Keopple v. National Wagonstock Company

• Court: Arkansas Supreme Court
• Writing for the Court: WOOD, J.
• Citation: Keopple v. National Wagonstock Company, 104 Ark. 466, 149 S.W. 75 (Ark. 1912)
• Decision Date: 24 June 1912
• Parties: KEOPPLE v. NATIONAL WAGONSTOCK COMPANY

149 S.W. 75

104 Ark. 466

KEOPPLE v. NATIONAL WAGONSTOCK COMPANY

Supreme Court of Arkansas

June 24, 1912

Appeal from Pulaski Circuit Court, Second Division; F. Guy Fulk Judge; reversed.

STATEMENT BY THE COURT.

Appellants and appellee entered into the following contract:

"This contract, made by and between the National Wagonstock Company of Little Rock, Arkansas, a corporation, and B. A. Keopple and R. R. McIntosh, copartners, doing business under the firm name and style of Keopple & McIntosh.

"Know all men by these presents that the National Wagonstock Company do hereby agree to take and have Keopple & McIntosh as the sole logging contractors for their mill in Little Rock, Arkansas, for and during the term of five years from date, and do hereby agree to purchase from the said Keopple & McIntosh, copartners, logs for the aforesaid mill, at the following prices and under the following terms, Doyle's scale of measurement to govern:

White oak, 14 inches and up

$ 24.00 per 1,000

Hickory, 12 inches and up

24.00 per 1,000

Red oak, 16 inches and up

18.00 per 1,000

Gum, 18 inches and up

8.00 per 1,000

f. o b. cars within a radius of one hundred and fifty miles of Little Rock, Arkansas, and be free from sap rot, worms knots, shakes, and like defects; straight grained, suitable for bending purposes and wagon material, and cut in lengths as directed by the company. The shipping of said logs is to commence within fifteen days from the date of this contract and continue so as to furnish the necessary material for the the mill to run. Whenever Keopple & McIntosh shall be unable to furnish logs for any reason, the National Wagonstock Company may purchase from other parties until such time as Keopple & McIntosh shall again be able to furnish them. That the logs are to be inspected once a week at points of loading and shipping, and inspection turned in at once, and then logs paid for, and, in case logs are banked, the banking shall be after October 1 of each year of this contract, and when banked shall be inspected once a week and paid for, less $ 2 per 1,000 reserved for loading, and there is not to be any logs inspected and taken up under this contract that is sap rotten or worm eaten. When banked logs are shipped, the $ 2 to be again added to price. The said Keopple & McIntosh agree to furnish not less than two and a half million feet of logs each year during the life of this contract, or sufficient to keep the bending plant running, and the National Wagonstock Company shall only be required to take the number of logs necessary for their requirements at any time. The said Keopple & McIntosh to have the privilege of otherwise disposing of logs they may get out in excess of the requirements of the bending plant on thirty days' written notice from the National Wagonstock Company to them not to cut or deliver any more logs, and the National Wagonstock Company agree to take all logs cut up to the time the aforesaid notice is served on the said Keopple & McIntosh. The prices named above in this contract may be revised by mutual agreement of the parties hereto on January 1, 1913. This agreement entered into and executed on this 21st day of March, 1910.

(Signed)

"National Wagonstock Company,

"By F. L. Mitchell, President.

"B. A. Keopple,

"R. R. McIntosh."

Appellant sued the appellee, setting up the contract in their amended and substituted complaint, and made the same Exhibit A thereto, and, among other things, alleged as follows:

