Reed Oil Company v. Cain

• Decision Date: 13 July 1925
• Docket Number: 117
• Citation: 275 S.W. 333,169 Ark. 309
• Parties: REED OIL COMPANY v. CAIN
• Court: Arkansas Supreme Court

275 S.W. 333

169 Ark. 309

REED OIL COMPANY v. CAIN

No. 117

Supreme Court of Arkansas

July 13, 1925

Appeal from Benton Circuit Court; W. A. Dickson, Judge; affirmed.

Judgment affirmed.

W N. Ivie and Nance & Seamster, for appellant.

OPINION

WOOD, J.

The appellee instituted this action against the appellant in the Benton Circuit Court on the first of February, 1924. Appellee alleged in substance that the appellant is an association operating in the State of Arkansas under a business trust agreement which authorizes the appellant to be sued in the name of Reed Oil Company. Appellee alleged that he owned the Northwestern Arkansas Traffic Bureau, which is engaged in the business of handling rates and tariffs on shipments of various products over various lines of railways; that prior to August 1, 1922, the St. Louis San Francisco Railway Company had in effect rates on oil and gasoline from Tulsa and other points in Oklahoma to Jonesboro and other eastern points in Arkansas, the rate being 38[cent] per 100 pounds while the rate from the same points in Oklahoma to the city of Memphis, Tennessee, a distance beyond the Arkansas points mentioned, was 28 1/2[cent] per 100 pounds; that the appellant employed the appellee to secure from the railroad company a reduction in the freight rates on the products mentioned from the Oklahoma cities to the Arkansas cities which would make that rate the same as the rate from the same cities to Memphis, Tennessee. Appellee alleged that the appellant agreed to pay him for his services a sum equal to the difference between the rate from the Oklahoma cities to Jonesboro, Arkansas, and the rate from the Oklahoma cities to Memphis, Tennessee, in case said reduction was made. The amount appellants would save by this reduction on shipments during a period of three years was to be ascertained by an average of the shipments of appellant from said cities in Oklahoma to points in Arkansas during and over a period of three years. The appellee alleged that he instituted proper proceedings with various traffic managers and traffic bureaus and with the Southwestern Freight Bureau, and that, as a result of his efforts, on or about the first of September, 1923, he secured a reduction of the freight rates on the products named from the cities in Oklahoma to Jonesboro and other eastern Arkansas cities of 27 1/2[cent] per 100 pounds; that the amount which the appellant would have saved as a result of such reduction on shipments during a period of three years was $ 3461; that appellant agreed to pay appellee fifty per cent. of this amount, or the sum of $ 1730.52, which sum was a reasonable fee for the services performed by the appellee on behalf of the appellant. Appellee prayed judgment in the sum of $ 1730.52.

The appellant denied categorically all the material allegations of the complaint. By consent of parties the cause was submitted to the trial court sitting as a jury.

The appellee testified in substance that he was engaged in the business of rate adjustments, claims for over-charges, and general traffic work. He was employed by two or three firms under a salary as their traffic manager and operated under the name of Northwestern Arkansas Traffic Bureau. He was employed by the appellant to secure, if possible, a reduction in rates on refined oils from Oklahoma producing points to Jonesboro, Arkansas, a city located on the Frisco railroad between the Oklahoma cities and Memphis, Tennessee. He made several trips to St. Louis and other points to get the rate to Jonesboro equalized with the rate to Memphis. The rate to Jonesboro from the Oklahoma cities was six cents higher per hundred pounds than the rate to Memphis on the same products. He was first employed in August, 1922, and he details efforts he made to secure a reduction of the freight rates from that time on until some time in September, 1923, at which time the rate was reduced to become effective October 1, 1923, making the rate from the Oklahoma cities to Arkansas cities the same as that of the rate from the Oklahoma cities to Memphis, Tennessee. At the time the contract was entered into between the appellee and the appellant, appellee was to receive an amount equal to fifty per cent. of what he saved the appellant covering a three-year period. After the reduction was effected by the appellee, he procured the freight bills for the previous year and figured what the amount would be for the following three years, and the appellant, on that basis, would owe him the sum of $ 1730.52, provided the rates remained the same and the appellant moved the same number of cars each year. Appellee demanded of appellant a settlement, and it declined to pay appellee, claiming that it had sold its business and would receive no benefit from the reduced rate. Appellee introduced considerable correspondence with the freight traffic commissioner of the Frisco showing the work performed by him, and he testified that the service was for a period of a year or more before he obtained the reduction. He detailed the expenses that he had incurred in performing the services under his contract with the appellant and stated that a fair estimate of the same would be $ 250. On cross-examination he stated that the agreement with the appellant was oral.

Witness H. P. Noyen testified that he was chief clerk to the assistant freight traffic manager of the Frisco railroad. The appellee filed with him an oral complaint, asking for a reduction of the freight rate to Jonseboro during the early part of August, 1922. At that time the railroad company had a rate of 28 1/2[cent] per hundred pounds to Memphis, Tennessee, from the Oklahoma cities mentioned and 34 1/2[cent] per hundred from the same cities in Oklahoma to Jonesboro and other intermediate points in Arkansas. The proposal for the reductions was turned down, but the rate was finally reduced from the Oklahoma cities to Arkansas cities to 27 1/2[cent] per hundred, the same as the rate from the Oklahoma cities to Memphis, Tennessee, and it was through the efforts of the appellee that the reduction was made. Appellee was notified about April 4, 1923, that his claim for reduction was denied, but afterwards the reduction was made and put into effect October 1, 1923. Appellee explained at the time he filed the complaint that the appellant was a shipper to Jonesboro and Marked Tree, Arkansas.

W. B. Redding testified that he had been a traffic or freight expert for about fifteen years, and was familiar with the fees paid to experts in such capacities. He had heard the testimony of the appellee and of the witness, Noyen, as to the services rendered by the appellee to the appellant and a reasonable fee for such services would be fifty per cent. of whatever amount was involved. That was the usual fee. Witness considered that $ 1730 would be reasonable compensation for the work appellee did.

It was agreed by counsel for the parties that the appellant was authorized to do business in Arkansas and could sue and be sued in this State.

Jack Reed was called as a witness by the appellant, and testified that he was president of the appellant during the month of August, 1922. Appellee worked for the appellant from June 1 1922, five or six months until appellant sold its Arkansas properties. The witness had a conversation with the appellee in March, 1922, about the rate to Jonesboro. He was president of the appellant at that time. He stated that he agreed with the appellee to give him one-half of what he saved the appellant over a period of three years, if he secured a reduction in the freight rates from Oklahoma cities to Jonesboro and other Arkansas cities. Witness never heard anything more about the reduction in rates...