Inman Bros. v. Dudley & Daniels Lumber Co.

• Decision Date: 05 June 1906
• Docket Number: 1,469.
• Citation: 146 F. 449
• Parties: INMAN BROS. v. DUDLEY & DANIELS LUMBER CO.
• Court: U.S. Court of Appeals — Sixth Circuit

146 F. 449

INMAN BROS. v. DUDLEY & DANIELS LUMBER CO.

No. 1,469.

United States Court of Appeals, Sixth Circuit.

June 5, 1906

Cockroft & Cabell, N. L. Scoby, J. H. Malone, and T. K. Riddick, for plaintiffs in error.

W. H Carroll, Johnson & Johnson, S. Grainger Latta, and Albert W Biggs, for defendant in error.

This was an action at law to recover damages for the breach of a contract for the purchase and sale of certain lumber. The contract was as follows:

'Newbern Tenn., Nov. 24, 1902.

'This contract, entered into this the 24th day of November, 1902, by and between Inman Brothers, party of the first part, of Newbern, Tennessee, and the Dudley & Daniels Lumber Co., of Grand Rapids, Michigan, party of the second part, Inman Brothers, party of the first part, do hereby give the exclusive sale to the Dudley & Daniels Lumber Co., party of the second part, all dry and green lumber they have on hand at their Riverside Mills and also their loading station, Newbern, Tennessee. Their estimate of oak lumber on hand at present being about 800,000 feet, of which 50,000 feet may be quartered red oak, 750,000 feet plain sawed red oak, with possibly a small quantity of white oak. Gum, 300,000 ft., all estimates being log run. Dudley & Daniels Lumber Company, party of the second part, do hereby agree to accept all lumber f.o.b. cars, Newbern, Tennessee, and settle for the same hereinafter specified, at following prices: 1' and 2' plain sawed red oak f.o.b. Newbern, Tenn., per M. ft. $25.00 Common plain sawed red oak f.o.b. Newbern, Tenn., per. M. ft. $14.50. 1' & 2' quartered red oak f.o.b. Newbern, Tenn., per. M. ft., $30.00. Common quartered red oak f.o.b. Newbern, Tenn., per M. ft., $19.50. Gum log run red oak f.o.b. Newbern, Tenn., per M. ft., $11.50. For surfacing gum or other lumber, one or two sides, per M. ft., $1.50. Dudley & Daniels Lumber Company agree to settle for all lumber loaded and shipped, at the end of each week with New York Exchange, less 2 per cent. It is also agreed that Dudley & Daniels Lumber Co., party of the second part, are to receive the entire cut of the party of the first part for and during the year 1903, barring accident by fire or otherwise, or as soon thereafter as the cut from this mill can be furnished plain and quartered red oak, including the stock on hand, also 1,000,000 feet, more or less, of log run gum at above prices. Inman Brothers, party of the first part, also agree to saw their cut of oak and gum henceforth to order and by specifications of Dudley & Daniels Lumber Co., so long as they may be financially responsible for their contracts during the lifetime of this agreement. Inspection to be mutually satisfactory, all parties to be governed by the National Hardwood Association rules of inspection.'

Some 50,000 or 60,000 feet of oak lumber of various grades was delivered when the defendants, as averred, refused to make any other or further deliveries. Thereupon this suit was brought.

The defenses, in substance, were these: First, that the contract by mutual agreement was rescinded; second, that the Dudley & Daniels Lumber Company became financially irresponsible, and defendants therefore justified in refusing to go on with the agreement; and, third, that defendants were not damaged by the breach, if any there was.

There was a jury and verdict for the plaintiff, and a judgment for $7,565. Defendants sued out this writ of error.

Before LURTON, SEVERENS, and RICHARDS, Circuit Judges.

LURTON Circuit Judge, after making the foregoing statement of the case, .

