Lockit Cap Co. v. Globe Mfg. Co.

• Decision Date: 12 August 1930
• Docket Number: 22056.
• Citation: 290 P. 813,158 Wash. 183
• Parties: LOCKIT CAP CO. v. GLOBE MFG. CO.
• Court: Washington Supreme Court

290 P. 813

158 Wash. 183

LOCKIT CAP CO. v. GLOBE MFG. CO.

No. 22056.

Supreme Court of Washington

August 12, 1930

Department 1.

Appeal from Superior Court, King County; Kinne, Judge.

Action by the Lockit Cap Company against the Globe Manufacturing Company and another. From the judgment, the defendants appeal.

Remanded with instructions.

Meier &amp Meagher, of Seattle, for respondent.

MILLARD J.

By written contract of July 17, 1928, the Lockit Cap Company agreed to supply the dies and pay to the Globe Manufacturing Company $2,800 for the manufacture of 5,000 so-called 'lockit caps,' intended for use on gasoline tanks of automobiles. The does were to be of ordinary average quality and efficiency. The manufacturing company was to maintain the dies in working order and condition, except for the usual and common wear and depreciation; but, if the dies needed correction or alteration, the cap company was to bear the reasonable expense therefor. The dies were to remain the property of the cap company and were to be returned upon demand in good condition, except for operative wear. Delivery of the finished product was to commence within two weeks after the dies were received and concluded within thirty days subsequent to the date of the first delivery.

'It is agreed and understood that deliveries of finished product shall start not later than two weeks from receipt of said dies and equipment by first party and that final delivery of completed contract number of five thousand (5000) caps shall be made within and not later than thirty (30) days from date of first delivery.'

By their supplemental contract of August 4, 1928, the parties provided for certain changes in the construction of the caps 'Also that they will perform one additional operation on the baffle-plate thereof, no additional time being required for this operation to comply with the terms of the sixth paragraph of the original contract.'

On August 4, 1928, the cap company delivered the dies, including baffle-plate dies, to the manufacturing company, The former also advanced to the latter $1,837 of the consideration of $2,800 to be paid for the caps when completed. No caps were ever delivered by the manufacturing company to the cap company. Upon refusal of the manufacturing company to comply with written demand September 27, 1928, that deliveries of the caps commence within two weeks, the Lockit Cap Company instituted this action against the Globe Manufacturing Company and against the Fidelity & Deposit Company of Maryland on its bond in behalf of the latter in the sum of $2,800, conditioned that 'the said Globe Manufacturing Company shall well and truly perform said contract and shall indemnify and save the Lockit Cap Company from any loss or damage which it may sustain by reason of the failure of the Globe Manufacturing Company to complete said contract in accordance with its terms and conditions.' Plaintiff seeks recovery of $1,837 advanced in payment for the caps, $3,000 for conversion of the dies, and $3,750 profits lost by failure of the defendant to manufacture and deliver the 5,000 caps. The affirmative defense interposed was that the changes made as demanded by the plaintiff in the dies, tools, and materials prevented performance of the contract, and that the dies were not of the quality and efficiency required by the terms of the contract. Defendants also counterclaimed for $2,705. The cause was tried to the court without a jury, and resulted in fidings and judgment in favor of the plaintiff against the defendant manufacturing company in the sum of $5,837, and against the defendant surety in the sum of $2,800. From those judgments both defendants have appealed.

Appellants first assign error upon the failure of the court to make a finding on the contention of the manufacturing company that the respondent had waived timely performance of the contract as specified therein. Such waiver as there may have been could have operated only upon nonperformance of the contract prior to the notice of September 27, 1928. A waiver of past failures does not necessarily constitute a waiver of future defaults; and, while there can be no arbitrary forfeiture where delays have been acquiesced in, still a party, who by his conduct has not insisted upon a timely performance and has thereby waived performance within the time specified in the contract, may, nevertheless, thereafter declare a forfeiture or cancellation of the contract for delay, provided he first makes demand for performance and grants a reasonable time therefor.

'Even where time is made the essence of the contract, this provision may be waived by the party for whose benefit or protection it is inserted, either expressly or by extending the time for payment or performance or by granting indulgence to the other party in this regard; and when such a waiver has been made, he cannot arbitrarily and summarily declare a forfeiture of the contract for delay, but must first demand payment or performance and give the other party a reasonable time and opportunity, after such demand, to comply.' Section 219, Black on Rescission and Cancellation (2d Ed.)

The time allowed by the written notice of September 27, 1928, was reasonable, for it gave the same length of time as was specified in the contract itself; therefore there was no question of waiver upon which the court should have made a finding.

Appellants next insist that the evidence does not show performance of the contract by respondent, in that the respondent failed to supply the proper dies. Paragraph 8 of the counterclaim alleges that, at the time the notice of September 27, 1928, was served, the work was 60 per cent. completed, and that practically all of the lockit caps would have been completed 'in accordance with the terms of the contract between the parties had it not been prevented from doing so by plaintiff's notice of repudiation.' This is hardly consistent with appellants' contention that the dies were so defective that they could not be used. Disregarding this inconsistency, we find sufficient evidence upon which the court could say that the dies were of ordinary average quality and efficiency for the manufacture of the caps, and that there was no lack of performance on the part of the respondent.

Appellants next complain of the award in favor of the respondent on the theory of conversion.

The manufacturing company gained possession of the dies lawfully. The contract provided that title to the dies remained in the respondent, and that, upon demand, the dies were to be returned to the respondent in good condition upon completion of the contract. No demand was ever made for the dies. Where property is taken into possession with the consent of the owner, such possession does not become wrongful until demand and a refusal for its return. Hanson v. Ostrander Ry. & Timber Co., 147 Wash. 104 265 P. 159. Counsel for respondent argue that no demand was necessary because the demand would have been unavailing. True, if the demand would have been unavailing there would have been no necessity therefor; the law never requiring as a condition precedent that a person shall do a useless thing. No demand is necessary as a condition to the maintenance of an action for conversion if it is made to appear...