Milliken-Tomlinson Co. v. American Sugar Refining Co.

• Decision Date: 25 November 1925
• Docket Number: No. 1825.,1825.
• Citation: 9 F.2d 809
• Parties: MILLIKEN-TOMLINSON CO. v. AMERICAN SUGAR REFINING CO.
• Court: U.S. Court of Appeals — First Circuit

9 F.2d 809 (1925)

MILLIKEN-TOMLINSON CO. v. AMERICAN SUGAR REFINING CO.^*

No. 1825.

Circuit Court of Appeals, First Circuit.

November 25, 1925.

COPYRIGHT MATERIAL OMITTED

Albert S. Woodman, of Portland, Me. (Woodman, Whitehouse & Littlefield, of Portland, Me., on the brief), for plaintiff in error.

William R. Pattangall, of Augusta, Me., and J. F. Abbott, of New York City (Pattangall, Locke & Perkins, of Augusta, Me., Leon V. Walker and Verrill, Hale, Booth & Ives, all of Portland, Me., and Hull, Abbott & Carpenter, of New York City, on the brief), for defendant in error.

Before BINGHAM and JOHNSON, Circuit Judges, and BREWSTER, District Judge.

BREWSTER, District Judge.

This is an action of contract brought by the American Sugar Refining Company, defendant in error (hereinafter referred to as the plaintiff), against Milliken-Tomlinson Company, plaintiff in error (hereinafter referred to as the defendant).

The plaintiff seeks to recover damages for breach of alleged contracts whereby defendant agreed to accept and pay for 500 barrels of sugar, to be delivered and accepted during the month of September, 1920. Numerous defenses were set up in defendant's "brief statement to be used under the general issue." These defenses may conveniently be divided into three classes: First, those that deny the existence of the contracts; second, those that admit the existence of the contracts, but deny their validity; and, third, those that assume valid contracts but allege excuses for nonperformance. A demurrer to certain of the defenses of the second class was sustained in the District Court. The case was tried with a jury. The trial judge ruled that the defendant had made out none of the remaining defenses, and instructed the jury to determine only the date of the breach and the amount of damages. The principal questions calling for consideration are whether the court erred in sustaining the demurrer and whether, on the evidence presented, the case should have been submitted to the jury on other issues raised by the pleadings. These questions require a somewhat extended consideration of a voluminous record and an examination into the several defenses relied upon and the law applicable thereto. Many of the defenses with which the defendant has opposed plaintiff's claim are strikingly similar to those interposed to like suits in other jurisdictions, some of which have been prosecuted to the courts of last resort.

Briefly, the undisputed facts, so far as material to the present inquiry, may be thus stated: The plaintiff is a refiner of sugar and the defendant a wholesaler. Early in June, 1920, one Johnstone, a representative of the plaintiff, told the defendant that he (Johnstone) had been allotted a certain quantity of sugar for his customers, among whom was the defendant, that he could sell the defendant sugar for delivery during the months of July, August, and September, 1920, at 22½ cents per pound, and that it would be necessary for the defendant to sign written orders in order to get the sugar. Defendant was at first unwilling to sign orders for future delivery at a fixed price, at least beyond July, but a few days later he signed written orders for 300 barrels to be delivered in July, 300 barrels to be delivered in August, and 200 barrels to be delivered in September. Later in the month Johnstone again advised defendant of another and further allotment which had been provided for his trade, and invited defendant to participate. Again, after some delay, defendant signed orders for 100 barrels to be delivered in July, 100 barrels to be delivered in August, and 300 barrels to be delivered in September. In each instance four (4) copies of the orders were signed by defendant, one of which was designated "Customer's Copy." All four copies were taken and mailed by Johnstone to the plaintiff's Boston office. The customer's copies were returned to defendant about June 25, 1920. Plaintiff's action is based upon three of these orders, calling for delivery in September, 1920. One is dated June 2, 1920, and covers 200 barrels; one is dated June 8, 1920, for 200 barrels; and the third is also dated June 8, 1920, and is for 100 barrels. The orders were identical in terms, except as to dates and quantity of sugar, and one other detail to be noted hereafter. They read as follows:

"The American Sugar Refining Company "117 Wall Street, New York. "Order No. ----. "United States Food Administration License Number: F-0241. "Date: June 8, 1920. "Salesman's Order No. ____. "District No. ____. "Ship to "Sold to Milliken, Tomlinson Co. "Address "Address No. 303 Commercial Street.

