Jacobs v. DancigerJacobs v. Danciger
Johnson, Garnett & Quinn for respondents.
On April 23, 1920, A. Danciger, representing defendants, partners, of Kansas City, Missouri, entered into a written contract with A. Hattrem, representing plaintiffs, partners, of Salem, Oregon, whereby it was agreed that plaintiffs would sell and defendants would buy 150 bales of hops, to be delivered f. o. b. cars at Kansas City, Missouri, 50 bales in October, 50 bales in November and 50 bales in December, 1920. Thereafter the market price of hops declined. On September 23rd and 24th, 1920, defendants notified plaintiffs they would not accept the hops if shipped and would not comply with the contract. The hops, therefore, were not shipped. Plaintiffs sued to recover the difference between the contract price and the market value of the hops at the time of breach of the contract. Defendants, by their answer, alleged that the contract was void because in violation of law, in that plaintiffs knew defendants intended to use and sell the hops in certain packages called “home brew packages,” containing materials and appliances for making home brew beer having more than one-half of one per cent of alcohol, contrary to Section 18, Title 2, National Prohibition Act, U. S. C., Title 27, Section 30 (
The case has been in this court twice before. At the first trial plaintiffs recovered judgment, which on appeal was reversed by this court (Div. One), in Jacobs et al. v. Danciger et al., 328 Mo. 458, 41 S. W. (2d) 389. Another trial followed, in which the verdict was for defendants. On plaintiffs’ appeal we again reversed the judgment and remanded the cause. [Jacobs et al. v. Danciger et al. (Div. Two), 339 Mo. 91, 95 S. W. (2d) 1193.] Both reversals were because of errors in instructions. Such further statement of facts as may be deemed necessary will be made in the course of this opinion. In this connection, also, we refer the reader to our opinions on the former appeals for more detailed statement of the facts.
I. Defendants contend that Instruction No. 5, given for plaintiffs was prejudicially erroneous. It reads:
“The jury are instructed that mere knowledge alone, without assent thereto or participation therein on the part of the sellers at the time of entering into a contract for the sale of a commodity that their purchasers intended to use such commodity as an ingredient in
a mixture, the sale of which would be a violation of law, would not in itself invalidate such contract; there must be some act or agreement or consent of the sellers in furtherance of such unlawful purpose. “If you find and believe from the evidence that, at the time of entering into the contract in suit, the plaintiffs knew that the defendants intended to use said hops in the manufacture and sale of packages in violation of law, but notwithstanding such knowledge, if any, did nothing or agreed to do nothing which would be in furtherance of such purpose, nor consent to such violation, you will disregard the defense that the contract in evidence was a contract in violation of the law.”
The complaints of said instructions are, first, that it directed the jury to disregard the defense of illegality of the contract unless plaintiffs were particeps criminis in a violation of law by defendants, and second, that it improperly singled out and commented upon certain evidence in its reference to plaintiffs’ knowledge of defendants’ intended illegal use of the hops.
Said instruction was given in both the previous trials to which we have referred. It was challenged by defendants on the first appeal and apparently met the approval of this court. Defendants now say, however, that they did not then raise the specific objections above indicated and that therefore the court did not pass upon those phases of the instruction, and further that, even if we were being asked to re-examine a contention previously made and ruled upon we have the power—and the duty—to correct our own errors if convinced that we erred on the first appeal; citing Mangold v. Bacon, 237 Mo. 496, 512, 141 S. W. 650, and other cases. In that case the court stated the general rule to be “that legal conclusions announced on a first appeal, whether on the general law or the law as applied to the concrete facts, not only prescribe the duty and limit the power of the trial court to strict obedience and conformity thereto, but they become and remain the law of the case in all after steps below or above on subsequent appeal.” The court stated the reasons for the rule, but noted also that there are well recognized exceptions thereto, citing illustrative cases, and summed up the discussion thus: “The premises considered, the sum of the matter is this: Whether from grace or right when cogent and convincing reasons appear, such as lack of harmony with other decisions and where no injustice or hardship would flow from a change, or where by inadvertence principles of law have been incorrectly declared the first time, or mistake of fact has been made, or injustice to the rights of parties would be done by adhering to the first opinion, then the exceptions to the rule have play, and it is our duty to re-examine and correct our own errors on the second appeal in the same case.”
