Fred Mosher Grain v. Kansas Co-op. Wheat Marketing Ass'n

• Decision Date: 05 November 1932
• Docket Number: 30153.
• Citation: 136 Kan. 269,15 P.2d 421
• Parties: FRED MOSHER GRAIN v. KANSAS CO-OP. WHEAT MARKETING ASS'N. [*]
• Court: Kansas Supreme Court

15 P.2d 421

136 Kan. 269

FRED MOSHER GRAIN v. KANSAS CO-OP. WHEAT MARKETING ASS'N. ^[*]

No. 30153.

Supreme Court of Kansas

November 5, 1932

Syllabus by the Court.

Construction placed by parties upon contract which is indefinite and uncertain, will be adopted if not inconsistent with language thereof.

Contract between wheat marketing association and owner of elevator facilities for latter to handle wheat, though not designating amount, held not void for uncertainty, in view of practical construction by parties.

Notice terminating contract between wheat marketing association and owner of elevator facilities, served April 17, held too late under option requiring service on or before April 1.

1. Where parties to an indefinite and uncertain contract have by their conduct construed the contract, such construction will be adopted by the court if not inconsistent with the language of the contract.

2. The parties reserved an option in a contract to terminate it by serving notice on or before the 1st day of April. The notice was not served until April 17th. Held, that the notice was too late and did not terminate the contract.

Appeal from District Court, Sedgwick County, Division No. 2; Thornton W. Sargent, Judge.

Action by Fred Mosher Grain, a copartnership comprised of Fred Mosher and another, against the Kansas Co-operative Wheat Marketing Association. Judgment in favor of the defendant and the plaintiff appeals.

Reversed with directions.

J Graham Campbell and W. M. Glenn, both of Wichita, for appellant.

Benj. F. Hegler, A. V. Roberts, and Roger P. Almond, all of Wichita, for appellee.

SLOAN J.

This was an action to recover damages for the breach of a contract. The trial court held the contract void for indefiniteness, and the plaintiff appeals.

The plaintiff owned and operated a grain elevator at Kanorado from August 29, 1924, to and including the year 1927. During this time there was a competitive grain elevator in Kanorado operating under the name of the Kanorado Equity Elevator Company. The petition contained the usual allegations for the recovery of damages for a breach of contract. It alleged the execution and performance on the part of the plaintiff, and the failure of the defendant. Attached to the petition was a copy of the contract, which is, in part, as follows:

"The Kansas Co-op. Wheat Marketing Ass'n.

"Elevator Contract No. 721.

"This Agreement, made and entered into this 29th day of August 1924, between the Kansas Wheat Growers Association, a non-stock, non-profit corporation, duly organized and existing under the laws of Kansas, hereinafter called the Association, party of the first part, and Fred Mosher-Grain, a corporation or association, duly organized and existing under the laws of the State of Kansas, hereinafter called the Company, unless otherwise directly indicated, party of the second part:

"Witnesseth:

"In consideration of the mutual obligation of the respective parties hereto, and as an aid in carrying on the undertaking on the part of the Association to provide an efficient co-operative marketing system for wheat as set forth in existing contract and agreements between the Association and its individual members; and in consideration of the expenses incurred and to be incurred by the Company in providing local handling facilities for wheat; and in pursuance of provisions of the contract between the Company and the Association, it is agreed:

"Use of Facilities.

"1. That the Association shall use the facilities of the Company located at Kanorado, Kansas, in making the delivery of wheat of its members to the Association, provided that when said Company is unable to handle all wheat delivered by said members of Association, either through lack of railroad facilities or otherwise, there shall be nothing in this contract to prevent said Association from contracting with additional elevators to handle such excess.

"Grading and Handling.

"2. The Company agrees to weigh, test, grade and ship to the order of the Association, all wheat delivered to the Company for such purposes by individual members of the Association."

