the trial the defendant asked for thirty-three rulings and took exceptions to the refusal of the judge
In his argument here the defendant has cut adrift from the exceptions which he took at the trial, and has contended that there are six questions of law for this court to decide. These questions are stated in the footnote.
1. The first two propositions upon which the defendant insists are that the question of what items ought to be included in the “actual cost of finishing” was a question of law for the court and as matter of law that many of the items included by the plaintiffs in the charge of $1.71 per case for “actual cost of finishing” were items which ought not to be included in it. One of the items
We are of opinion that where, as in the case at bar, the price agreed upon is the cost actually incurred, to which is to be added a percentage for profit or compensation, the items making up the cost are substantially if not exactly the same as the items to be deducted from gross receipts to ascertain net profits. It is settled in such cases that overhead charges here objected to by the defendant are items to be deducted from gross, to ascertain the amount of net, profits. Stone v. Wright Wire Co. 199 Mass. 306. Stein v. Strathmore Worsted Mills, ante, 86.
This disposes of the first two propositions put forward by the defendant.
2. There was confusion of thought both on the part of the plaintiffs and on the part of the defendant as to their rights under the contract. There was evidence from which the jury could have found that the plaintiffs insisted not only that the defendant should pay “$1.71 per case” for the actual cost of finishing, but in addition that they insisted that he must agree in advance that that was the correct cost of finishing, and that if he did not agree to it in advance they (the plaintiffs) would not continue their deliveries under the contract. The presiding judge told the jury that if the plaintiffs refused to continue deliveries under the contract unless the defendant paid $1.71 per case
3. On the fourth of December the plaintiffs wrote a letter to the defendant in which they stated that their finishing cost was so high that “you [the defendant] cannot afford to pay the price it costs every case of paper we have shipped you has cost us more than you have been willing to pay for it therefore we will ask you to secure your requirements elsewhere.” The full letter is given in the footnote.
4. The next proposition is that the defendant was under no obligation to arbitrate the proposed estimate of finishing cost. This proposition arose in connection with a letter written by the plaintiffs to the defendant dated December 18,1909, in which they said in answer to a letter of the defendant of December 16, “We will arbitrate the new prices and meet you in every way that is mutually fair, that is fair to you and also to us.” The letter in full is set forth in the footnote.
As we have already said, it was the defendant’s contention at the trial that his position in December was that while the cost of finishing demanded by the plaintiff was wrong he was ready to pay it if it was right. On the other hand it was the plaintiffs’
5. When the auditor’s report was put in evidence the defendant “objected to the introduction of all that portion of the report contained beginning in the last paragraph at the bottom of page 13, as follows: ‘That by (Johnson’s) refusal to assent to the schedule of prices asked by (Fillmore and Slade) when the subject was finally considered on or about December 13,1909, [he] violated the contract and then committed a breach of the same, and subsequently by refusing to arbitrate or consider the prices asked by the plaintiffs, and by refusing on January 1, 1910, to pay the amount then due for sales to him consummated in the previous months of November and December, for which demand for payment had been made, all constitute a breach and final repudiation of the contract between the parties,’ but the court overruled the objection and the defendant” took an exception. This exception is not well taken. This was part of the auditor’s report. The plaintiffs had a right to introduce the auditor’s report in evidence.
From what has been said already it is plain that a part of the portion of the auditor’s report objected to by the defendant was wrong. It was wrong as matter of law to rule “that by his (Johnson’s) refusal to assent to the schedule of prices asked (by Fillmore and Slade) when the subject was finally considered on or about December 13,1909, [he] violated the contract and then committed a breach of the same.” It was also wrong in the statement that the defendant “subsequently by refusing to arbitrate or consider the prices asked” by the plaintiff committed a breach of the contract. Whether it was wrong in the conclusion that the defendant “by refusing on January 1,1910, to pay the amount then due for sales to him consummated in the previous months of November and December, and for which demand for payment had been made” committed a breach of the contract, need not be determined now. Although the exception taken to the refusal of the judge to exclude this portion of the auditor’s report, when it was offered in evidence, was not well taken, there were three rulings (set forth in the footnote)
6. We have dealt with the only questions argued. We treat points not argued as waived.
7. As we have already said, the verdict returned by the jury in the first action was a general verdict for the plaintiffs on both counts. The defendant at the trial admitted that the plaintiffs were entitled to recover on the second count. They claimed interest from January 4,1910, on the ground that they made demand on that day for the sum due them for the “toilet” paper delivered and covered by the second count. The judge left it to the jury to include interest from January 4, 1910, or from the date of the writ as they found or did not find that there was a demand made upon that day. It is impossible to know, therefore, how much of the verdict of $4,962.22 was a finding on the second count and how much was a finding on the first count. The result is that the verdict cannot stand for any amount.
