Gothro v. Southern Oregon Co.

Decision Date25 July 1922
Citation208 P. 705,104 Or. 481
PartiesGOTHRO v. SOUTHERN OREGON CO.
CourtOregon Supreme Court

In Banc.

Appeal from Circuit Court, Coos County; John S. Coke, Judge.

Action by George Gothro against the Southern Oregon Company. From judgment for plaintiff, defendant appeals. Reversed.

McBride J., dissenting.

Cassius R. Peck, of Portland, and John G. Mullen, of North Bend (Griffith, Leiter & Allen, of Portland, on the brief), for appellant.

John D Goss, of Marshfield, and Jay Bowerman, of Portland (Goss Kendall & Murphy, of Marshfield, on the brief), for respondent.

BURNETT C.J.

The plaintiff and one Hockett made a contract with the defendant as follows:

"It is hereby understood and agreed by and between the Southern Oregon Company, an Oregon Corporation of Empire Oregon, of the first part and George S. Gothro and C. G. Hockett of the second part as follows:
"That in case either or both of the parties of the second part bring to the party of the first, either by person or by letter, a bona fide purchaser for all or part of the lands, mill or timber of the first party, the first party will pay to the second parties the sum of five per cent. (5%) of the purchase price on or before thirty days after the signing, ensealing and delivery of deed or contracts of sale.
"This agreement is to be and remain in force for the term of sixty days from date hereof, except that in case of sale pending at the date of the expiration the time will be extended by the first party for the completion of said sale.
"It is mutually understood by the parties hereto that nothing in this agreement shall prevent the first party from selling any or all their lands, timber or other property themselves or by or through other agents."
(Signed by the parties November 15, 1917.)

Hockett assigned his interest in the contract to the plaintiff. Gothro claims to have been the moving cause, and to have procured the firm of McDonald & Vaughan, hereinafter for convenience called the firm, to make with the defendant the following contract:

"This agreement made and entered into this 31st day of January, 1918, by and between William Vaughan and J. J. McDonald, as partners doing business under the firm name of McDonald & Vaughan, of North Bend, Oregon, the first parties, and the Southern Oregon Company, an Oregon corporation, of Empire City, Coos county, Oregon, the second party, witnesseth:
"That whereas, the said second party is the owner of the lands hereinafter described and all the merchantable timber standing, lying, or being thereon, and desires that the same shall be cut, logged, removed and sold; and
"Whereas, the said first parties are engaged in conducting a logging business:
"Now, therefore, in consideration of the mutual covenants and agreements hereinafter set forth, the said parties do contract and agree with each other as follows, to wit: That the said first parties may enter in and upon the following described lands, to wit: [Description omitted]--and cut and remove all of the merchantable timber standing, lying or being thereon, and the said first parties do agree to so enter thereon and cut and remove the same as hereinafter provided. The said second parties hereby giving and granting to the said first parties, their agents and employees the right to enter upon all of said above-described lands and cut, log and remove all of said timber thereon, and use in the operation thereof any and all necessary or convenient logging tools, equipment or devises in order to so cut, log and remove said timber in the shortest time and at the least expense possible. "The first parties do hereby agree that upon so cutting and removing said timber to deliver the same to the purchasers thereof at such point in the waters of Coos bay as shall be agreed upon with such purchaser.
"It is also understood and agreed that all timber is to be cut into such lengths as will be most practicable and sell to the best advantage in the opinion of the first parties. * * *
"It is understood and agreed that the first parties have the exclusive right to all of such timber so logged and that they will use their best endeavor and efforts to sell the same only to responsible parties at the highest and best prices and terms possible, and that they will use their best efforts to sell said logs for sums not less than $9.00 per thousand feet board measure and as much more as it is possible to get.
"It is understood and agreed, however, that any and all moneys to be paid by the purchaser of said logs shall be paid to and collected by the second party, and that the said second party will use its best efforts and endeavors to collect the purchase price therefor promptly and immediately at the time the same shall become due and payable, and that of the amount so collected the following proportions thereof shall belong to and be the separate property of the respective parties hereto, and that the second party will deliver the proportion thereof so belonging to the said first parties immediately upon demand, which said proportions are as follows:
"In case the said purchase price shall be at the rate of $9.00 per thousand feet board measure, then of said sum the first parties are the owners of $5.50 thereof for each and every thousand feet board measure, and the second party is the owner of the sum of $3.50 per thousand feet board measure, and that any amount over and above said sum received for any of said logs shall belong to and be the property of said parties in equal proportions. It is further understood and agreed that in case any of such timber of any grade or kind shall be sold for a price of less than $9.00 per thousand feet board measure, the said first and second parties hereto will divide the difference between the said sum of $9.00 and the price actually received therefor into halves, and each party will deduct one-half of such difference from the proportion it or they would have received if the price received was $9.00 per thousand feet board measure. It being understood and agreed that the division of the price received shall be made upon each grade and each variety of timber separate from the other grades or varieties.
"And the said first parties hereby agree to accept and receive such proportion of the price that said timber shall be sold for in full payment for logging and delivering said timber, and said second party agrees to receive and accept such proportion of the purchase price above stated as full payment for said timber and the use and occupancy of said premises, and the rights and privileges herein granted, given and conferred to and upon the said parties. The proceeds from the sale of said timber shall be determined and governed by the scale determined at the sale and the price sold therefor, and whenever said scale is made and accepted it shall be final and binding upon both parties hereto.
"But it is further understood and agreed that at any time the party of the second part shall be dissatisfied with the price for which the parties of the first part are selling said timber, or any part thereof, it may, if it so desires, purchase those particular logs on which said price is unsatisfactory, and at the same price the said first parties are selling or offering to sell them for, and the said party in such event agrees to immediately pay to the first parties their share of the purchase price which shall be in the same proportion they would receive under the terms of this agreement, if said timber was sold to other parties, and further agrees to accept immediately delivery from the first parties and hold the same in its own boom sticks or booms and at its own risk. * * *
"It is also understood and agreed that if during the life of this contract that the price obtainable for said timber should be such that in the opinion of both parties it would not be profitable to continue logging and selling the same, then in that event the first parties may cease cutting, logging and removing said timber until such time as in the judgment of the parties hereto it will be profitable to continue the same, but it is distinctly understood and agreed that, in case said logging operations are suspended under those provisions, the time for the completion of said work shall be extended a further length of time equal to such suspension; provided, further that, in case said logging operations are suspended for a period of one year, then, in that event, either party hereto may terminate this contract by giving the other thirty (30) days' written notice of its intention and desire so to do."
(Signed by the parties January 31, 1918.)

Besides setting forth the contract of employment and the efforts of himself and Hockett thereunder, the plaintiff alleges:

"That up to the time of filing this complaint the said defendant had received in cash upon the sale of said timber so made as hereinbefore set forth, the sum of $100,000"

--and claims as due from the defendant 5 per cent. of that sum. A general demurrer to the complaint was overruled. Denials and some affirmative defenses were interposed, which it is deemed unnecessary to consider, because the whole issue properly may be determined on the demurrer to the sufficiency of the complaint.

As the result of a jury trial, a verdict was returned in favor of the plaintiff. From the ensuing judgment the defendant appealed.

For convenience the contract with Gothro and Hockett will be called Exhibit A, and the agreement between the defendant and McDonald & Vaughan will be called Exhibit B. Reduced to its lowest torms, the complaint alleges in substance that Gothro was employed to find a purchaser for the timber in question for which the defendant was to pay 5 per cent. of the purchase price, and that Gothro procured McDonald & Vaughan to...

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