Lusk Lumber Co. v. Independent Producers Consolidated

• Decision Date: 05 October 1926
• Docket Number: 1235
• Citation: 249 P. 790,35 Wyo. 381
• Parties: LUSK LUMBER CO. v. INDEPENDENT PRODUCERS CONSOLIDATED, ET AL. [*]
• Court: Wyoming Supreme Court

249 P. 790

35 Wyo. 381

LUSK LUMBER CO. v. INDEPENDENT PRODUCERS CONSOLIDATED, ET AL. ^[*]

No. 1235

Supreme Court of Wyoming

October 5, 1926

APPEAL from District Court, Natrona County; CYRUS O. BROWN, Judge.

Action by the Lusk Lumber Company against the Independent Producers Consolidated and others. Judgment for plaintiff, and defendants appeal.

Reversed and Remanded with Instructions.

A. C Allen and O. N. Gibson, for appellants.

The action was for recovery under a contract for the sale removal and reconstruction of a drilling rig; the defense was non-performance; the contract was one for manufacture and sale as distinguished from the erection of an improvement on real estate; 26 C. J. 675; Allerson v. Mining Co. (Ore.) 65 P. 978; Pomeroy v. Bell, (Cal.) 50 P. 683; Mining Co. v. Ramsay, 4 Alaska 734; Gassaway v. Thomas, (Wash.) 105 P. 168. There was an implied warranty that the rig would conform to requirements of a rig of that character; 4736, 4737 C. S.; 35 Cyc. 384. The rule applies to the reconstruction of a second hand machine for a special purpose; Lotham v. Shipley, 85 Ia. 543; Co. v. Co., (Mo.) 140 S.W. 923; Kelly v. Co., (Mo.) 156 S.W. 62. An express warranty does not negative a warranty implied by law; 4737 C. S.; Ideal Heating Co. v. Cramer, (Ia.) 102 N.W. 840; Blackmore v. Fairbanks Co., (Ia. ) 44 N.W. 548. Discovery of breach before passing of title is ground for rescission; 4733 C. S.; 35 Cyc. 257; 23 R. C. L. 1418. A trivial defect in performance will not defeat recovery; 13 C. J. 692; 23 R. C. L. 1418; Denton v. Atchinson, (Kan.) 8 P. 750. The term, "Substantial Performance," as applied to sales, differs from the term when applied to building contracts on the theory that the owner has received benefits; Vilas v. Co., (Vt.) 65 A. 104; 13 C. J. 690; Omaha Co. v. Omaha, 156 F. 922. An allegation of substantial performance, instead of due performance, fails to state a cause of action; 5681 C. S.; 31 Cyc. 58; 13 C. J. 727 and cases cited. To recover on a defective performance, an excuse must be alleged for failure of full performance; 13 C. J. 728, and cases cited. The petition would be insufficient, even if it were a building contract; 13 C. J. 727; Brenton v. Newlin, 161 Ill.App. 168; Parker Co. v. Ayers, 43 Ind.App. 513. The motion for continuance was improperly denied; 13 C. J. 123; Knauer v. Morrow, 23 Kan. 360. It was incompetent to show that the rig, as constructed, was an average, standard rig in that locality; Camel v. Russel, 139 Mass. 278; Streeter v. Sanitary District, 143 F. 476. The character of the builder was not in issue and evidence relating thereto was improper; 1 Wigmore, 286; Bank v. Richmond, (Mo.) 139 S.W. 352; 22 C. J. 744. Approval by Myrin was a condition precedent to plaintiff's recovery; 9 C. J. 867; Blome v. Inst., 150 Ill.App. 164; Herbert v. Dewey, (Mass.) 77 N.E. 822; O'Brien v. New York, (N. Y.) 35 N.E. 323. Where preponderence of evidence is against the verdict, it will be reversed on appeal; 4 C. J. 856; Fieldhouse v. Leisberg, 15 Wyo. 207; Rainsford v. Massengale, 5 Wyo. 1; Adams v. Smith, 11 Wyo. 200. A continuance should have been granted; Mowat v. Brown, 17 F. 178.

James P. Kem, for respondent.

The case involved a building contract; 6 R. C. L. 967. The doctrine of substantial performance applies; Harrild v. School Dist., (Wash.) 192 P. 1. The petition is sufficient; 3 C. J. 778-781; Pierson v. County, (S. D.) 128 N.W. 616; Borden v. Berthenshaw, (Kan.) 74 P. 639. Performance is sufficiently pleaded; Finley v. Pew, (Wyo.) 205 P. 310; Piper v. Co., (Okla.) 85 P. 965; Parke Co. v. Bridge Co., (Calif.) 78 P. 1065. Motion for continuance was properly overruled; 13 C. J. 123; Kearney Works v. McPherson, (Wyo. ) 38 P. 920; McFadden v. French, (Wyo.) 213 P. 760; Chapman v. Bank, (Wyo.) 181 P. 360; Keffer v. State, (Wyo.) 73 P. 556. No exception was taken to instructions given; Reagan v. Aiken, 138 U.S. 109; Syndicate Imp. Co. v. Bradley, (Wyo.) 43 P. 79. There was no error in the instructions; 23 A. L. R. 1435; testimony that the rig was an average standard rig, in the locality where built, was competent; 38 Cyc. 1432; Co. v. Harryman, (Colo.) 92 P. 922; Town v. Fairfield, (Colo.) 136 P. 470. Testimony as to reputation of the builder was competent; Henderson v. Coleman, (Wyo.) 115 P. 439; 1 Wigmore Evidence, 68; 3 Wigmore Evidence, 1984; Willman v. Jones, (Ala.) 27 So. 416; 13 C. J. 773. The evidence is sufficient to support the judgment; 31 Cyc. 110; Bank v. Henry, (Wyo.) 136 P. 863; Cronberg Bros. v. Johnson, 29 Wyo. 11; Boatman v. Miles, 27 Wyo. 481.

