Independent Gas & Oil Co. v. T. B. Smith Co.

• Decision Date: 01 April 1932
• Docket Number: 5777
• Citation: 10 P.2d 317,51 Idaho 710
• Court: Idaho Supreme Court
• Parties: INDEPENDENT GAS & OIL COMPANY, a Corporation, Appellant, v. T. B. SMITH COMPANY, a Corporation, Respondent

10 P.2d 317

51 Idaho 710

INDEPENDENT GAS & OIL COMPANY, a Corporation, Appellant, v. T. B. SMITH COMPANY, a Corporation, Respondent

No. 5777

Supreme Court of Idaho

April 1, 1932

MONOPOLIES-CONTRACT FOR EXCLUSIVE SALE OF GOODS-ESTOPPEL-WAIVER.

1. Contract whereby wholesale oil distributing company agreed to make payments to local company, partly in return for latter's agreement to handle distributing company's products exclusively, held not illegal (Const., art. 11, sec 18; C. S., sec. 2534).

2. Contract of wholesale oil distributing company to make payments to local distributing company, and to lease to it gasoline station equipment, in return for latter's agreeing to handle former's products exclusively at prevailing prices, held not illegal (Const., art. 11, sec 18; C. S., sec. 2534).

3. Court will take judicial notice of population of particular city and of existence of many concerns therein doing gasoline and oil business.

4. "Waiver" is voluntary act which implies election to dispense with something of value or forego right or advantage.

5. Evidence sustained finding that wholesale oil company waived requirement of agent's settlement of customer's account on weekly basis.

6. Waiver and estoppel are mixed questions of law and fact.

7. Court will not disturb judgment where there is sufficient evidence, if uncontradicted, to support verdict.

APPEAL from the District Court of the Fifth Judicial District, for Bannock County. Hon. Robert M. Terrell, Judge.

Action to recover balance of account. Judgment for respondent. Affirmed in part and reversed in part.

Appellant entitled to judgment for the item of $ 165.89, with interest. Judgment affirmed in part. Petition for rehearing denied.

B. W Davis, for Appellant.

To have justified consideration of the questions of waiver and estoppel by the jury in this case when it was submitted there should have been evidence of at least three of the essential elements of waiver and estoppel, upon which such evidence was completely lacking, viz.: An intention of the plaintiff to relinquish or waive the clause on credit violation, reliance by the defendant upon the waiver and alteration of its position, and the passing from the defendant to the plaintiff of some valuable consideration for it. (27 R. C. L. 904, 908, sec. 5; Idaho Grimm Alfalfa Seed Growers' Assn. v. Stroschein, 42 Idaho 12, 47 A. L. R. 916, 242 P. 444; Ohio Confectionery Co. v. Eimon Mercantile Co., 154 Minn. 420, 191 N.W. 910; Craig v. White, 187 Cal. 489, 202 P. 648; Castleman v. Stryker, 109 Ore. 207, 219 P. 1084; Woolley v. Loose, 57 Utah 336, 14 A. L. R. 372, 194 P. 908.)

The contracts between the plaintiff and Trist Auto Company and Bannock Motor Company on the one hand and between it and the defendant or the other primafacially and presumptively legal did not contravene or violate in their making or operation any rule of law or statute of the state of Idaho and were not in any manner illegal. (6 R. C. L. 694; Bayles v. Kansas P. Ry. Co., 13 Colo. 181, 22 P. 341, 5 L. R. A. 480; C. L. of Idaho, 1919, sec. 2534 (section which the court concluded the transactions, violated).)

Jones, Pomeroy & Jones, for Respondent.

Waiver may be made by an express agreement or promise declaring an intention not to claim the supposed benefit or advantage, and such agreement or declaration will not only waive those matters coming expressly within its terms, but will extend to other matters which by a natural and necessary implication would be affected.

The more usual manner of waiving a right is by conduct or acts which indicate an intention to relinquish the right, or by such failure to insist upon it that the party is estopped to afterwards set it up against his adversary. (40 Cyc. 265.)

Intent to waive can be constructive as well as actual. (Somers v. Germania Nat. Bank, 152 Wis. 210, 138 N.W. 713.)

In determining whether a given contract contravenes public policy, the test is not always nor necessarily what acts the parties performed or contemplated in order to fulfill their agreement or its actual result, but rather whether its tendency is evil. (Oliver v. Wilder, 27 Colo. App. 337, 149 P. 275.)

