New Brunswick & C. R. Co. v. Wheeler

• Decision Date: 08 June 1882
• Citation: 12 F. 377
• Court: U.S. District Court — District of Connecticut
• Parties: NEW BRUNSWICK & CANADA R. CO. v. E. S. WHEELER & CO.

12 F. 377

NEW BRUNSWICK & CANADA R. CO. v. E. S. WHEELER & CO.

United States Circuit Court, D. Connecticut.

June 8, 1882

John W Alling and Chas. R. Ingersoll, for plaintiff.

John S Beach and Edward J. Phelps, for defendants.

SHIPMAN D.J.

This is an action at law which was tried by the court, the parties having waived a jury trial by the written stipulation which is a part of the record. The facts in the case which are found to be true, the testimony which was objected to, the rulings of the court upon said objections, and the exceptions to said rulings, are as follows:

The averments of the complaint in regard to the citizenship residence, incorporation, and partnership of the respective parties are true.

The New Brunswick & Canada Railroad Company is a corporation which owns and manages a railroad running from St. Stephens, in New Brunswick, to Holton, in the state of Maine, a distance of about 100 miles. At the time of the transactions hereinafter mentioned the corporation had eight directors, who owned nearly all of the capital stock of the company. At the organization of the company, a few years ago, there were but eight owners. The business of said directors was transacted very often without the formality of votes, but by verbal instructions to the president, and more after the manner of a partnership than of a corporation.

In 1878 the directors commenced to relay the road with new steel rails, and 1,000 tons were bought for that purpose. On July 24, 1879, the directors passed the following vote 'Resolved, that the president be authorized to purchase 2,000 tons of steel rails, if he deems it advisable to do so.'

Negotiations for this purpose were thereafter commenced, which resulted in a contract, executed about February 6, or 7, 1880, with an English firm for the purchase of that amount of steel rails. They were to arrive some time thereafter. As reliance was placed upon the money to be obtained from the sale of the old rails for the payment of the new, the directors of the corporation, in conversations and by verbal instructions given from time to time before the completion of said contract, both at directors' meetings and at occasional interviews elsewhere, but not by vote passed at any meeting, verbally authorized and instructed their president to sell the old rails belonging to said company and then upon the road-bed, and gave him full authority to do whatever was necessary for that purpose. When Mr. James Murchie, the vice-president of said company, was about to leave St. Stephens for New York and the eastern cities in January, 1880, upon business of his own, the president gave him express instructions to sell said old rails, the approximate weight of which was well understood, for 75 tons of old rails would be taken up by the laying 100 tons of new rails, and in pursuance of said instructions said Murchie, as vice-president of the company, entered at New Haven on January 31, 1880, into the written contract with the defendants for sale of 1,000 tons, and also for the sale of 200 to 600 tons, which contract is contained in plaintiff's Exhibits 1 and 2 hereto annexed. ^[1]

On February 16, 1880, at a meeting of the directors of the plaintiff corporation, the following votes were passed:

'Resolved, that the contract made by Mr. Murchie with Messrs. E. S. Wheeler & Co., of New Haven, be agreed to; a memorandum to this effect to be furnished to Mr. Murchie, to be forwarded to Messrs. Wheeler & Co.

(After discussion upon another subject:)

'Resolved, that the following sale of old rails made by Mr. James Murchie to Messrs. E. S. Wheeler & Co. be confirmed:

'Sold E. S. Wheeler & Co. 1,000 tons of old rails for delivery in New York or New Haven, at their option, before August the 1st next, at thirty dollars ($30) per ton of 2,000 lbs., the duty to be paid by Wheeler & Co., and also 200 to 600 for delivery in New York or New Haven, between August 1st and October 1st, at twenty-eight dollars ($28) per ton of 2,000 lbs., the duty to be paid by Wheeler & Co.

'In each case, cash against invoice, bill of lading; insurance policy in satisfactory company.'

