H. B. Coates v. Eastern States Farmers Exchange

• Decision Date: 07 October 1925
• Parties: H. B. COATES v. EASTERN STATES FARMERS EXCHANGE
• Court: Vermont Supreme Court

130 A. 709

99 Vt. 170

H. B. COATES v. EASTERN STATES FARMERS EXCHANGE

Supreme Court of Vermont

October 7, 1925

February Term, 1925.

ACTION OF CONTRACT. Pleadings: Complaint, answer, replication, and demurrer to replication. Trial by court at June Term, 1924 Bennington County, Willcox, J., presiding. Defendant's demurrer to replication sustained. The plaintiff excepted. The opinion states the case.

Judgment reversed; demurrer overruled; replication adjudged sufficient, and cause remanded.

James K. Batchelder for the plaintiff.

Holden & Healy for the defendant.

Present WATSON, C. J., POWERS, TAYLOR, SLACK, and BUTLER, JJ.

OPINION

TAYLOR

The cause was heard below on the pleadings, and was passed to this Court before final judgment. The plaintiff brings up exceptions to the denial of a motion to strike out certain parts of the answer, and an exception to sustaining defendant's demurrer to the replication.

Plaintiff seeks to recover certain commissions for the sale of feed and grain as agent of the defendant. The contract, which was in writing, is set out in the complaint in full. It is entitled "Memorandum of agreement between H. B. Coates, agent, representing the Bennington County Farm Bureau and the Eastern States Farmers' Exchange (The Exchange) of Springfield, Mass., in the sale and distribution of feed and grain in the following territory: Bennington County." We give the substance of the several stipulations of the contract:

1. Agent is given exclusive sales rights to Eastern States feeds in the territory specified.

2. Agent agrees to represent the Exchange in the sale of feed and grain.

3. Agent agrees to carry out the terms of contracts between the Exchange and the farmers in his territory relating to his responsibilities.

4. Agent agrees to order feed and grain for shipment with such regularity as to supply the requirements of the farmers in his territory during the life of the contract.

5. It is agreed that agent shall receive as commissions 25 cents per ton for sales commission at time of sale and $ 1.25 per ton commission "for financing and distributing shipments for cash at car door."

6. Agent agrees to sell feed and grain to farmers at Eastern States retail prices or to charge no more than the allowance for commissions as a margin over Eastern States wholesale prices.

7. Agent agrees upon specific conditions to pay drafts and accept shipments upon arrival.

8. The Exchange agrees to lend sales assistance.

9. Agent agrees to carry out details of business according to instructions from the Eastern States office.

10. The agreement was to be in effect for one year from its date (May 28, 1923) and was subject to cancellation only in the event that either party failed to live up to its terms, or in the event that either party was unable to continue the agreement for reasons beyond his control, in which case thirty days notice was required.

The complaint further alleges what amounts to performance of the contract on plaintiff's part; that as agent for the defendant under the contract plaintiff sold two thousand tons of feeds and grain to be subsequently delivered by the defendant; that the defendant broke the contract by refusing to recognize the plaintiff as agent and by failing to make the deliveries to him as agreed; that defendant recognized and treated one Russell as agent in filling the orders taken and forwarded by the plaintiff; that plaintiff had held himself ready and willing to perform the terms of the contract relating to financing and distributing the shipments; and that there was due the plaintiff $ 1.25 per ton as commission which the defendant refused to pay.

