Dorsey v. Oregon Motor Stages

• Decision Date: 23 January 1948
• Citation: 183 Or. 494,194 P.2d 967
• Parties: DORSEY <I>v.</I> OREGON MOTOR STAGES
• Court: Oregon Supreme Court

183 Or. 494

194 P.2d 967

DORSEYv.

OREGON MOTOR STAGES

Supreme Court of Oregon.

Argued November 13, 1947.

Reargued January 23, 1948.

Affirmed June 2, 1948.

Appeal and error — Law action — Findings of fact — Verdict

1. In law action, circuit court's finding of fact have effect of jury verdict.

Appeal and error — Equity — Findings of fact — Supreme court — de novo

2. An equity judge's findings of fact are not binding on Supreme Court, which must try de novo the issues resolved by the findings.

Contracts — Illegal

3. A contract is at an end when further performance is rendered illegal by change in law.

Contracts — Commercial frustration — Supervening impossibility of performance

4. The English doctrine of "commercial frustration" and American doctrine of "supervening impossibility of performance", which read into contract, in absence of repellent circumstances, implied condition that promisor is relieved of performance if, through supervening circumstance for which neither party is responsible, a thing, event or condition which was essential so that performance would yield to the promisor the result which the parties intended him to receive, fails, is a rule governing construction of contracts and is not an equitable principle.

See Words and Phrases, Permanent Edition, for all other definitions of "Commercial Frustration" and "Supervening Impossibility of Performance".

Appeal and error — Supervening impossibility of performance — Findings of law court

5. In action for alleged breach of contract, trial court's findings on defense under doctrine of "supervening impossibility of performance" were not findings of equity judge but were findings of law court binding on reviewing court if supported by substantial evidence, since the legal principles governing the defense were not equitable.

Contracts — Meaning — Language — Question of fact

6. The meaning of language of contract is question of fact.

Contracts — Local schedules — Technical term — Word of art

7. The term "local schedules" in contract between plaintiff and defendant, who were experienced in transportation business, forbidding defendant from using busses of third party for operation of

"local schedules" between two points, was "technical term" or "word of art" which would be given its technical meaning. O.C.L.A. § 2-219.

See Words and Phrases, Permanent Edition for all other definitions of "Technical Term" and "Word of Art".

Contracts — Trade terms — Technical sense — Inference

8. Courts infer that members of vocation employ its trade terms in their technical sense whenever they use such terms in contracts.

Contracts — Operation of busses on local schedules

9. Evidence warranted finding that operation of busses between Corvallis and Albany via Camp Adair did not constitute operation of busses on local schedules between Corvallis and Camp Adair within contract forbidding defendant from operating certain busses on local schedules between Corvallis and Camp Adair. O.C.L.A. §§ 2-218, 2-219, 2-222.

War — Government — Requisition property

10. The Government has unfettered power in time of war to requisition property and services essential to the war effort.

War — Purpose of First War Powers Act

11. The purpose of provision of First War Powers Act empowering President to authorize governmental agencies prosecuting the war effort to enter into contract facilitating prosecution of war was to enable subordinates to the President either in his capacity as Chief Executive or in his other capacity as Commander in Chief, to contract freely for all supplies and services needed to facilitate prosecution of war. First War Powers Act of 1941, § 201, 50 U.S.C.A. Appendix, § 611.

War — Executive order — First War Powers Act

12. Executive order under First War Powers Act authorizing governmental agencies to enter into contracts for all types and kinds of things and services necessary, appropriate or convenient for prosecution of war authorized lease of United States busses to common carrier of passengers between army camp and nearby cities. First War Powers Act of 1941, §§ 201, 50 U.S.C.A. Appendix, §§ 601, 611; Executive Order No. 9001, 50 U.S.C.A. Appendix, § 611 note.

Contracts — Statutory prohibition — Terminates — Contract

13. A statutory or administrative change in law prohibiting further performance of contract terminates contract, notwithstanding that contract contains no provision absolving promisor from performance in such event.

