Badger State Lumber Co. v. G. W. Jones Lumber Co.

• Decision Date: 03 June 1909
• Citation: 121 N.W. 933,140 Wis. 73
• Parties: BADGER STATE LUMBER CO. v. G. W. JONES LUMBER CO.
• Court: Wisconsin Supreme Court

140 Wis. 73

121 N.W. 933

BADGER STATE LUMBER CO.

v.G. W. JONES LUMBER CO.

Supreme Court of Wisconsin.

June 3, 1909.

Appeal from Circuit Court, Pepin County; E. W. Helms, Judge.

Action by the Badger State Lumber Company against the G. W. Jones Lumber Company. From a judgment for plaintiff, defendant appeals. Reversed.

On April 10, 1907, the plaintiff and defendant entered into a contract, by the terms of which the plaintiff agreed to sell, and the defendant agreed to buy, all of plaintiff's stock of soft elm lumber. The contract recited that a considerable portion of the lumber was then sawed and in pile in the city of Durand, and that the remainder of the stock was to be sawed from logs at the Plummer Mill in Durand, and at John Moy's Mill in the town of Canton, Buffalo county, Wis., and at Julliot's Mill in the town of Waterville, Pepin county, Wis., and at Gates' Mill in the town of Frankfort, Pepin county, Wis., and that so much of the logs as were unsawed were to be sawed as soon as possible under the supervision of the plaintiff. The plaintiff agreed to manufacture the portion of the logs not yet sawed into such thicknesses as the defendant might direct, and to cause the sawing to be done in a good and workmanlike manner; also to load the lumber sold (estimated at 550,000 feet more or less) into cars at Durand, Wis., at such time as cars were provided by the defendant, but at the expense of the plaintiff. The plaintiff agreed to ship the lumber as soon as same was in shipping condition. The National Hardwood Lumber Association rules were to govern the inspection and scale, and the inspection and scale were required to be made at the mill and were to be final. It was further provided that each of the parties should have their inspectors present when the lumber was being loaded, if they so elected; but, in the event of the failure of the defendant to furnish an inspector, the inspection made by the plaintiff should be final. In case any dispute as to scale or grade arose between the inspectors for the parties to the contract, which could not be settled by them, it was agreed that such dispute should be adjusted by an inspector of the National Hardwood Lumber Association. It was further agreed that the lumber should be well sawed, of proper thickness, edged, and trimmed, and the logs so sawed as to produce as much of the upper grades of lumber as possible. The defendant agreed to ship all of said lumber on or before January 1, 1908. If any stock remained in the yard after that time, it was agreed that it should be jointly estimated by the representatives of the parties, and be paid for according to such estimate. For all water elm, red elm, and gray elm, the defendant agreed to pay the plaintiff, f. o. b. Durand, for No. 3 common and better, $20 per 1,000 feet, upon the following terms of payment: “Cash 15 days from date of shipment, less 2 per cent. sixty days from date of shipment, net.” It was further agreed between the parties that title to the lumber should remain in the plaintiff until same was shipped out or paid for according to the estimate of January 1, 1908.

On November 27, 1907, plaintiff shipped to defendant, at its request, one car load of lumber. This car was invoiced at the contract price, and contained upper grades of lumber, and was paid for at the contract price. On November 29, 1907, the defendant wrote plaintiff as follows: “It will be impossible for us to take the soft elm we bargained with you for, as the stock has not been sawed at all in accordance with our instructions. Our Mr. B. G. Harper, whom we sent there to take up a trial car of the stock, explained the matter fully to your Mr. Pierce, so you know what our grounds for complaint are against the lumber. We regret to advise you of this, but if you will look up the correspondence we have had with you in reference to sawing this stock, you will find that we gave you explicit and positive instructions regarding it, and these instructions have not been observed. Under these circumstances we feel justified in turning the stock down.” On the day following the plaintiff acknowledged receipt of this letter, in which it denied that the lumber was not properly manufactured, and stated that, if the lumber was not shipped out by the defendant in accordance with the terms of the contract, it would cause the lumber to be estimated, and commence action to recover the contract price of the same. On January 14, 1908, the plaintiff again wrote the defendant, calling its attention to the provision in the contract providing for an estimate of the lumber by joint representatives of the parties, and notifying the defendant that it was ready to proceed with such estimate, and further stating that, if the defendant did not appear on or before January 28, 1908, it would on that date proceed to take the estimate without the cooperation of the defendant, and bring suit to recover the contract price. The defendant did not elect to take any part in making the estimate, and the plaintiff caused an estimate to be made in accordance with the statement contained in its letter of January 14th. On February 29, 1908, the plaintiff forwarded to the defendant a bill for the contract price of the lumber in accordance with the estimate made by it. The amount of such bill was $11,078.16. The defendant refused to pay, and this action was brought to recover the contract price of the lumber and resulted in a verdict and judgment in favor of the plaintiff for such contract price, from which judgment this appeal is taken.Nash & Nash (C. A. Ingram, of counsel), for appellant.

