Columbia Digger Sand & Gravel Co. v. Ross Island Sand & Gravel Co.

• Decision Date: 10 October 1933
• Citation: 25 P.2d 911,145 Or. 96
• Parties: COLUMBIA DIGGER SAND & GRAVEL CO. v. ROSS ISLAND SAND & GRAVEL CO. [*]
• Court: Oregon Supreme Court

25 P.2d 911

145 Or. 96

COLUMBIA DIGGER SAND & GRAVEL CO. v. ROSS ISLAND SAND & GRAVEL CO. ^[*]

Supreme Court of Oregon

October 10, 1933

Department 2.

Appeal from Circuit Court, Multnomah County; Robert Tucker, Judge.

Action by the Columbia Digger Sand & Gravel Company against the Ross Island Sand & Gravel Company.Judgment for plaintiff, and defendant appeals.

Reversed and remanded.

This is an action for damages arising out of an alleged breach of a contract.The contract is set forth as Exhibit A to the complaint.The gravamen of plaintiff's complaint is that said contract being in full force and effect, the defendant failed to give and allot to plaintiff 50 per cent. of its truck hauling of sand, gravel, and fill material under the contract; that the shortage during the time the contract was in force was 10,853 yards, and by reason thereof plaintiff was damaged by loss of profit it would have made from such additional hauling, to which it was entitled under the contract.The larger amount mentioned as damages in the original complaint was reduced by plaintiff to $2,400.The cause was tried to the court and a jury, and a verdict was rendered in favor of plaintiff for the amount demanded, for which judgment was entered.At the close of plaintiff's testimony in chief, defendant moved for a nonsuit, and at the termination of all the evidence defendant moved for a directed verdict in its favor.Defendant appeals and assigns error upon the refusal of the motions.

I. N. Smith, of Portland (Platt, Platt, Fales, Smith & Black, of Portland, on the brief), for appellant.

Stephen W. Matthieu, of Portland (John F. Logan, of Portland, on the brief), for respondent.

The history of the controversy is about as follows: Prior to and in 1928, many different corporations, partnerships, and individuals were engaged separately in the sand and gravel business in Portland, Or.Prior to the contracts several of these corporations united their interests in a general sales plan for the mutual benefit of each associate member, whereby the Central Sand & Gravel Company, called herein the Central Sand, was organized.The constituent members of this organization were Hackett Digger Company, Hawthorne Dock Company, Columbia Truck Company, Pacific Bridge Company Nickum & Kelly, James A. C. Tait & Company, Star Sand Company, and the Ross Island Sand & Gravel Company, called Ross Island herein.Some independent operators did not join the Central Sand at the time of its organization.Plaintiff in this case, the Columbia Digger Sand & Gravel Company called herein Columbia Digger, was in the sand and gravel business, but, when it entered into the contract set forth as Exhibit A, it retired from such business for a certain time as by the terms of that agreement.The contract between the Ross Island and the Central Sand, which was similar to the contracts of the other associate members, was attached to the complaint as Exhibit B.These contracts were executed July 21, 1928.By the terms of the contract, Exhibit B, Ross Island was to be awarded 21 per cent. of the sand and gravel truck deliveries of the Central Sand, and, under the terms of Exhibit A, the Columbia Digger, the plaintiff, was to have 50 per cent. of the Ross Island's truck hauling of sand gravel, and fill material.

Plaintiff claims that the Ross Island, the defendant, failed to deliver to it the 50 per cent. quota of the 21 per cent. of the truck hauling which Ross Island was awarded under these contracts.

