Johnston v. Fairmont Mills
| Decision Date | 02 August 1902 |
| Citation | 116 F. 537 |
| Parties | JOHNSTON v. FAIRMONT MILLS et al. |
| Court | U.S. Court of Appeals — Fourth Circuit |
C. P Sanders and Simpson & Bomar, for plaintiff.
Nicholls & Jones, for defendants.
This is an action at law, brought by A. S. Johnson, a citizen and resident of the state of Mississippi, against the Fairmont Mills, a corporation of the state of South Carolina. The Fairmont Mills is in the hands of L. Guy Harris, duly appointed its receiver; and the receiver, a citizen and resident of the state of South Carolina, is also made a party defendant. The cause has been submitted to the court to be tried without a jury. The complaint alleges the existence of contracts entered into between plaintiff and defendant on or about the 10th and 15th days of October, 1900, under which plaintiff contracted to sell and deliver to the Fairmont Mills 500 bales of cotton, 100 of said bales to be delivered during each of the months of February, March, April, May, and June 1901, to be paid for as follows: For the cotton delivered during the months of February, March, and April, 1901, at the rate of 10 3/8 cents per pound, for the rest of the cotton at the rate of 10 1/8 cents per pound. That thereafter the price of cotton declined rapidly, and on or about the 27th October 1900, the Fairmont Mills notified plaintiff that it had canceled the contracts, and would not accept, receive, or pay for the same. That plaintiff has always been ready to carry out his part of the contract, and has only been prevented from so doing by this action on the part of the defendant. That, owing to the decline in the price of cotton, plaintiff has been prevented from placing the cotton at the prices agreed upon, and that he has been damaged by this action on the part of the defendant in the sum of $4,687.50, and the complaint prays judgment therefor. The defense amounts to a general denial of the existence of any such contracts.
These are the facts as developed in the testimony: The transaction occurred through the agency of C. P. Mathews. Mr. Mathews is a cotton broker, residing in Spartanburg, S.C., doing business in the Carolinas, chiefly with cotton mills. On 10th October, 1900, Mr. Harris, president of the Fairmont Mills, made an offer to him, as such broker, to buy cotton, 100 bales for each of the months of February, March, and April, at 10 3/8 cents. He communicated the offer by telegram to the plaintiff at Meridian, Miss., and received by telegram the same day authority to accept the offer of 300 bales at 10 3/8, shipments named. He communicated by telephone to Mr. Harris the receipt of this authority and on the next day (11th October) wrote to Mr. Harris, as follows:
C. P. Matthews.'
It does not appear, except by this letter, that Mr. Harris knew who would furnish the cotton. On receipt of this letter Mr. Harris replies:
W. J. Harris, Presdt.'
On 15th October, 1900, Mr. Harris made another offer to C. P. Matthews for the purchase of 200 bales of cotton at 10 1/8, deliverable 100 bales each in months of May and June, 1901. This was communicated also to A. S. Johnston at Meridian, Miss., by wire, and Johnston, by wire, answered, 'Confirm sale 100 bales each May and June, St. Mid. to good Mid., 10 1/8. ' On its receipt Matthews notified Harris, and on the next day he wrote a letter, identical in terms, except as to number of bales and the price, with his former letter. To this Harris replies, using the same terms as his reply to the former letter, varying only as to the number of bales and the price, and ending, as in his former letter, 'Sold to us by A. S. Johnston, Meridian, Miss., and subject to his confirmation. ' The usage of the mills is always to require confirmation by the principal of contracts made through the broker, and this confirmation is made to the purchaser direct; sent either by mail or through the broker. In the present instance Matthews requested Johnston to confirm direct to Harris. After the 15th, and between that day and the 25th, October, unpleasant rumors were in circulation as to the solvency of Johnston, whereupon Mr. Harris, on 25th October, demanded from Matthews security for the performance of these contracts by Johnston. Matthews not furnishing the security demanded, Harris canceled the contracts. On 29th October, 1900, Matthews inclosed to Harris letter of Johnston confirming the contract of 10th October, except that the place of delivery was stated to be Spartanburg, S.C., instead of Moores, as stated by Matthews. On or about 1st November, 1900, Johnston went to Spartanburg, and in company with Messrs. Boziman, his attorney, and Mr. Cairn, of Mississippi, offered Mr. Cairn as his surety for delivery of the cotton as per contracts. Mr. Harris made no objection to the character and sufficiency of the security, but refused to accept it, as the contracts were canceled. Mr. Matthews says that in this transaction he acted merely as agent of each party in making the sale, and assumed no responsibility.
The question in this case is, was there a binding contract between these parties? The answer will depend upon the force and...
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