Druar v. Ellerbe & Co.

• Decision Date: 01 November 1946
• Docket Number: 34137.
• Citation: 24 N.W.2d 820,222 Minn. 383
• Parties: DRUAR et al. v. ELLERBE & CO. HITCHCOCK & ESTABROOK, Inc., v. SAME.
• Court: Minnesota Supreme Court

24 N.W.2d 820

222 Minn. 383

DRUAR et al. v. ELLERBE & CO.

HITCHCOCK & ESTABROOK, Inc., v. SAME.

No. 34137.

Supreme Court of Minnesota

November 1, 1946

Syllabus by the Court.

1. Certain conversations between plaintiffs and defendant as to the securing and performance of a contract with the federal government for architectural and engineering services in connection with its military construction program Held so incomplete and indefinite that they failed to constitute a binding contract.

2. If an alleged contract is so uncertain and incomplete as to any of its essential terms that it cannot be carried into effect without new and additional stipulations between the parties, it is not a valid agreement.

3. Court did not err in excluding certain exhibits.

Appeal from District Court, Ramsey County; Robert V. Rensch Judge.

Harry W. Oehler, of St. Paul, for appellants.

Doherty Rumble, Butler, Sullivan & Mitchell, of St. Paul, for respondent.

MAGNEY Justice.

Plaintiffs John F. Druar and Arthur S. Milinowski, copartners, and plaintiff Hitchcock & Estabrook, Inc., a corporation, as separate entities, were engaged in the practice of engineering. Defendant Ellerbe and Company, a corporation, is an architectural firm. For some time prior to December 1941 each organization had attempted without success to secure contracts from the federal government for the rendition of engineering and architectural services in connection with its extensive military building program. Plaintiffs claim that in the latter part of December 1941 the three organizations agreed to pool their abilities and facilities and, in the words of their complaints, that they--'should use their or its best efforts to secure from the government of the United States the award of contracts for the rendition of engineering and architectural services and that all contracts awarded to them or any of them * * * should be received and executed by or on behalf of all of them and that all work to be done under any such contracts should be done by all of them and that all monies and profits received * * * should be immediately divided equally * * *. ' They claim that the Ellerbe company breached this alleged agreement by entering into a contract with the federal government for the rendition by itself alone of engineering and architectural services in connection with the development of a Bombardment Air Base at Great Falls, Montana, and in their separate actions for accounting each seeks to recover $33,500, representing one-third of the fees received by defendant for the performance of that work.

On motion by plaintiffs, the court agreed to submit the following special question to the jury:

'Did the plaintiffs, in each action, and the defendant in each action, on or about October 1, 1941, agree with each other and one another, as follows:

'That during the present war, the best efforts of each would be used to secure from divisions or agencies of the United States Government, the award to them of contracts for the furnishing of engineering and architectural services; that all such contracts so awarded to them or any of them, would be performed by all of them; and that all profits therefrom would be equally divided between them.'

At the close of plaintiffs' testimony the court directed a negative answer to the special verdict and a general verdict in favor of defendant in each case. Plaintiffs appeal from an order denying their motion for a new trial.

1. As stated, plaintiffs Druar and Milinowski were engaged in the practice of engineering. They acted as consulting engineers on waterwork, sewer, electric-light and hydroelectric projects and did some general engineering. Estabrook & Hitchcock was also engaged as a consultant in municipal engineering work. Defendant was engaged in the practice of architecture. On December 20, 1941, Estabrook and Hitchcock, officers of Estabrook & Hitchcock, Inc., Thomas F. Ellerbe, president of defendant, and Druar and Milinowski held a conference in Ellerbe's office. Ellerbe had never met Estabrook and Hitchcock prior to this meeting, but he and Druar and Milinowski had a slight social acquaintance. Plaintiffs claim that the oral contract sued upon was entered into at this meeting and at two subsequent conferences held on December 24, 1941, and January 2, 1942. If we are able to spell out a binding contract from what was said at these three meetings, plaintiffs are entitled to prevail. If we are unable to do so, there must be an affirmance. It is necessary, therefore, to quote extensively from the testimony and from it to determine the legal effect of the conversations.