“It shall be unlawful to advertise, manufacture, sell or possess for sale any utensil, contrivance, machine, preparation, compound, tablet, substance, formula, direction, or recipe advertised, designed or intended for use in the unlawful manufacture of intoxicating liquor.”
Referring to that statute the court said (l. c. supra):
“It is not expressly provided in the statute that mere knowledge by the seller of the intended use of the substance by the purchaser is a violation of law. It seems if the Congress had so intended, it would have provided that it shall be unlawful to knowingly sell any substance intended by the purchaser for such use. It did not do so, but fixed the intention of the seller in making the sale as the test of legality. For this reason we think the word ‘intended’ was not used in the sense of mere knowledge. It means more than mere knowledge. It means knowledge of the seller accompanied by some act on his part indicating consent to or encouragement in such use. We are encouraged in this view by the general rule, which follows:” (quoting from 23 R. C. L., sec. 134, pp. 1317-19, and citing also 13 C. J., p. 517, and Michael v. Bacon, 49 Mo. 474, 476, quoting from the latter case).
Both contentions were denied, as was the further contention that mere knowledge of the intended use by defendants of the hops was evidence tending to show that plaintiffs were guilty of a conspiracy to violate the National Prohibition Act.
On the second appeal we reaffirmed those holdings as to the effect of mere knowledge on the part of the seller of the buyer‘s intended
Neither do we consider said instruction a comment on, or a singling out and undue emphasis of, the fact of knowledge, as those terms are and should be understood in cases in which comment on the evidence in instructions has been condemned. The court was merely telling the jury the legal effect of knowledge on the part of plaintiffs of defendants’ intended use of the hops. In Tyler v. Hall, 106 Mo. 313, 17 S. W. 319, there was a vital question whether or not a certain deed made by Sylvester Hall purporting to convey land to his son George had been delivered to George. The trial court instructed the jury that although “Sylvester Hall during his lifetime kept the deed in a place to which George L. Hall had access, yet that fact, of itself, was not sufficient to constitute delivery. The intention to deliver must be proven by some word or act of the grantor.” This court said, 106 Mo. l. c. 323, 17 S. W. 319:
“It is insisted that this instruction was a comment on the evidence, and was, therefore, improper. It is always proper for the court to declare to the jury the legal effect of the facts in proof. The very
purpose of instructions is to advise the jury as to the legal effect of the evidence. The fact that the deed was left by the grantor in a place accessible to defendant did not, as has been seen, constitute a delivery, in the absence of an intention on the part of the grantor to deliver and of the grantee to accept it. To simply declare this legal effect was not a comment on the evidence.”
In Ward v. Fessler (Mo.), 252 S. W. 667, 671, we said: “It is always proper for the court to tell the jury what is the legal effect of facts in proof. (Citing cases.) It is not proper for the court, in an instruction, to give undue prominence to certain parts of the evidence upon which the jury must pass in finding the facts. That is a comment upon the evidence, but that is very different from telling the jury what is the legal effect of certain facts in proof.”
Tyler v. Hall, supra, has been frequently cited and followed. In the recent case of Stanton v. Jones, 332 Mo. 631, 59 S. W. (2d) 648, this court cited with approval Ward v. Fessler, supra, and distinguished Barr v. City of Kansas, 105 Mo. 550, 16 S. W. 483, cited by appellants here. For other illustrative cases applying the principle announced in Tyler v. Hall, see the following: Gray v. Doe Run Lead Co., 331 Mo. 481, 53 S. W. (2d) 877, 883 (14); Offutt v. Battagala (Mo. App.), 44 S. W. (2d) 202, 204 (4-5); Acker v. Koopman (Mo.), 50 S. W. (2d) 100; Schrowang v. Von Hoffman Press (Mo. App.), 75 S. W. (2d) 649.
In the instant case the jury, without direction from the court, might have misunderstood the legal effect of mere knowledge alone on the part of plaintiffs of defendants’ intended use of the hops, and might have given such mere knowledge an effect which should not be attributed to it. As we have pointed out, defendants’ counsel themselves, on the first appeal, misconstrued the legal effect of such mere knowledge and urged for it an effect which this court said it does not have. If learned counsel could thus misconstrue plaintiffs’ “mere knowledge,” it is not unlikely that a jury of laymen, without direction from the court, might have had a similar misapprehension. The instruction served a useful purpose in clarifying the issues for the jury.
