Raymond Syndicate, Inc. v. American Radio & Research Corp.

• Decision Date: 22 March 1928
• Citation: 160 N.E. 821,263 Mass. 147
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: RAYMOND SYNDICATE, Inc., v. AMERICAN RADIO & RESEARCH CORPORATION.

263 Mass. 147

160 N.E. 821

RAYMOND SYNDICATE, Inc.,

v.AMERICAN RADIO & RESEARCH CORPORATION.

Supreme Judicial Court of Massachusetts, Suffolk.

March 22, 1928.

Exceptions from Superior Court, Suffolk County; Edward T. Broadhurst, Judge.

Action by the Raymond Syndicate, Inc., against the American Radio & Research Corporation and trustees. Verdict for plaintiff, and defendant brings exceptions. Exceptions to denial of directed verdict on two counts sustained. Exceptions relating to third count overruled.E. F. McClennen, A. E. Whittemore, and J. R. Flanagan, all of Boston, for plaintiff.

J. W. Worthen, E. B. Cook, and G. M. Palmer, Jr., all of Boston, for defendant.

SANDERSON, J.

This is an action of contract in three counts. The first two are for the recovery of money paid by the plaintiff for radio sets and are based upon a rescission of the contract; the third is in the alternative for damages for breach of warranty in the same contract. The jury found for the plaintiff on the first and second counts in the sum of $11,668.95, and, in the alternative, on the third count in the sum of $8,157.

Certain testimony was admitted de bene, subject to the defendant's exceptions, but was followed by no motion to strike out. Its admissibility need not be considered.

[2][3] The defendant contends that it did not make a contract of sale with the plaintiff. The written order for the goods dated February 6, 1924, was made in the name of Radio Supply Corporation, which was represented in the transaction by one Mahoney. The invoice for the goods was in the name of that corporation, and the checks given by the plaintiff in payment were made to its order. Melvin S. Dorr represented the plaintiff in the matter, and the negotiations for the sale were conducted both with Mahoney and one Ludlow, New England sales manager of the defendant. The goods were shipped directly from the defendant's factory to the plaintiff. The evidence tended to show that Dorr and Ludlow, at the end of the negotiations, agreed upon the price for the sets. Testimony was offered to explain the reason why the defendant desired the transaction put through in the name of the Radio Supply Corporation. Upon conflicting evidence the question whether the latter corporation was acting as agent for the defendant was one of fact for the jury. Submission of bills for the goods by and in the name of the Radio Supply Corporation did not preclude the plaintiff from showing that the sale was in fact made by the defendant. Lerned v. Johns, 9 Allen, 419;Byington v. Simpson, 134 Mass. 169, 170 (45 Am. Rep. 314);Morrison v. F. A. Dutton Motor Co., 251 Mass. 431, 432, 146 N. E. 713.

[4] The plaintiff's testimony tended to prove that it insisted on having the defendant's protection in the transaction and that it would not buy the radio sets unless assured that they carried the ‘Amrad’ guaranty with them. The jury could have found that this guaranty was ‘full satisfaction or money refunded.’ Such a guaranty constitutes a warranty. Weinstein v. Miller, 249 Mass. 516, 519, 144 N. E. 387. The facts in Wall v. Britton Stevens Motors Co., 251 Mass. 517, 520, 146 N. E. 693, 43 A. L. R. 647, distinguish it from the case at bar.

Circulars issued by the defendant containing such a guaranty were turned over to the plaintiff with its order. The sales manager of the defendant testified in substance that these circulars probably indicated ‘the attitude of the home office on January 28, 1924’; and, also, that it was the policy of the defendant to give unqualified guaranty of complete satisfaction or purchase price refunded up to the time the goods were delivered to the plaintiff. The circular was made competent when offered by the plaintiff by reason of the fact that it previously had been shown to the jury by the defendant; but it was admissible for the further reason that it tended to prove the guaranty referred to in the contract.

