Rayburn v. Maher
| Decision Date | 24 October 1939 |
| Docket Number | 44777. |
| Citation | 288 N.W. 136,227 Iowa 274 |
| Parties | RAYBURN et al. v. MAHER et al. |
| Court | Iowa Supreme Court |
Appeal from District Court, Johnson County; H. D. Evans, Judge.
Proceeding by the defendant, J. B. Maher, to set aside a default and judgment, entered against him. He appealed from the order of the Court overruling his motion.
Reversed.
James B. Ryan and Lehan T. Ryan, both of Des Moines, for appellant.
Will J Hayek, of Iowa City, and Hallagan, Fountain, Stewart & Cless of Des Moines, for appellee.
The plaintiff-partnership filed its petition at law, claiming damages for breach of contract against J. B. Maher, doing business as the Maher 7 Up Company, and Richard Frazee and E F. Chouquette. The petition was filed in the office of the clerk of the District Court of Johnson County, on August 31, 1936, for the September term of that court, commencing on September 21, 1936. An original notice entitled, as herein set forth, directed to J. B. Maher, Richard Frazee and E. F. Chouquette, claiming damages of $1,500 against each of them, for breach of an oral contract, making plaintiff exclusive agent for the sale of defendant's product, was served on Maher in Polk County, Iowa, on August 13, 1936. A like notice was served on " J. B. Maher, doing business as the Maher 7 Up Company" in Johnson County, Iowa, on September 2, 1936, by service on E. F. Chouquette, " he being a member of said Company." Another original notice entitled and directed the same as the above stated notices, reciting: " that there is now on file in the office of the clerk of the District Court of Johnson County, State of Iowa, a petition of the above named plaintiff alleging that E. F. Chouquette is operating and doing business representing the defendant, Maher 7 Up Company; That said E. F. Chouquette is a resident of Iowa City, Johnson County, Iowa, with an office and distributing point and warehouse of said 7 Up product; Plaintiff demands judgment against you and each of you for the sum of $1500.00 because of damages sustained by him in your breach of contract and interference with plaintiff's business established in the vicinity of Johnson County, Iowa", for the November, 1936, term of the Johnson County District Court convening on November 16, 1936, was served upon Chouquette, alone, on October 31, 1936. No notice was ever served on Frazee, so far as the record before us shows.
Plaintiff's petition alleged: That the Maher 7 Up Company was owned by J. B. Maher, and was operating and doing business in Johnson County, Iowa, through its agents, Frazee and Chouquette, with an office, distributing point and warehouse in Iowa City, in said county; that on or about May 25, 1936, plaintiff entered into an oral agreement with the defendant, Maher 7 Up Company, whereby the defendant granted to the plaintiff an exclusive right to handle the beverage product, 7 Up, and promised to pay plaintiff a brokerage commission of 20 cents a case for seven-ounce and twelve-ounce bottles, and 40 cents a case on twenty-four ounce bottles, and in addition to give plaintiff free one case, valued at $1.10, for every ten cases sold; that the agency was to cover Johnson and Washington Counties; that under said contract the plaintiff, was at its own expense, to advertise and create a market for the product in said territory; that the future profits from said business were in the contemplation of both parties and were the inducing cause for plaintiff to enter into said contract; that defendant shipped said merchandise to the plaintiff under said agreement, until about July 17, 1936, after which time the defendant Maher refused to make further shipments to plaintiff; that said petition further stated:
1. " That said defendant, J. B. Maher and/or The Maher 7 Up Company, through its agents, Richard (Dick) Frazee and E. F. Chouquette, visited all of the customers obtained by these plaintiffs using the information gained through plaintiffs' association with these defendants as exclusive agents, notifying said customers that these plaintiffs no longer represent said defendant company, and have no further authority to vend said product; that all of said defendants through their actions and through information surreptitiously obtained deprived these plaintiffs of the benefits of their said contract, and in addition, damaged plaintiffs' business with other products in said establishments causing damage to the extent of $500.00 in this manner. * * *
That the defendant company has since the 17th day of July, 1936, shipped at least two thousand cases of its product into the plaintiffs' territory aforesaid, upon which they are entitled to a brokerage commission of $500.00, no part of which has been paid.
