Nicoll v. Pittsvein Coal Co.
269 F. 968
2d Cir.
1920
Check Treatment
HOUGH, Circuit Judge

(after stating the facts as above). We are presented with 82 assignments of error, a number exceeding in uselessness any yet observed in a civil cause. Both in quality and quantity they are open to the criticisms of Fitter v. United States, 258 Fed. at page 569, 169 C. C. A. 507. We shall notice only such as have been referred to in briefs, and not all of them.

This case presents with an interesting fullness some parts of the large question as to hów far and in what manner a written document commonly called a contract, entered into between persons engaged in substantially the same business, couched in simple English words, and relating to matters easy of comprehension by men far removed from the actors in the transaction, can or may be affected by words not written in the contract, or acts not described therein.

[1,2] Some matters, judicially discussed in reported decisions, may *971be laid aside, as either not material or concluded by verdict. There was nothing indistinct or hidden about the notices printed on the business paper of the parties; they were as plain and obvious to the eye as any script or typewriting on the sheet. The custom, or rather usage, exists, and plaintiff below lived up to it honestly and fairly; and in its nature it complies with the requirements of reasonableness, legality, etc., recently again enumerated in Eames v. Claflin, 239 Fed. 631, 152 C. C. A. 465; indeed its legality has before now been recognized, when stated in the body of a contract writing (McKeefrey v. Connellsville, etc., Co., 56 Fed. 212, 5 C. C. A. 482; Luhrig v. Jones, 141 Fed. 617, 72 C. C. A. 311). It may be added that defendant below knew of the custom asserted, though he heartily disapproved of it—at least when sought to be enforced against him on a rising market— but this is immaterial. Silverstein v. Michau, 221 Fed. 55, 137 C. C. A. 79; Neer v. Lang, 252 Fed. 575, 164 C. C. A. 491.

[3,4] The distinction (usually disregarded) between usage and custom may be noted; what this pleading calls an “established custom” is really a trade usage (Williston, Contracts, § 648). As has often been said, a lawful custom is itself part of the common law, while a lawful usage, proved and shown to affect both parties, may be described as the law of their case.

Thus is reached the only point at bar: Was it lawful to permit the jury to find, in effect, that Nicoll’s contract was not to get 4,166 ions of coal per month, but to get so much thereof as the pleaded usage allowed him, and to reach that conclusion after considering not only the evidence of usage, but the notices on the contract letters and Nicoll’s acts (including letters) during the earlier months of the contract year? Plaintiff in error urges, in substance, that no one of these elements of defense was in itself lawful, and that conjointly they uo more make a defense (to his counterclaim) than does the addition of zeros produce a finite quantity. The argument is fair, but it cannot be denied that if any one of the elements noted be admissible, the others are, or at least may be, regarded as legitimate corroboration. Interpretation of contracts is always said to be an endeavor to discover and enforce what the parties meant, but the rules produced by accumulated decisions as to how such discovery shall be conducted often overlap and sometimes produce hindrance rather than help, while reconciliation of all cases is a task neither possible nor worth the effort; and it is notable that the most helpful and authoritative modern writers on matters cognate to the question at bar (Messrs. Wigmore and Williston) do not attempt it.

[5, 6] Taking up the plea of usage, and considering it alone, we have to deal with the trade custom variant of the parol evidence rule. With Dean Wigmore (Evid. § 2465) we think that there is no reason in the nature of things why the individual parties to a transaction may not employ words or whole phrases in a particular sense irrespective of the ordinary sense. Indeed when tradesmen say or write anything, they are perhaps without present thought on the subject, writing on top of a mass of habits or usages which they take as matter of course. So (with Prof. Williston) we think that any one contracting with *972knowledge of a usage will naturally say nothing about the matter unless desirous of excluding its operation; if he does wish to exclude, he will say so in express terms. Williston, Contracts, § 653. Courts for a long time have rightly been influenced by this belief, until a survey of decisions leads the same learned author to conclude, as we do, that usage has been more potent than any other collateral parol matter to affect, if not control, contractual interpretation. Section 654. In sound theory there is in each case only a question of fact, viz.: Were the parties using words in a special mutual sense? Rules are very apt to be stated dogmatically, and when tom from their environment of facts, apparently to swear at each other. Thus Hostetter v. Park, 137 U. S. at page 40, 11 Sup. Ct. at page 4, 34 L. Ed. 568, declares “it is well settled that parties who contract on a subject-matter concerning which known usages .prevail, incorporate such usages by implication into their agreements, if nothing is said to the contrary,” and De Witt v. Berry, 134 U. S. at page 312, 10 Sup. Ct. at page 537, 33 L. Ed. 896, asserts:

“Tbe principle is that, while parol evidence [of custom or usage] is sometimes admissible to explain such terms in the contract as are doubtful, it is not admissible to contradict what is plain, or to add new terms.”

