Dove Co. v. New River Coal Co.

• Decision Date: 24 May 1928
• Citation: 150 Va. 796
• Parties: J. MAURY DOVE COMPANY, INC., v. NEW RIVER COAL COMPANY, AND OTHERS.
• Court: Virginia Supreme Court

Page 796

150 Va. 796

J. MAURY DOVE COMPANY, INC., v. NEW RIVER COAL COMPANY, AND OTHERS.

Supreme Court of Virginia, Richmond.

May 24, 1928.

1. SALES — Action by Purchaser for Breach of Contract to Furnish Coal — Impairment of Purchaser's Credit — Unauthorized Assignment of Contract — Questions for the Jury — Case at Bar. — The instant case was an action for damages by a purchaser of coal against the seller for breach of the contract and failure to deliver coal according to the contract. The defense of defendant was that the purchaser's credit had become impaired, thus entitling seller to cancel the contract, and that the purchaser had undertaken to assign the contract to a third party, with a view to final liquidation, and that such an assignment could not be made without defendant's consent, which it had refused. It was contended in oral argument that a new agreement between the purchaser and its assignees emphasized the fact of the incapacity of the purchaser to continue its execution of the coal contract.

Held: That all inferences in that connection were for the jury to consider, together with the other evidence in the case.

2. SALES — Action by Purchaser for Breach of Contract to Furnish Coal — Impairment of Purchaser's Credit — Unauthorized Assignment of Contract — Questions for the Jury — Case at Bar. — The instant case was an action for damages by a purchaser of coal against the seller for breach of the contract and failure to deliver coal according to the contract. The defense of defendant was that the purchaser's credit had become impaired, thus entitling seller to cancel the contract, and that the purchaser had undertaken to assign the contract to a third party, with a view to final liquidation, and that such an assignment could not be made without defendant's consent, which it had refused.

Held: That upon consideration of all the evidence in the record the trial court did not err in submitting the issues arising upon the evidence to the jury, nor in overruling a motion to set aside the verdict in favor of defendant.

3. SALES — Action by Purchaser for Breach of Contract to Furnish Coal — Impairment of Purchaser's Credit — Unauthorized Assignment of Contract — Questions for the Jury — Case at Bar. — The instant case was an action for damages by a purchaser of coal against the seller for breach of the contract and failure to deliver coal according to the contract. The defense of defendant was that the purchaser's credit had become impaired, thus entitling seller to cancel the contract, and that the purchaser had undertaken to assign the contract to a third party, with a view to final liquidation, and that such an assignment could not be made without defendant's consent, which it had refused. It was urged in oral argument on appeal that an agreement for the sale of plaintiff's business to another corporation contemplated the practical extinguishment of its corporate existence at once, except for purposes of liquidation, and provided for an immediate cessation by it of all business transactions; that its officers acquiesced in this view, and did not undertake to act for plaintiff company until after a modified agreement was entered into.

Held: That such argument was for the jury, and that the case was clearly a case in which the jury should determine whether defendant had repudiated the coal contract and had just cause for so doing.

4. SALES — Action by Purchaser for Breach of Contract to Furnish Coal — Imparmient of Purchaser's Credit — Unauthorized Assignment of Contract — Evidence — Case at Bar. — The instant case was an action for damages by a purchaser of coal against the seller for breach of the contract and failure to deliver coal according to the contract. The defense of defendant was that the purchaser's credit had become impaired, thus entitling seller to cancel the contract, and that the purchaser had undertaken to assign the contract to a third party, with a view to final liquidation, and that such an assignment could not be made without defendant's consent, which it had refused. On the trial evidence was admitted as to an arrangement by plaintiff with its creditors and other matters relative to the financial and credit situation of plaintiff. These were circumstances known to both parties at the time the coal contract was entered into. They threw light upon the meaning and intention of the parties in the contractual reference to the impairment of the buyer's credit.

Held: That the evidence was relevant and admissible.

5. WITNESSES — Cross-Examination — Question Provocative of Discussion between Counsel and Witness as to the Meaning and Legal Effect of Language of Contract. — In the action for the breach of a contract for the sale of coal by buyer against seller, the refusal of the court to permit a witness on cross-examination to answer a question which would evidently have produced a discussion between counsel and the witness as to the meaning and legal effect of the language in question, was not error.

