Meissner v. Standard Ry. Equipment Co.

Decision Date01 April 1908
Citation109 S.W. 730,211 Mo. 112
PartiesMEISSNER v. STANDARD RY. EQUIPMENT CO.
CourtMissouri Supreme Court

Defendant contracted with plaintiff to defray the expenses of obtaining a patent for plaintiff's improvement on pneumatic hammers and pay plaintiff a royalty of 10 per cent. of the gross selling price of all the hammers embodying plaintiff's invention, for which plaintiff granted defendant the exclusive right to make and sell the invention and all improvements thereon. Defendant paid the expenses of obtaining the patent, and made every reasonable effort to utilize the invention, and gave plaintiff every facility and encouragement to render the invention practically useful, but the hammers, though skillfully made under plaintiff's personal supervision, were unmarketable and incapable of use because defective in principle. The invention was never improved so as to render it operative, and neither the invention nor any tool made under it or any improvement of it was ever used or sold by defendant because incapable of practical use. Held, that plaintiff could not recover royalties of defendant, there being no sales upon which to estimate such royalties, and it was immaterial that defendant sold pneumatic hammers not made according to plaintiff's invention or his improvements thereon.

3. SAME—FAILURE OF CONSIDERATION—QUESTION OF FACT.

In a suit upon such contract for royalties, whether pneumatic hammers sold by defendant were made in pursuance to plaintiff's invention and his improvements thereon would be a question of fact.

4. SAME—ACTIONS—JURISDICTION.

In a suit on a contract whereby defendant in return for the exclusive right to make and sell plaintiff's patented improvement on pneumatic hammers, agreed to pay plaintiff a royalty of 10 per cent. of the gross selling price of all hammers embodying the improvement, a plea that after making the contract defendant worked diligently and at great expense and under plaintiff's supervision to make use of the invention, but that it proved useless and impracticable, and that defendant never used or sold any hammers embodying the invention, did not assail the validity of the patent so as to take the case out of the jurisdiction of the state court.

5. SAME—ROYALTIES—ACTIONS.

When a defendant is sued for a royalty, he has the right to prove, if he can, that the thing he made and put on the market did not contain the device protected by the patent, and for that purpose he is entitled to show the particular point covered by the patent.

6. SAME—CONTRACTS—ACTIONS—DEFENSES.

In a suit on a contract, whereby defendant for the exclusive right to make and sell plaintiff's patented improvement on pneumatic hammers agreed to pay plaintiff a royalty of 10 per cent. of the gross selling price of all hammers embodying the improvement, if it appears that defendant made and sold hammers containing in their mechanism plaintiff's invention it would be no defense to say that the invention was impracticable and of no value, the fact that the hammers were made and sold under the license of the patentee estopping defendant from saying that the invention was of no value.

7. SAME.

Defendant contracted with plaintiff to pay the expenses of obtaining a patent for plaintiff's improvement on pneumatic hammers, and to pay plaintiff a royalty on the selling price of all hammers embodying plaintiff's invention, in consideration for which plaintiff granted defendant the exclusive right to use the invention and all improvements he should make thereon. Defendant paid the expenses of obtaining the letters patent, and afterwards employed plaintiff to invent improvements on pneumatic hammers. Plaintiff while so employed, and aided by the suggestions of defendant's officers, and at defendant's expense, invented other distinct improvements in pneumatic hammers, for which letters patent were issued in his name, of which defendant understood it was to have the benefit. Plaintiff knew that defendant so understood, and encouraged the latter in that belief. Held, that plaintiff could not recover royalties for hammers sold embodying only such other improvements, the written contract embracing only the original invention and improvements thereon, and having no reference to other and distinct improvements.

8. SAME—PERSONS ENTITLED TO PATENT.

Such distinct improvements made while in the employ of defendant and at defendant's expense were the property of defendant.

9. SAME — CONSTRUCTION—SUBJECT-MATTER— MANUFACTURERS.

Under the circumstances, the contract of employment being subsequent to the written contract would entitle defendant to the benefit of the later and distinct improvements, even if it varied from the written contract.

