Huntington v. Jacob Haish Co.
| Decision Date | 16 February 1921 |
| Docket Number | 33012. |
| Citation | 181 N.W. 480,190 Iowa 1197 |
| Parties | JOHN F. HUNTINGTON, Appellant, v. JACOB HAISH COMPANY, Appellee |
| Court | Iowa Supreme Court |
Appeal from Pottawattamie District Court.--THOMAS ARTHUR, Judge.
ACTION by an agent employed to sell goods on commission, for damages for breach of the contract on the part of the principal. The petition was in three counts. Count 1 was dismissed by plaintiff. The court directed a verdict in favor of defendant on Counts 2 and 3, and the plaintiff appeals.--Affirmed in part and reversed in part.
Affirmed in part and reversed in part.
E. R Jackson and John P. Organ, for appellant.
Tinley Mitchell, Pryor & Ross and John Dowdall, for appellee.
ARTHUR, J., took no part.
The appellant was a traveling salesman, skilled in the business of selling gasoline engines. The appellee is a manufacturing company, with its principal place of business at De Kalb, Illinois, engaged in the manufacture and sale of various implements, among them being gasoline engines, known as the "Chanticleer" engines.
On or about the 13th day of January, 1915, the parties entered into a written contract, by the terms of which the appellant was to promote the sale of said gasoline engines for appellee in the state of Nebraska and the three western tiers of counties in the state of Iowa for the period of three years. The portion of said contract material to the matters involved in this suit is as follows:
Under said contract, the appellant began the work of selling said gasoline engines, having an office in Council Bluffs. A stock of engines was furnished by the company, and maintained in Council Bluffs. In April, 1917, the appellee sold the entire gasoline-engine branch of its business to the Appleton Manufacturing Company, and notified the appellant of such sale, directing him to turn over all of the merchandise in his possession at Council Bluffs to the said Appleton Manufacturing Company. He was also informed by telephone by an officer of the appellee company that it had sold out the business at Council Bluffs, together with the stock of engines and other goods stored there.
Thereafter, the appellant brought this action, his petition being in three counts. Count 1 was dismissed. In Count 3, the appellant claims a commission, under the terms of his contract, on the stock of goods on hand at Council Bluffs, which were sold and delivered to the Appleton Manufacturing Company, as above stated. In Count 2, appellant claims damages for the loss of commissions which the appellant alleges he would have earned, had said contract been performed and carried out until its conclusion.
At the close of the plaintiff's case, the court sustained a motion for a directed verdict as to each of said counts, and entered judgment accordingly; and from such action this appeal is prosecuted.
The major propositions presented for our consideration are twofold: First, under the terms of the contract, is the appellant entitled to recover commissions on the stock on hand at Council Bluffs, which was sold by the appellee to the Appleton Manufacturing Company; and second, was the appellant entitled to recover any so-called "prospective profits" under the contract?
I. We will first consider Count 3. The contract between the parties contains the following clause:
"Party of the first part agrees to give party of the second part credit for all orders for 'Chanticleer' engines, repairs, or other goods, whether such orders are sent in by party of the second part, his agents, by mail or otherwise, for goods shipped into the territory of the party of the second part."
The evidence shows that the goods on which appellant claims a commission in this count of his petition were shipped by the appellee to Council Bluffs. They were kept there in store for sale in the territory allotted to the appellant, and we take it from the record that the stock was replenished from time to time, as ordered by the appellant. The amount remaining on hand in April, 1917, was sold by appellee to the Appleton Manufacturing Company, and delivered to its representative at Council Bluffs. Appellant's contention is that, under this state of facts, he is entitled to be credited with his commission at the agreed rate on all the engines and stock so sold by the appellee and turned over to the Appleton Company at Council Bluffs. It is conceded that the sale to the Appleton Company was not made at Council Bluffs, but was made in a foreign state, and that the stock of goods and engines on hand at Council Bluffs was turned over en masse to the Appleton Company.
The appellee contends that the contract did not contemplate a sale of this character, and that no commissions can be claimed by appellant because thereof.
It is a rule too elementary to require the citation of authorities that, in the construction of a contract, the court must, if possible, ascertain and give effect to the mutual intention of the parties at the time of entering into said contract. We must look to the situation of the parties, the purpose of the contract, the subject-matter about which the parties were contracting, and the surrounding circumstances and conditions, in order to determine the true intent of the parties and the proper construction to be placed upon the language used.
In this case, the evident purpose and intent of the parties were that the appellant should be employed as a salesman for the appellee in the prescribed territory. It was contemplated that he should use his personal efforts, and build up the business. He was to receive a commission on all orders for appellee's goods within this territory during the life of the contract. The parties evidently contemplated that he would establish a trade for the appellee in the particular gas engine in question. They also contemplated that, in time, it might be that customers would order gas engines within this territory direct from the company, rather than through the agency of the appellant; and, to protect him, and reward him for his efforts in building up a trade and establishing the reputation of this engine in this territory, it was provided by the contract that he should not only be paid a commission on all orders for such engines that he procured, but on all orders sent in by his agents or by mail or otherwise, for goods shipped into the territory. The evident purpose was that the appellant should have commissions on all goods that he ordered for his territory, and for all goods ordered within the territory by any subagents whom he might appoint, or by customers within the territory who might purchase goods direct from the company.
The evidence shows that, shortly after appellant was appointed, the appellee placed in stock a considerable quantity of its goods in a building at Council Bluffs. The appellant testifies:
At the time the appellee sold its entire gasoline-engine business to the Appleton Manufacturing Company, it sold these engines so in storage in Council Bluffs. The appellant contends that he is entitled to his commissions on all of the stock on hand and so sold to the Appleton Company. We think the appellant is in error in this contention. The contract between the parties did not contemplate any such sale as this. It expressly provides for the payment of commissions on "orders" for goods, whether the orders were sent in by the appellant or by his agents or otherwise. Surely, the goods shipped in by the company and held in stock to fill orders received in the territory were not goods "ordered" under the terms of this contract, or in accordance with the contemplation of the parties.
The court was right in directing a verdict for the appellee upon this count of ap...
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