6. APPEAL AND ERROR — Harmless Error — Failing to Strike Out Answers of Witness — Case at Bar. — In the instant case the ruling of the trial court in failing to strike out answers by a witness was assigned sa error. Another witness had already testified to the same thing, and in any event the ruling could scarcely have been prejudicial to the plaintiff in error.

Held: Harmless error.

7. EVIDENCE — Argumentative Letters between Counsel. — In the instant case the trial court did not err in refusing to admit in evidence certain letters between counsel for the parties. These letters were written with the intention of arguing the correctness of one or more of the positions taken by the respective parties and were properly excluded.

8. INSTRUCTIONS — Request to Instruct Jury to Disregard all Evidence on a Particular Point — Testimony Upon the Point Considered as Upon a Demurrer to the Evidence. — In considering a request to the trial court to instruct the jury to disregard all evidence pertaining to a particular point in issue, or a motion to set aside the verdict on such ground, the testimony bearing upon the point in question is to be considered as upon a demurrer to the evidence.

9. SALES — Instructions — Request to Instruct Jury to Disregard all Evidence on Financial Condition or Credit of Plaintiff — Case at Bar. — The instant case was an action by buyer against seller for breach of a contract of sale. The contract provided that the seller might cancel the contract if the credit of buyer became impaired. Plaintiff requested the court to instruct the jury to disregard all evidence pertaining to the financial condition or credit of the plaintiff, which the court refused to do. The credit of the plaintiff, as a subject involved, lay upon the very surface of the transactions anc conversations between the parties during a certain period, and much evidence was introduced as to such transactions and conversations. The plaintiff subsequently sought continued credit for its successor, a new company, and not for the contracting party.

Held: That it was for the jury to determine whether or not the contract was and should be considered as cancelled and abandoned.

10. SALES — Cancellation of Contract by Impairment of Purchaser's Credit — Formal Notice of Cancellation — Case at Bar. — In an action for damages for breach of contract of sale by seller, defendant contended that the contract had been cancelled by the impairment of the buyer's credit and by the unauthorized assignment of his contract by buyer.

Held: That no formal notice of cancellation was required, as under the peculiar circumstances of the case the initiation of all the transactions was caused by plaintiff, and knowledge may be equivalent to notice.

11. SALES — Cancellation — Impairment of Credit of Buyer — Right to Cancel a Continuing Right. — The right to take advantage of a stipulation concerning impairment of credit is not similar to that arising upon a breach by the other party of an affirmative condition in a contract of sale. It is a continuing right or contractual privilege inhering at all times in the dealings of the parties. In connection with such a stipulation, there is no breach of a specific term in the contract, which the other party overlooked in a way to mislead the party in default.

12. SALES — Cancellation — Impairment of Credit of Buyer — Waiver of Right to Cancel — Case at Bar. — The instant case was an action by buyer for breach of a contract for sale of coal. The contract provided that the seller might cancel it if the credit of the buyer became impaired.

Held: That no question of waiver of seller's right to cancel, where buyer's credit became impaired, could arise unless the seller had continued to furnish coal after the buyer had sold out to another company and attempted to assign the contract to it.

13. SALES — Impairment of Buyer's Credit — Unauthorized Assignment of Contract of Sale — Election between Defenses — Case at Bar. — The instant case was an action for damages by a purchaser of coal against the seller for breach of the contract and failure to deliver coal according to the contract. The defense of defendant was that the purchaser's credit had become impaired, thus entitling seller to cancel the contract, and that the purchaser had undertaken to assign the contract to a third party, with a view to final liquidation, and that such an assignment could not be made without defendant's consent, which it had refused. The question of impairment of credit, and assignment or requirement by the original contracting buyer that the seller should accept a substituted buyer, were so interwoven in the case that the seller could rely upon both and was not put to an election.

14. SALES — Instructions — Impairment of Credit of Buyer — Unauthorized Assignment of Contract — Measure of Damages — Case at Bar. — The instant case was an action for damages by a purchaser of coal against the seller for...