8. To prevent misapprehension we think we ought to add that it would seem that the ruling of the judge as to the date from which interest was to run was right only because of the claim for interest made in the declaration. The claim in the declaration was for interest from January 4,1910. The amount due was by the terms of the contract due thirty days after shipment. It would seem that interest ran from the due date named in the contract without a demand being made. This point is not before us for decision and we add this to avoid misapprehension.
The entry in both cases must be
Exceptions sustained.
“The same to be based on the number of pounds of tissue contained in each ease at the fair market price per pound of equal quality and weight tissue, where the same is sold to manufacturers of toilet paper in parent or jumbo rolls; the prevailing market price to be fixed semi-annually on the first day of January and July for the succeeding six months. There is also to be added to the value of the number of pounds of tissue contained in a case an amount of five (5) per cent; to the above combined amount the actual cost of finishing the tissue into toilet paper rolls and packages is to be added, constituting the cost per case to be paid by the said Johnson, said price to be F.O.B. cars No. Bennington, Vermont. Settlements to be made thirty days from date of shipment, and a discount of three (3) per cent is to be allowed at time of settlement on value of the invoice excepting the said discount is not to apply on that part of the case price charged as finishing cost.”
Lawton, J.
“1. Had the plaintiffs a legal right to charge, either as a part of the finishing cost or in any other way, for loss occasioned by ‘shrink? ’
“2. Had the plaintiffs a legal right to charge as a part of the finishing cost either for insurance on any part of their plant, or for depreciation of any part of their plant or machinery, or for rent of any part of their premises, or for personal services of the plaintiffs themselves as ‘superintendent’ or for ‘office work,’ or for other things mentioned at the bottom of page 11 of the bill of exceptions?
“3. Should the court have ruled that ‘the actual cost .of finishing’ was not a matter of estimate which could be made in advance?
“4. Should the court have instructed the jury as to the plaintiffs being estopped by their letter of December 4th, from claiming damages for not taking their paper after that date?
“5. Should the court have instructed the jury that Johnson was under no obligations to arbitrate the proposed estimated finishing costs?
“6. Was that part of the auditor’s report to which the defendant excepted properly admitted? ”
"Geo T Johnson & Co “No Benn Vt‘ Dec 4'/09
Boston Mass
Gentlemen
We have tried out the making of 10$ paper and find it is impossible for us to make it and also the shrink between parent roll and toilet roll and the finishing cost is so high that you cannot afford to pay the price it costs every case of paper we have shipped you has cost us more than you have been willing to pay for it therefore we will ask you to secure your requirements elsewhere at the earliest possible moment we will in the mean time try and take care of your orders, you are sending them in faster than we can make them at present you doubtless will have no trouble in securing the goods elsewhere as you had several mills that wanted the business on the same terms you offered us. do not send any more orders for this month as you allready have sent in more than we can make. _
Very Truly
Fillmore & Slade S.”
“Geo. T. Johnson & Co.
Boston Mass
Gentlemen. Answering your letter of the 16/09 will say we will arbitrate the new prices and meet you in every way that is mutually fair, that is fair to you and also to us whatever we do let us do it at once, we are waiting on you, please give us your views at once, when here you were satisfied the old prices were not high enough, let us know what you consider right.
Very Truly
Fillmore & Slade per Slade.”
“16. That in and so far as the auditor’s report contains rulings of law in conflict with the rulings of law given by the court, then it must be disregarded.
“17. That if any finding or conclusion of the auditor is based upon a mistake in law, such finding or conclusion should be disregarded.
“18. That if the auditor finds Johnson broke the contract because the auditor finds that Johnson refused to agree in advance to pay a specified amount as the finishing costs, then that finding should be disregarded.”