KIMBALL, Justice. POTTER, Ch. J., and BLUME, J., concur.

OPINION

KIMBALL, Justice.

This is an action for the recovery of an amount claimed to be due under a contract for the sale, removal and reconstruction of a drilling rig intended to be used in drilling for oil. The defense was non-performance of the contract. A jury trial resulted in a verdict and judgment for the plaintiff and the defendants appeal.

The defendants, Independent Producers Consolidated and Wyoming Star Oil Company, are corporations engaged in prospecting and developing oil and gas lands. Their managing officer, at the times herein mentioned, was H. A. W. Myrin. The contract was with the Independent Producers Consolidated, and the judgment was against that company. There are no points made on this appeal that require any further reference to the Wyoming Star Oil Company. The First State Bank, another defendant, was made a party because it was the paying agency, as will further appear on a recital of the facts. Hereinafter we shall refer to the Independent Producers Consolidated as the defendant.

In August, 1921, the defendant was looking for a second-hand drilling rig to be used in drilling a well 47 miles north of Moorcroft. The plaintiff, Lusk Lumber Company, had such a rig located near Osage. A Mr. Jackson, who did not testify in the case, inspected this rig for defendant, and thereupon, about September 1, 1921, he and plaintiff's manager prepared a form of contract between the plaintiff and defendant. The material stipulations of the contract were that plaintiff agreed to sell to defendant the drilling rig, described as a "seventy-two ft., twenty ft. base standard rig;" that plaintiff agreed to move and rebuild the rig furnishing certain specified new parts and extra braces, and replacing materials damaged by tearing down and moving; that defendant would pay for the rig when so moved and rebuilt the sum of $ 4600; that a certified check for said amount be deposited by the defendant with the First State Bank, said check to be mailed to the plaintiff when "contract is completed and passed on" by the defendant.

The writing embodying this contract was sent to Mr. Myrin for his approval and the defendant's signature. The defendant signed upon condition that the rig be completed by October 1; that the "wooden crown blocks can be used for drilling to minimum 2500 feet," and that the certified check for $ 4600 would be mailed to plaintiff at the date "when contract is completed and passed on by myself (Myrin)." It is admitted that plaintiff agreed to these changes or amendments of the writing. The bank notified the plaintiff that Myrin had deposited with it $ 4600 to pay to plaintiff according to the terms of the contract. The plaintiff then proceeded to tear down, move and rebuild the rig. On September 22, plaintiff notified Myrin that the rig would be completed and ready for inspection September 25. Myrin replied that he could not make an inspection until the 29th. The inspection was made on the 29th. Mr. Myrin came from Riverton for that purpose accompanied by his attorney and Mr. Hall, a rig builder. Mr. Hall, in the presence of Mr. Myrin and plaintiff's manager, examined the rig, and on September 30 made out a formal, written report in which he set forth 18 specific defects in the rig, stated that there were other minor defects too numerous to mention, and advised against any attempt to repair the structure. This report was sent to the plaintiff with a letter from Mr. Myrin stating that in the face of the report he was unable to accept the rig.

On October 6, plaintiff wrote to Mr. Hall stating in substance that it wished to make the rig satisfactory, but that some of Mr. Hall's objections related to matters not covered by the contract. Mr. Hall was asked to make out for plaintiff a list of materials that would be necessary to put the rig in "A 1 shape," and to state what he would charge to work with plaintiff's workmen while the rig was being made over so plaintiff would know that when completed it would be right. This letter to Mr. Hall was answered October 13 by Mr. Myrin who stated that he was sorry to repeat that he was unable to accept the rig, and that any additional work would be of no benefit to defendant and would not comply with the contract. He gave as his reasons Mr. Hall's report of September 30, in which he advised against an attempt to repair; that Mr. Hall stated that if the rig should be completely rebuilt it would be a patched-up job, and dangerous to workmen; that the rig had not been completed within the time stipulated by the contract, and that it could not be put in shape for drilling by October 25, the time when defendant was obligated to commence drilling.

To this last letter the plaintiff, on October 18, replied by telegram as follows:

"Rig erected per contract and within time fixed. Entitled to and demand payment. Consider objections of Mr. Hall for most part trivial and concerning matters not covered by contract but to be more than fair are willing to meet every substantial objection and have work required for that purpose done by October twenty-fifth. In making this offer we do not admit non-compliance with contract...