The association agreed to carry insurance on the wheat received by the company, make rules and regulations for standardizing the manner of keeping elevator records and accounts, and making reports. The company agreed to keep separate the wheat delivered to it by the members of the association, forward samples of all wheat delivered, and deliver to the association all wheat delivered to it by the members of the association. For this service the association agreed to pay 4 cents per bushel for the first one hundred thousand bushels handled by the company. The provision for terminating the contract is as follows: "13. This agreement shall be in full force and effect from the date of its execution to June 15, 1929, with the provision that either party hereto may terminate the contract at the end of any contract year under the following terms and conditions: Notice in writing of such termination must be given by the party desiring the same to the other party prior to the first day of April preceding June 15, of any year, and the party giving such notice must, prior to the effective date of same, pay any indebtedness due the other party."

The answer contained a general denial and an affirmative allegation that the plaintiff did not have storage capacity available during the year 1928 to handle the wheat of the members of defendant's association, and that the plaintiff was not in fact damaged by the failure of the members of defendant to deliver wheat.

A demand was made by the defendant for an inspection of the books and papers of the plaintiff and a motion filed asking that the court appoint an auditor. The motion was as follows:

"Comes now the defendant and moves the court to appoint an auditor to audit the books of the plaintiff corporation for the purpose of determining the following facts:

"1. The amount of storage capacity which the plaintiff had available from day to day between the 17th day of July, 1926, and the 23rd day of April, 1927, and also, between the 1st day upon which any member of defendant delivered wheat to the Kanorado Equity Elevator as alleged in the eighth paragraph of plaintiff's petition and the said 23rd day of April, 1927.

"2. That said auditor be instructed to compare the deliveries of wheat at said Kanorado Elevator by plaintiff's members, the dates and amounts of which deliveries defendant offers to make available to said auditor with the storage capacity of plaintiff's elevator which would have been available for the reception of said wheat at the time of its delivery to said Kanorado Equity Elevator and to determine therefrom, how much of said wheat the plaintiff could have handled if it had been delivered to it.

"3. That said auditor be directed to examine and analyze the books of plaintiff and make therefrom, a computation showing the expense of handling a bushel of wheat in plaintiff's elevator during the crop season of 1926 and 1927 and what expense plaintiff would have incurred in handling the said 37,494 bushels of wheat of the defendant association's members which was delivered to the said Kanorado Equity Elevator Company as alleged in plaintiff's petition."

On the hearing of the motion it was agreed that the court appoint an auditor to make findings as to the following facts:

"1. The amount of storage capacity, which the plaintiff had available from day to day between July 17, 1926, and April 23rd, 1927.

"2. The expense per bushel of handling wheat in plaintiff's elevator during the period from July 17th, 1926, to April 23rd, 1927, and what, if any, added expense per bushel plaintiff would have incurred in handling 37,494 bushels of wheat in addition to the wheat that the plaintiff did actually handle during said period."

The auditor made and filed his report and the case was tried to the court on an agreed statement of fact. The agreed facts, so far as pertinent to the question under consideration, are as follows:

"5. That plaintiff handled the wheat of the members of defendant association from and after the execution and delivery of said contract until the 17th day of April, 1926, when the defendant association by written communication, dated April 17, 1926, notified plaintiff that the association wished to cancel its contract with plaintiff for handling association wheat, such cancellation to take effect June 30, 1926. ***

"8. That during the wheat shipping season of 1926 and between the dates of July 17, 1926, and April 23, 1927, there was delivered to the Kanorado Equity Elevator mentioned in plaintiff's petition and shipped out by said Kanorado Equity Elevator, twenty-six (26) cars of wheat which was grown, harvested and delivered to the Kanorado Equity Elevator by the members of the defendant association.

"9. That said twenty-six (26) cars of wheat contained a total shipping weight of 2,249,640 lbs. or a total of 37,494 bushels.

"10. That the plaintiff was at all times ready and willing to handle the wheat of the defendant association members and at all times between July 17, 1926, and April 23, 1927, was able to and had the necessary elevator facilities and capacity to handle said 37,494 bushels of wheat of the defendant sociation's members. ***

"17. That figuring plaintiff's cost per bushel at $.01302, the net profit per bushel would have been $.02698 or a total profit for handling 37,494 bushels of $1,011.58. *** "19. That a true copy of the marketing contract between the defendant, The Kansas Cooperative Wheat Marketing Association and its members, which was in force during the year 1928, is hereto attached, marked 'Exhibit A' and made a part hereof as if herein fully set

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