"The plaintiff and defendant at all times understood, and for more than five months both parties operated under the contract with that understanding and agreement, that the defendant was to take and the plaintiffs were bound to furnish two and one-half million feet per year. That the plaintiffs were at all times willing and ready to carry out their part of the contract; that they had expended large sums of money with the understanding and under the belief that they were compelled to furnish at least two and one-half million feet per year, and with the knowledge of the defendant they expended a large sum, towit, about $ 25,000, in buying timber lands preparatory to carrying out their part of the contract. That at the time of the breach of the contract by the defendant the plaintiffs had secured and paid for sufficient timber to fulfill the contract for the remainder of its full term thereof; that they had operated under the contract for five months, and were able and ready to furnish before the end of the year the first two and one-half million feet of logs. That defendant, without default of the plaintiffs, cancelled and made a breach of the contract without giving the plaintiffs the thirty days' notice as required by the contract. That the plaintiffs had cut and had on hand ready for shipment at the various places from which they had been shipping logs about one and one-half million feet, as follows, towit: At Okolona, ready for shipment and cut in the woods, 700,000 feet; at Delight, cut 50,000 feet; at Whitlow, 500,000 feet; at Bigelow, 75,000 feet; at Tinsman, 50,000 feet; at Ozan, 75,000 feet. That, by reason of the wrongful breach of the contract by the defendant and its failure to give notice, the contract having provided that the defendant agreed to take all the logs cut up to the time the aforesaid notice is served on the plaintiffs, the plaintiffs lost on an average of $ 10 per thousand feet, making a total loss on this account of fourteen thousand five hundred dollars ($ 14,500). That, after the breach of the contract by the defendant, the plaintiffs used their best efforts to sell the logs cut to the best advantage, but were compelled to work them up into staves and use for other purposes for which they were not cut, and sustained, not only the loss in price, but a large loss in timber, aggregating the said sum of $ 14,500. That the defendants knew that the plaintiffs were buying timber and making outlays to meet their part of the contract, and, notwithstanding this knowledge, defendant never at any time notified plaintiffs, by its officers, that it did not intend to take at least two and one-half million feet of logs per year. That without any fault of the plaintiffs the defendant, on August 6, 1910, refused to take any more logs, and had, in many ways before and since that time, made material breaches of its contract. That plaintiffs are ready, able and willing to carry out their part of the contract, and are now offering to do so. That defendant knew that plaintiffs were buying timber suitable for its special purposes, and that plaintiffs had purchased teams and equipment in getting ready to carry out the contract; and defendant knew that plaintiffs would not need the teams and equipment but for the fact that they were going to furnish the defendant two and one-half million feet of logs per year; and that by reason of the breach of the contract on the part of the defendant the plaintiffs lost $ 10,000 on this item of teams and equipment. That plaintiffs, if they had been permitted to carry out the contract, would have made a profit of $ 10 per thousand feet on all logs furnished under the contract. That plaintiffs are able, willing and are prepared, having timber, teams and equipment, to furnish for the remainder of the contract 11,500,000 feet of logs, which is the amount called for in the contract. That they have lost this profit by the wrongful breach of the contract by the defendant. That all of these facts and conditions were well known to the defendant, and were contemplated by its officers and agents; and that they knew that by causing a breach of the contract the plaintiffs would lose on this item the sum of $ 115,000. Wherefore plaintiff prays judgment against the defendant in the sum of one hundred and thirty-nine thousand, five hundred dollars ($ 139,500) and costs, and for all other and proper relief."

After the parties had been operating under the contract about four months, the president of appellee wrote appellants complaining because the mill had been "shut down for want of logs." In that letter, after referring to the contract, he says: "The understanding being that you were to keep us supplied with logs in sufficient quantities to keep the mill running, and I am somewhat at a loss to understand why you have not been able to carry out your part of the understanding." And again: "You, of course, understand that we have been depending solely upon you for the supply; and, unless you can furnish the logs, we will, of course, be obliged to make other arrangements, and it is highly important that the mill be kept busy. We are paying you a higher price for the logs than we ever paid before, as you know. We pay the price to get the service, and we expect that you will give it to us. Will you kindly inform me whether from this time on you will be able to give us as many logs as we require."

In answer to this letter the appellants wrote in part as follows:

"Local weather reports for the month of June advise that it rained all but eight days in that month, and for the month of July it has continued to rain almost daily. To show how much in earnest we are in this matter, we wish to state that we have advanced, spot cash, $ 4,640.65, our pledges for $ 2,533.32 more, and a cash investment in teams and equipment of $ 2,986.50, making a total investment of $ 10,170.48. We admit that we are behind on our contract calling for 2,500,000 feet per year for five years, or an average of 208,333 feet of logs per month. To take care of a contract of this kind, it should be a very plain proposition that we will in some months have to more than double this average, as there are some months in Arkansas that it is an almost impossibility to get out logs, and this throws the responsibility on...