Big Butte Ranch, Inc. v. Grasmick

• Decision Date: 07 June 1966
• Docket Number: No. 9722,9722
• Parties: BIG BUTTE RANCH, INC., a Corporation, Plaintiff-Appellant, v. Hank GRASMICK, dba Grasmick Produce Co., Defendant-Respondent.
• Court: Idaho Supreme Court

Page 48

415 P.2d 48

91 Idaho 6

BIG BUTTE RANCH, INC., a Corporation, Plaintiff-Appellant, v. Hank GRASMICK, dba Grasmick Produce Co., Defendant-Respondent.

No. 9722.

Supreme Court of Idaho.

June 7, 1966.

Kerr & Williams, Blackfoot, Derr & Derr, Boise, and Ronald C. Barker, Salt Lake City, Utah, for appellant.

Roberts & Poole, Boise, for respondent.

SPEAR, Justice.

Big Butte Ranch, Inc., contracted with Hank Grasmick, dba Grasmick Produce Co., for a sale of some potatoes and the agreement reached was put in the form of a written contract signed by the parties. Each in turn now claim a breach of that contract by the other. Big Butte Ranch instituted the action and sought to recover the sum of $2,178.30 for potatoes shipped for which payment had not been made. Respondent admitted he had received 822 sacks of potatoes for which he had not paid, but counterclaimed alleging appellant had breached its contract obligation in failing to ship an additional 4,181 100-1b. sacks of potatoes before May 3, 1964 and that such breach resulted in damages to respondent in the sum of $16,095.85. Since respondent admitted he owed the sums claimed by appellant for the last shipment of 822 sacks of potatoes, the only issue in the trial arose from respondent's counterclaim.

The chief point of contention is the contract itself, Plaintiff's Exhibit 1. It is vague and ambiguous and open to two interpretations. It is dated January 25, 1964 and contains two provisions that particularly cause difficulty. The first provides that:

'The Seller has, this day, sold and contracted with the Purchaser, for approximately 9000 100-1b. sacks of Idaho U.S. No. 1 potatoes at a price and consideration of $2.65 * * *.'

The second states:

'Weight loss from storage will be stood by Purchaser, until all of said U.S. No. 1 potatoes in Seller's possession shall have been shipped; * * *.'

Appellant contends that under the provisions of the contract the parties negotiated for the purchase of a particular lot of potatoes. It is claimed that since the lot was inspected by both parties the statement of 'approximately 9000 100-1b. sacks' was only an estimate of the quantity of U.S. No. 1 potatoes in that lot. Under this construction the contract would not have been breached even if the total shipment fell considerably short of the original total estimate which later proved incorrect because of excessive spoilage. (Green v. K. S. Webster & Sons, 77 Idaho 281, 291 P.2d 864, 58 A.L.R.2d 371). Appellant would have met its obligation under the contract when it shipped to defendant all the potatoes meeting the grade specified which were in its possession in that particular lot at the date the contract was closed.

Respondent rejects this construction and contends he had agreed to purchase the specific quantity of potatoes, namely, 900 100-1b. sacks. The word 'approximately' which was inserted in the contract covered loss incident to handling and shipping, and such usage was not unusual. He contends the provisions which referred to the seller's shipping all the potatoes which were in his possession is, in proper context, a term of delivery and would not support the contention an agreement had been reached for the seller to sell and the purchaser to buy all potatoes which the seller might have which met the quality specified. Under this interpretation, when the seller notified respondent it could not deliver the additional 4,181 sacks, there occurred a material breach for which respondent was entitled to recover.

The clear intention of the parties is not evident from the written contract alone. Quite properly, it was permitted and required in the trial court that all circumstances surrounding the negotiations be examined, and the final determination was left to the jury. By its verdict the jury agreed with the construction contended for by respondent and awarded damages to him in the amount of $2,543.50 with interest and costs. From the judgment entered thereon this appeal was taken.

The basis for the verdict was not specifically spelled out. However, in finding for respondent, the jury must necessarily have concluded either (1) that respondent had proven by a preponderance of the evidence that the parties had in fact agreed to contract for the specific quantity of 9000 100-1b. sacks of potatoes, or (2) that the parties had contracted for a specific lot and appellant had failed and refused to deliver all the U.S. No. 1 potatoes in its possession in that lot at the time the contract was made.

We shall consider appellant's assignments of error in the same order presented in its brief.

The first specification of error is that the court refused appellant's requested instruction No. 1. This instruction amounted to a request for a directed verdict, and clearly was not warranted in the light of the ambiguity of the written contract itself and the evidence submitted in support of respondent's counterclaim. The trial court properly found the contract was ambiguous and susceptible to two quite different interpretations. Extrinsic evidence therefore was properly considered and the case correctly submitted to a jury with proper instructions for determination. National Produce Distributors v. Miles & Myer, Inc., 75 Idaho 460, 274 P.2d 831, and cases cited therein; Griffin v. Clark, 55 Idaho 364, 42 P.2d 297 and cases cited therein; Keane v. Pittsburg Lead Mining Co., 17 Idaho 179, 105 P. 60.

Appellant assigns as his second assignment of error the giving of instruction No. 9. ¹ In support of this assignment appellant argues that since the evidence established both parties contributed to the drafting of the contract, it was error for the court to give instruction No. 9, because it was incomplete and left the jury with the impression that only one person, Mr. Ranquist, vice-president of appellant and an attorney, drafted the contract. Appellant further claims the jury was misled into assuming that it had to construe the contract most strictly against appellant and Ranquist regardless of the burden of proof of respondent in sustaining his counterclaim. This assignment has no merit. The trial court by its instruction No. 4 ² made it plain that respondent carried the burden of proving the allegations of his counterclaim by a preponderance of the evidence and correctly defined that phrase. Moreover, instruction No. 9 was carefully phrased and used the term 'against the party who selected the language.' The evidence left no doubt that appellant, Big Butte Ranch, through its attorney Ranquist, selected the language in its material parts. Ranquist, acting for aplant, actually drafted the contract at his office in Salt Lake City and forwarded it to respondent for approval. It is true some changes were made by respondent, but none in any of the portions material here. The rule is clear, that a contract should be construed most strongly against the party preparing it or employing the words concerning which doubt arises. Morgan v. Firestone Tire & Rubber Co., 68 Idaho 506, 201 P.2d 976; Stone v. Bradshaw, 64 Idaho 152, 128 P.2d 844; Ries v. Pacific Fruit & Produce Co., 50 Idaho 140, 294 P. 336.

By its third assignment of error appellant asserts the verdict is contrary to law and the clear weight of the evidence. Such...