Martin v. MORSE BOULGER DESTRUCTOR COMPANY, 371

• Decision Date: 11 July 1958
• Docket Number: Docket 25041.,No. 371,371
• Citation: 256 F.2d 675
• Parties: Warren S. MARTIN, Plaintiff-Appellee, v. MORSE BOULGER DESTRUCTOR COMPANY, Defendant-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

256 F.2d 675 (1958)

Warren S. MARTIN, Plaintiff-Appellee, v. MORSE BOULGER DESTRUCTOR COMPANY, Defendant-Appellant.

No. 371, Docket 25041.

United States Court of Appeals Second Circuit.

Argued May 14, 1958.

Decided July 11, 1958.

Englander & Englander, New York City, for appellant. Herman Englander, New York City, of counsel.

Wait, Wilson & Newton, New York City, for appellee. Howard G. Wilson, New York City, of counsel.

Before CLARK, Chief Judge, and SWAN and LUMBARD, Circuit Judges.

SWAN, Circuit Judge.

This is an appeal by defendant from a judgment awarding damages to plaintiff in an action for breach of a royalty contract, dated December 11, 1950. Federal jurisdiction rests on diversity of citizenship. The case was tried to the court without a jury. Judge Inch made findings of fact and conclusions of law, but wrote no opinion.

The contract sued upon was in the form of a letter addressed by defendant (for brevity called Morse) to plaintiff Martin, and by him accepted. Martin, an engineer, was the owner of several patents which he had licensed Morse to use under a royalty agreement dated February 13, 1946.¹ Morse, a Delaware corporation, was engaged in the manufacture of furnaces for the disposal of wastes. In the autumn of 1950 Morse received a request from Atlantic Refining Company to submit a bid for the construction for Atlantic of a waste water sludge incinerator. Martin claimed that the building of such incinerator would "necessitate using ideas contained in" his Patent No. 2471882 or in a new patent application he proposed to file, and that said patent and new application were not covered by the existing royalty agreement. Thereupon the parties made the contract in suit. It was a royalty arrangement for the particular Atlantic job. After several recitals, which will be mentioned later, so far as relevant, the letter contract bound Morse to pay Martin $6,000., "payable to you in the same proportion, and at the same time as the Atlantic Refining Company would pay us if we obtain the Contract, which amount shall become due only if and when the said furnaces are built for the Atlantic Refining Company, in accordance with the bid which we intend to submit to them, or any modifications thereto providing the same incorporate the type of furnaces covered by the above mentioned letter patent or application for letter patent."²

It is not disputed that the bid submitted by Morse to Atlantic was for "the type of furnaces covered by the above mentioned letter patent or application for letter patent." Indeed, the specifications of Morse's bid, of which Martin was the author, stated, among other things, "This incinerator shall be a Martin Rotary Hearth rabble furnace designed for normal 2200° F operation." The bid was accepted and a contract was made between Morse and Atlantic on February 28, 1951. The work was not completed until March 18, 1954, but it is conceded that the contract was performed to Atlantic's satisfaction and that the full price named in Morse's bid, $245,000., was paid. Certain changes in the design of the furnace, as described in the bid, were made during construction. The appellant contends that the furnace actually built for Atlantic was not built in accordance with the bid submitted and the modifications thereto did not "incorporate the type of furnaces covered by the above mentioned letter patent or application for letter patent."

Finding (7) made by Judge Inch reads as follows:

"(7) The type of furnace built by defendant for Atlantic Refining Company is a single rotating hearth with air-cooled rabble arms and this type of furnace

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