"Subject to Acceptance by A. S. R. Co., delivering carrier, Portland, Maine.

"Delivery complete on receipt of goods by carrier. Seller's ruling freight basis on day of shipment. This purchase to be invoiced and paid for at contract price. No allowances will be made for declines in market. This contract contingent on strikes, accidents, fire or other delays beyond seller's control. All additional import duties, excise or other taxes hereafter levied on the raw or refined sugar necessary to fill this contract at buyer's expense in addition to price specified.

                  -------------------------------------------------------------------------------------------------
                                                         Half         Kind
                  Containers.   Cases.   Sacks.   Bags.  Bbls.  Bbls. Pkgs.   Grade.       Pounds. Price.   Amount
                                                                Domino Granulated
                                                                200 lg barrels or equivalent        22.50
                  -------------------------------------------------------------------------------------------------
                

"Assortment to be furnished to seller by buyer before September 1, 1920, but subject to such substitutions as seller may find necessary to make. In event assortment is not furnished promptly, seller reserves right to ship such grades as it has available at time of shipment. Delivery to be during September or as soon thereafter as is possible, and buyer will accept delivery when made by seller. Seller is to have option of making delivery from any of its refineries. All transportation charges to be for the account of buyer.

"Subject to rules and regulations of any government department at the time of shipment or delivery.

"United States Food Administration license No. G:13891."

According to the course of dealings between the parties which obtained during the summer of 1920, the defendant would telephone its assortments for whatever sugar it wanted, and would send its trucks to the plaintiff's warehouse in Portland, where the deliveries would be made. The first assortment was furnished July 12, 1920, and from time to time thereafter the sugar, covered by the orders for July and August deliveries, was all ordered out. No assortments for the sugar to be delivered in September were ever furnished by the defendant, and on or about November 5, 1920, it first notified the plaintiff of its refusal to take the sugar under the three contracts declared upon in this action.

When the customer's copies, above referred to, were received by defendant about June 25, 1920, Mr. Laughlin, its president and manager, called Johnstone's attention to the fact that they were not signed by or on behalf of plaintiff, and that he expected and demanded a written acceptance. Mr. Johnstone said he would get confirmations of the orders. Confirmations of all contracts were received on or before July 15, 1920, but these bore no written signature of the plaintiff, and again Mr. Laughlin complained that he had yet received no written acceptances binding upon the company, to which, as he claimed, the defendant was entitled. The confirmations in form were not in all particulars identical with the orders which they confirmed. These discrepancies are relied upon in defense to the action and will be referred to later.

Coming, now, to the several defenses which deny the existence of any contract between the parties, we find the defendant claiming (1) that there was no meeting of the minds of the parties; (2) that the terms of the contract were too indefinite to be enforced; (3) that defendant's offers to buy sugar were not duly accepted by plaintiff, since the acceptances (a) were not signed, (b) were not authorized, (c) were not unqualified, and (d) were not seasonable.

The first and second of these defenses may be treated together. As we understand defendant's claim, it is that the provisions in the contract relating to assortments to be furnished by the defendant and the terms "subject to acceptance by A. S. R. Co." are susceptible of two constructions; that, as the defendant construed these terms, the provisions respecting assortments conferred a privilege on defendant which it might exercise or not, as it chose, and did not carry any legal obligations; also that the word "acceptance" meant a written acceptance, and if it should now appear to the court that defendant had proceeded upon a misconception of the legal import of the terms of its written orders there was no contract, or at least no contract that can be enforced against it. When the terms of a contract are beyond dispute, it is for the court to say what legal consequences flow from them, and both parties are bound by the correct legal construction — whatever that may be. This is elemental. Sawyer v. Hovey, 3 Allen, 331, 81 Am. Dec. 659; Hotchkiss v. National City Bank (D. C.) 200 F. 287, 293; Williston on Contracts (1920) § 21.

There may be — in fact, there have been — differences of opinion as to the constructions to be placed on language employed in the provisions of these orders. See American Sugar Refining Co. v. Blake et al. (Superior Court, June 6, 1920, overruled Conn. Supreme Court, April 3, 1925), 102 Conn. 194, 128 A. 523. But it does not follow that there was no valid contract between the parties because individuals or courts have disagreed as to its...