American Lead Pencil Co. v. Nashville, C. & St. L. Ry.

• Decision Date: 04 February 1911
• Parties: AMERICAN LEAD PENCIL CO. v. NASHVILLE, C. & ST. L. RY.
• Court: Tennessee Supreme Court

134 S.W. 613

124 Tenn. 57

AMERICAN LEAD PENCIL CO. v. NASHVILLE, C. & ST. L. RY.

Supreme Court of Tennessee.

February 4, 1911

Appeal from Chancery Court, Davidson County; John Allison Chancellor.

Action by the American Lead Pencil Company against the Nashville Chattanooga & St. Louis Railway. From a decree dismissing the bill, plaintiff appeals. Affirmed.

Smithson & Armstrong and Vertrees & Vertrees, for appellant.

Frank Slemons and Claude Waller, for appellee.

BUCHANAN J.

The American Lead Pencil Company filed its original bill in the chancery court of Davidson county against the Nashville Chattanooga & St. Louis Railway. This bill was based on the alleged breach of a contract, and the alleged loss to complainant of a car load of pencil and penholder material, the value of which is set out in the bill to be $2.900; but the proof shows the value of the contents of the car to have been $2,451.97.

This car load of material was destroyed by fire on October 24, 1904, while it was standing on a siding near the warehouse of complainant in the town of Lewisburg, Tenn. The car had been placed on the siding by defendant at complainant's request, in order that the material might be loaded into the car. The loading was finished on October 22, 1904, near the hour of noon.

Complainant's contention, averred in the bill, was that, whensoever complainant should apply for an empty car in which to ship his products, defendant was bound to furnish the car under the contract forthwith and as soon as it could be done, and that, upon receipt of notice from complainant that said car was loaded and ready for shipment, the defendant was bound forthwith to remove the car from the spur track, or siding, and start the same toward its destination promptly.

Complainant averred in its bill that, when the car load of material in controversy was loaded and ready to be moved from the siding, it (the complainant) gave to the defendant immediate notice thereof, but that the defendant failed to promptly move the car from the siding, and allowed several of its freight trains to pass and leave the car standing on the siding, and that this default on the part of defendant was the proximate cause of the loss of the car by fire.

The fire which consumed the car and its contents originated in the warehouse office of complainant, as the result of the accidental overturning of a coal oil heating stove. This stove was overturned by one of the employés of the complainant.

The defendant answered the bill, and denied the existence of the contract sued on, and denied all of the material averments of the bill, and further set up, by way of defense, the statute of limitations of three years; but this defense of the statute of limitations was abandoned on the filing of an amended and supplemental bill by the complainant showing matter in avoidance of the statute.

Proof was taken on both sides, and on final hearing the chancellor dismissed the bill, and made a memorandum of his opinion a part of the record in the cause.

The complainant appealed to this court.

After a very careful review of all the evidence in this cause, we are unable to reach the conclusion that any contract of like tenor and effect to that averred in the bill was ever in existence between these parties. No one of the witnesses who testified in the cause had ever seen such a contract, or had any knowledge of its existence. A usage, or course of dealing, of like character to that which the bill avers was required by the contract, undoubtedly did exist between the parties, as shown by the proof, and there was much evidence that this usage was a custom between the parties, and this usage seems now to be relied on by the complainant as constituting the contract set out in the bill.

We cannot bring ourselves to the conclusion that a bill, which bases the complainant's right to recover upon the breach of a contract, can be sustained by proof of a usage and no proof of a contract, or by proof of a custom and no proof of a contract. A contract is created by act of the parties. It may be either expressed or implied. It may be either written or oral. It must result from a meeting of the minds of the parties in mutual assent to its terms. It must be founded on a sufficient consideration. It must be mutual, free from fraud or undue influence, not against public policy, and sufficiently definite. See Cyc. vol. 9, 241, 242, and note 1, p. 141.