Wickham & Farr, for respondent.

BARNES, J. (after stating the facts as above).

The rule is well settled that in executory contracts, where specific performance cannot be enforced, either party has the power to stop the performance on the other side by an explicit order to that effect, by subjecting himself to such damages as will compensate the other party for being stopped in the performance on his part at that point or stage in the execution of the contract. In such cases it is held that an action cannot be maintained to recover the contract price, but may be maintained to recover damages for the breach of the contract. Ward v. American Health Food Co., 119 Wis. 12, 25, 96 N. W. 388;Fountain City D. Co. v. Peterson, 126 Wis. 512, 106 N. W. 17;Merrick v. N. W. National Life Ins. Co., 124 Wis. 221, 226, 102 N. W. 593, 109 Am. St. Rep. 931;Tufts v. Weinfeld, 88 Wis. 647, 60 N. W. 992;Woodman v. Blue Grass Land Co., 125 Wis. 489, 494, 103 N. W. 236, 104 N. W. 920;Engeldinger v. Stevens, 132 Wis. 423, 424, 112 N. W. 507.

The decisions of this court upon the question under discussion are in harmony with the great weight of authority elsewhere. Mr. Page states the rule applicable where one party to a contract, who is not himself in default, has covenants still to be performed when the breach is committed by the other party, as follows: “The adversary party cannot ignore the breach, perform the covenants of the contract on his part to be performed, and recover the entire contract price as if no breach had occurred. This state of facts often exists in breach by renunciation.” Page on Contracts, vol. 3, § 1435. See cases cited in notes 2 and 3, p. 2219. If the contract was still executory, the defendant might breach it, and would thereby subject itself to the payment of such damages as would fairly compensate the plaintiff for the breach, and ordinarily such damages would be the difference between the contract price of the lumber and its value at the time of the breach. Ganson v. Madigan, 13 Wis. 67, 72; s. c. 15 Wis. 144, 150, 82 Am. Dec. 659;Chapman v. Ingram, 30 Wis. 290.

The general rule that a breach of an executory contract gives a right of action for damages for the breach, and not for recovery of the purchase price, is not modified by the case of Boyington v. Sweeney, 77 Wis. 55, 45 N. W. 938. It is there held that where the vendor tenders a delivery in accordance with the terms of the contract, and an actual delivery is prevented by the refusal of the vendee to accept and receive the article at the time and place agreed upon, the vendor may sue for and recover the purchase price. In this case the plaintiff failed to furnish cars within a reasonable time, and before they were furnished a portion of the logs sold were burned, and it was held that the offer to deliver was tantamount to an actual delivery, and that the vendor had in fact performed his part of the contract. The case of Pratt v. Freeman & Sons Mfg. Co., 115 Wis. 648, 92 N. W. 368, holds that, where a vendor, in an executory contract for the sale of goods to be paid for on delivery, discovers that the vendee has become insolvent, he may store the property for the buyer and sue for and recover the purchase price. No other case in this court is called to our attention that has any tendency to mitigate the rigor with which the general rule referred to has been enforced.

It is a conceded fact in the case that the defendant wrote plaint...