10. SAME — ACTION—DEFENSES—MISCONDUCT OF PLAINTIFF.

Where defendant under the written contract was to give plaintiff quarterly statements of the sale of the improved hammers, and plaintiff, though defendant refused to give him such statements, continued in defendant's employ, receiving a salary and making experiments at defendant's expense, and during such time became possessed in confidence of the secrets of defendant's business, and entered into negotiations with defendant's business rival to whom he betrayed such secrets, and afterwards sold the patents in question, and subsequently instigated a suit by the rival against defendant for infringement of such patents, he should not be allowed to come into court claiming royalties from defendant, even though the written contract embraced all subsequent improvements on pneumatic hammers, whether connected with the original invention or not.

11. APPEAL—OBJECTIONS IN LOWER COURTMOTION FOR NEW TRIAL.

It is sufficient to have the appellate court review the trial court's action in overruling exceptions to a referee's report, that appellant in his motion for new trial pointed out in detail the reasons why the court should have sustained the exceptions to the report.

12. CONTRACTS — CONSTRUCTION — CONSTRUCTION BY PARTIES.

The construction put on a contract by the parties thereto in the course of its performance, as evidenced by their actions, is an aid to the court in determining the meaning of the contract if it is expressed in ambiguous language, but such construction is not conclusive.

13. SAME.

Such rule does not apply however, where the meaning of the terms is clear, in which case the fact that the parties themselves by their subsequent conduct or otherwise have placed an erroneous construction upon the contract will not prevent the court from giving it its true construction.

14. SAME.

The contract between the parties was not ambiguous, and there was no necessity for resorting to the acts of the parties under it to ascertain its meaning, plaintiff granting defendant the right to use his invention and any improvement and modification thereof, not the use of plaintiff's future inventions of separate and distinct improvements.

15. EVIDENCE—ADMISSIONS—PLEADINGS.

Plaintiff sued for royalties under such contract, and defendant contended that the hammers sold by it embodied, not the invention referred to in the contract or any improvements or modifications thereof, but subsequent inventions of distinct improvements, made by plaintiff while employed and paid by defendant for that purpose, and at the sole expense of defendant, which improvements therefore belonged to defendant. In a suit in a federal court by another company against defendant for infringement of patents, defendant filed a verified answer pleading the contract involved herein as a defense, and that under such contract it had the right to make the implements sold by it. Held, that such answer was admissible in evidence to show that defendant then thought that the product of its factory was covered by the contract, and that it was proper for the referee to consider such answer, but that such answer was not conclusive.

16. EQUITY—PLEADING—PLEAS—NATURE AND OFFICE.

A plea in equity is different from an answer in equity and from an answer under our code pleading, being not directly responsive to the bill of complaint in equity or to the petition under the Code, nor is it the same as a demurrer, but it is more in the nature of a demurrer than of an answer, for as a demurrer admits the facts well pleaded, but only for the purposes of the demurrer, and as the demurrer, if overruled, cannot be read in evidence, so also the plea in equity is not effective as an admission in courts adhering to the chancery procedure.

17. EVIDENCE—ADMISSIONS—CONCLUSIVENESS —PARTIAL PAYMENT.

A man may make a part payment on a demand which he at the time thinks he is obligated to pay, but the payment will not preclude him from afterward disputing the demand, if on further information or advice as to his legal rights he thinks he is not so obligated.

18. SAME—JUDICIAL ADMISSIONS.

In a suit for royalties under a contract whereby defendant, for the exclusive right to make plaintiff's patented invention on pneumatic hammers or any improvements thereon, agreed to pay plaintiff a royalty on the gross selling price of all hammers embodying the invention or its improvements, defendant contended that the hammers sold by it embodied not the invention referred to in the contract or any improvements thereof, but plaintiff's subsequent inventions of distinct improvements on pneumatic hammers, made by plaintiff while employed and paid by defendant for that purpose, and at the sole expense of defendant, which improvements therefore belonged to defe...

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