The complaint alleges the corporate character of plaintiff and defendant, the executions of Exhibits A and B, and asserts that the contracts were breached by defendant's refusal to deliver the 10,853.06 yards of truck hauling as required in said written contract, to plaintiff's damage.The answer admits the formal allegation of incorporation, the execution of the contracts, and denies the other allegations of the complaint, including the breach of the contract, the failure of defendant to deliver the allotted yardage, as claimed by plaintiff, and the damage.The answer then affirmatively alleges that, by the contract upon which the complaint is based, the plaintiff agreed at all times during the life thereof to keep and have available and in good repair automobile trucks of proper size and sufficient number, properly and promptly to make all deliveries as called for by the defendant; that, while the contract, Exhibit A, was in force, the Central Sand sold to Readymix Concrete Company, another corporation, certain sand and gravel, and allotted to defendant the delivering thereof; that such sales to Readymix Concrete Company were delivered at the Ross Island bunkers without truck deliveries; that the defendant allotted to plaintiff and plaintiff did more than 50 per cent. of all defendant's available truck hauling of sand, gravel, and fill material during the life of the contract and was paid in full therefor.The answer also alleges that plaintiff wrongfully claims and bases his cause of action upon the theory that the truck hauling of mixed concrete made by Readymix Concrete Company from the sand and gravel delivered to Readymix Concrete Company by defendant, which deliveries were made from plants of the Readymix Concrete Company to its own customers, should have been taken into consideration by defendant in arriving at the available truck hauling within said period, and that during such period plaintiff was given opportunity to haul and there was offered to plaintiff for hauling 50 per cent. of the available truck hauling of defendant, and also 50 per cent. of the truck hauling of the Readymix Concrete Company for the same period.Defendant does not allege that 50 per cent. of the Readymix Concrete Company truck hauling was offered to plaintiff by defendant, but that plaintiff failed and refused to do more than a small portion of the Readymix Concrete Company's hauling for such period and failed and refused to keep and have available and in good repair automobile trucks of proper size and of sufficient number, properly and promptly to do such truck hauling.

Plaintiff's reply alleges that Exhibit A was entered into in furtherance of a general plan for the organization of Central Sand, as before stated; that Central Sand was the managing unit of the plan whereby its constituent members participated in a share of the sand and gravel business of Portland; that that contract was a part of the general plan, and one of the principal considerations from the plaintiff to defendant was the fact that plaintiff retired from the sand and gravel business for a period of not more than five years, or for such period as the Central Sand contract with defendant was in force; that, when plaintiff and defendant executed Exhibit A, there were three methods of delivering sand, gravel, and fill material, to wit (1) by loading barges, (2) by loading on railroad cars, (3) by truck delivery, of which plaintiff was to have 50 per cent.; that both parties entered into the contract on the assumption that all sand and gravel would be delivered in one of three ways, and thereby plaintiff would receive substantially the same profits which it theretofore had made before making said agreement.The reply then alleges that the order for sand and gravel from Readymix Concrete Company was secured for Central Sand by defendant and allotted to defendant by Central Sand at its option, instance, and request; that said Readymix Concrete Company was organized soon after the execution of Exhibit A and was owned by the managing officer or officers of Ross Island and was a subsidiary thereof; that the Readymix Concrete Company was not a consumer, but a dealer, and that Readymix Concrete Company merely mixed sand and gravel with water and cement and thereafter delivered the same to the various retail customers throughout the city of Portland that, after Ross Island commenced making deliveries of sand and gravel to Readymix Concrete Company, plaintiff protested to defendant that such delivery, as well as the delivery of the Readymix Concrete Company product by Readymix Concrete Company to its own customers, was a breach of Exhibit A; that the claim was made in good faith, and plaintiff threatened defendant with legal proceedings by reason thereof and made claim that the action of defendant constituted a breach by defendant of Exhibit A, so as to release plaintiff from any further compliance therewith; that, in settlement of said claim and said threatened litigation and to induce plaintiff to continue with its agreement and to secure a waiver and relinquishment by plaintiff of its damage claim, defendant"agreed that the sand, gravel and fill material delivered by it to the Readymix Concrete Company and in turn delivered by the Readymix Concrete Company, after being mixed with cement and water, was within the purview of the contract between plaintiff and defendant with respect to all sand, gravel and/or fill material contained in the product of the Readymix Concrete Company, and the defendant further agreed that it would as a part of its aforesaid contract with plaintiff and in compliance with the terms thereof secure for the plaintiff the hauling of sand, gravel and materials delivered by defendant to said Readymix Concrete Company, and that the defendant would pay plaintiff for the hauling of said sand, gravel and fill materials included in the products of the Readymix Concrete Company at the same rate provided for the hauling thereof in the aforementioned contract referred to as Exhibit A, with an additional undertaking on the part of the defendant for the reimbursement of plaintiff for that portion of the Readymix product consisting of cement and water which the plaintiff was required to haul in addition to the sand,...