Jacksonville Paper Co. v. Smith & Winchester Mfg. Co.

• Decision Date: 27 May 1941
• Citation: 147 Fla. 311,2 So.2d 890
• Court: Florida Supreme Court
• Parties: JACKSONVILLE PAPER CO. v. SMITH & WINCHESTER MFG. CO.

2 So.2d 890

147 Fla. 311

JACKSONVILLE PAPER CO. v. SMITH & WINCHESTER MFG. CO.

Florida Supreme Court

May 27, 1941

Rehearing Denied July 3, 1941.

Ragland, Kurz & Layton, of Jacksonville, for plaintiff in error.

Martin H. Long and F. P. Hamilton, both of Jacksonville, for defendant in error.

THOMAS, Justice.

The Smith &amp Winchester Manufacturing Company, a corporation, brought an action of replevin against Jacksonville Paper Company, also a corporation, for the recovery of certain machinery the description of which required several pages in the affidavit in replevin, the writ, the declaration, the verdict and the judgment. The pleas were not guilty and recoupment and at the close of the testimony the court granted a motion for a judgment in favor of the plaintiff. The defendant becomes plaintiff in error here and the plaintiff, defendant in error. For the sake of clarity we will, in our observations, refer to the parties litigant according to their respective positions in the trial court.

In the exchange of correspondence culminating in the contract, which we will later describe, there appeared significant statements by the plaintiff: 'It is understood that should we build the machine for you, acceptance by you is subject to the ability of the machine to make commercially acceptable bags at the speeds we guarantee' and by the defendant: 'At the same time, we are perfectly willing to pay for a machine if it will perform satisfactorily after it has been constructed.'

The contract entitled 'Specifications and Sales Agreement Covering One--Garment Bag Machine,' entered into between the parties, to the controversy April 19, 1938, contained provisions, among others, for the delivery of machinery for the construction of 'commercial garment and pants bags * * * designed for a top speed of sixty bags per minute when making the longest bags; shorter bags to be made at a somewhat what higher speed,' and for a purchase price of four thousand dollars, payable one thousand dollars at the time of the execution of the contract, one thousand dollars when the machine was ready for shipment and the remainder after shipment.

Simultaneously with the execution of the contract the plaintiff wrote the defendant, in a letter enclosing two copies of the agreement 'covering the garment bag machine we are building for you,' that a drawing depicting the machine when completed would be sent within a few days and that no reason was then known why the shipment of the completed machinery could not be made by the date mentioned in the contract, namely, June 15, 1938. Replying to this communication, a week later the defendant stated that the machine in course of construction was the first one of its kind which the plaintiff had understaken to build and that it was understood by the writer that the merits of the apparatus would be proven before any money would be expected by the manufacturer. Shortly afterwards the plaintiff wrote the defendant, quoting a statement in a former letter, that it would be 'fully responsible for the successful operation of the machine, and that you [defendant] would not be expected to accept it unless it made commercial garment bags at the speeds specified.' In the same communication appeared this significant language: 'Moreover, if the machine should fail to make bags as specified, you will not be expected to take the machine and your initial payment will be refunded to you.' That there was no misunderstanding about the conditions on which the sale was made is evident from the reply of the defendant that although they had not examined their file they were 'quite sure that there was some agreement there as to producing the machine subject to our approval in view of the fact that you had not made one previously.' It was added that 'This is immaterial, however, as we understand if the machine does not perform as guaranteed by you we are under no obligations and our money will be refunded,' the latter reference being to a payment of one thousand dollars enclosed with the letter. The importance of the excerpts from the correspondence will develop as we treat of the questions presented for determination.

Eventually, the machinery was received and installed by the defendant and upon being placed in operation was found to be defective in some particulars, whereupon, much effort and money were spent by the manufacturer, through an agent sent to the factory of the defendant, in an attempt to improve the machinery to the end that it would manufacture as many paper bags as specified in the contract. For that purpose expense was also undergone by the defendant. The deferred payments became due, were not met by the defendant and the replevin action resulted.

It is strenuously urged by the defendant that the plaintiff should not have been successful in its attempt to recover the property sold because title passed at the time of delivery and the contract was a 'sale or return' transaction, while the plaintiff argues as strongly that the sale was made 'on approval' and that therefore title was retained in the vendor.

It will be important when this phase of the controversy is reached to bear in mind that the property sold was not available on the market. Its characteristics were not definitely known to either the seller or purchaser because it was to be created by the former on the order of the latter. These features are particularly material in examining the delicate distinction between transactions termed 'sale or return' and those denominated 'sale on approval.' Allied with this feature of the litigation is the objection of the defendant to the consideration of the correspondence immediately preceding the signing by the parties of the sales agreement.

It is fitting to decide at once the propriety of the admission of the correspondence and true status of the title of the property at the time of the action. The rule is that negotiations before the execution of a contract are absorbed in it....