Long-Bell Lumber Co. v. Stump, 1,006.

• Citation: 86 F. 574
• Decision Date: 21 March 1898
• Docket Number: 1,006.
• Parties: LONG-BELL LUMBER CO. v. STUMP et al.
• Court: U.S. Court of Appeals — Eighth Circuit

86 F. 574

LONG-BELL LUMBER CO. v. STUMP et al.

No. 1,006.

United States Court of Appeals, Eighth Circuit.

March 21, 1898

The Petross-Stump Lumber Company is a voluntary association conducting in the state of Arkansas and the Indian Territory the business of manufacturing and selling lumber. The Long-Bell Lumber Company is a Missouri corporation, with its principal business office at Kansas City, Mo., with an agency at Van Buren, Ark., where the lumber in question was principally shipped after having been milled. On the 17th day of November, 1893, these companies entered into the following contract:

'Memorandum of agreement made this, the 17th day of November, 1893 between the Petross-Stump Lumber Company, of Tuskahoma, I T., and the Long-Bell Company, of Kansas City, Mo witnesseth: The said Petross-Stump Lumber Company agree to sell all the merchantable lumber manufactured by their mill now located at Tuskahoma, I. T., or any other mill or mills they may erect or operate during the year 1894, at the following prices, per Exhibit A, hereto attached, and made a part of this agreement. All shipments and grades to be subject to grades adopted by the Southern Lumber Manufacturers' Association. The said Petross-Stump Lumber Company agree to cut all lumber of such lengths and of such thickness and widths as the said company may direct, and to cut all stock plump, as to length, width, and thickness, and to insure all lumber in stack at the end of each month in favor of said company, and pay the premium on the same. And in consideration of the above the said company agrees to take an inventory of all the lumber in stack at the mill of the said Petross-Stump Lumber Co. will, after said inventory turn over to the agent of the said company all of the said lumber so mentioned, which was to become the property of the said company, and for which the agent of the said company will render a statement to the said Petross-Stump Lumber Co. for all lumber received from them. The said company further agrees to advance $5 per thousand for all lumber checked up each month, in 120-day acceptances; reserving the right to discount the same at 4 per cent., and pay the remainder when the stock is shipped out on the same terms. No advance will be made on star and clear, but all shipments made during the month will be paid for in full between the 1st and 10th of the following month, as per terms specified above,-- 120-day acceptances. And it is expressly understood and mutually agreed upon that the company is under no obligation, by reason of taking the entire output of the mill, to accept any lumber that will not meet the requirements of the grades referred to. This contract is to continue in force until Jan. 1st, 1894.'

Shipments of lumber under this contract were made to the Long-Bell Company (hereinafter called the 'defendant'), by Petross-Stump Lumber Company (hereinafter called the 'plaintiff'), up to the 9th day of January, 1895, at which time the plaintiff assigned said contract to the Bank of Springdale, Ark., when it sent to the defendant the following notice thereof:

'Tuskahoma, I. T., Jan. 9th, 1895.

'Long-Bell Lumber Co.-- Gentlemen: Pay to the Bank of Springdale, Arkansas, any and all sums of money now due, or which may hereafter become due, from you under the agreement and contract existing between yourself and the undersigned; we having this day sold and assigned to the said the Bank of Springdale all our right and title, claim and interest, in and to all accounts and claims and interest, in and to all accounts and claims in our favor, and against you, for any and all lumber now being held by us for your account under said agreement.

'Respectfully,

Petross-Stump Lumber Co. L.S.P.'

