Marx v. American Malting Co.

• Decision Date: 19 April 1909
• Docket Number: 1,883.
• Citation: 169 F. 582
• Parties: MARX v. AMERICAN MALTING CO.
• Court: U.S. Court of Appeals — Sixth Circuit

169 F. 582

MARX v. AMERICAN MALTING CO.

No. 1,883.

United States Court of Appeals, Sixth Circuit.

April 19, 1909

A. P Cox, for plaintiff in error.

O. B Taylor, for defendant in error.

Before LURTON and SEVERENS, Circuit Judges, and TAYLER, District judge.

SEVERENS Circuit Judge.

This is an action brought by the defendant in error, which was plaintiff below and will be so designated in this opinion against the plaintiff in error, to be designated 'the defendant,' to recover the price and value of a quantity of malt alleged to have been sold and delivered by the plaintiff to the defendant at a certain stated price per bushel. The defendant, admitting his liability upon the cause of action stated in the declaration, nevertheless set up a counterclaim arising from a breach by the plaintiff of the stipulations of the contract under which the malt had been sold and delivered to him, demanded that the damages resulting to him thereby be recouped and set off against the plaintiff's demand to the extent thereof, and that for the balance he be given judgment. The contract of sale was partly printed and partly written upon an order blank such as used by the plaintiff in its business, and, as the evidence tended to show, was filled up by it for execution. It was as follows:

'American Malting Company,

'Memorandum of Sale.

'Dated, Detroit, Mich., November 12, '06.

'Sold to Frank Marx Brewing Co.

'P.O. Address, Wyandotte, Mich.

'Quantity, all their requirements to December 31, 1907.

'Quality, standard malt.

'Price, fifty-eight cents per bushel.

'F.O.B. Detroit.

'Terms of payment, cash 3 mos. net from date of bill.

'When to be shipped, all to be taken by December 31, 1907.

'In bags.

'The bags when empty, to be bundled and returned to Detroit branch.

'Shipping directions; via, rail or boat.

'Remarks, If malt is taken in car lots from Detroit, same will be delivered f.o.b. cars Wyandotte at 58 cents per bushel.

'Amount of malt to be used will be between 15,000 and 20,000 bushels.

'American Malting Company, 'Per F.B. Northwood, Seller.

'Correct:

Frank Mark Brewing Company, 'Per F. Marx, Purchaser.

'No privilege, option or refusal on an additional quantity will be recognized unless special and definite mention thereof is made on this order blank.'

The original contract was exhibited at the hearing, but it is not difficult to distinguish the printed skeleton from the special matter written in. The construction of this agreement is admitted to be the essential matter in controversy. Upon the trial it was shown that 20,000 bushels of the malt had been delivered; but that more than this was required for the defendant's business before the end of the year, and that the plaintiff had refused to deliver more, and this upon the ground that its obligation was by the contract limited to 20,000 bushels. The market price had materially advanced during the year 1907, and the defendant had been obliged by the exigencies of his business to purchase elsewhere a considerable quantity of malt and at a higher price. It was shown that in recent years before the date of the contract the requirements of the defendant's business had been from 15,000 to 20,000 bushels; but it was further shown that at that date the defendant had erected and nearly completed extensive additions to its plant, which was intended to be used during the coming year, and that the requirements for malt would be likely to much exceed 20,000 bushels, and that the plaintiff understood these facts at the time of making the contract. The court, accepting the construction put upon the contract by the plaintiff in respect to the quantity it was bound to deliver as correct, held that it had fulfilled its obligation, and excluded all evidence offered by the plaintiff in support of his counterclaim. The plaintiff's claim being admitted, the court instructed the jury to find a verdict for the plaintiff for the amount thereof. The jury found a verdict accordingly, and a judgment was entered thereon.

We think the court was in error. Contracts for the supply of the material to be used in a certain business for a certain time limited, or for the purchase of the entire output of a certain plant or manufactory, for a certain time or season, are valid; this specification of the quantity contemplated by the parties is held to be sufficiently certain; that the certainty can be ascertained from the means to be supplied by the future exercise of the business in good faith and in the normal manner of such business. As this is a commercial transaction, we need go no further than to cite authorities from the federal courts.

Brawley v. United States, 96 U.S. 168, 24 L.Ed. 622; Loudenbeck Fertilizer Co. v. Tennessee Phosphate Co., 121 F. 298, 58 C.C.A. 220, 61 L.R.A. 402; Lima Locomotive, etc., Co. v. National Steel, etc., Co., 155 F. 77, 83 C.C.A. 593, 11 L.R.A. (N.S.) 713; Inman Bros. v. Dudley & Daniels Lumber Co., 146 F. 449, 76 C.C.A. 659.

Coming to the construction of the contract, we are of opinion that in respect to the quantity of the malt contracted...