Millie Iron Mining Co. v. McKinney
| Decision Date | 26 July 1909 |
| Docket Number | 1,905. |
| Parties | MILLIE IRON MINING CO. v. McKINNEY. |
| Court | U.S. Court of Appeals — Sixth Circuit |
The action grew out of an agreement in writing consisting of two papers, each dated March 2, 1894. It is alleged: That under this agreement the Millie Company delivered to McKinney certain iron ore then on its stockpile near the city of Iron Mountain, Mich.; that McKinney agreed to accept the ore at $14,500 and to ship it to Lake Erie ports, as soon as convenient and profitable, and there sell the same; and further, that if the gross receipts exceeded $14,500 and the cost of loading, railroad and lake freights, insurance and seller's commission of 10 cents per ton, and interest on the whole for six months at the rate of 6 per cent. he would pay the excess to plaintiff. It is alleged, further, that, in violation of his agreement, McKinney, on March 7, 1894 before the opening of navigation and before the ore was shipped to Lake Erie ports, sold the ore at $2.50 per ton which, if reasonably held and marketed, would have brought $3.25 per ton, and that upon this price the Millie Company would have been entitled to a balance of $10,995.91. Plaintiff alleged that it had been damaged by reason of defendant's breach of contract in that sum and prayed judgment.
The answer contains a general denial in the first defense. The second defense sets up estoppel, alleging: That an action was brought in the court below, January 20, 1897, by the Millie Company against the present defendant, McKinney, and James Corrigan and Stevenson Burke, wherein the same contract as the one now in suit was involved; that in the former suit McKinney had been charged with failure to perform the contract in the manner now complained of, and with having together with his codefendants, as a firm known as 'Corrigan, McKinney & Co.,' assumed to pay his (the present defendant's) obligations and liabilities under the contract, and by reason of the premises asked judgment against him; that evidence was presented by plaintiff; that McKinney made separate motion to direct a verdict in his favor on the ground that the contract was not made by him as an individual, but as receiver of a firm known as Corrigan, Ives & Co., pursuant to order of the Cuyahoga common pleas; that his motion to direct was granted, and, after motion for new trial was overruled, judgment was entered on the verdict and is in full force and effect.
In the reply it is admitted that plaintiff brought action against Corrigan, Burke, and McKinney, alleging in its petition that the three were copartners as Corrigan, McKinney & Co., and that McKinney had entered into the contract now sued on as agent for the copartnership of Corrigan, Ives & Co., and that Corrigan, McKinney & Co., had succeeded to the business of that firm and had assumed and agreed to perform the obligations of Price McKinney under said contract, and that the joint answer filed therein by the three defendants admitted the making of the contract by McKinney, but denied that he made it as agent for Corrigan, Ives & Co., or that the other firm had assumed the contract. It admits that the case went to trial upon these issues, and that the plaintiff, having failed in the opinion of the court to make proof of the agency of McKinney for Corrigan, Ives & Co., and of the assumption aforesaid by the other firm, verdict was directed and judgment entered on the verdict. It denied that the liability of McKinney under the contract was put in issue, tried, or contested.
In the trial of the present case the two papers constituting the agreement of March 2, 1894, were read in evidence. They disclose the Millie Company and Price McKinney as the only parties to the agreement. Proofs were offered tending to show: That the ore was delivered to McKinney and sold as alleged in the petition; that it was fairly worth, and would, if reasonably disposed of, have brought, the price named. Defendant offered proofs tending to contradict the evidence concerning sale of the ore, and to show that in fact he made the contract as receiver, though under the advice of counsel he made it in his individual name. Evidence was received tending to show: That at the date of the contract the Millie Company owed Corrigan, Ives & Co. $14,500; that the defendant was then receiver of that firm; and that, through correspondence had by him as receiver with the Millie Company, it knew that the purpose of the agreement was to utilize the ore to discharge the indebtedness of the Millie Company. It was admitted during the introduction of the defendant's testimony that the amount actually received by him for the ore sold exceeded the consideration aforesaid, and all expenses by something more than $900, and that, if the agreement was in fact the individual undertaking of defendant, the plaintiff would be entitled to that sum, with interest. The pleadings and the proceedings of the court in the former case, together with the opinions rendered therein, first, by Judge Hammond upon the motions made for directed verdicts, and, second, by Judge Tayler in overruling the motion for a new trial of that case and entering judgment on the verdict, were received in evidence. In granting the motion for a directed verdict, the court below, without determining any other matter, decided that the operation of the judgment in the former case prevented recovery in the present case.
