Appliance Distributors v. Mercury Electric Corp.
| Citation | 202 F.2d 651 |
| Decision Date | 27 February 1953 |
| Docket Number | No. 4529.,4529. |
| Parties | APPLIANCE DISTRIBUTORS, Inc. v. MERCURY ELECTRIC CORP. |
| Court | United States Courts of Appeals. United States Court of Appeals (10th Circuit) |
James E. Grigsby, Oklahoma City, Okl. (Jess L. Pullen, Oklahoma City, Okl., on the brief), for appellant.
Luther Bohanon, Oklahoma City, Okl. (Lynn Adams and Bert Barefoot, Jr., Oklahoma City, Okl., on the brief), for appellee.
Before PHILLIPS, Chief Judge, and BRATTON and PICKETT, Circuit Judges.
The Mercury Electric Corporation brought this action against Appliance Distributors, Inc.,1 to recover damages for failure to accept delivery and pay for 1,200 electric awning fans pursuant to a written order. In its answer the defendant admitted the execution of the order and alleged that when the order was executed the defendant reserved the right to cancel the order at any time and that it was cancelled after it had received and paid for the fans delivered to it. In a cross-complaint the defendant alleged that the purchase of the fans was by sample, and that it had suffered damages because of the failure of the plaintiff to deliver fans which conformed to the sample. Upon trial to the jury a verdict was returned in favor of the plaintiff and judgment was entered thereon.
The plaintiff was engaged in the manufacture, distribution and sale of a combination fan and awning known as "Air Awn." In February, 1950, it exhibited a handmade model of this fan at the hardware show in Oklahoma City where it was viewed by representatives of the defendant. At the request of the defendant, the model was taken to Tulsa, Oklahoma, and displayed to agents of the defendant there. Later, dealers for the defendant exhibited the model in a hotel in Oklahoma City. Negotiations were entered into between the parties whereby the defendant was to become the exclusive dealer for these fans in Oklahoma. As a result of these negotiations, the defendant, on February 17, 1950, executed a purchase order for 1200 fans at $47.28 each, to be delivered as follows: 100 on the date of the execution of the order, and 100 on the 1st and 15th of each month thereafter. It was provided that "this order is automatically cancelled if any other distributor is appointed in the State of Oklahoma, or if any other distributor ships merchandise to any dealer or contractors in the State of Oklahoma." This provision was modified by a subsequent letter from the plaintiff to the defendant and agreed to by the parties.
After the purchase order was signed, the plaintiff commenced the manufacture of the fans. The first shipments were not made as scheduled but one fan was delivered on February 28th and one on April 18th. A short time prior to April 20, 1950, the defendant wired the plaintiff requesting information as to when the fans would be shipped. 41 fans were shipped the date this telegram was received, 60 on April 24th, 175 on April 26th, and 85 on April 29th. These were accepted and paid for by the defendant. On May 1, the defendant notified the plaintiff to suspend shipment until further notice. Plaintiff completed the manufacture of the remainder of the 1,200 fans by July 1, 1950. On July 11, the defendant wired the plaintiff to "cancel all orders undelivered as of this date." Following receipt of this notification, the plaintiff wrote several letters to the defendant stating that the remaining fans which had been ordered were packed and ready for shipment and requested shipping instructions. No reply was received to these letters until September 14, 1950, when defendant's attorney wrote to the plaintiff stating that further delivery would be rejected because the goods were of inferior quality. The plaintiff sold the fans at a loss of $6,494. In addition, plaintiff claimed damages in the sum of $5,826.12 for expenses necessarily incurred because of the refusal of the defendant to accept delivery of the fans. The court submitted the question of damages to the jury upon the issue of whether the fans delivered conformed to the sample displayed to the defendant.2 The defendant assigns as error the refusal of the court to direct a verdict for the defendant, and contends that the evidence was undisputed that the awning fans shipped to the defendant did not substantially conform to the sample which had been shown. Two fans were introduced in evidence. Witnesses for the defendant testified that one of these exhibits was the one shown at the hardware shows, and that the other was one which the plaintiff later shipped to the defendant. There was a substantial difference in the two fans but there was no evidence that the fan first exhibited was of inferior quality to that which was actually shipped to the defendant. Witnesses who were officers and representatives of the plaintiff testified that the plaintiff did not manufacture the fan claimed to be the sample; that they had never seen it before; and that they did not know where it came from. The testimony was in direct conflict with that of witnesses for the defendant, and presented a question for the jury. Baer Bros. Land & Cattle Co. v. Reed, 10 Cir., 197 F.2d 569.
Over objection by the plaintiff, the defendant was permitted to offer proof that at the time of the execution of the order it was agreed between the parties that the defendant should have the right to cancel the order at any time. The court, however, instructed the jury that it was not to consider this oral testimony, and stated that the written contract provided the conditions under which the order might be cancelled, and that neither party had the right to arbitrarily cancel the contract except as provided for in the contract. This was a correct statement of the law in Oklahoma. 15 Okl.St.Ann. § 137 provides: "The execution of a contract in writing, whether the law requires it to be written or not, supersedes all the oral negotiations or stipulations concerning its matter, which preceded or accompanied the execution of the instrument." Wilson v. Plummer, 204 Okl. 157, 228 P.2d 176; Sinclair Refining Co. v. Roberts, 201 Okl. 358, 206 P.2d 193; National Mineral...
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...191 Okla. 484, 485, 131 P.2d 108, 110 (1942) (sixteen-month delay barred rescission); see also Appliance Distributors, Inc. v. Mercury Electric Corp., 202 F.2d 651, 654 (10th Cir.1953). In this case, Palermo admits that he became aware of the alleged fraud in October 1981. Although he infor......
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