Bay State Smelting Co. v. Ferric Industries, Inc.

Decision Date30 June 1961
Docket NumberNo. 5803.,5803.
PartiesBAY STATE SMELTING CO., Inc., Defendant, Appellant, v. FERRIC INDUSTRIES, INC., Plaintiff, Appellee.
CourtU.S. Court of Appeals — First Circuit

Arthur M. Gilman, Boston, Mass., with whom Walter H. McLaughlin, Boston, Mass., was on the brief, for appellant.

Stuart Macmillan, Boston, Mass., with whom Warren G. Reed, Philip H. Suter and Haussermann, Davison & Shattuck, Boston, Mass., were on the brief, for appellee.

Before WOODBURY, Chief Judge, and HARTIGAN and ALDRICH, Circuit Judges.

HARTIGAN, Circuit Judge.

This is an appeal from a judgment of the United States District Court for the District of Massachusetts entered January 6, 1961.

The action was commenced by a complaint filed by Klockner & Company (hereinafter referred to as Klockner),1 against the defendant-appellant, Bay State Smelting Co., Inc. (hereinafter referred to as Bay State), alleging that Klockner through its authorized agent, Ferric Industries, Inc. (hereinafter referred to as Ferric), entered into five written contracts with Bay State whereby Bay State agreed to provide Klockner with certain quantities of copper, suitably packed in drums, for agreed prices, shipment date to be Jan./Feb. 1955 on one lot (hereinafter referred to as lot #1) and Feb./first half March '55 on the other lots. Klockner further alleged that Bay State attempted to cancel the foregoing contracts without cause by a notice on February 28, 1955 as to lot #1 and notices on March 11, 1955 as to the other lots, and that since that time Bay State has refused to make delivery of the copper in accordance with the contracts.

Klockner alleged that the price of copper has risen since the contracts were entered into and that it has been damaged by Bay State's breach of the contracts. Klockner sought judgment of $10,725 together with interest and costs.

Bay State in its substitute answer denied various material allegations and made further answer that it orally agreed to sell certain quantities of copper for export to Klockner on the condition that Klockner would secure the necessary federal government export licenses during the period prescribed for delivery, and that the copper was to be shipped as it was completed by Bay State at various intervals during the period prescribed in the agreement. Bay State further answered that it completed the material and notified Klockner and requested shipping instructions and evidence of the necessary export licenses, that Klockner did not provide shipping instructions or evidence of necessary export licenses, and was not able to provide the export licenses during the period prescribed for delivery because of a federal government embargo on the material, that Bay State held the material at its plant and when the period prescribed for delivery had elapsed it notified Klockner that it would not sell the material because of Klockner's failure to comply with the terms and conditions of the agreement and further by reason of the contingency provision in the agreement excusing delivery by the seller.

As a second defense Bay State said that the embargo on the copper material remained in effect during the entire period prescribed for delivery, thereby rendering the sale by Bay State to Klockner illegal and excusing Bay State from performance of the agreement.

Ferric made a motion for substitution as party plaintiff or as joint plaintiff on the basis of a written assignment by Klockner of its claim and Ferric's allegation that the contracts referred to in the complaint were executed between Ferric and Bay State, that Ferric is not the agent of Klockner and that Ferric is the real party in interest in this action. The motion was allowed.

A trial was held before a jury. At the completion of the trial Klockner was discontinued as a party plaintiff and a motion for a directed verdict against Klockner was granted. The district court reserved its ruling on Bay State's motion for directed verdict against Ferric. The case was submitted to the jury for a special verdict on five specific issues:

"1. Did the plaintiff, Ferric Industries, Inc., as principal make contracts with the defendant, Bay State Smelting Co., Inc. to buy the property described in plaintiff\'s exhibits one to five, inclusive?
Answer. Yes.
"2. If your answer to the foregoing interrogatory number one is `no\', did Kloeckner & Co. as principal contract with Bay State Smelting Co., Inc. to buy the property described in plaintiff\'s exhibits one to five, inclusive?
Answer. No answer required. Answer left blank by Jury.
"3. Did the buyer involved in said contracts fail without reasonable cause to take delivery of the said property within a reasonable time after seller was able, ready, and willing to deliver said material pursuant to the contract and buyer was notified thereof?
Answer. No.
"4. Was the notice of cancellation of said contracts by the seller on or about March 11, 1955, made before there was any breach of the contract by the buyer?
Answer. Yes.
"5. What was the difference between the total contract price of the material described in exhibits one to five inclusive and the market value of said material on or about March 15, 1955?
Answer. $7,500."

Bay State urged its motion for directed verdict against Ferric by a memorandum of law filed within ten days of the verdict. The district court denied the motion and ordered entry of judgment in favor of the plaintiff, Ferric, and against the defendant, Bay State, in accordance with the verdict of the jury. Judgment was...

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4 cases
  • In re Dorand, Inc.
    • United States
    • United States Bankruptcy Courts. First Circuit. U.S. Bankruptcy Court — District of Massachusetts
    • March 19, 1982
    ...Co. v. Ondrick, 310 F.2d 462 (1st Cir. 1962) cert. denied, 373 U.S. 911, 83 S.Ct. 1300, 10 L.Ed.2d 412; Bay State Smelting Co. v. Ferric Industries, Inc., 292 F.2d 96 (1st Cir. 1961). Tax escalation clauses like other provisions in ever popular net leases have a readily understandable purpo......
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    ...(1990) (noting that contra proferentum "may be invoked even if the parties bargained as equals" (citing Bay State Smelting Co. v. Ferric Indus., Inc., 292 F.2d 96, 99 (1st Cir.1961)). Weavers proffers no evidence that CU participated in drafting the language at issue. In any event, of cours......
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