Immediately prior to the meeting of December 20, 1941, plaintiffs had been informed through Ellerbe that the government had offered the three concerns a contract to design a Bombardment Air Base at Rapid City, South Dakota, estimated to cost $10,000,000. The parties met on that day to discuss this and also to become acquainted. The banding together of the three concerns for the duration of the war for the purpose of soliciting architectural work from the government and performing that work was also the subject of conversation.

Milinowski testified that as to the general arrangement talked over at that meeting he was--'unable to say what was said, other than it was a matter of general conversation, * * * that first conversation was casual, it was more or less of a mutual congratulatory meeting, you might say, about the outcome of our efforts so far. * * *

'Q. What did Druar say in Ellerbe's presence? A. He said that it was fine, that we had now at least gotten something, that now it was up to us to perform and perform it well, that if we did, we could expect more consideration and more work for the group. * * * I remember his making the remark: 'Well, now, it is all agreed that we go on and try to get more work * * * and we have got to perform this contract well to get more and we will be getting along very nicely,'' and Mr. Ellerbe said: "That is right; it is understood we are all to go and get work and perform it together."

Joseph B. Estabrook, an officer of Hitchcock & Estabrook, testified that at that meeting Druar said:

'* * * that in a matter of several conversations with Mr. Ellerbe this plan of taking in these three firms had been agreed upon * * * now we had some work that apparently was going to be a good entering wedge,' and that he, Druar, 'was careful to ask each of us, including Mr. Ellerbe, if that was O.K. with them, and each man said 'Yes.' So Mr. Hitchcock * * * then asked how the fees would be divided, and I suggested--I think it was I suggested--that they be divided evenly three ways, to save bookkeeping. I remember that was in my mind, and that Mr. Ellerbe thought probably it would be all right for a starter. And that was the major part of the discussion.'

Paul C. Hitchcock, also an officer of Hitchcock & Estabrook, said that at the meeting of December 20 there was a general discussion. He testified:

'* * * I * * * raised the question as to how in this group association we would handle the matter of the assignment of the fees * * * and Mr. Ellerbe suggested that the fees be split three ways. Mr. Ellerbe's remark to that arrangement was that it was perfectly acceptable to him, * * *. Mr. Druar * * * said in effect * * * that he had finally gotten the group together, because it was apparent that there was some work definitely in prospect and wanted to be sure that all three of the firms and all of the principals of them understood that we were associating together for the purpose of getting contracts to do engineering work on war plants of various and sundry kinds, and that the reason we were associating together was that we had an organization that way which could handle almost any type of work that might come up and that he wanted to be sure that everyone agreed that that was the status of the affairs and that we were going to continue on attempting to get work as a group. And Mr. Ellerbe agreed that that was the idea and so did the other members, Mr. Druar, Mr. Milinowski, Estabrook, and myself. * * * Mr. Druar's conversation was generally along those lines. * * * The associating together for the promotion of obtaining government work * * * in the future * * *. I said in effect that the organization was one that would continue right along until there was no more government contracts which we would be interested in.'

On cross-examination he said:

'I said that we would associate together and continue to get government work until there was no more government work of that nature.'

Mr. Druar, who apparently was the most active of the parties in connection with arrangements for joint activities and who termed himself the 'go-getter' of the group, testified that at the first meeting on December 20 he said:

'* * * we had been attempting each individually to secure federal contracts, that it was time we banded together so as to present a better front to the federal government in the matter of securing contracts * * * and I asked Mr. Ellerbe if he still wanted to continue into the proposition of joining the two others in the development of the work, that he acquiesced, said 'Yes,' and I asked Mr. Estabrook and Mr. Hitchcock, and of course my partner. I asked him also and acquiesced myself to the agree--that we all come together for the duration of the war * * * in providing and finding contracts which we would execute jointly and divide the proceeds thereof or any profits we made on the development of this work. * * * I put that latter part in the form of a question and asked each one personally if they were satisfied to join with me in this project.

'Q. What was the answer, first, say of Ellerbe? A. Yes that he would.

'Q. And...