On February 17, 1880, Mr. Murchie sent the defendants the letter hereto annexed, marked Defendants' Exhibit B. ^[2] On February 28, 1880, the defendants replied to said letter of Murchie, and sent to him, as vice-president, the letter hereto annexed, marked Defendants' Exhibit D., ^[3] which letter was duly received, but to which no reply was made. No other communication, verbal or written, passed between the plaintiff and defendants until about June 10, 1880, when Mr. Murchie called upon the defendants and asked them whether they would have those rails delivered in New Haven or New York, and said that the defendant was ready to deliver them, and that the tons were to be 2,240 pounds each

The defendants declined to receive any rails upon the ground that the plaintiff had repudiated the contract of January 31st, or that it had ceased to exist by the plaintiff's act. The plaintiff thereupon sent the defendants the letter of June 14, 1880, hereto annexed and marked Defendants' Exhibit E., ^[4] to which the plaintiff replied by letter of June 15, 1880, hereto annexed and marked Defendants' Exhibit F. ^[5]

On June 30, 1880, the plaintiff tendered in fact, under the contract of January 31, 1880, to the defendants a cargo of old iron rails of about 65 tons, of 2,240 pounds to the ton, at the city of New Haven, and the defendants declined to receive the same, or to say where they should be delivered, whether at New Haven or New York, or to give any instructions whatever on the subject.

The plaintiff, on August 10, 1880, sent to the defendant the letter of that date, hereto annexed and marked Plaintiff's Exhibit 3, ^[6] to which the defendant replied by letter of August 21, 1880, hereto annexed and marked Plaintiff's Exhibit 4. ^[7] All the letters hereinbefore mentioned were duly and seasonably received by the respective parties to whom they were sent The defendants never received, but always, after June 10, 1880, refused to receive, any of said 1,000 tons, or of said 600 tons, either in the city of New York or at New Haven, although the same were duly and properly tendered to them on June 10th, June 14th, June 30th, and August 20th. The plaintiff had at said respective dates, and before August 1, 1880, 1,000 tons of rails for delivery under the contract of January 31, 1880, for delivery under said contract, and was, at said respective dates upon which tender was made, able, ready, willing, and anxious to deliver said iron, and to comply with the contract of January 31st by the delivery of 1,000 and 600 tons, of 2,240 pounds each.

It was agreed (subject to the plaintiff's right of objection to the admission of evidence to prove the same, to which evidence and to the proof of which fact the plaintiff duly and seasonably objected upon the ground that the statutes hereinafter quoted show the meaning of the word 'ton,' but the court admitted the same, to which ruling the plaintiff duly and seasonably objected) that a ton of iron rails or other scrap iron, when contracted for, or bought and sold in the markets of the cities of New York and of New Haven, by the uniform usage or custom of those markets, means, and on January 31, 1880, meant, a ton of 2,240 pounds, unless the term of the contract evidenced a different meaning upon its face.

The statute of the state of Connecticut, in force on January 31, 1880, and still in force, provides as follows: 'In the sale of articles by avoirdupois weight, 100 pounds shall constitute a hundred weight, and 2,000 pounds shall constitute a ton; and the aliquot parts of a hundred weight and of a ton shall be reckoned accordingly. ' By the statutes of New York, Maine, and the dominion of Canada, in force upon January 31, 1880, and still in force, 2,000 pounds constitute a ton. The parliament of the dominion of Canada has control of weights and measures throughout the dominion, and its statute provides that every contract made in the dominion for any merchandise agreed for by weight or measure shall be deemed to be made and had according to one of the dominion weights or measures, ascertained by said act, and if not so made, according to the metric system.

On January 31, 1880, and when the contract of that date was entered into by and between the said Murchie, acting in behalf of and as the agent of said company, and E. S. Wheeler, one of the defendants, and acting for said firm, each of said parties contracted for the sale and purchase of gross tons, in accordance with said custom, and each understood that he was contracting for tons of the customary weight,-- that is, of 2,240 pounds each,-- and each knew that the word 'tons,' as used in said contract, meant in his mind tons of 2,240 pounds each, and there was no misunderstanding between said persons as to the true intent and meaning of said contract.

The plaintiff duly and seasonably objected to any evidence in regard to custom or usage, or the understanding of Mr. Murchie as to the meaning of the word 'ton,' but the same was admitted, and to said ruling the plaintiff duly and seasonably excepted.

It was agreed that the list hereto annexed and marked Plaintiff's Exhibit No. 6 ^[8] correctly shows the market price per ton of old iron rails in the markets of the cities of New York and New Haven, at the dates respectively as given, and that a ton of such rails or other scrap iron, when quoted for the market price in said markets, means a ton of 2,240 pounds, the duty on such iron being eight dollars per ton of 2,240 pounds, and included in said market price.

The damage to the plaintiff by reason of the refusal of the defendant to accept said 1,000 tons was the sum...