The assignments of error relate to admitting the aforesaid copies of pleadings, also of the proceedings and judgment and opinions of the court, also of the briefs of plaintiff and appointment of McKinney as receiver of Corrigan, Ives & Co., also to granting motion to direct verdict and entering judgment.
A. C. Dustin, for plaintiff in error.
S. H. Holding and Tracy H. Duncan, for defendant in error.
Before LURTON, SEVERENS, and WARRINGTON, Circuit Judges.
WARRINGTON Circuit Judge (after stating the facts as above).
The assignments of error may be disposed of under the inquiry: Does the judgment in the former case operate as an estoppel against recovery in the present action?
The cause of action in each case was based upon the same instruments, and it was sought in each to recover the difference between the price received for the ore and the price alleged to be its true value, less charges and expenses. But the present action is upon the agreement as it was written; it is against Price McKinney as principal. The former action was not upon the contract as it was written. Recovery was sought upon the agreement as though a totally different principal had in name executed it through Price McKinney as agent.
The form of the present action appears in the statement. The former action was against James Corrigan, Stevenson Burke, and Price McKinney. Immediately after statement of jurisdictional facts, it was alleged in the petition: That Corrigan and Burke and one Ives were copartners under the firm name of Corrigan, Ives & Co.; that Corrigan, Burke, and McKinney organized a copartnership under the name of Corrigan, McKinney & Co.; that the last-named firm succeeded to the business of the prior firm, and assumed all the liabilities of Corrigan, Ives & Co. It was next alleged that Corrigan, Ives & Co., in March, 1894, had a claim against the Millie Iron Company, which on the second of that month was liquidated at $14,500. Then followed a statement of the contract made between the Millie Company and McKinney on that date, and thereupon:
'Plaintiff further says that it is informed and believes, and so charges the fact to be, that the said Price McKinney acted, throughout, in said matters, in the interests and for the benefit and at the special instance and request of Corrigan, Ives & Co., and as their agent and representative, and that the contract and agreement aforesaid, although made by him in his own name, was the contract, agreement, and obligation of the said firm of Corrigan, Ives & Co., and that all that the said Price McKinney did in and about said contract, and in and about the execution and attempted execution thereof, was done by him as their agent and representative, and with their full knowledge and approval.'
After stating the quality and value of the ore and what under reasonable handling it would have brought, the petition charged that Price McKinney and Corrigan, Ives & Co. failed to carry out the contract and sell the ore as they should, to the damage of the plaintiff in a sum specified.
It is true that a breach was charged in the former case against both McKinney and his alleged principal; but in the same paragraph, not to speak of other portions of the petition, it was further charged that, if the contract had been performed, 'said Corrigan, Ives & Co. and said Price McKinney, as their duly authorized agent and representative, would have realized' the excess sued for. Charging the breach of contract against McKinney as well as Corrigan, Ives & Co., must, we think, be treated as a charge against McKinney in his capacity as agent of that firm, for the petition as a whole is framed upon that hypothesis, and Judge Hammond so regarded it.
The only features of the answer in the former case that need be noticed are the averments that on July 11, 1893, an action was brought by Stevenson Burke in the Cuyahoga common pleas against his copartners, Corrigan and Ives, and that the firm of Corrigan, Ives & Co. was dissolved, and Price McKinney appointed and qualified as receiver; also, the admission that that firm had a claim against the Millie Company which on March 2, 1894, was liquidated at $14,500.00; also, the further admission that on that date the Millie Company and McKinney entered into an agreement, but denial was made that it was correctly set forth in the petition. This is followed...
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