Mohr v. Shultz

• Decision Date: 29 January 1964
• Docket Number: No. 9203,9203
• Parties: Frank MOHR, Plaintiff-Appellant, v. Preston SHULTZ, Defendant-Respondent.
• Court: Idaho Supreme Court

Page 1002

388 P.2d 1002

86 Idaho 531

Frank MOHR, Plaintiff-Appellant, v. Preston SHULTZ, Defendant-Respondent.

No. 9203.

Supreme Court of Idaho.

Jan. 29, 1964.

Frank E. Chalfant, Jr., Boise, for appellant.

Hall & Rowett, Mountain Home, for respondent.

SMITH, Justice.

This is an appeal from a judgment of dismissal of an action brought by appellant (plaintiff) to recover the reasonable value of certain baking equipment sold and delivered to respondent (defendant). Appellant's assignments of error necessitate a review of the evidence in order to determine if the trial court erred.

In October 1959, appellant closed his bakery business in Kimberly, Idaho. In a letter dated March 15, 1960, respondent, then in the process of starting a bakery business at his dairy in Bruneau, Idaho, requested price quotations on appellant's electric bakery oven and other baking equipment. In May 1960, respondent traveled to appellant's place of business in Kimberly where he purchased and accepted delivery of the oven and other baking equipment and merchandise, and shortly thereafter respondent paid $100 to appellant to apply on purchase price. While the parties agreed at the time that the price for the oven was $450.00 there is conflicting evidence concerning the prices for the other items of baking equipment, and as to whether respondent accepted several of the items free of charge as gifts.

In the fall of 1960, several months after the sale and delivery to respondent, a dispute arose between the parties concerning the prices to be paid for certain items of the baking equipment. Appellant demanded $2,499.15; respondent insisted that the price agreed upon was $1,328.00 and objected to the inclusion of several items in appellant's billing which, respondent claimed, he did not purchase. The parties not having arrived at an agreement as to price, respondent advised appellant in a letter, dated October 15, 1960, that he was returning a truck load of the baking equipment and that he would return the rest 'as soon as we have the time.' In the same letter however, respondent enclosed a second partial payment of $100.00 toward purchase of the equipment. Appellant refused redelivery of those items of equipment, and they were unloaded in a vacant lot adjacent to appellant's place of business.

Appellant then secured the services of an attorney in Twin Falls, Idaho, to assist in obtaining payment by respondent for the baking equipment. This resulted in an exchange of letters with respondent's attorney, pursuant to which, in a letter dated November 25, 1960, appellant's attorney suggested that respondent 'return the equipment, and that the deal be cancelled between the parties.' Respondent's attorney under date of January 3, 1961, replied to that offer stating that respondent 'would prefer to cancel the agreement between the parties. He will therefore return the equipment.' On January 11, 1961, appellant's attorney acknowledged the aforesaid reply, 'advising me that Mr. Shultz has decided to return the equipment to my client, Mr. Mohr'; then requested that the equipment be returned to the same place and in the same condition as when first delivered; and further requested the date of delivery since 'Mr. Mohr would like to be * * * on hand to accept the same and examine it.'

On January 27, 1961, appellant's attorney again wrote respondent's attorney about the agreement supposedly arrived at by the previous correspondence, in which letter the following statement appears:

'Some time ago, you advised me that Mr. Shultz had decided to return the equipment to Mr. Mohr, which, up to this date, he has failed and neglected to do. We have been advised that he is using all of this equipment, and it now appears to Mr. Mohr that Mr. Shultz has no intentions of returning said equipment, and Mr. Mohr feels that he has had more than a reasonable length of time to live up to this, his second promise, so Mr. Mohr is no longer willing to accept redelivery of said equipment, but demands payment therefor.'

In reply, respondent's attorney, in a letter dated January 31, 1961, stated:

'On January 3, 1961, I advised you that we had accepted your offer to cancel the agreement. I assume that you know that the Little Valley Dairy operates a bakery and has been operating it for some time. A part of the equipment, namely the oven, could not be removed at once because it was built into the building and it is necessary for the Little Valley Dairy to secure a replacement for it. I am sure that you did not expect them to discontinue their business immediately. They have gone ahead, based upon our prior agreement, and are securing the property for replacement and we will return Mr. Mohr's property to him just as soon as possible.'

