J. W. Tipton Cotton Co. v. Clayton

• Decision Date: 08 September 1936
• Parties: J. W. TIPTON COTTON CO., RESPONDENT, v. W. L. CLAYTON ET AL., CO-PARTNERS, DOING BUSINESS UNDER THE NAME OF ANDERSON CLAYTON & COMPANY, APPELLANTS
• Court: Missouri Court of Appeals

99 S.W.2d 549

231 Mo.App. 247

J. W. TIPTON COTTON CO., RESPONDENT, v. W. L. CLAYTON ET AL., CO-PARTNERS, DOING BUSINESS UNDER THE NAME OF ANDERSON CLAYTON & COMPANY, APPELLANTS

Court of Appeals of Missouri, Springfield

September 8, 1936

Rehearing denied January 2, 1937.

Appeal from Pemiscot County Circuit Court.--Hon. John E. Duncan Judge.

AFFIRMED.

Judgment affirmed.

C. A Cunningham and C. G. Shepard for appellants.

Ward & Reeves for respondent.

BAILEY, J. Allen, P. J., and Smith, J., concur.

OPINION

BAILEY, J.

--This is a suit to recover damages for breach of an option contract on the sale of 129 bales of cotton. The plaintiff is a corporation of Missouri and defendants, W. L. Clayton et al., are co-partners doing business under the name of Anderson Clayton Company, with their principal office in Memphis Tennessee.

The issues involved may be more clearly understood by a reference to the pleadings. Plaintiff's amended petition, upon which the case was tried, alleges in substance (quoting from respondent's statement of the case) the following: "that on November 3rd, 1932, plaintiff agreed to sell to defendants 129 bales of cotton weighing 69,259 pounds, the price thereof to be fixed 40 points off the March cotton market quotation in New York City, the date of the fixation of such price to be at the option of the plaintiff, the seller.

"That on the following day the defendants mailed a confirmation of said sale to plaintiff, which confirmation was signed by both parties and provided in small printed matter that plaintiff would keep on deposit with defendants not less than $ 10.00 per bale margin, but that the defendants did not at any time require plaintiff to keep said sum of $ 10.00 per bale as margin, and that it was understood and agreed between plaintiff and defendants that said provision of the written confirmation was waived by defendants. The petition further charges that said cotton was not delivered to the defendants until January 9th, 1933, and up until that time no part of the consideration had been paid and on said date when said cotton was delivered to the defendants the defendants voluntarily paid to plaintiff on the purchase price of said cotton the sum of $ 3,365.98, and that at said time the margin left with the defendants was approximately $ 5.00 per bale, and that defendants promised and agreed that said sum would be sufficient. That, thereafter, at the request of plaintiff, the defendants were authorized to add to said advance on said cotton the sum of $ 184.20 representing amounts due from plaintiff to defendants on return checks, so that the total advance on said cotton was $ 3,550.18. It is further charged in said petition that thereafter, on February 21, 1933, by a new contract and agreement entered into between plaintiff and defendants (which contract was in writing) the agreement touching the sale of said cotton was modified and changed from 40 points off of the March market quotation in New York City, subject to plaintiff's call, to 74 points off of July, 1933, market quotation, New York City, subject to plaintiff's call, and that in order to get said contract changed and modified plaintiff was required to pay the additional sum of 34 points as a consideration for changing said contract, and that, after said new contract was entered into between plaintiff and defendants, plaintiff was required only to keep said cotton margin to a figure 17 points (85 [cents] per bale) above the amount that plaintiff had been paid on said cotton, and that so long as the market price of said cotton was as much as 17 points above said amount the same would be carried by the defendants, and the plaintiff then had until July, 1933, to call for a fixation of the purchase price of said cotton. It is further charged in said petition that in conformity with said new agreement the plaintiff did, on June 12th, 1933, call for a sale and fixation of the value of said cotton upon the basis of the close of the New York cotton quotation of that date, and on said date the New York close was 9.37 [cents] per pound, and that deducting the 74 points in conformity with the contract from that amount left a balance due plaintiff of 8.63 [cents] per pound, which gave the plaintiff the total sum of $ 5,977.05 as the sale price of said cotton, and that deducting therefrom the sum of $ 3,550.18 left a balance due plaintiff of $ 2,426.87, for which amount plaintiff asks judgment.