Every contract, combination or agreement whose direct purpose, probable effect or necessary tendency is to stifle or unduly restrict competition is unlawful by common law and by statute. (19 R. C. L. 36, sec. 20.)

The test is the evil tendency of the contract and not its actual injury to the public in a particualr case.

And agreements whose tendency is to establish a monopoly are void although they may not in the particular case destroy competition or enhance prices. (13 C. J. 425; Russell v. Courier Printing & Pub. Co., 43 Colo. 321, 95 P. 936; Craft v. McConoughy, 79 Ill. 346, 22 Am. Rep. 171.)

BUDGE, J. Lee, C. J., and Givens, Varian and Leeper, JJ., concur.

OPINION

BUDGE, J.

On February 1, 1924, appellant, engaged in the wholesale business of distributing gasoline and lubricating oils and greases, entered into a written contract with respondent, whereby the latter became the local agent of the former for the sale and distribution of appellant's products in the city of Pocatello and surrounding territory, upon a commission basis. This relationship continued thereafter until about January 1, 1929. On July 14, 1930, appellant commenced this action against respondent to recover $ 165.89, an alleged unpaid balance due for certain merchandise sold and delivered to respondent and unaccounted for, and also to recover $ 782.09, an alleged unpaid balance for merchandise sold to one Dawson by respondent upon credit in alleged violation of the contract above referred to. In its answer respondent admitted the execution of the contract but denied its violation and the indebtedness. By affirmative defenses respondent pleaded: (1) illegal charges by appellant for which it received no credit, aggregating $ 690, (2) facts tending to show respondent's release from liability to appellant as to the Dawson indebtedness, (3) waiver of the terms of the contract alleged to have been violated, and (4) estoppel. By counterclaim respondent sought to offset or recover $ 689.80 on account of alleged unpaid commissions.

Upon the issues thus framed the cause was tried to the court and a jury. Verdict was rendered in favor of respondent for costs and judgment was entered accordingly, from which judgment and from an order overruling appellant's motion for new trial this appeal is taken.

There is no dispute in so far as the correctness of the items sued upon is concerned. The controversy is limited to two propositions, viz.: First, the right of appellant to charge against respondent certain payments made by appellant to Trist Automobile Company and Bannock Motor Company according to the terms of two certain contracts entered into between appellant and the two respective companies. Second, whether or not appellant waived the terms of its contract with respondent as to certain credit extended to one Dawson and was estopped by its acts and conduct from relying upon such terms.

Taking up the first question, it appears from the record that on September 18, 1925, appellant entered into a contract with the Trist Automobile Company whereby the latter leased to appellant the sign privileges on the east side of its building for a term of three years for $ 30 per month, payable monthly, the Trist Automobile Company agreeing to purchase from appellant all gasoline, kerosene, lubricating oils and greases handled, sold or distributed by it in the city of Pocatello during the term of said lease, except such oils and greases as were then handled by it. The evidence discloses that the sign privileges were never exercised by appellant.

On December 8, 1927, appellant entered into an agreement with Bannock Motor Company whereby appellant agreed to deliver and lease to Bannock Motor Company for a period of three years certain gasoline pumps and gasoline station equipment, to be installed and used only by the latter on its property and place of business at Pocatello during the life of the contract, the title to the leased property to remain in appellant, conditioned that at any time prior to or at the expiration of the contract the Bannock Motor Company should have the right to purchase such equipment at stipulated prices. The Bannock Motor Company further agreed, during the life of the contract, to purchase from appellant all gasoline sold or distributed on its premises through such equipment at prevailing market prices, not to sell or give away from said premises during the term of said contract any gasoline of any kind whatsoever except as might be purchased from appellant, and to encourage, promote, advertise and push the sale of appellant's gasoline. It was further stipulated that the sale of appellant's gasoline and products was the principal consideration for the covenants of this agreement. Appellant agreed, during the life of the contract and while the covenants thereof were complied with, to pay to Bannock Motor Company $ 60 per month, payable monthly.

Pursuant to verbal agreement, confirmed by letter by appellant, it was agreed between appellant and respondent that the $ 30 monthly payment required to be made by appellant to Trist Automobile Company under the contract above referred to should be paid by appellant, charged to respondent and deducted from the latter's monthly commissions.

It was verbally agreed between appellant and respondent that the $ 60 monthly payment required to be made by appellant to Bannock Motor Company under the contract above referred to should be paid by appellant, and one-half of that amount, to wit, $ 30, should be charged to respondent and deducted from its monthly commissions.

Monthly payments were...