Union Refining Co. v. Barton

| Ala. | Dec 15, 1884

STONE, C. J.

The present suit grew out of an executory agreement, containing mutual stipulations. Commencing about the first of December, 1881, it was to continue three years. The business of the corporation — appellant here — was that of refining cotton-seed oil, and the object of the contract was the introduction and establishment of a market for the sale of its oil in the State of Georgia. The agreement was in writing, signed by both parties; and by its terms Barton was constituted traveling agent, with authority to make sales, either through himself or ag'ents, to pay his own and agents’ expenses of every kind, and to have for his' compensation ten per-cent, of the amount of his sales. He was to have the sole right of selling in Georgia; but was subject to the orders of the company. Tlie refining company was necessarily bound to furnish the oil with which to fill Barton’s contracts. The contract is very general in its expressed provisions, and, hence, many of the duties it imposes are left to the usages of such trade, if there be such, and to implications springing out of the nature of the transaction. Thej’e is no testimony of any usage in such dealings, and we need not consider that question.

What are the implications? Barton bound himself to give the service his time, his energy, and a faithful effort to make sales, and to establish a trade and market for the company’s oils; and all this, in the best good faith, for the promotion of the company’s interests. Save his stipulated compensation of ten per-cent., he could have no aim or interest in antagonism to the interest of the company. He must defray all expenses incident to the agency, and, in this matter, could call on the company for no assistance. He was to be subject to the orders of the company. This must relate to the matter of making sales, for there is nothing else for it to relate to. This would embrace the mode and manner of payment, and the matter of delivering the goods when sold, and also the question of price, under rules to be presently stated. He must sell for cash, unless this is varied by a usage of trade, or by authority from his principal.

The implied duties resting on the refining company were equally binding on it. They, too, must have been performed in the best of good faith, in honest promotion of the common aim to establish the desired trade. Barton was subject to the company’s orders; but those orders must have been given in promotion of the enterprise, not to thwart its purposes. They could stipulate the price at which their oils should be sold, and, in doing so, could take'into the account the cost of production, and the rates of their home, or other accessible markets, if such were available. If, by force of competition of an equal, or inferior grade of goods, or by cutting of rates, they could not enter into the market without a loss, the contract imposed on them no obligation to so scale down their prices, as to leave them without a reasonable profit on their merchandise. The contract was conceived in the spirit of mutual benefit. On the other hand, the contract, in its spirit, required that the price of the goods should not be raised so far above remunerative prices, as to defeat, or substantially hinder sales. Nor could the price be raised above rates which would yield a reasonable profit, as a means of getting rid of Barton’s agency. And the company was bound, with no undue delay, to perforin Barton’s contracts of sale. This, for the common benefit of both parties, and in the true spirit of the contract.

About two months after Barton entered upon the agency, the company, in reply to a request of his, wrote him as follows: “When here, you mentioned about thirty days acceptance; and after thinking of it, I now say, that in all cases have buyers remit by P. O. order, if possible, on delivery, as we prefer it in all cases ; and do not mention thirty days acceptance, except in extreme cases ; and be sure they are all good men.” “Extreme cases,” mentioned in this note, must mean, that the authority was not conferred, except in those cases where the thirty days indulgence appeared to be a condition of effecting a sale, to a financially good man : only in such conditions was the thirty days indulgence allowed to be given. Now, this was in no sense a contract, nor was it the modification of a contract. No promise, or other consideration, moved from Barton. It was one of the orders, or directions of the company ; properly speaking, a parol license. Such license is always sufficient excuse for any act done under it while it is allowed to stand, but no longer. It can be revoked or modified at the will or caprice of him who grants it.— Chambers v. Seay, 73 Ala. 373.

On the 21st March, 1882, the company wrote to Barton as follows: “You favor of 20th inst. received, and noted. In reply to your statement, that you do not guarantee any bills, and such was not contemplated in our contract, I will only say that, henceforth, you will understand that you are not authorized to sell bills that you do not guarantee, and that this has always been our understanding of the arrangement between us.” The authority to sell on thirty days time being only a license, and not a contract, the company was authorized to modify it; and the order of March 21st, copied above, was so far a modification of the license previously given, as to take away Barton’s right to sell on time, without himself becoming the guarantor of the payment.