Appellants also challenge plaintiffs’ Instruction No. 1, because, they say, it too required a finding that plaintiffs were particeps criminis in order to make the defense of illegality available. The instruction is long and we shall not quote it. It hypothesizes the facts necessary to be found to authorize a verdict for plaintiffs and directs such verdict upon the finding of such facts, unless it is further found that at the time of the sale Hattrem knew of defendants’ intended use of the hops “and agreed to sell said hops in furtherance of such purpose, as defined in other instructions.” (Italics ours.) It does not attempt or purport to define what would constitute agreeing to sell in furtherance of such purpose, but points to “other instructions,“—
II. Appellants assign error in the admission of certain telegrams, or portions thereof, as indicated infra.
On September 23, 1920, defendants wired plaintiffs,—
“We are discontinuing our malt business and will be unable to use the order for hops wire us what you will take to relieve us of same.”
September 24, 1920, plaintiffs wired defendants,
“Answering your telegram twenty third we prefer ship according contract however subject your immediate telegraphic acceptance will cancel contract in consideration of your paying us at this time in cash nine thousand six hundred and twenty four dollars which is the difference between market value and contract price.”
September 24, 1920, defendants wired plaintiffs,
“Your telegram twenty fourth received we re-affirm statement of our telegram of yesterday and will not receive any of your hops and will not pay any damages demanded by you as far as we are concerned the contract is terminated.”
September 24, 1920, plaintiffs wired defendants,
“Answering your telegram this date beg to state that we will not cancel your hop contract with us as dated April twenty third nineteen twenty only in consideration of your paying us at this time in cash nine thousand six hundred and twenty four dollars and this offer is made subject for your immediate telegraphic acceptance otherwise will hold you liable for fulfilment of contract on your part in all of its terms.”
The italics in the above quoted telegrams are ours, used to point out the portions objected to. Defendants objected to the introduction of the italicized portions on the ground that on the face of the telegrams it appeared that such italicized portions were statements made in an attempt to compromise and were therefore inadmissible. Negotiations for the peaceful settlement of disputes are to be encouraged and, if they fail, testimony with reference thereto should be excluded on a trial of the cause. [Starnes v. St. Joseph Railway, Light, Heat & Power Co., 331 Mo. 44, 52 S. W. (2d) 852, 855.] But it is not always easy to determine what constitutes an offer of compromise or negotiations looking to that end. In 3 Jones’ Commentaries on Evidence (2 Ed.), section 1052, page 1939, we read:
“It is often difficult to determine, in a particular case, what amounts to an ordinary admission, and what constitutes an offer of compromise within the meaning of the general rule above stated; and the intention of the parties must be the guide in each case. If the intention
is apparent to concede liability and to seek to buy relief from a liability recognized as such, it is an ordinary admission against interest and not an attempt to compromise; but if, on the other hand, the proposal is tentative, made to ‘buy peace,’ and with the idea of mutual concessions, as to such point it is a mere offer of compromise. The test of what constitutes an offer of compromise within the rule is said to be whether the admission of the truth of the facts on which the claim is based is hypothetical only, in which case it cannot be regarded as any recognition of the basis of the opposing party‘s claim, or unconditional and made without regard to accompanying circumstances. “Needless to say, statements and admissions made before any dispute took place, or after an attempted compromise has been abandoned, and admissions which, by their very nature, negative compromise, such as an endeavor to obtain time or arrange terms of payment, are not to be excluded upon the ground which prevents a bona fide offer of compromise from being used to the prejudice of either party.”
In Moore v. Gaus & Sons Mfg. Co., 113 Mo. 98, 20 S. W. 975, the plaintiff was demanding of the defendant $2900 for certain work done. The defendant claimed he was entitled to $600 on account of increased insurance charges suffered by the plaintiff‘s delay in completing the work. The plaintiff drew a draft on the defendant for $2900, the contract price, and sent it to his agent to collect. The agent called on one of the defendant‘s officers and was told by said officer that he had left his proposition with his bookkeeper. The memorandum—“proposition“—read:
“Twenty-seven hundred dollars ($2,700) to be paid in three notes, $900 each, in sixty, ninety and one hundred and twenty days, without interest, or there will not be an acceptance of the work.”