That the defendant company wrongfully and in violation of its agreement with the plaintiffs, failed and refused to ship merchandise in the territory for which they held exclusive agency as aforesaid, from and after the 17th day of July, 1936, through these plaintiffs, thereby preventing the plaintiffs from making sales to their customers contacted by them in said territory, and thereby preventing the plaintiffs from earning their profits through said contract; and that the defendant did wrongfully and without right of authority and without the consent of these plaintiffs, transfer said agency to another person, the defendant E. F. Chouquette, and that said defendant, E. F. Chouquette, did without the plaintiffs' consent sell and distribute said product in the plaintiff's territory to the plaintiffs' customers while the plaintiffs were the defendant company's agents as aforesaid; that these plaintiffs are informed and believe that the defendant company shipped at least two thousand cases of its product into the territory in which these plaintiffs had exclusive agency and on which these plaintiffs were entitled to their commission, thereby damaging said plaintiffs in the sum of $500.00, being the sum which would have been earned by these plaintiffs less the cost of delivery and distribution.
That by reason of said defendant's breach of contract and failure to perform, these plaintiffs have been damaged in the total sum of Fifteen ($1500.00) Hundred Dollars, said damage including the expense, work and labor expended by plaintiffs in preparation of the fulfillment of said oral contract and by way of damages through the breach by these defendants in selling said product in plaintiffs' territory, with interest thereon at the rate of five per cent from September 1, 1936, no part of which has been paid.
Wherefore, plaintiffs demand judgment against these defendants and each of them for the sum of Fifteen Hundred ($1500) Dollars, with interest at six per cent from the 17th day of July, A. D. 1936, and for costs of this action." This petition was verified and filed on August 31, 1936.
According to his affidavit of merit, which is not denied, James B. Ryan, an attorney of Des Moines, got in communication with Will J. Hayek, attorney for plaintiff, shortly after the suit was commenced, and notified him that he represented the defendant, Maher, and that E. A. Baldwin, an attorney, at Iowa City, would represent the defendants locally. Ryan also states, in said affidavit, that he communicated with Baldwin and told him to try to settle the litigation for a nominal amount. The record discloses no further pleadings filed in the case, and no further action of any kind taken, except the filing of a trial notice by the plaintiff for the May, 1937, term, until May 8, 1937, when a special appearance was filed for J. B. Maher, by his attorneys, James B. Ryan and E. A. Baldwin, for the sole purpose of objecting to the jurisdiction of the court, and praying dismissal of the action as to him. This special appearance alleged that J. B. Maher was not a resident of Johnson County, Iowa, and was not maintaining an agency there at the time of the commencement of the action, either through E. F. Chouquette, or any one else. It was supported by an affidavit of Chouquette.
At the same time the same attorneys filed a motion to strike from the petition certain allegations, on behalf of the defendants, Frazee and Chouquette. On June 10, 1937, a hearing was had before the Court, Honorable H. D. Evans, presiding Judge on the special appearance, and it was overruled, and the defendants were directed to plead further within five days. At the same time the motion to strike was overruled, with the same direction to plead.
The Court Calendar, in this cause, noting Will J. Hayek, Attorney for the plaintiff, and E. A. Baldwin, for defendants, has this notation:
Nothing further appears of record to have been done until July 21, 1937. On that date E. A. Baldwin, as attorney for J. B. Maher, perfected an appeal to this court, from the ruling of the trial court on June 10, 1936, overruling the special appearance.
No pleading was filed or further action was taken in the suit, except the filing of a trial notice by plaintiff for the November, 1937, term, and the following notation on the calendar sheet in said cause:
The attorney for plaintiff made affidavit that he so notified Baldwin by telephone on Nov....
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