Clark v. Compania Ganadera de Cananea, S.A.

• Citation: 387 P.2d 235,95 Ariz. 90
• Decision Date: 11 December 1963
• Docket Number: No. 7156,7156
• Parties: G. W. CLARK and Ben F. Williams, Sr., Appellants, v. COMPANIA GANADERA de CANANEA, S.A., a corporation, et al., Appellees.
• Court: Supreme Court of Arizona

Page 235

387 P.2d 235

95 Ariz. 90

G. W. CLARK and Ben F. Williams, Sr., Appellants, v. COMPANIA GANADERA de CANANEA, S.A., a corporation, et al., Appellees.

No. 7156.

Supreme Court of Arizona, In Division.

Dec. 11, 1963.

Ben F. Williams, Jr., and W. Shelley Richey, Douglas, for appellants.

Evans, Kitchel & Jenckes, Phoenix, for appellees Compania Ganadera de Canaea, S.A., Ranchos de Cananea, Octavio Elias, Enrique Cubillas, Kemper Marley and Frank T. Greene.

Gentry & McNulty, Bisbee, for appellees Estate of Mary Greene Wiswall, decd., and George A. Wiswall, Exr.

John M. Williams, Douglas, for appellee Florence G. Sharp.

James M. Murphy, Tucson, for appellee Clarence Kirk Greene.

James V. Robins, Nogales, for appellee Charles Harrison Greene.

Beer, Seaman & Polley, Phoenix, for appellees, Virginia Sturdivant and Cia. Minera de la Trinidad, a corp., trustee for Virgina Sturdivant.

JENNINGS, Justice.

We deem it necessary to enlarge upon the following novel problem, which we casually mentioned in the original opinion: Under the circumstances, were appellants required, at their peril, to include in the record the evidence, if any, adduced respecting a condition subsequent, a matter of defense, when the lower court directed a verdict at the end of their case on the ground of merger and in making the ruling used words which negatived any idea that he had considered the condition subsequent in making the decision?

The material facts are that appellants' assignors allegedly entered into contracts with appellees Ranchos and Ganadera for the sale and delivery of cattle, appellants and appellees being organized under the laws of the United States and Mexico respectively. There was a stipulation in the alleged contracts 'that the delivery of the cattle was contingent upon their being no restrictions imposed by Mexico or the United States on competent authority.' Appellants sued appellees for failure to deliver 2,233 head of cattle. In defense appellees alleged affirmatively that restrictions had been imposed by the governmental authorities, thereby excusing them from their nonperformance.

It was undisputed that a contract with Ganadera had been consummated. The complaint, however, was dismissed as to that party on jurisdictional grounds. The court, at the end of appellants' case, directed a verdict for Ranchos on the ground that the alleged contract with Ranchos had been merged into the contract with Ganadera. This ruling absolved Ranchos of any liability whatever since it was not a party to the latter contract.

Appellants assigned as error the ruling on the ground of merger and included in the record all of the evidence adduced below which was necessary to a determination of this alleged error. Appellees contended that whether the lower court ruled on the ground of merger was immaterial; that the directed verdict was the only result that could have been legally reached since there never was a contract consummated with Ranchos in the first place; and that even if this Court did find that a contract came into existence, it would, nevertheless, be compelled to affirm the judgment of the lower court for the reason that the record did not disclose a breach of such contract or damages sustained as a result thereof. In answering this contention we found that the record did contain sufficient evidence to show that appellants had made out a prima facie case below, namely, that a contract with Ranchos had been consummated, that appellees had failed to deliver the remaining cattle, and that damages had been sustained as a result thereof.

What appellants did not do was place in the record the evidence, if any, adduced respecting the contingency which, if proved below, would have excused appellees from their nonperformance. It was for this reason appellees made the statement 'the record did not disclose a breach of such contract.' To this we said that the issues of breach of contract and damages were not properly before us at that time but that we were only concerned with whether appellants had made out a prima facie case warranting the submission thereof to the jury.

Our statement needs elaboration. It was undisputed that the sellers had failed to deliver the cattle but it was alleged that such delivery was excused under the terms of the contract by reason of restrictions imposed upon their exportation. Whether a limitation, condition, or proviso in a contract is one precedent, subsequent, or a mere covenant is not to be determined alone by any technical language used, but primarily by the intention of the parties as evidenced by the transaction and the language used. Cozby v. Edwards, 203 S.W.2d 569 (Tex.Civ.App.1947). The parties, by their pleadings, evinced the intention that it was a condition subsequent which would excuse appellees' nonperformance. Such being the case, it was a matter of defense to be pleaded and proved by appellees in the lower court. Title Guaranty & S. Co. v. Nichols, 224 U.S. 346, 32 S.Ct. 475, 56 L.Ed. 795 (1912). We must remember that the directed verdict came at the end of appellants' case.

Appellees contend, however, that there was testimony...