Portsmouth Cotton Oil Refining Corp. v. Madrid Cotton Oil Co.

• Decision Date: 10 February 1916
• Docket Number: 4 Div. 595
• Citation: 71 So. 111,195 Ala. 256
• Parties: PORTSMOUTH COTTON OIL REFINING CORP. v. MADRID COTTON OIL CO.
• Court: Alabama Supreme Court

71 So. 111

195 Ala. 256

PORTSMOUTH COTTON OIL REFINING CORP. v. MADRID COTTON OIL CO.

4 Div. 595

Supreme Court of Alabama

February 10, 1916

Appeal from Circuit Court, Houston County; H.A. Pearce, Judge.

Action by the Portsmouth Cotton Oil Refining Corporation against the Madrid Cotton Oil Company. From a judgment for defendant plaintiff appeals. Reversed and remanded.

E.S Thigpen, of Dothan, for appellant.

Farmer & Farmer, of Dothan, for appellee.

MAYFIELD J.

Appellant claims to have purchased two tanks of cotton seed oil from appellee, through a commercial broker, one C.G. Hewitt, and that appellee failed and refused to deliver according to the contract; that appellant was forced to go into the market and purchase other oil, and hence sues to recover the difference between the contract price and the price which appellant was compelled to pay in the open market. The defense of appellee was that it never sold, or agreed to sell, the oil in question to appellant at the price and on the terms claimed by appellant, but that it did agree to sell to the broker at the price of 27 cents per gallon, and he declined to take the oil at the price agreed. This record shows beyond doubt that appellant did purchase, through Hewitt, and on the terms named, and that appellee declined to sell or ship on those terms, after demand by appellant; that the price of oil was higher, at the time for delivery, than it was at the time of the alleged sale by appellee to appellant, and that the latter went into the market and purchased the oil at an advanced price over the alleged contract price. There is no doubt that Hewitt was a broker merchant, and that as such he was held out by the defendant to the plaintiff as its agent to sell its oil, and that as such agent he sold the oil to plaintiff; and that defendant declined to be bound by the contract of sale made by its agent. This is shown by a telegram from defendant to Hewitt, of date October 24, 1914 which read as follows: "Offer tank of oil for immediate shipment. [ Signed] Madrid Oil Co." Acting on this, and other undisputed authority from defendant, the broker did sell two tanks of oil, one for immediate delivery, and one for November delivery, at 26.55 cents per gallon. The real contention of defendant was that the agent was not authorized to sell except for 27 cents per gallon. Mr. Watford, defendant's general manager, who sent the telegram set out above, and who held telephonic communications with the broker, and conducted a correspondence with him about the sale, testified in part as follows:

"That he knew that C.G. Hewitt was a broker in Montgomery; that he knew that Hewitt had made sales as a broker prior to that time for the Madrid Cotton Oil Company that Hewitt had made sales under his direction to the Portsmouth Cotton Oil Refining Corporation prior to that time, as a broker; that the Madrid Cotton Oil Company had some oil that it wanted to sell; that he wires Hewitt for the purpose of getting a price on that oil; that he didn't know that Hewitt wasn't dealing in cotton seed oil; that he knew that Hewitt was a broker in cotton seed oil; that he sent a telegram to Hewitt on October 24th; that Hewitt did not tell him in the conversation over the telephone that he had sold the oil at $3.54 per 100 pounds, and that he didn't hear anything about any price per pound; that he didn't know that Hewitt was to sell the oil for the Madrid Cotton Oil Company, to some other person; that at the time he asked him for prices on oil, he expected that he would sell it to some other person; that he received a letter from Mr. Hewitt right after the 27th day of October, inclosing contracts, showing that the two tanks of oil had been sold to John Aspegren; that he retained those contracts; that he didn't answer that letter; that the letter that Hewitt wrote him told him that he had sold the oil for account of Madrid Cotton Oil Company at $3.54 per 100 pounds; that he received another letter from Mr. Hewitt, dated the 2d day of November, inclosing copies of corrected contracts. Witness was shown the contracts and corrected contracts that had been introduced in evidence, and stated that the copies sent to Madrid Cotton Oil Co. were copies of those contracts. Witness stated that in that letter of November 2d, Mr. Hewitt sent copies of contracts, showing the sale of the oil that was made to the Portsmouth Cotton Oil Refining Corporation on account of Madrid Cotton Oil Company at $3.54 per 100 pounds, one tank to be shipped upon prompt forwarding of tank car, and the other tank for November shipment from mill; that he did not remember what date the letter, inclosing the corrected copies, was received; that he remembered the telegram that he sent to Mr. Hewitt about the tank car, but did not remember whether the letter, inclosing the corrected contracts, was received before he sent the telegram about the tank or not; that the Madrid Cotton Oil Company retained that letter and those contracts, and never returned them to C.G. Hewitt and never wrote C.G. Hewitt about that contract at all. Witness further testified that he received the letter from Hewitt, dated October 27th, inclosing the contracts of John Aspegren, and subsequently he received the letter, dated November 2d, inclosing corrected contracts of the Portsmouth Cotton Oil Refining Corporation, stating that he had sold this oil for the Madrid Cotton Oil Company, retained them and never said anything at all about them." The plaintiff offered to prove by the broker, Hewitt, that after he received the telegram from defendant, as above set out, and before any telephonic or other communication had with defendant, he, the broker, did get prices from dealers in crude oil such as the defendant had offered for sale. The trial court sustained defendant's objection to this testimony, and plaintiff excepted. The plaintiff also offered to prove by this witness, Hewitt, that he had made other sales of oil for the defendant, as broker, and that witness did not represent any particular refining, or oil mill, in his sales of crude oil; but the court declined to allow this proof to be made. The plaintiff also offered to prove by this witness that after he had a telephonic communication with the general manager of defendant, as to the sale of the oil in

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