Goebel v. Linn

• Decision Date: 18 January 1882
• Citation: 11 N.W. 284,47 Mich. 489
• Court: Michigan Supreme Court
• Parties: GOEBEL and another v. LINN and another.

11 N.W. 284

47 Mich. 489

GOEBEL and another v. LINN and another.

Supreme Court of Michigan

January 18, 1882

Defendants were large brewers and had a contract with an ice company to supply them with ice during the season of 1880 at one dollar and seventy-five cents a ton, or two dollars if the crop was short. The contract was made in November, 1879. The following winter was so mild that the ice crop was a failure. In May the defendants were notified by the ice company that no more ice would be furnished them under the contract. Defendants had then on hand a considerable amount of beer that would be spoiled without ice, and under stress of the circumstances they made a new arrangement with the ice company, and agreed to pay three dollars and a half per ton for the ice. At this rate ice was received and paid for afterwards. A note given for ice at this rate in October being sued, defendants disputed its validity, claiming that it was obtained without consideration and under duress.

Held

(1) that it was entirely competent for the parties to enter into the new arrangement if they saw fit. Moore v. Detroit Locomotive Works, 14 Mich. ----.

(2) That the note was not without consideration, being given for ice received.

(3) That the refusal of the ice company to perform its contract and the exaction of a higher price, was not legal duress. Hackley v. Headley, 45 Mich. ----; [S.C. 8 N.W 511.]

Error to superior court of Detroit.

Maybury & Conely and Fred A. Baker, for plaintiffs in error.

Atkinson & Atkinson and C.J. Reilly, for defendants in error.

COOLEY J.

The action in this case is upon a promissory note given by defendants, October 20, 1880, to the Belle Isle Ice Company and by that company transferred to the plaintiffs after it fell due. The execution of the note is admitted, and the only question in the case is, whether the defendants have established any defence to it. The defence set up is that the note was obtained without consideration, and by means of duress. The facts which are supposed to show duress are the following: November 8, 1879, the Belle Isle Ice Company entered into a contract with the defendants below, who are brewers in the city of Detroit, whereby the company undertook to furnish defendants at their brewery all the ice they might need for their business from that date until January 1, 1881. The ice was to be delivered on orders, and the price was to be one dollar and seventy-five cents per ton, and in case of the scarcity of ice during the season of 1880, two dollars per ton. Ice was furnished under this contract until May, 1880, when defendants were notified by Mr. Lorman, the manager or president of the ice company, that owing to the failure of the ice crop the preceding winter the company could and would furnish no more at the price stipulated. Other brewers in the city who held similar contracts received the like notification. This led to a meeting of several of the brewers with the president of the company and one of his associates, at which the brewers were informed that instructions were given to the teamsters of the company to deliver no more ice until the parties had agreed to pay more for it. Five dollars a ton was at first demanded, but the company finally agreed to deliver for three dollars and a half. Mr. Goebel who was a witness on behalf of the defendants explained the situation thus: "We had to pay most anything, if they asked $20; if we had no ice one day or two, if we had been without ice, all our stock would have been spoiled; if we hadn't ice for two days, all our stock of beer would have been spoiled, we cannot run our business one day without ice; it would spoil our beer; it cools the cellar and cools the beer. At that time I could not procure ice of anybody; they waited just long enough not to give us a chance to buy ice of anybody else; *** we could not contract with anybody for ice as there was not any; all ice was contracted for then--all the ice of the icemen right here in the market; there were several men came over who had boat loads to sell and offered us ice; I told Lorman we had a chance to buy ice, and he told us we should not; he would see our contract filled; this was during the spring months, before this conversation. At the time of this conversation no ice was obtainable in this market; not in such large quantities as we wanted. *** We never had less than 2,000 or 3,000 barrels of beer on hand. At 2,500 at $6 a barrel would be $15,000, which would have been an entire loss, besides ruining the whole business, the whole trade; we could not have had any customers; we could not have brewed any more; the brewing would have stopped also." The consequence was, as he says, that they were forced to assent to the terms imposed upon them. From that time defendants paid $3.50 per ton for the ice as it was delivered to them, up to the first day of January following. Notes were given for the ice at this rate from time to time, and with the exception of the one in suit, paid as they fell due.

This statement is a sufficient presentation of the facts for the purposes of a decision. The defendants claim a set-off of the sums paid by them for ice in excess of two dollars a ton. It is very manifest that there is no ground for saying that the note in suit was given without consideration. It was given for ice which was furnished by the payee to the defendants; which was owned by the payee and bought by the defendants, and for which defendants concede their liability to make payment. What the defendants disputed is, the justice of compelling them to pay the sum stipulated in the note when according to their previous contract ...