Royal Brewing Co. v. Uncle Sam Oil Co.

• Decision Date: 13 December 1920
• Docket Number: No. 13669.,13669.
• Citation: 205 Mo. App. 616,226 S.W. 656
• Parties: ROYAL BREWING CO. v. UNCLE SAM OIL CO.
• Court: Missouri Court of Appeals

226 S.W. 656

205 Mo. App. 616

ROYAL BREWING CO. v. UNCLE SAM OIL CO.

No. 13669.

Kansas City Court of Appeals. Missouri.

December 13, 1920.

Appeal from Circuit Court, Jackson County; Thos. J. Seehorn, Judge.

Action by the Royal Brewing Company against the Uncle Sam Oil Company. Judgment for plaintiff, and defendant appeals. Affirmed.

Redmond S. Brennan and Thurman L. McCormick, both of Kansas City, for appellant.

Ringolsky & Friedman and Wm. G. Boatright, all of Kansas City, for respondent.

ELLISON, P. J.

Plaintiff, as its name indicates, was a brewery, and operated a plant at Weston, Mo., and charges defendant, an oil company, with violating a written contract between them, whereby defendant agreed, for a certain stipulated price per barrel, to furnish plaintiff with all fuel oil necessary to operate the plant. This action was brought to recover damages, and plaintiff recovered judgment in the trial court. The chief point defendant makes against the judgment is that the petition fails to state a cause of action. The specification is that the contract pleaded in the petition is not a mutual obligation, is unilateral and void. Plaintiff's petition alleged the damages to have occurred between February 16, 1916 and July 13, 1916, by having to purchase from others than the defendant 36 tank cars of fuel oil, which plaintiff claims cost $1,828.69 in excess of the price for which the defendant contracted to furnish the same material.

The contract upon which the petition is based was executed on May 15, 1915. It provides for the defendant to furnish to plaintiff —

"their requirements of fuel oil as follows: 42 gallons to the barrel. Petroleum tailings, 2 or 3 tank cars each week, to be shipped to Weston, Missouri, price per barrel 40 cents; terms 10 days net; for the period of one year, ending the 13th day of July, 1916, at the price mentioned f. o. b. Cherryvale, Kansas."

The contract further provided that —

"The said party of the second part hereby agrees to purchase and order from the party of the first part, at Kansas City, Kansas, all of said oil which may be necessary for use or sale by party of the second part during said term and to pay party of the first part for each shipment promptly within ten days from the date of invoices covering such shipment."

It will be seen that on reasonable notice defendant agrees to sell to plaintiff its "requirements of fuel oil" for one year, and that plaintiff agrees to purchase and order from defendant all of such oil that may be necessary for its use and sale during the term, and to pay for each shipment within 10 days from date of invoice. in other words, one agrees to furnish and the other to buy, all the oil necessary for its use, or which it may sell during the year. The matter involved relates to fuel for operation of the brewery plant.

The question is, Is the contract void for lack of mutuality — is it unilateral? The rule in respect to mutuality is that the contract must obligate each party to do something in consideration of what the other does, or is to do. It is frequently difficult in a given contract to say whether this rule is complied with. If the contract purports to bind one party to do something and leaves the other free to do, or not to do, as he may please, the latter is not bound, and the contract is void. In this case it is clear enough that the contract purports to bind defendant to furnish the fuel oil at a certain named price, and we have to determine whether plaintiff is bound to take the oil at that price. It seems equally clear that it is so bound, for the contract reads that plaintiff agrees to take "all of said oils which may be necessary" for its use in the brewery.

But defendant insists that the terms are too indefinite to form an obligation on plaintiff's part. That the agreement to buy all the oil which may be "necessary" leaves plaintiff free to say what quantity is necessary — whether much, or little, or none at all. But this claim is not borne out by reason or the law. Plaintiff's brewing business was an established one, and its fuel necessities could be estimated, approximately, by competent persons with a knowledge of such requirements in like institutions. A statement of what is, and what is not a valid contract under the mutuality rule is found in Cold Blast Transp. Co. v. Bolt & Nut Co., 114 Fed. 77, 81, 52 C. C. A. 25, 29 (57 L. R. A. 696). It reads that —

"A contract for the future delivery of personal property is void, for want of consideration and mutuality, if the quantity to be delivered is conditioned by the will, wish, or want of one of the parties; but it may be sustained if the, quantity is ascertainable otherwise with reasonable certainty. An accepted offer to furnish or deliver such articles of personal property as shall be needed, required, or consumed by the established business of the acceptor during a limited time is binding, and may be enforced, because it contains the implied agreement of the acceptor to purchase all the articles that shall be required in conducting his business during this time from the party who makes the offer. [Authorities.] But an accepted offer to sell or deliver articles at specified prices during a limited time in such amounts or quantities as the acceptor may want or desire in his business, or without any statement of the amount or quantity, is without consideration and void, because the acceptor is not bound to want, desire, or take any of the articles mentioned."

To the same effect is Crane v....