Such rules can be understood only from the context of facts, which are rarely quoted. Cf. Vanderbilt v. Ocean, etc., Co., 215 Fed. 886, 132 C. C. A. 226.

The most frequent regulatory statement is to say that in commercial transactions, incidents may be annexed to the written agreement by usage or custom' (Williston, Contracts, § 652) ; but no man can confidently assert beforehand exactly what incident may be annexed, nor how deep it may cut into the meaning of words, as they would be read by an intelligent stranger.

We conclude (again with Prof. Williston) that the most philosophical statement or explanation of the rule is that of Rord Campbell in Humfrey v. Dale, 7 E. & B. 266, who said, in substance, that the moment usage does more than verbally define or explain the words used, it does in a certain sense vary the contract; the truth is that in trade agreements the parties oftentimes do not set down on paper the whole of their contract in all its terms; they set down only those necessary to be determined in the particular case by specific agreement, leaving to implication those general and unvarying incidents which a uniform usage would annex. The facts in the case whose words we have paraphrased are most instructive; for there brokers had sold goods specifically “to our principals,” and were by usage held to personal responsibility on the “bought note” because they had not disclosed their principal’s name.

[7] Further, however, the" matter'in which this contract is affected by usage is one of'number, quantity, amount, or measurement, and on this point, while it is quite impossible to harmonize all decisions (see citations 27 Rul. Cas. Law, 188) there is no 'doubt at all that ambiguity in phrase is not necessary to let in evidence of usage (Walls v. Bailey, 49 N. Y. 464, 10 Am. Rep. 407; Smith v. Wilson, 3 B. & Ad. 728, and for other cases, Williston, Contracts, § 608, note).

*973[8,0] Whether without the printed notices on letter heads, and the practical interpretation of the earlier contractual period, the plea and evidence of custom would have been enough to take the case to the jury, we are not required to decide. The usage annexed an incident of a nature which materially changed the possible, and as it turned out the actual, content of the agreement. Yet assuredly no more so than in Humfrey v. Dale, and Walls v. Bailey, supra, or in Lillard v. Kentucky, etc., Co., 134 Fed. 168, 67 C. C. A. 74, an opinion by Justice Durton when Circuit. J udge.

Taking up next the effect of printed notices, this court must recognize the saying of Sturm v. Boker, 150 U. S. 312, 14 Sup. Ct. 99, 37 L. Ed. 1093, that “a printed billhead can have little or no influence in changing the clear and explicit language of the letters” constituting or evidencing a contract. But the citation is far from declaring that such notices cannot as matter of law have any influence over decision. How great that influence ought lo be will depend on the facts of each case, and we think the rule (so far as such matters can be reduced to theorems) is well put in Sturtevant Co. v. Fireproof, etc., Co., 216 N. Y. 199, 110 N. E. 440, L. R. A. 1916D, 1069, viz. it “cannot be held, as matter of law, that [such notice] was incorporated in and made a part of” the proposal, acceptance or contract. But Pittsvein Company never rested on the notices; its plea in substance was that the usage was so incorporated, and the notice in effect called attention thereto. On this record we cannot dissociate the notice from the usage; whether without any such support the notice would have been enough to get to the jury is a query beyond the exigency of this case, but one on which Poel v. Brunswick, etc., Co., 216 N. Y. 310, 110 N. E. 619, and Ohio, etc., Co. v. Clarkson Co. (C. C. A.) 266 Fed. at page 189, are instructive.

Such notices, however, must mean something, no court can erase them altogether and when such obvious and close connection exists between the notice words “all contracts subject to car supply,” or “all contracts contingent upon delays of carriers,” and the proven usage, we may and do hold that it was for the jury to say, not that the notice became incorporated in the contract, but the usage was intended by the parties so to be incorporated, and the notices used by both parties were some evidence of such intent.

In so far as Menz v. McNeeley, etc., Co., 58 Wash. 225, 108 Pac. 621, 28 L. R. A. (N. S.) 1007 (much relied on by plaintiff in error) is inconsistent with the foregoing, we differ, preferring the authority of the cases cited above, some of which recognize the doctrine of that decision partially only.

[10] The remaining point seems to us clear, for assuming now that the jury question was whether the parties intended to contract subject to the usage, it was plainly competent and material to show such intent in what Nicoll wrote, by showing what Nicoll did; this is, or may be, that “practical interpretation,” which is “always a consideration of great weight.” Insurance Co. v. Dutcher, 95 U. S. at page 273, 24 L. Ed. 410.

When it was established that there was a contract running over a *974year and an applicable usage, to which the notices might reasonably refer, and that for the earlier months of the year both parties conformed to the usage, the jury did not doubt, and we do not doubt, that the question put to them was in accord with the better doctrine of contractual interpretation.

Judgment affirmed with costs.