Jonesboro Compress Co. v. Mente & Co.

• Decision Date: 14 September 1934
• Docket Number: 9898.,No. 9897,9897
• Citation: 72 F.2d 3
• Parties: JONESBORO COMPRESS CO. v. MENTE & CO., Inc. MENTE & CO., Inc., v. JONESBORO COMPRESS CO.
• Court: U.S. Court of Appeals — Eighth Circuit

72 F.2d 3 (1934)

JONESBORO COMPRESS CO. v. MENTE & CO., Inc.^*

MENTE & CO., Inc., v. JONESBORO COMPRESS CO.

Nos. 9897, 9898.

Circuit Court of Appeals, Eighth Circuit.

July 13, 1934.

Rehearing Denied September 14, 1934.

W. R. Roddy, of Little Rock, Ark. (J. W. House, C. H. Moses, and W. H. Holmes, all of Little Rock, Ark., on the brief), for Mente & Co., Inc.

Shields M. Goodwin, of Little Rock, Ark. (S. M. Casey, of Batesville, Ark., and E. P. Mathes, of Jonesboro, Ark., on the brief), for Jonesboro Compress Co.

Before SANBORN and BOOTH, Circuit Judges, and MUNGER, District Judge.

SANBORN, Circuit Judge.

The facts out of which this controversy arises are virtually undisputed. On April 1, 1926, the Jonesboro Compress Company (which will be referred to as the "buyer") agreed, in writing, to purchase from Mente & Co., Inc., as seller, "3 cars (about 30,000 lbs. each) Mente New Rewoven Patches about 3 lb. F. O. B. N. O. New Orleans at 7.91¢ per lb." The contract contained the following provisions:

(1) The goods "to be shipped as ordered between September 1, 1926, to Jany. 15th, 1927."

(2) "Failing to receive timely shipping instructions or prompt payment Seller at its option may ship approximately equal quantities monthly or declare this order cancelled either in whole or in part, and if instructions be not received for shipment of entire order during term herein fixed, Seller need not tender the goods nor put buyer in default, but Seller may then or thereafter at its option either cancel this order or invoice entire undelivered balance and recover full purchase price therefor with interest at highest conventional rate from time goods should have been delivered, and may withhold delivery until full payment plus carrying charges of two per cent per annum from time goods should have been delivered until delivery made."

(3) "Interest at highest conventional rate will be charged for any delay in payment and security may be demanded before manufacture or shipment. Title to goods shipped hereunder shall remain in Seller until paid for, whether goods be in possession of Buyer or others, and whether filled or empty; but if illegal to so retain title then Buyer grants and Seller retains a specific lien to secure any unpaid purchase money."

(4) "Conditions of this order apply to goods hereby sold; * * * it is not guaranteed against declines, is not subject to cancellation and Buyer's rights cannot be sold or assigned without Seller's written consent."

The contract was signed on behalf of the buyer by S. R. Gibbons, who was the manager of the buyer. It was confirmed by the seller by telegram on April 1, 1926, and on April 7, 1926, by letter. About October 20, 1926, the salesman of the seller called on the buyer and asked when it was going to order out the patches. He was told that Mr. Gibbons was no longer connected with the buyer, and new managers had been appointed; that those in charge of the business had no knowledge of the contract. The salesman wrote the seller to send copies of the contract to the buyer, which was done on October 22, 1926. On December 18, 1926, and on January 13, 1927, the seller wrote the buyer for shipping instructions. It received no reply. On February 7, 1927, the seller wrote again, calling attention to its unanswered letters and the expiration of the shipping period, and again asked for shipping instructions. The buyer answered this letter on February 10, 1927, stating that Gibbons, the former manager, was without authority to make the contract; that the writer of the letter, Mr. Smith (who signed as "Accountant"), understood that the contract "permitted the purchase of three cars of patches"; that he did not "feel" that his company was obligated to accept three cars of patches; and, in conclusion: "As I view the matter the only thing that I can see is to cancel the contract that you have, but I shall be glad to hear further from you and shall be glad to have a copy of the contract or order which you have covering the bagging, in order that I may submit the same to Mr. Stewart." On February 14, 1927, the seller replied, expressing its surprise that any question should at that late date arise as to the validity of the contract, calling attention to the fact that the contract was an outright purchase contract, that copies of it were forwarded to the buyer on October 26th, and stating that the seller was not in a position to cancel, and that, unless it received shipping instructions by February 21st, the goods would be invoiced. On February 21, 1927, the seller again wrote, asking for shipping instructions. On March 3, 1927, it wrote asking for replies to its former letters. On March 17, 1927, having received no replies, it inclosed an invoice for the patches, amounting to $7,119 plus interest of $109.16, less freight New Orleans to Jonesboro, $369, leaving a net balance due the seller of $6,859.16, and asking for remittance. On May 30, 1927, the seller wrote to the buyer at both Gulfport and Jonesboro, asking what the buyer proposed to do about the three cars of patches. On June 1, 1927, the agent of the buyer at Gulfport stated that the letter would be taken up with the local office and that he would get in touch with the seller as soon as he had the requisite information. So far as the record shows, this was the last letter from the buyer. On June 20, 1927, the seller wrote the buyer, stating that "we would like very much to come to an understanding as to when we will receive shipping instructions on the remainder due." The seller received no...