The defendant admits in its answer the execution of the contract set out in the complaint, but in other respects denies plaintiff's allegations. It is alleged in the answer that plaintiff did not perform the services for which the commission of $ 1.25 per ton was to be paid, and so defendant denies that he was entitled thereto. It is further alleged that the contract, as appears by its terms, was made with the plaintiff as agent representing the Bennington County Farm Bureau; that on a day named the Bureau discharged the plaintiff and notified the defendant that he no longer represented the Bureau; that therefore the contract between the plaintiff and defendant automatically terminated. It is also alleged that the plaintiff violated paragraph nine of the contract in that he did not carry out the details of the business according to the instructions of the defendant, which are set out in the answer. The defendant states in the answer what would have occurred in the usual course if the contract had been fully completed. In effect it is alleged that the supplies would have been charged to the plaintiff at a price fixed by the defendant; that there would have been allowed to the plaintiff and deducted from said price $ 1.25 per ton, leaving the balance to be paid the defendant before the supplies would be turned over to the plaintiff; that in distributing the shipment to the farmers plaintiff would collect the price fixed by the defendant and so would collect the $ 1.25 per ton from the purchasers. In this connection defendant admits that after being notified of plaintiff's discharge by the Farm Bureau it caused the shipments of supplies to be made to said Russell, as he had been designated by the Bureau as its representative to replace the plaintiff under the contract. It is alleged that the said Russell took and paid for the grain and supplies according to the foregoing practice, distributed the same to the farmers, and collected from them the $ 1.25 per ton. The defendant alleges that acting in good faith it notified the plaintiff that the contract was of no further force and effect. It further alleges that it was led to take this action for the reasons, in substance: (1) That plaintiff had violated his instructions; (2) that plaintiff had been discharged by the Farm Bureau; (3) that before giving such notice it had learned of certain delinquencies of the plaintiff in the sale of seed for another company which are detailed in the answer; (4) that after the contract was executed plaintiff agreed to furnish a bond to secure the performance of the contract on his part, but had neglected and refused to do so. One paragraph of the answer states facts on which it is claimed that the plaintiff should be ordered to return to the defendant a part of the sum already paid as commissions on sales.

Plaintiff filed a motion to dismiss six separate paragraphs of the answer. The motion was wholly denied, whereupon the plaintiff was allowed an exception as to each point of the motion. Thereupon the plaintiff filed his replication, wherein he denies the allegations of the answer and either joins issue on such allegations or states his claims with reference thereto. The defendant demurred to the replication, specifying the particular paragraph demurred to and the special ground of demurrer. We find occasion to notice only such parts of the replication as are challenged by so much of the demurrer as is now relied upon. The court sustained the demurrer upon the ground that the contract became void and nonenforceable when the plaintiff ceased to be the representative of the Farm Bureau. This in substance is the basis of defendant's claim on demurrer. Plaintiff denies in the replication that he made the contract with the defendant as agent representing the Farm Bureau, but claims that the contract was personal between him and the defendant, and that he was designated therein and was acting thereunder as agent of the defendant--that the words "representing the Bennington County Farm Bureau" were words of identification, and implied only that at the time of the execution of the contract he had their backing and moral influence. In this connection plaintiff denies that his discharge as representative of the Bureau could or did end the contract.

It would seem that the court did not err in overruling plaintiff's motion to strike out portions of the answer. The Practice Act points out the proper function of such a motion. G. L. 1793. The first point of the motion is directed to claimed inconsistencies in the answer; but that would not be a valid ground of a motion to expunge. Since the amendment of the Practice Act in 1921 inconsistent defenses are permissible and only subject the defendant, on motion before or during the trial, to an election of the defense on which he intends to rely. No. 72, Acts of 1921, § 1. The fifth point of the motion relates to the reason assigned for terminating the contract to the effect that the plaintiff had been guilty of financial delinquencies. This allegation is challenged as wholly irrelevant and scandalous. If the pleading were open to this charge it would properly be subject to the motion to expunge, even though the allegation of such matter would not lay the foundation for the admission of evidence in support of it. Berkley v Burlington Cadillac Co., 97 Vt. 260, 266, 122 A. 665. But the questioned allegations are not irrelevant. The defendant relies in part upon revocation of the agency as a defense. Even though an agency is for a definite term, the principal has a right to revoke it before the expiration of the term, without incurring liability for damages, because of the agent's failure faithfully to perform his express or implied undertakings as agent. 2 C. J. 536. The default on the part of an agent which will justify the revocation of the contract is not confined to his dealings with the principal. This right of revocation for cause is held to extend to moral delinquencies which are calculated to affect injuriously the agent's reputation, such as public drunkenness and disorderly conduct (Bass Furnace...