Elbow Lake Coop. Grain Co. v. Commodity Credit Corp.

• Decision Date: 28 February 1958
• Docket Number: No. 15668.,15668.
• Citation: 251 F.2d 633
• Parties: ELBOW LAKE COOPERATIVE GRAIN COMPANY, a Minnesota Cooperative Association et al., Appellants, v. COMMODITY CREDIT CORPORATION, a Corporation Created by Act of Congress, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

251 F.2d 633 (1958)

ELBOW LAKE COOPERATIVE GRAIN COMPANY, a Minnesota Cooperative Association et al., Appellants, v. COMMODITY CREDIT CORPORATION, a Corporation Created by Act of Congress, Appellee.

No. 15668.

United States Court of Appeals Eighth Circuit.

January 16, 1958.

Rehearing Denied February 28, 1958.

William M. Thomson, Minneapolis, Minn. (Herbert F. Horner and Gordon J. Berg, Minneapolis, Minn., were with him on the brief), for appellants.

Kenneth G. Owens, Asst. U. S. Atty., St. Paul, Minn. (George E. MacKinnon, U. S. Atty., St. Paul, Minn., was with him on the brief), for appellee.

Before GARDNER, Chief Judge, and VOGEL and VAN OOSTERHOUT, Circuit Judges.

VOGEL, Circuit Judge.

Appellants herein are owners of country elevators or other local grain storage facilities in Minnesota. Appellee is a federal corporation created under Title 15 U.S.C.A. § 714 for the general purpose of "* * * stabilizing, supporting and protecting farm income and prices". With a few exceptions, not material here, all appellants during 1953 and 1954 individually agreed to store grain owned by appellee under a "Uniform Grain Storage Agreement", the pertinent provisions of which are stated below:

"12. Determination of Weights and Grades on Load Out — The class, grade, quality and quantity of all the grain loaded out by the warehouseman, whether stored, handled only, or direct transferred, and whether commingled or identity preserved, shall be determined on the basis of official weights and grades at the warehouse location, or if official weights or grades are not available at such point, on the basis of official weights and/or grades at destination or at the inspection point shown on the shipping order furnished the warehouseman, which, unless otherwise agreed, shall be the customary location on the route of shipment of an inspector licensed under the U. S. Grain Standards Act. Such inspection shall be for the account of Commodity.

In the event either party calls for federal appeal inspection, such inspection shall be final and the expense thereof shall be for the account of the party requesting the appeal.

* * * *

19. Definitions — * * * (e) Official Grades — Grades and grading factors established by an inspector licensed under the U. S. Grain Standards Act in accordance with the Official Grain Standards of the United States and protein content established by a recognized protein laboratory."

Under their contracts with appellee, appellants were obliged, at the direction of appellee, to deliver on board railroad boxcars quantities of flax for transportation to terminal warehouses, which, after grading and weighing, would satisfy the delivery requirements thereof and entitle appellants to agreed storage fees. Appellants have not challenged appellee's method of determining gross weight of the flax so delivered, but have alleged that its method of determining the grade, dockage and, therefore, net weight of such flax, upon which appellants' storage fees depended, was in violation of the Uniform Storage Agreements between the parties. Each of the appellants claims to have been damaged thereby in amounts varying from $210.00 to $3,347.47.

Nearly all of the involved carloads of flax were graded three times by either state or federal inspectors, all of whom were licensed under the U. S. Grain Standards Act, 7 U.S.C.A. § 71 et seq. "Probe" sample grades were first taken from the loaded boxcars by state inspectors at various points between the appellants' warehouses and the terminal locations. Two "belt run" samples were later taken simultaneously by state and federal inspectors as the unloaded flax was being received in the terminals. The federally taken "belt run" samples produced the "federal appeal grades" requested by appellee and upon which appellee based its settlements with appellants. The handling of the remaining carloads differs from the above procedure only in that no federal appeal grade was taken, settlements being made on the state "belt run" grades. Appellants claim that all settlements should have been made on the grades determined from the earlier "probe" samples taken in the loaded boxcars. Appellants admit that all the involved grades were made from samples taken by inspectors licensed under the U. S. Grain Standards Act, and that all such grades are "official".

After pleadings were filed and pretrial procedures were completed, appellee moved for summary judgment on the following grounds: (1) That the only issue before the court was the validity and officiality of the grain grades used in settlement between the parties, which issue was within the exclusive jurisdiction of the Secretary of Agriculture; (2) that appellants had failed to exhaust their administrative remedies in challenging the validity and officiality of such grades; and (3) that appellants had failed to allege facts upon which relief could be granted. After hearing was had on these questions, the trial court issued its memorandum opinion and order granting appellee's motion and dismissing the action on the ground that no genuine issue of material fact remained before the court and that appellee was entitled to judgment as a matter of law. Elbow Lake Cooperative Grain Co. v. Commodity Credit Corp., D.C. Minn., 1956, 144 F.Supp. 54, 65. The appeal here is taken from that judgment and order.

Under Rule 56(c), F.R.Civ.P., 28 U.S.C.A., a summary judgment "* * * shall be rendered forthwith if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law". However, summary judgment should not be granted unless the conceded facts "show defendant's right with such clarity as to leave no room for controversy; with all reasonable doubts touching the existence of a genuine issue as to a material fact resolved against the movant; * * *". Northwestern Auto Parts Co. v. Chicago, B. & Q. R. Co., 8 Cir., 1957, 240 F.2d 743, 746.

This action is essentially one for breach of contract. On a defendant's motion for summary judgment in such actions a trial court may grant a summary judgment only when, after examination of the pleadings and the pretrial proceedings, it becomes apparent that there has been no breach.

To comply with the terms of the contracts between it and appel...