Then, under date of February 6, 1961, appellant's attorney reaffirmed the position taken in his letter of January 27th, stating:

'Mr. Mohr is not willing to accept the equipment back at this time, and will not accept it back unless and until a satisfactory agreement is worked out in writing concerning the condition that the equipment must be in when it is returned, where it is to be placed, and the amount of rent that Mr. Mohr is to receive for its use during these many long months.'

Later, during March 1961, respondent returned additional items of the equipment, and during July 1961, he returned the remaining items, including the bakery oven. Appellant refused to accept the redelivered property, and it was stored in a commercial warehouse.

After respondent had returned all of the baking equipment, appellant commenced this action on August 17, 1961, seeking judgment for $2,499.15, the sum originally demanded, as the reasonable value of the baking equipment sold and delivered. The action was tried to the court sitting without a jury. At the conclusion of appellant's case in chief the court granted respondent's motion for dismissal, followed by entry of the judgment dismissing the action, and this appeal resulted.

Appellant assigns as error the trial court's conclusion of law reading:

'The offer of the plaintiff to cancel the agreement and accept the return of the property and its acceptance by the defendant constituted a rescission of the sale agreement, if there was a sales agreement, and any agreement for the sale and purchase of said property between the parties was thereby nullified.'

Appellant attacks the expression of doubt as to whether a valid sale took place, and if so, whether the parties subsequently rescinded it by mutual agreement.

The record shows that the parties entered into an oral contract for the sale and purchase of the baking equipment, although there was uncertainty as to prices to be paid other than for the oven. I.C. § 64-308 (a part of the Uniform Sales Law), provides:

'The buyer is deemed to have accepted the goods when he intimates to the seller that he has accepted them, or when the goods have been delivered to him, and he does any act in relation to them which is inconsistent with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them.'

The evidence shows that in October 1960, some four months after respondent's initial acceptance of the equipment under an implied agreement to pay its reasonable value, except for the oven, respondent redelivered a portion of the equipment. In his letter dated October 15, 1960, respondent told appellant that 'we will return the rest as soon as we have the time.' In remitting an additional $100 to appellant in that letter respondent stated, 'meanwhile find a check inclosed to be applied as agreed on the equipment that we first purchased from you.' Respondent's letter shows, (1) that the return of the equipment would be at his, respondent's convenience, and (2) that he regarded a portion of the equipment, i. e., that 'first purchased,' to have been purchased by him subject to payment of a purchase price. Respondent's conduct in those two instances was 'inconsistent with the ownership of the seller.' I.C. § 64-308.

Time then elapsed from October 15, 1960 to January 2, 1961, and respondent had not returned the balance of the equipment; whereupon appellant's attorney by his letter of January 27, 1961, demanded payment because of respondent's failure to return the equipment within a reasonable length of time. The reply letter of respondent's counsel of January 31, 1961, indicates respondent's continued use of the equipment in his business, and that he would return it 'as soon as possible,' i. e., once more at his convenience. That letter again showed conduct on respondent's part inconsistent with ownership by appellant as seller. Time continued to elapse until March 1961, when respondent returned additional equipment, and during July, when he returned the balance of the equipment including the oven. Appellant did not accept redelivery of any part of the equipment.

While appellant retained the $200 paid by respondent on account of the purchase price, an accounting is implicit in the terms of the letter of February 6, 1961, written by appellant's attorney, which makes reference to the condition of the equipment upon its return, and the amount of rent 'for its use during these many long months.' Although the letter constituted an offer on appellant's part to take back the equipment on a basis to be agreed upon in writing, including an accounting, the parties did not arrive at any agreement; nor does the record indicate any overture by respondent in response to the letter by appellant's attorney of February 6th.

Respondent is deemed to have accepted the goods, and to have become obligated to pay their reasonable value in the absence of a definite price agreement, when he has received and appropriated them to his own use. Reynolds v. Blackwell Lumber Co., 61 Idaho 529, 104 P.2d 19 (1940); Simpson, Contracts § 14 (1954).

In the light of our disposition of this appeal by the...