AM Webb & Co. v. Robert P. Miller Co.
| Decision Date | 27 July 1949 |
| Docket Number | No. 9739.,9739. |
| Citation | 176 F.2d 678 |
| Parties | A. M. WEBB & CO., Inc. v. ROBERT P. MILLER CO. |
| Court | U.S. Court of Appeals — Third Circuit |
Herbert Spencer Leman, New York City (Moss & Moss, Philadelphia, Pa., on the brief), for appellant.
Julius Zizmor, New York City (Nathan E. Zelby, New York City, and Samuel E. Bertolet, Reading, Pa., on the brief), for defendant-appellee.
Before BIGGS, Chief Judge, and O'CONNELL and KALODNER, Circuit Judges.
This diversity case is being considered by us for a second time. On the previous appeal, we reinstated the complaint after it had been dismissed in the court below. Our opinion, which includes much of the factual background of the case, is reported at 1946, 157 F.2d 865, and need not be here repeated.1
Plaintiff ("Webb"), a middleman, seeks an accounting and damages for breach of contract by defendant ("Miller"), a manufacturer of underwear and sport shirts. It is undisputed (1) that the agents of the parties to this case signed a "memorandum of agreement" on January 9, 1941, in New York, which memorandum committed Miller to sell, for approximately five years, its entire output to or through Webb; and (2) that Miller did thereafter, without concurrence by Webb, sell some of its goods to the government and to another middleman.
If the record before us on appeal is more complicated than is to be expected of a case of this nature, we think that this could have been avoided if the litigants had made their positions sufficiently clear to one another to permit the framing of the precise factual and legal issues. We shall confine ourselves to what we deem the critical issues on this appeal.
One of the defenses asserted by Miller was that the memorandum of agreement had been cancelled by mutual assent of the parties one or two months after the agreement was made in January, 1941. This defense was not an afterthought inspired by our disposition of the first appeal. It was the sole affirmative defense pleaded by Miller in the original answer, was reiterated in substantially similar language in the first amended answer filed prior to the motion for dismissal of the complaint, and was renewed in the second amended answer which the district court permitted Miller to file after we ruled on the first appeal that the memorandum of agreement was enforceable under New York law. At the jury trial which followed, each of the parties put on the stand two witnesses who testified as to this issue: the president and the attorney of Webb averred that, although negotiations looking toward the drafting and signing of a new agreement were had, on April 9, 1941, the understanding was that the January 1941 agreement was to remain in force until the new agreement was consummated (which never occurred); on the other hand, the treasurer and attorney of Miller stated that each side orally agreed to release the other from the obligations imposed by the January 1941 agreement and to begin negotiations for a new contract without being bound by the previous commitments.
At the close of all the testimony, the trial judge decided to submit several questions to the jury for a special verdict. One of the questions was, "Did the parties at their meeting in April, 1941, agree that the existing contract should be entirely rescinded regardless of whether or not a new contract could be made?" The charge to the jury and supplementary comments of the trial judge, which fully and clearly explained this question, indicate that, had he been the finder of fact, he might well have returned a negative answer, as he apparently deemed it more logical for Webb to want to retain whatever advantage it had gained by the January agreement, rather than to be willing to revert to a status of one merely inviting a contract. In fact, his comments led Miller to make as its first objection to the charge that the judge had given "a sort of prejudiced viewpoint in your charge, in favor of the plaintiff." The jury, nevertheless, answered this question in the affirmative; i. e., that rescission was effected in April, 1941.
After careful examination of the record, we cannot say that the jury here reached a capricious result. The jury apparently believed the version related by the witnesses of Miller, whose allegations that Webb had little faith in the enforceability of the January memorandum and that there was more to be gained by beginning negotiations with a clean slate, apparently had weighty effect. There being substantial evidence to support this jury finding, it must be accepted on review. Consequently, since written agreements may be rescinded by later parol agreements, see 1 Restatement,...
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