It was contended by the appellee in the court below, and the contention is renewed here, that the refining company violated, and thus broke up the contract, in the spring of 1882, and thereby injured plaintiff, in this ; that it deprived him of the opportunity of earning and realizing large profits, which he could have done, if permitted to continue in the agency. The company does not concede that it violated its contract; but it takes the position, that, if this issue should be determined against it, the damages claimed are of the class called speculative, can not be estimated with proximate certainty, and therefore can not be recovered, no matter how closely they may have followed the breach. The precise form of the argument is, that no standard can be furnished for estimating such damages. In Brigham v. Carlisle, at the present term — a case not distinguishable from this on the point under discussion— the question was very carefully considered, and we reached the conclusion, that such damages depend on too many contingencies to be the subject of a recovery. We need not repeat the argument. — See, also, Cin., Selma & Mobile Railway Co. v. Evans, at the present term ; Pollock v. Gantt, 69 Ala. 373" court="Ala." date_filed="1881-12-15" href="https://app.midpage.ai/document/pollock--co-v-gantt-6511155?utm_source=webapp" opinion_id="6511155">69 Ala. 373. In fact, the success of such enterprise depends on so many contingencies, that we can conceive of no means of making the necessary proof, on which to found a verdict. No rule for such ascertainment can be predicated. Past success in the same, or a similar enterprise, will not do. Conditions may not always remain the same. — Washburn v. Hubbard, 6 Lansing, 11; Masterson v. Mount Vernon, 58 N.Y. 391" court="NY" date_filed="1874-10-06" href="https://app.midpage.ai/document/masterton-v--village-of-mount-vernon-3596153?utm_source=webapp" opinion_id="3596153">58 N. Y. 391; Lewis v. Atlas Mut. Life Lns. Co., 61 Mo. 534" court="Mo." date_filed="1876-01-15" href="https://app.midpage.ai/document/lewis-v-atlas-mutual-life-insurance-8005225?utm_source=webapp" opinion_id="8005225">61 Mo. 534 ; 2 Wait’s Ac. & Def. 443.

It results from what is stated above, that the judgment in this case must be reversed on many of the rulings.

The complaint and amended complaint contain many averments of breach, and there are many demurrers thereto. Some of the breaches are insufficient. We will not notice all the imperfections, but will call attention to some of them. These, with the principles declared above, will, we trust, furnish a sufficient guide for another trial. The following are imperfections in the original complaint: The first breach should have averred some amount of sales. The second breach should have averred that, when the alleged other agent was sent to Georgia to make sales, plaintiff was still performing the duties of agent under the contract, or was prevented from doing so by the wrongful act of defendant. The third should have averred some amount of sales, for compliance with which defendant failed to furnish oil. Assignments numbered 3-J, 4, 5, 6, 7 and 8, we need not specially comment on. The principles declared above will determine when, -and to what extent, they need amendment. These remarks apply equally to amendments of the complaint, as shown in the record.

Extent of sales made by plaintiff was competent evidence, as tending to furnish a basis for fixing plaintiff’s compensation for services he had rendered. It was not competent as affording a guide for estimating future or prospective profits. This was proper subject for a charge, explanatory of the extent of its admissibility. — 1 Erick. Dig. 809, § 87; Lb. 810, § 98.

That part of the general charge which was excepted to, has a tendency to mislead. This will not reverse. Appellant should have asked an explanatory charge. The third charge given at the request of plaintiff should have been refused. In the charge given by the court of its own motion, the City Court erred, in the following language : “ If the evidence shows you [the jury] that the defendant did give the plaintiff such authority [authority to sell on time], and that while plaintiff was exercising the same defendant did not withdraw it, but informed plaintiff he would be required to guarantee all such sales, such requirement, if it embarrassed plaintiff in his operations, and prevented him from making sales, was a breach of contract.” We have shown above that the authority to sell on time was a mere order, which the company was authorized by the contract to give, or. at most, a mere license. The company was not only authorized to revoke it, but could modify it at its pleasure. It was not a contract. If it had been, neither party could have rescinded or modified it without the concurrence of the other. Each would have been equally bound by it, or neither was bound.— Cin., Selma & Mobile Railway Co. v. Evans, at present term.

No one will contend that, under this license, Barton was compelled to sell on time ; or that, if he had refused to do so, it would have been a breach of his agreement. Not being bound himself, the compauy was not bound to continue the license any longer than it chose to grant it. It had authority to continue the license, to revoke it absolutely, or to modify it. When Barton was informed he would not be permitted to sell on time except on his own personal guaranty, he had a clear right to refuse to make credit sales on these terms. This order was no breach of contract on the company’s part, and it conferred on Barton no right to treat the contract as broken by the company.

The sixth charge should not have been given, because it assumed as fact, without hypothesis, that Barton had kept, and was keeping his part of the contract, and that the company had been guilty of a breach on its part. The eighth charge is objectionable on the same ground.

Reversed and remanded.