Usage and custom, on the other hand, in legal contemplation, differ radically in many respects from a contract. Usage is a repetition of acts, and is distinguished from custom in that usage is a fact, while custom is a law. There may be usage without custom, but there can be no custom without usage to accompany or precede it. Usage consists in the repetition of acts, and custom arises out of this repetition. Esriche Dict. Jurisprudence, quoted in Cutter v. Waddingham, 22 Mo. 206-248, and cited in Cyc. vol. 12, p. 1030, note 1.

Usage, then, as we have seen above, is the germ, which, by constant repetition, and general use, and great antiquity, develops into custom; and custom, when fully developed, is a law. The distinction thus drawn between contract and usage or custom is quite apparent. Where a contract between parties is shown to have existed, and is indistinct or ambiguous, or uncertain in its terms, usage or custom on the particular point will be accepted, like the general law, not in contradiction of the stipulations of the contract, but in explanation of what is indistinct in it, and as furnishing the rule where it is silent. See Charles v. Carter, 96 Tenn. 614, 36 S.W. 396. Usage ought never to be allowed to vary or contradict the written instrument, either expressly or by implication. See Bedford v. Flowers, 11 Humph. 242. But usage cannot make a contract where there is no contract, nor prevent the effect of the settled rules of law. See Charles v. Carter, 96 Tenn. 614, 36 S.W. 396.

It follows from the foregoing that to permit the complainant to maintain its bill based upon the breach of a contract by proof of the breach of a usage is to permit complainant to profit by a variance between its bill and its proof. The proof does not connect the defendant with the loss, if the contract was in fact nonexistent, and if there was no contract there was no breach, and so, on the proof, the defendant would stand wholly disconnected from the loss of the property.

It is a fundamental principle that the proof must correspond with the allegations in the pleadings. East Tenn., etc., R. Co. v. Collins, 85 Tenn. 227, 1 S.W. 883; East Tenn. Coal Co. v. Daniel, 100 Tenn. 65, 42 S.W. 1062; East Tenn., etc., R. Co. v. Lindamood, 111 Tenn. 457, 78 S.W. 99; Foster v. Jackson, 8 Baxt. 434.

In the last-named case, the court said:

"While technical forms in pleadings are not now required, still the parties should be confined to the case made in the pleadings; the proof should correspond with the allegations; the parties ought not to be allowed to charge one case in their pleadings and prove a case substantially different; and we think a charge that an attorney collected the money on a debt due his client and failed to pay it over is substantially different from proof that he did not collect the money, but might have done so with due diligence."

Now, reverting to the case at bar, we think there is quite a substantial difference between the averment in the bill of a loss occasioned by breach of a contract, and proof of a loss not occurring as a breach of contract at all, but of a loss occurring, as the complainant claims under its proof, by breach of a usage, which is a wholly different and distinct thing in its legal essence from a contract. We do not mean to be understood in this opinion as saying that circumstances might not arise where the courts would hold parties to a usage or to a custom--to have created by their course of dealing an implied contract; but under the facts of this case it is clear that there was no contract between the parties to this suit, either express or implied.

The parties to this suit are respectively corporations--one a manufacturing corporation, and the other a railroad corporation. It is not shown by the evidence in this record that the usage, shown to have existed by the proof, was ever brought to the attention of any officer of either of these corporations clothed with authority to make a contract, such as is set out in the bill. The usage in this case, adopted by the inferior employés of these corporations for the convenience and mutual accommodation of the employés in handling shipments, cannot be held to have the force and effect and dignity in law of a solemn contract, either express or implied, between these corporations.

It follows from these views that there was a fatal variance between the averments of the complainant's bill and its proof, on account of which variance there could be no recovery by the complainant in the court below.

There is another view of the case, however, upon which we are equally clear that the complainant was not entitled to a recovery on the proof in this cause, leaving out of view altogether the question of contract.

The risk of a common carrier begins on delivery and acceptance of the goods. Chitty, Con. 73-78; Mathew Watson v. Memphis & Charleston Ry. Co., 9 Heisk. 255; Stewart, Ralph & Co. v. Gracy & Bro., 93 Tenn. 315, 27...