1. The defendants sought to show the actual amount of lumber cut at Riverside sawmill during the year 1903. This evidence was objected to and excluded upon the ground that the contract was for the sale of a definite amount of lumber, and that it was immaterial whether the lumber actually cut during 1903 was more or less than the amount contracted for. This was error. The contract was for the sale of the lumber which Inman Bros. had on hand at their mill and at their shipping station, and also for the sale of such lumber as they should cut during the year 1903. The lumber on hand was all sold, whether much or little. The contract 'estimated' that the quantity so on hand and sold was 'about' 800,000 feet, 'of which 50,000 may be quartered red oak, 750,000 feet plain sawed red oak, with possibly a small quantity of white oak; gum 300,000--all estimates being log run. ' By another and distinct provision Inman Bros. agreed to sell their 'entire cut for and during the year 1903, barring accident by fire or otherwise, * * * estimated to be 1,500,000 feet, more or less, plain and quartered red oak, including the stock on hand, also 1,000,000 feet more or less, of log run gum at above prices. ' Such a contract is not an engagement to sell a definite or certain quantity of lumber; in which case the terms 'about' and 'more or less' would only provide against immaterial, accidental variations. Moore v. U.S., 196 U.S. 158, 25 Sup.Ct. 202, 49 L.Ed. 428, is an illustration. There the agreement was to furnish and deliver 'about 5,000 tons of coal.' The contractor delivered 4,634 tons, and then brought and tendered 366 additional tons. This the government refused to receive, when the contractor sold it at a loss and sued for damages. The court said the obligation was to receive about '5,000 tons,' and that the only question was whether 366 tons less than 5,000 tons was 'about 5,000 tons.' It was held that the difference was too great, and that 'the addition of the qualifying words 'about,' 'more or less,' and the like, in such cases, is only for the purpose of providing against accidental variations arising from slight and unimportant excesses or deficiencies in number, weight, or measure. ' But the case at bar falls under different principles altogether. The defendants agreed to sell and deliver at an agreed price all their 'dry and green lumber' then on hand at their mill and at their shipping station. This lumber so on hand constituted a definite and ascertained pile or stock of lumber, as much so as if the sale had been of all the corn in a particular pen or the cotton in a particular ginhouse. This definite lot of lumber was 'estimated' at 800,000 feet of oak and 300,000 feet of gum. But this was not a sale of 800,000 feet of oak or a sale of 300,000 feet of gum, or a sale of 'about' 800,000 feet of one kind and 'about' 300,000 feet of the other. It was the sale of the entire stock of lumber on hand, much or little, and, in the absence of fraud, the purchaser was bound to take all and the seller to deliver all, regardless of departure from estimates. The same is true about the lumber to be cut during 1903. The sale was not of a definite number of feet to be cut then, but of the 'entire cut' of that year. This cut was estimated at 1,500,000 feet of oak, including the 800,000 estimated as on hand already cut, and the cut of gum was estimated at 1,000,000 feet. But this was an agreement to sell and deliver the entire cut of 1903, whatever it should be. The contract applied, therefore, to the specific lots of lumber identified as the lumber green and dry at the mill and the shipping station, and to the 'entire green and dry at the mill and the shipping station, and to the 'entire cut' of lumber by the mill during the year 1903, and the estimation of the amount of lumber on hand or which might be cut did not constitute a warranty. Good faith was all that was required from the parties in making an estimate, or in the future operation of the mill. Brawley v. U.S., 96 U.S. 168, 24 L.Ed. 622; Rib River Lumber Co. v. Ogilvie, 113 Wis. 482, 89 N.W. 483.

The plaintiff in error made more than one effort to show the cut of lumber by its Riverside mill during 1903. One Harrington, who stated that he had hauled all of the logs cut at that mill during that and other years, was asked as to the logs hauled by him to be cut during 1903. Objection was made upon the ground that the contract was for the sale and delivery of a definite number of feet. The court excluded the evidence, saying: 'I think if you are liable at all you would be liable for the amount you sold here, or the difference between the amount you furnished and the amount you agreed to sell.

I don't think it would make any difference how much lumber he hauled there.'

S. P. Inman, one of the defendants, was subsequently asked to state what the entire cut of the Riverside Mills during the year 1903 was. Thereupon exception was again interposed, Mr. Biggs, attorney for plaintiff, putting his objection upon the ground that 'under the contract they were to cut and furnish so much, and what they did cut was immaterial. ' The ruling made when evidence as to the amount of logs hauled to the mill in 1903 was offered was again repeated and the evidence excluded. The defense now made for this ruling is, not that the court did not misconstrue the contract, and commit error in excluding evidence of actual cut of mill, but that the error was harmless, and therefore not ground for reversal. That error is always presumed to be prejudicial is elementary. Nevertheless, it is an established rule in error proceedings that error which was not prejudicial will not justify a reversal. But in Deery v. Cray, 5 Wall. 796, 807, 18 L.Ed. 653, the court said that, 'when the application of this rule is sought, it must appear so clear as to be beyond doubt that the error did not and could not have prejudiced the party's rights. ' This language has more than once been repeated in subsequent cases (Vicksburg, etc., R.R. v. O'Brien, 119 U.S. 99, 7 Sup.Ct. 118, 30 L.Ed. 299), and was applied by this court in Standard Life Ins. Co. v. Sale, 121 F. 666, 57 C.C.A. 418.

The argument that the exclusion of evidence as to...