Dominey v. Johnson-Brown Co.

• Decision Date: 09 May 1929
• Docket Number: 4 Div. 432.
• Citation: 219 Ala. 666,123 So. 52
• Parties: DOMINEY ET AL. v. JOHNSON-BROWN CO.
• Court: Alabama Supreme Court

123 So. 52

219 Ala. 666

DOMINEY ET AL. v. JOHNSON-BROWN CO.

4 Div. 432.

Supreme Court of Alabama

May 9, 1929

Rehearing Denied June 27, 1929.

Appeal from Circuit Court, Dale County; J. S. Williams, Judge.

Action by R. E. Dominey and others, doing business under the firm name of the Dominey Produce Company, for the use of the Federal Reserve Bank of Atlanta, against the Johnson-Brown Company. Plaintiff, being dissatisfied with the judgment in its favor, appeals. Reversed and remanded.

Sollie & Sollie, of Ozark, for appellants.

O. S Lewis, of Dothan, for appellee.

FOSTER J.

The rule is well understood, and frequently expressed, that when there is a contract for the sale of articles of merchandise and some are delivered, but the purchaser fails to pay for them as stipulated, the seller has an election to rescind the contract for such failure, and, if he so elects and complies with the duties enjoined upon him by law in such event, he may refuse to make further deliveries. Lysle Milling Co v. N. A. Gro. Co., 201 Ala. 222, 77 So. 748; Hieronymus v. Bienville, Water S. Co., 131 Ala. 447 31 So. 31; Drake v. Goree, 22 Ala. 409; Ackley & Co. v. Hunter-Benn & Co.'s Co., 166 Ala. 295, 51 So. 964; Lowy v. Rosengrant, 196 Ala. 337, 71 So. 439; Worthington v. Gwin, 119 Ala. 44, 24 So. 739, 43 L. R. A. 382.

In order to effect such rescission, however, under those circumstances, "it is his duty to notify the opposite party and to give him a reasonable time within which to comply with the terms of the contract." Ackley & Co. v. Hunter-Benn & Co., supra; Elliott v. Howison, 146 Ala. 570, 587, 40 So. 1018; McFadden v. Henderson, 128 Ala. 221, 29 So. 640.

If we assume, therefore, that the meaning of the ambiguous terms of the contract was that appellee, the purchaser, was thereby required to pay in cash the entire invoice price of the peanuts as soon as loaded f. o. b. Ozark, yet in order to justify the seller, appellant, in rescinding the contract on account of a failure so to do, and in failing to ship the other car pursuant to the contract, he should have so advised the purchaser and given him an opportunity to pay for them. He did notify the purchaser by telegram the day the peanuts were loaded and shipped, asking for a bank guaranty of draft, and drew a draft for the price, and the next day thereafter the purchaser answered by telegram, offering to have the bank wire guaranteeing payment of the draft for the contract price, and asking for statement of the amount thereof. The telegram from the purchaser was not received until after noon of the day following that on which the seller had sent the one above mentioned. Upon receipt by him of an answer from the purchaser on the next day offering to have the bank guarantee draft and asking for amount, the seller again wired the purchaser as follows: "Waited till after twelve o'clock have placed car elsewhere"-referring to the additional car. Thereupon, on the same day, the purchaser sent another telegram to the seller, expressing the hope that there would be a compliance with the contract; but the additional car was never shipped, and the telegram was not answered by the seller.

We cannot say, therefore, that the verdict was contrary to the evidence predicated in charges (a) and (b), given for appellant, which justify a failure to ship the second car upon the refusal to pay the price of the first car before the seller refused to ship the other. The jury could draw the inference that the purchaser refused to pay, if at all, after and on account of notice by the seller to the effect that he had sold the car to another, which means, we think, a refusal by the seller to ship such other car.

As a general rule, and in the absence of special circumstances leading to a different result, the measure of damages in a suit by the purchaser against the seller for the breach of a contract to sell personal property, when the purchase money has not been paid, is the difference between the contract price and the market value of the property agreed to be sold at the time of the breach of the contract and at the place of delivery. McKinney v. Baker, 212 Ala. 490, 103 So. 467; Craig & Co. v. Pierson Lumber Co., 179 Ala. 535, 60 So. 838; Bell v. Reynolds, 78 Ala. 511, 56 Am. Rep. 52; Covington Mfg. Co. v. Ferguson, 204 Ala. 192, 85 So. 726; Crandall-Pettee Co. v. Jebeles, 195 Ala. 152, 69 So. 964. Many authorities to a similar effect are cited in the cases noted above. This is said to be "upon the principle that the purchaser can readily go into the market and supply himself with the desired goods, by paying the difference in price. When this cannot be done, the reason of the rule ceases, and the rule itself can therefore have no application." Ala. Iron Works v. Hurley, 86 Ala. 217, 5 So. 418, McFadden v. Henderson, supra, page 235 of 128 Ala. (29 So. 644).

If the purchaser goes into the market and purchases such goods as cheaply as he can, this tends to show the market value at that time, and is admissible for that purpose, when properly related as to time and place to the date of the breach of the contract and place of delivery under...