Federal Coal Co. v. U.S. Fuel Corp.

• Decision Date: 20 January 1923
• Citation: 246 S.W. 528,147 Tenn. 212
• Parties: FEDERAL COAL CO. v. UNITED STATES FUEL CORPORATION.
• Court: Tennessee Supreme Court

246 S.W. 528

147 Tenn. 212

FEDERAL COAL CO. v. UNITED STATES FUEL CORPORATION.

Supreme Court of Tennessee.

January 20, 1923

Error to Circuit Court, Hamilton County; Oscar Yarnell, Judge.

Action at law by the Federal Coal Company against the United States Fuel Corporation. There was a directed verdict for the defendant, and plaintiff brings error. Reversed, and case remanded for trial.

Lusk & Thompson, of Chattanooga, for plaintiff in error.

Sizer Chambliss & Chambliss, of Chattanooga, for defendant in error.

GREEN J.

This suit was brought to recover damages for alleged breaches of two contracts to deliver coal. There was a directed verdict for the defendant, from which the plaintiff below appealed in error. There is some doubt as to whether this court has jurisdiction of this appeal in error. We have decided to entertain the appeal in error, inasmuch as the case involves a revenue statute and may be said to involve state revenue.

The plaintiff in error, the Federal Coal Company, is a corporation chartered under the laws of the state of Delaware, and has its principal office in Chattanooga, Tenn. The defendant in error, the United States Fuel Corporation has an office also in Chattanooga, Tenn. The contracts were made in Chattanooga.

The contracts were entered into between the parties in 1919. Under the first of these contracts defendant in error agreed to deliver to the plaintiff in error, "f. o. b mines," 100 tons of "Horse Creek" coal at $3 per ton. Under the second contract defendant in error agreed to deliver to the plaintiff in error 20 cars of "Harlan county round coal." Two cars only were delivered under the first contract, and two cars only under the second contract. It is for the failure to deliver other coal under these contracts that this suit was brought.

Quite a number of pleadings were filed by the above parties and amendments made. It is not necessary to go into these details.

The issue finally presented, and upon which the trial judge dismissed the suit, was the right of the plaintiff in error to recover, when it had not paid the privilege tax exacted of coal dealers by the Acts 1919, c. 134, § 4, p. 454, and section 16, p. 489. There is no question about the liability of the plaintiff in error for this tax. That is conceded, and the tax has now been paid. The question is whether plaintiff in error was entitled to maintain suit upon these particular contracts, made when it was in default as to said privilege tax.

Proof tends to show that the Horse Creek coal and the Harlan county round coal are both mined in the state of Kentucky, and that under the arrangement between the parties this coal was to be delivered to plaintiff in error on the cars at the mines, to be shipped to points in Kentucky, Tennessee, Georgia, and other states on the order of the plaintiff in error. The proof further shows that it was later agreed between the parties that none of these cars would be ordered to points within the state of Kentucky on account of the freight rates, but all of them would be ordered to points out of the state of Kentucky.

The plaintiff in error contends that the subject of the contracts here involved was interstate commerce, and that its rights respecting such contracts were not affected by its default with respect to...