Said memorandum was read in evidence and it was contended on appeal that it should have been excluded as an offer of compromise. This court said, 113 Mo. l. c. 111, 20 S. W. 975:
“The rule excluding offers of compromise is stated by Greenleaf, sec. 192, ‘that confidential overtures of pacification and any other offers or propositions between litigating parties, expressly stated to be made without prejudice, are excluded on grounds of public policy.’ ‘But in order to exclude distinct admissions of facts it must appear either that they were expressly made without prejudice, or, at least, that they were made under the faith of a pending treaty and into which the party might have been led by the confidence of a compromise taking place.‘”
The court further said that the rule had always been recognized and enforced in this State but was not applicable to the facts of that case; that there was “an unconditional demand for the contract price, and a counter-demand for $200 as a counterclaim for increased
In Farber v. Boston Insurance Co., 215 Mo. App. 564, 256 S. W. 1079, where the defendant, at the trial, was denying liability, the court held that an offer to pay $8000, made by an adjuster for all the insurance companies interested, should have been admitted as an admission of liability, there being no evidence that it was offered as a compromise and no controversy or disagreement having arisen between the parties prior to the offer. (We shall later again refer to the Farber case.) In Mason v. Agricultural Ins. Co., 150 Mo. App. 17, 129 S. W. 472, it was held that an effort of the parties to agree upon the amount of loss and avoid the necessity of an appraisement, leaving the question of liability open, was not inadmissible as an offer of compromise. In Hunter v. Helsley, 98 Mo. App. 616, 73 S. W. 719, the defendant, by contract, was to receive from the plaintiff a stock of merchandise “at cost and freight added.” The court held that the efforts of the parties to determine the amount of the freight were not for the purpose of effecting a compromise but only to ascertain the amount due.
Referring again to the Farber case. It was decided by the Kansas City Court of Appeals. The same court later in Starnes v. St. Joseph Railway, Light, Heat & Power Co., 22 S. W. (2d) 73, seems to criticize and in effect overrule the Farber case, and refers to some other appellate court cases expressing like views. The Court of Appeals’ opinion was not the final decision in the Starnes case. That court certified the case to this court, deeming its opinion in conflict with decisions of the St. Louis and Springfield Courts of Appeals, and here the case was decided on the merits as though originally appealed here, the decision being reported in 331 Mo. 44, 52 S. W. (2d) 852, supra. Counsel for defendants rely strongly on the Court of Appeals’ opinion, which they say was affirmed by this court. But this court did not in terms affirm the appellate court‘s opinion. It reached the same result, but wrote its own opinion, as it does when a case reaches it in such manner. On the point we are considering, the discussion, if it may be called discussion at all, is very brief. The
In the instant case defendants’ telegram of September 23, 1920, was the first intimation from either side that there was any thought of abandoning the contract, and even that message could hardly be understood to indicate an intended repudiation thereof. It indicated that defendants recognized the contract as valid and in force, and only sought to know the amount for which plaintiffs would be willing to cancel it. At that time there was no controversy between the parties—nothing to settle—and without the italicized portion of that telegram, the only part thereof to which defendants objected, it could hardly be understood just what the telegram meant. It called for an answer, which was given. Not until defendants’ telegram of September 24th was there a definite statement from them that they would not receive the hops and would not pay any damages—in short, a definite refusal to comply with the contract. Plaintiffs’ second telegram of the 24th, in answer to defendants’ message of that date, added nothing to what they said in their first telegram, except a more definite statement that they would not cancel except on payment of the sum named, it being the legal measure of damages. Plaintiffs were simply asserting and demanding what they claimed as their legal rights under the contract and there was no intimation by defendants in their telegrams that they then claimed the contract was void. In the circumstances shown we think the telegrams were admissible. Defendants’ telegrams tended to show that they then recognized and admitted the validity of the contract.
III. Defendants’ remaining assignment of error is that the court should have discharged the jury and declared a mistrial, at their request, and should have sustained their motion for new trial, because
The judgment of the circuit court should be affirmed. It is so ordered. Westhues, C., concurs; Bohling, C., concurs in paragraph II as to result.
PER CURIAM:—The foregoing opinion by Cooley, C., is adopted as the opinion of the court. All the judges concur.