Up to the time of this assignment, monthly statements of such shipments, showing dates, quantity, quality, and grade, as also cost price during the current month, accompanied with defendant's check for the amount of each month's dues, were regularly sent by the defendant to the plaintiff. And after the assignment and shipments were continued as theretofore up to the last consignment, in January, 1896, and monthly statements and remittances as aforesaid were sent to the bank. Thus matters stood until this action was instituted by the plaintiff in June, 1896, claiming a balance on account of $2,413.44. The answer, inter alia, pleaded that by reason of the assignment the plaintiff is not the real party in interest. It denied that the exhibit filed with the petition as a part of said contract was either the original, or a copy thereof; and defendant filed with its answer what is claimed to be a correct copy. It also pleaded that all the lumber shipped by plaintiff was not merchantable lumber, as called for by the contract. It then specifically pleaded the facts aforesaid respecting the rendering of monthly accounts,--that each monthly stated account was closed up and settled by them at the time, and that by its acceptance thereof, as also its assignee, the bank, without objection or project or protest, the plaintiff is estopped from reopening the account and maintaining this action. The reply only put in issue-- First, the allegation of the answer respecting the assignment of the contract to the bank; and, second, 'that it is not true, as set up on the third paragraph of defendant's answer, that plaintiff is estopped; that defendant has not accounted to this plaintiff as set forth; neither has this plaintiff ever acquiesced in any settlement with, or account rendered by, defendant.'

The trial was to a jury. The principal contention around which the battle raged at the trial was as to the quantity or unmerchantable lumber, known as 'culls,' contained in the shipments made. The plaintiff, while conceding that culls were not within the terms of the contract, yet contended that all the lumber shipped was merchantable, while the defendant contended that the discrepancy between the quantity shipped and the quantity accounted for was the testimony the defendant asked the court, and it refused, to give the following instructions: 'You are instructed that the defendant, the Long-Bell Lumber Company, having rendered to the plaintiffs monthly accounts showing the debits and credits existing between them, and the credits therein being upon account of lumber delivered, and an account of such lumber, giving its grade, and showing the amount culled therefrom as not merchantable, having been rendered plaintiff upon each shipment, then such accounts became stated accounts, and, unless objected to within a reasonable time became binding upon the plaintiffs; and they can only object to them now upon the ground of fraud or mistake. I instruct you, as a matter of law, that the evidence shows that the plaintiffs did not object to the grading, and did not object to the culling from the lumber of certain amounts, as unmerchantable, within a reasonable time; and hence your inquiry in this case is confined to the simple question as to whether the defendant, the Long-Bell Lumber Company, practiced upon the plaintiffs a fraud in the grading and culling of the lumber shipped, or whether the grading and culling was founded upon a mistake as to grades and culls; and in the latter case, if, after full knowledge of the grades and amount of culls made upon each car, the plaintiffs acquiesced therein, then they are estopped to claim now that such grades and culls were founded upon mistake. ' 'The defendant having furnished the plaintiffs with a statement of the grades of the lumber shipped, and the amount of lumber rejected as unmerchantable, the plaintiffs must have objected within a reasonable time to the grades an culls so stated; and if they failed to do so within a reasonable time, and accepted the purchase price of the lumber at the grades, and less the rejected lumber, then they became bound by the grading and culling so reported to them, and cannot in this suit reopen that question. ' To which action of the court in refusing said instructions the defendant duly excepted. Among the instructions given by the court of its own motion, to which exceptions were taken, are the following: '(2) The court instructs you that, under the contract upon which suit is brought, when the Petross-Stump Lumber Company sawed, stacked, and insured their lumber at the mill-- And I just stop long enough to say to you what I mean when I use the word 'contract' hereafter. I mean this paper that is marked as a copy of the contract, and attached to the complaint. The court instructs you that, under the contract upon which suit is brought, when the Petross-Stump Lumber Company sawed, stacked, and insured their lumber at the mill, and the agent of the Long-Bell Lumber Company had inventoried the same, and the Petross-Stump Lumber Company had turned the lumber over to the said agent, that the lumber at the mill became the lumber of the Long-Bell Lumber Company, as soon as the said agent had received said lumber, and furnished a statement thereof to the plaintiff company; that is, to the Petross-Stump Lumber Company,-- the men who sawed it. (3) The court further instructs you that, when the lumber was so received by the Long-Bell Lumber Company as their lumber, it was received as merchantable lumber, under the terms of the contract, subject, however, to be graded under the rules adopted by the Southern Lumber Manufacturers' Association for grading lumber. Either party therefore had the right to grade the lumber, and no place was fixed in the contract as to where, when, or by whom it should be graded. The evidence tends to show that both parties undertook to grade the lumber according to the rules adopted by the Southern Lumber Manufacturers' Association. Whether either party did so is a question of fact for...