Contracts — Carrier's use of government owned vehicles

14. A motor bus carrier's use of Government owned vehicles to transport passengers between army camp and nearby city was not breach of contract forbidding carrier from using vehicles of third party to carry passengers between camp and city, where Government's insistence that carrier use Government vehicles or stay out of the camp was compulsory though expressed in form of voluntary agreement, notwithstanding that contract contained no provision excusing carrier from promise not to use third party's vehicles. 50 U.S.C.A. Appendix, §§ 841, subds. 1, 2, 4, 842; First War Powers Act of 1941, §§ 1 et seq., 201, 50 U.S.C.A. Appendix, §§ 601 et seq., 611; Executive Order No. 9001, 50 U.S.C.A. Appendix, § 611 note; Executive Orders Dec. 18, 1941, Jan. 16, 1942, May 2, 1942, Aug. 5, 1942, Sept. 17, 1942, Jan. 4, 1943, Nos. 8989, 9024, 9156, 9214, 9246, 9294.

                  See 137 A.L.R. 1199
                  12 Am. Jur. 960
                

Appeal from Circuit Court, Benton County.

L.G. LEWELLING, Judge.

J.S. Middleton, of Portland, argued the cause and filed a brief for appellant.

John J. Coughlin, of Portland, argued the cause for respondent. With him on the brief were Griffith, Peck, Phillips & Nelson, and C.T. Terrill, of Portland.

Before ROSSMAN, Chief Justice, and LUSK, BELT, KELLY, BAILEY, BRAND and HAY, Justices.

Action for alleged breach of contract by Dean Dorsey against Oregon Motor Stages, an Oregon corporation. From the judgment, the plaintiff appeals.

AFFIRMED.

ROSSMAN, C.J.

This is an appeal by the plaintiff from a judgment of the Circuit Court which was entered in an action based upon an alleged breach of a contract signed by the parties June 16, 1942, and amended by a supplementary agreement November 11, 1943.

The appellant presents two assignments of error. The first is:

"The trial court erred in finding and adjudicating that Respondent fully complied with the terms of its contract with Appellant, and that Appellant failed to establish breach thereof."

The second is:

"The trial court erred in finding and decreeing that the use by Respondent of the United States owned busses was required by the military authorities of the United States and that Respondent was compelled to use said busses and that such busses were not busses of third parties within the meaning of the contract and that the use of such busses by Respondent did not constitute a breach of contract."

The appellant was engaged in the business of transporting by motor busses pupils to the high schools in Albany and Corvallis. The respondent was a common carrier of passengers by busses.

Prior to the execution of the contract the United States Army commenced the construction of Camp Adair upon a site a few miles outside of both Albany and Corvallis. The site was not upon a straight line drawn between the two cities, but was accessible to both. When construction of the camp was begun the respondent provided transportation for the camp. The building of the camp gave employment to large numbers of men, and after it was completed tens of thousands of soldiers were stationed there.

The contract upon which this case is predicated recites facts which, when epitomized, are that the transportation demands of the area served by the respondent, as expanded by the transportation needs of the employees in the Portland shipyards and the soldiers and civilians at Camp Adair, render it impossible for the respondent's equipment to serve the needs. The agreement mentions particularly the heavy demands for transportation on Saturdays, Sundays and holidays by the soldiers stationed at Camp Adair. The instrument expresses its purpose as follows:

"The purpose of this agreement, therefore, is to meet the equipment emergency above outlined, to the end that * * *."

Before going on with a further delineation of the provisions of the agreement we pause to state that prior to the construction of Camp Adair the respondent ran no busses into that place. It maintained schedules between Corvallis and Albany, but the busses which served them ran upon a highway which was virtually a straight line. The distance was twelve miles. The roundabout course between Albany and Corvallis through Camp Adair was twenty-one miles.

The parts of the agreement which are germane to the assignments of error required the appellant (1) to apply for a permit authorizing him to operate his school busses between Corvallis and Camp Adair until September 19, 1942, and (2) to discontinue, on September 19, 1942, the operation of his busses between Corvallis and Camp Adair. The same portion of the agreement required the respondent to resume service between the two points just mentioned on September 19, 1942. The only other covenant which needs mention is the very one upon which this cause is based and which we shall now state. Referring to the respondent as Stages and to the appellant by the name of Dorsey, it says:

"* * * Stages agrees that during the life of this agreement it will not lease or use busses of a third party for the operation of local schedules between Corvallis and Camp Adair, except unless at least five (5) of the six (6) busses owned by Dorsey shall at the time be operating under the terms of this lease in the service of Stages."

In short, the respondent bound itself to use the appellant's school busses upon the "local schedules between Corvallis and Camp Adair" to the exclusion of the busses of third parties whenever its own proved inadequate. As we...