"The defendants filed a motion to strike out certain parts of this amended petition, but this motion was never called to the attention of the circuit court and, consequently, it was never acted upon."

To this amended petition defendants filed an amended answer in which it is admitted that on the 3rd day of November, 1932, they entered into a contract with plaintiff to purchase 129 bales of cotton f. o. b. cars, forty off March New York market, but deny each and every other allegation. The answer further pleaded that the contract of purchase was reduced to writing, which contract contained the following provision:

"It is the intention of the parties to this contract that the price shall be fixed on or before shipment and delivery, but if the seller has not directed the fixing of the price by that time and the buyer agrees to an extension of time for fixing the price, seller agrees to keep the buyer protected at all times by having on deposit with the buyer not less than ($ 10.00) Ten Dollars per bale margin and to pay all expenses incidental to the price fixed of this contract, including telephone and telegraph charges. If price is not fixed before the first notice day the cotton then becomes buyer's call and the buyer has the privilege of fixing at any time. Advice of such fixing to be promptly reported to seller. Seller agrees that failure on his part to keep contract margin according to agreement automatically gives the buyer the privilege of fixing the price on this contract."

It was further pleaded that on the 21st of February, 1933, at plaintiff's request, the call on said cotton was transferred from forty off March to seventy-four off July; that at that time plaintiff was indebted to the National Cotton Seed Products Company and sold and assigned to said company all its right and title in the alleged contract with defendants to secure plaintiff's obligations to said company; that plaintiff failed to keep the said cotton margined, as agreed in said contract; that defendants thereafter called upon said National Cotton Seed Products Corporation for funds to keep said margin within the terms of said contract which demand was refused; that plaintiff was notified of said refusal and himself called upon to furnish funds to take care of said margin, which plaintiff likewise failed and refused to do; that thereafter on February 25th, 1933, defendants notified plaintiff that they had placed a "stop order" fixing the price for the 129 bales of cotton on July at $ 6.05; that they afterwards, through their representative, offered to reinstate said contract if plaintiff would pay the margin agreed upon, which plaintiff refused to pay but demanded that defendants carry the risk.

It is further pleaded that defendants carried out all the terms of the contract on their part and did not fix the price on said cotton until plaintiff failed to furnish the margin agreed upon; that defendants acted in all things according to the rules of the Memphis Cotton Exchange as provided in the written contract.

It is further pleaded that in addition to the cotton in question plaintiff sold defendants 119 bales of cotton; that when the 129 bales of cotton were sold defendant placed to the credit of the 119 bales the sum of $ 70.62 and notified plaintiff of that fact; that plaintiff retained said credit with full knowledge of the facts and ratified said transaction and is therefore estopped from claiming any damages for the sale of the 129 bales of cotton.

The reply was a general denial of the new matter set up in the answer. Upon the issues thus drawn a trial was had to a jury which resulted in a verdict and judgment for plaintiff in the sum of twenty-five hundred fifty and 22/100 dollars, from which judgment defendants have appealed.

The first error assigned is that the trial court failed to sustain a motion to strike part of plaintiff's petition. The record does not show that the trial court took any action upon this motion or that the matter was thereafter called to the attention of the trial court. Under such circumstances that assignment cannot be reviewed here.

The next point made is that the trial court erred in refusing to sustain defendants' demurrer to the evidence offered at the close of plaintiff's case and again at the close of the whole case. The evidence most favorable to plaintiff will be set forth in brief.

J. W. Tipton was president of the J. W. Tipton Cotton Company, plaintiff, and at the time of the transaction involved herein was in charge of its management. In the fall of 1932, plaintiff was engaged in buying and selling cotton at gins. On November 3rd, 1932, plaintiff, acting through J. W. Tipton, sold 129 bales of cotton to defendants on the basis of "40 points off March N. Y.," the sale being made by telephone. The sale was immediately confirmed by letter and the terms thereof accepted by plaintiff. This letter was, in part, as follows:

"It is the intention of the parties to this contract that the price shall be fixed on or before shipment and/or delivery but if the seller has not directed the fixing of the price by that time and the buyer agrees to an extension of the time for fixing the price, seller agrees to keep the buyer protected at all times by having on deposit with the buyer not less than ($ 10.00) ten dollars per...