Mawhinney v. Millbrook Woolen Mills, Inc.

• Decision Date: 21 November 1922
• Citation: 234 N.Y. 244,137 N.E. 318
• Parties: MAWHINNEY v. MILLBROOK WOOLEN MILLS, Inc.
• Court: New York Court of Appeals Court of Appeals

234 N.Y. 244

137 N.E. 318

MAWHINNEY

v.MILLBROOK WOOLEN MILLS, Inc.

Court of Appeals of New York.

Nov. 21, 1922.

Action by George S. Mawhinney against the Millbrook Woolen Mills, Inc. A judgment for defendant, entered on a verdict directed by the court, was affirmed by the Appellate Division (201 App. Div. 589,194 N. Y. Supp. 780), and plaintiff appeals.

Reversed, and new trial granted.

Appeal from Supreme Court, Appellate Division, Second Department.

Thomas G. Prioleau, of New York City, for appellant.

Roderic Wellman and Francis L. Wellman, both of New York City, for respondent.

POUND, J.

The case comes up on appeal after a second trial of the action granted by this court. 231 N. Y. 290, 132 N. E. 93. The action is to recover damages for breach of contract to manufacture and sell certain woolens. The contract was dated February 9, 1917. The subject-matter of the contract was 100 pieces of woolens. The agreed price was $1.75 a yead. Deliveries were to be made during the months of May, June, and July in the year 1917. Defendant de livered only 10 pieces, for which plaintiff paid.

The question before this court on the former appeal was as to the sufficiency of certain defenses, based on the precedence of certain government contracts made after the date of the contract in suit. It had been held below that, although under government orders and contracts, beginning May 11, 1917, defendant's looms had been utilized and performance of plaintiff's contract had been thereby delayed, the character of the government contracts differed not from ordinary civil contracts, and that until November 24, 1917, when a formal order was made under the provisions of the National Defense Act (39 Stat. 166), the contracts and the acts of the government officials in demanding performance of such contracts constituted no defense for failure to preform plaintiff's contract. The documentary and other evidence of such contracts is set forth in the opinion, to which reference is hereby made.

This court, however, held that, during the emergency of the war with Germany, when the government made contracts for uniform cloth, and requested through its proper army officers that delivery be made as speedily as possible, and that precedence be given over all civilian business, such orders came within the spirit and meaning of the National Defense Act, § 120 (U. S. Comp. St. § 3115g), making compliance with all such precedence orders obligatory on a contractor with the government, so that the contractor to furnish uniform cloth, who complied with the orders and neglected civilian business, is not liable for breach of contract to civilian customers. It also held that:

‘The undisputed facts in this case show that the government made contracts for woolens with the defendant which required the use of its looms and materials and preference in the execution of the work. This preference was necessitated within the meaning and purpose of the above act of Congress and constituted a good defense for the delay or cancellation of the plaintiff's contracts.’ 231 N. Y. 300, 132 N. E. 96.

The court did not hold, nor was it necessary for its decision to hold, that the undisputed facts showed that the work on the government contracts actually did wholly delay or prevent further preformance of plaintiff's contract prior to and until November 24, 1917, when the government requisitioned all cloth in defendant's possession and in process of manufacture, and required defendant to utilize all its machinery exclusively for the performance of the government contracts.

On the second trial judgment in favor of the defendant was directed by the court. The Appellate Division, by a divided court, affirmed the judgment of the court below, saying that:

‘The Court of Appeals has laid down the law of this case to the effect that the government contracts, beginning with the one of May 11, 1917, took precedence of civilian contracts, and, in so far as they prevented performance of plaintiff's contract, constituted a good defense for the delay or cancellation of it. * * * Time was of the essence of the contract between plaintiff and defendant. The defendant contracted to deliver the goods in May, June and July. Whether the government contracts of May 11th and July 22d, taking precedence of plaintiff's contract, caused delay or prevented performance of it in whole or in part, would have been a question of fact on the evidence. But plaintiff waived the time of performance by letters of August 24, October 4, and October 17, 1917. The defendant, therefore, had a reasonable time after October 17th to deliver the goods and such time was never fixed by notice under the doctrine of Taylor v. Goelet (208 N. Y. 253), but was left indefinite. Meanwhile still another government contract was made on August 25th, and the evidence warranted the court in holding as matter of law that performance of plaintiff's contract was then rendered impossible by the government contracts with the effect given them by the National Defense Act (39 Stat. 213, § 120), as interpreted by the Court of Appeals.’ 201 App. Div. 589,194 N. Y. Supp. 780.

The letters of August 24, October 4, and October 17, 1917, above referred to, are mere requests to rush balance of overcoatings due, to advise when delivery will be made, and to give information in regard to delivery. Far from indicating an intention to rescind the plaintiff's contract for delay, they plainly indicate an intention to enforce the contract and to demand delivery of the goods contracted for. Defendant did not formally rescind the contract until December 1, 1917, when it notified plaintiff that the United States government had commandeered all material to the exclusion of private orders.

Taylor v. Goelet, supra, held merely (208 N. Y. 258, 101 N. E. 868, Ann. Cas. 1914D, 284) that:

...