B. F. Goodrich Co. v. Brooks

• Decision Date: 08 July 1959
• Docket Number: No. 1092,1092
• Citation: 113 So.2d 593
• Parties: B. F. GOODRICH COMPANY, a foreign corporation, Appellant, v. James A. BROOKS, Appellee.
• Court: Florida District Court of Appeals

Page 593

113 So.2d 593

B. F. GOODRICH COMPANY, a foreign corporation, Appellant, v. James A. BROOKS, Appellee.

No. 1092.

District Court of Appeal of Florida, Second District.

July 8, 1959.

Neal D. Huebsch, Eustis, for appellant.

Joseph E. Johnston, Jr., and E. S. MacKenzie, Brooksville, for appellee.

ALLEN, Chief Judge.

Appellant was the plaintiff in the lower court and appellee was the defendant.

Plaintiff filed a suit alleging that defendant was indebted to plaintiff on ten promissory notes totaling $5,665.88 plus interest and sought attorney's fees and costs. The defendant answered and filed a set-off and counterclaim which after several amendments was set for hearing upon plaintiff's motion for summary judgment which was denied by Circuit Judge, D. R. Smith, on January 17, 1958. Thereafter, on September 10, 1958, the cause came to trial. The jury brought in a verdict in favor of plaintiff for $1,167.46 and a final judgment was entered thereon on November 18, 1958. Motion for a new trial was denied on November 7, 1958. Plaintiff then filed this appeal on January 10, 1959.

On May 8, 1956, the plaintiff entered into a consignment agreement with the defendant, their dealer at Brooksville, in an effort to correct the delinquent condition of accounts between plaintiff and defendant. Subsequent thereto additional stock was furnished defendant by plaintiff on consignment. This consignment arrangement failed to work out the financial troubles of defendant and on January 18, 1957, ten promissory notes in the total amount of $4,829.93 were executed by the defendant to the plaintiff. Within a few days after the execution of the notes, the plaintiff informed the defendant that he would be entitled to credits and adjustments on prior transactions between the parties which could be used to help meet the note payments. A dispute arose as to the amounts due defendant for these credits and adjustments and because of this dispute defendant refused to make further payments on the notes. The notes were in default, payment was demanded by plaintiff, and thereafter this suit was commenced by plaintiff on the notes. An answer and counterclaim and set-off were filed by the defendant after which a motion for summary judgment was made by the plaintiff. This motion was denied and the cause came on for a jury trial.

The transcript shows numerous transactions between the plaintiff corporation and its defendant franchise dealer. Due to the nature of the tire business, there arose question of: Allowances by defendant of adjustments made on defective tires to the customers of defendant; discounts alleged to have been promised defendant by plaintiff for meeting certain sales quotas; bonuses promised defendant by plaintiff's agents; and percentages of commission for warehousing tires for plaintiff. The defendant also testified that plaintiff billed him for merchandise that was covered by the consignment thus creating a double charge to defendant. Since plaintiff's suit was on the notes, its case in chief consisted of proving the execution of the notes. The defendant then proceeded on his set-off introducing testimony and evidence in support thereof. After totaling the sums under the set-off claimed by defendant, the balance due on the notes amounted to $890.80. The jury returned a verdict in favor of plaintiff for $890.80, plus costs and interest and attorney's fees resulting in a total amount of $1,167.46 from which plaintiff appeals.

The question involved in this case is the application of the parol evidence rule. The appellant cites J. M. Montgomery Roofing Company, Inc. v. Fred Howland, Inc., Fla., 98 So.2d 484 and 13 Fla.Jur. 383, for the principle that the terms of a written contract cannot be varied by oral agreement or extrinsic evidence made before or at the time of the execution of the instrument in question. This principle is not disputed by appellee who asserts that the facts of this case are governed by the Florida case of Payne v. Nicholson, 100 Fla. 1459, 131 So. 324, 326, and cases cited in the opinion of said case.

The set-off or counterclaim filed by the defendant was supported by several exhibits containing itemized entries of alleged credits due the defendant for return of merchandise; customer adjustments; discounts; warehousing fees; double charges; and other claims that had arisen between the parties between the time the consignment agreement was entered into and the date of suit. It will appear from the evidence before the jury that at the time the notes in question were executed it was mutually understood between the parties that any and all credits due the defendant from plaintiff should be credited as payment against the amount due on the note. Apparently from the evidence the plaintiff did not deny this understanding, but objected on the basis that the defendant had either already received the credits or was not entitled to them.

In the case of Payne v. Nicholson, supra, the Supreme Court of Florida, in discussing whether oral testimony in support of a claimed set-off constituted an attempt to alter or vary the terms of the note, stated:

'As regards a promissory note, an extrinsic agreement as to the mode of payment, or the amount of payment, must be ineffective, since the parties have expressly dealt with those matters in the instrument; but an agreement to concede a credit or counterclaim, as offsetting the obligation of the instrument, would be a separate transaction, not dealt with in the instrument, and valid. Wigmore on Evidence, § 2444; Bennett v. Tillmon, 18 Mont. 28, 44 P. 80; Buckeye Cotton Oil Co. v. Malone, 33 Ga.App. 519, 126 S.E. 913; John Lucas & Co. v. Bradley, 4 Cir., 246 F. 693; Roe v. Bank of Versailles, 167 Mo. 406, 67 S.W. 303; Branch v. Wilson, 12 Fla. 543.

'Evidence of a parol agreement, made at the time of the execution of...