[7][8] The radio sets were described to the plaintiff as Amrad radio sets 3500-U and 3500-2, with certain radio frequency and one stage of detector and two stages of volume. ‘Where the goods are bought by description from a seller who deals in goods of that description, whether he be the grower or manufacturer or not, there is an implied warranty that they shall be of merchantable quality.’ G. L. c. 106, § 17, cl. 2. When an article is sold by a trade-name there is no implied warranty as to its fitness for any particular purpose. G. L. c. 106, § 17, cl. 4. But there is an implied condition of the merchantability of the goods according to such trade name.' Parker v. S. G. Shaghalian & Co., Inc., 244 Mass. 19, 21, 138 N. E. 236;Standard Rice Co., Inc., v. P. R. Warren Co. (Mass. 1928) 159 N. E. 508. The jury could have found that the defendant knew the plaintiff was buying the goods for resale and that the plaintiff relied on the skill of the defendant as the manufacturer of these sets. Ward v. Great Atlantic & Pacific Tea Co., 231 Mass. 90, 93, 120 N. E. 225, 5 A. L. R. 242;Keenan v. Cherry & Webb, 47 R. I. 125, 131 A. 309, 311.

The rights of the defendant could not have been prejudiced by the refusal of the court to give its request to the effect that the fact that the defendant knew the plaintiff was a retail merchant buying goods for resale is not evidence of a warranty that they were fit for resale by the plaintiff. This request, if given, might confuse the jury as to the law of implied warranty of merchantability. The fact that goods are bought for resale is one of the elements necessary to the establishment of this implied warranty. Parker v. S. G. Shaghalian & Co., Inc., supra. The charge adequately covered this aspect of the case.

The defendant's request for a ruling, that, if the plaintiff bought and received goods having a trade-name, there is no implied warranty that the goods were fit for any particular purpose, properly was refused. This request overlooked the fact that the particular purpose may be merchantability, and the selling by a trade-name does not prevent the implied warranty of merchantability. Parker v. S. C. Shaghalian & Co., Inc., supra.

[11] Many sets, after being sold by the plaintiff, were returned to it for the assigned reasons that they were defective, unsatisfactory, and would not work, and that the oscillation in some cases made them useless. There was testimony that a person with a clear conscience could not sell them to customers as radio sets; that they were not worth anything to sell as such sets and that the only things of value were the parts to break up and sell separately. An expert in such matters testified that, in his opinion, the two hundred and forty-six sets submitted to him by the plaintiff for examination were not, properly speaking, commercial radio sets merchantable as such by an honest merchant. Two of the sets were demonstrated to the jury. They therefore were able to base their conclusion upon what they observed, as well as upon the testimony of witnesses, in deciding whether the sets were merchantable as radio sets. This question was one of fact for the jury.

Three hundred and fifteen sets were delivered to the plaintiff. Two hundred and thirty-eight of these were sent back with a letter dated June 27, 1924, stating that they were not radio sets in that they would not operate and were not in accordance with the contract of sale, and a demand was made for the repayment of the purchase price. The sets returned were sent directly to the defendant by the expert employed by the plaintiff; eight sets were put in storage by him and there has been no offer to return these eight sets; some are still in the plaintiff's place of business, having been returned by purchasers since the sets were sent back; some may have been broken up and the parts sold; and some of the sets sold by the plaintiff have not been returned by the purchasers. The witness Mahoney, called by the plaintiff, testified that the plaintiff would not buy any of these sets unless he got three thousand variometers at a stipulated price, and that the sale of these variometers was a part of the same transaction. The witness then testified that this variometer transaction was a separate one but he then repeated his testimony to the effect that the plaintiff insisted that he would not take any radio sets unless he got the variometers at a special price. The written order for the radio sets included an order for these variometers. No offer was made to return any of them.

[12][13][14] Following this return of property, counsel for the defendant, in a letter to counsel for the plaintiff, stated, among other things, that they understood the defendant had no dealings with the plaintiff and therefore the plaintiff had no right to return merchandise to the defendant; and furthermore, that the merchandise was what the defendant was expected to deliver under its contract with the Radio Supply Corporation. An agreement was then made that the merchandise would be stored by the defendant in a separate lot within prejudice to the rights of either party. A vendee cannot at the same time attempt to disaffirm a part of his contract and keep the benefit of the rest. Loomis v. Pease, 234 Mass. 101, 107, 125 N. E. 177;Learned v. Hamburger, 245 Mass. 461, 139 N. E. 641. If a party undertakes to rescind a contract of sale, ‘he must first return the property sold, or do every thing in his power requisite to a complete restoration of the property to the vendor, and, without this, he cannot recover.’ Dorr v. Fisher, 1 Cush. 271, 274. See Acorn Silk Co. v. Herscovitz, 250 Mass. 553, 555, 146 N. E. 35. As a general rule, subject to certain well-established exceptions, the right to rescind depends upon the buyer's ability to put the seller into...