Rudin v. King-Richardson Co.

• Decision Date: 08 April 1924
• Docket Number: No. 15671.,15671.
• Citation: 311 Ill. 513,143 N.E. 198
• Parties: RUDIN v. KING-RICHARDSON CO. et al.
• Court: Illinois Supreme Court

311 Ill. 513

143 N.E. 198

RUDIN

v.KING-RICHARDSON CO. et al.

No. 15671.

Supreme Court of Illinois.

Feb. 19, 1924.

Rehearing Denied April 8, 1924.

Replevin by John Rudin against the King-Richardson Company and others. Judgment for defendants, and plaintiff appeals.

Reversed and remanded.

Cartwright and Dunn, JJ., dissenting.Appeal from Circuit Court, Cook County; George A. Sentel, judge.

Winters, Price & Stevense, of Chicago (George M. Stevens, Julian C. Risk, and Melvin L. Griffith, all of Chicago, of counsel), for appellant.

Winston, Strawn & Shaw, of Chicago (Edward W. Everett and George T. Evans, both of Chicago, of counsel), for appellees King-Richardson Co. and Nevins.

Glennon, Cary, Walker & Murray, of Chicago (F. W. Flott, of Chicago, of counsel), for appellee New York Cent. R. Co.

THOMPSON, J.

This is an action of replevin brought by John Rudin, appellant, for the recovery of a carload of books shipped by the King-Richardson Company, a corporation, from its warehouse at Springfield, Massachusetts, to itself, at Chicago. At the time the action was begun the books were held by the New York Central Railroad Company in its warehouse. The circuit court of Cook county, which tried the case without a jury, entered judgment against appellant, and he has appealed. The appeal is brought to this court because a constitutional question is involved.

For several years prior to January 1, 1914, appellant was employed by the King-Richardson Company as manager of its Chicago branch. On the date stated these parties entered into an agreement by which appellant became the representative of the company at Chicago for a term of five years, and thereafter he conducted his business under the firm name of ‘The King-Richardson Company, Chicago Branch.’ By this agreement the company was to furnish him with its publications at a uniform discount of 75 per cent. from the retail prices. Appellant agreed to pay all the expenses of the business, including freight, rent, salaries, wages, and commissions, to keep an accurate account of the business, to file all correspondence and subscription contracts, to permit the officers of the company to inspect all records and files, and to turn the same over to the companyat the expiration of the agreement. All the net profits of the business belonged to appellant. January 12, 1916, the parties entered into a supplemental agreement, by which appellant agreed to render monthly statements of collections and disbursements, to retain not to exceed $700 on deposit for the purpose of conducting the business of the branch, and to remit to the company, monthly, the balance of the funds of the branch until appellant's account with the company was discharged. Appellant also agreed to pay to the company, on or before September 1 of each year, whatever remained due the company for business done during the previous year.

There had been considerable controversy between the parties regarding payment of accounts and shipments of books, and by this supplemental agreement each party agreed to release the other from claims for damages. Further disagreements arose, and they entered into a second supplemental agreement September 8, 1917. By this agreement appellant was given the exclusive right to sell the publications of the company in twenty states and certain other specified territory, and he was required to execute a bond to guarantee payment of his account in accordance with the terms of the contract. October 19, 1918, the term of the original contract was extended three years. By this agreement appellant was given the option, upon the expiration of the term, to pay the entire account due, in which event he was to be allowed a discount of 2 per cent., or to make payments from month to month in accordance with the contract, settling the account in full on or before Septmber 1 following, in which event he was to furnish satisfactory security covering the entire balance due. The company sold all its publications through two branches-one in Springfield, Mass., and the other in Chicago, Ill.

December 23, 1920, the company entered into an agreement with the proprietors of the two branches to furnish one of its publications, known as ‘The Bible Story,’ at a special discount, in consideration of the branches taking between them a total of 20,000 sets. There was a stipulation that if less than 20,000 sets but more than 15,000 sets were taken the price of each set was to be increased 50 cents, and if less than 15,000 sets were taken the price of each set was to be increased $1. An additional discount of 50 cents a set was allowed on all sets above 20,000. Other disagreements having arisen in the meantime, it was declared in this agreement that all claims for breach of contract were settled. The term of the previous contracts was extended to December 31, 1922. Appellant agreed to take 14,000 sets of The Bible Story and the Springfield branch agreed to take the remaining 6,000 sets. March 25, 1922, appellant ordered from the company 14,000 sets of The Bible Story and listed the number of each binding desired. The company did not make deliveries promptly, as it had agreed, and appellant was in arrears with his payments. To settle this further controversy between the parties a sixth agreement was executed, by which appellant agreed to make certain substantial payments on his contract and to discharge the balance due by weekly payments, and the company agreed to deliver the books as ordered.

Up to December, 1922, the company had delivered but 7,701 sets of the 14,000 due appellant. During the nine years covered by the contract and the supplements thereto there were many disagreements; each party charging the other with unfair dealing. These controversies became more bitter during the year 1922; appellant claiming that the company was not delivering the books promptly and the company claiming that appellant was not making his remittances in accordance with the contract. William H. Nevins is president, treasurer, majority stockholder, and sole manager of the King-Richardson Company, and he is also sole proprietor of the Springfield Printing & Binding Company. The King-Richardson Company occupied a portion of the fifth floor of the building occupied by the Springfield Printing & Binding Company. The publications of the former were printed by the latter. December 22, 1922, the carload of books in controversy, consisting of 3,225 sets of The Bible Story, was shipped from Springfield to Chicago, the bill of lading naming the Springfield Printing & Binding Company as the consignor and consignee. Appellant's place of business was located at 2301 Prairie avenue, Chicago, and the books were shipped to 2300 Prairie avenue, Chicago. Nevins arrived in Chicago on December 26, and thereafter the parties held many conferences, but no agreement was reached. January 24, 1923, the books were transferred to the warehouse and a negotiable warehouse receipt was issued to Nevins.

The principal question in this case is whether appellant has title to the carload of books. Appellees contend that the title is in Nevins, the printer. Appellant contends that the title has never been in Nevins, but that it was in the King-Richardson Company until it appropriated the books to the contract and thereby transferred title to him. Appellees contend further that this action of replevin cannot be maintained as long as there is an outstanding negotiable bill of lading or warehouse receipt, until such instrument of bailment is surrendered to the bailor or its negotiation enjoined. Appellant contends that the warehouse receipt is void because the New York Central Railroad Company is operating its Taylor Street Warehouse in violation of the laws of the state of Illinois, and appellees contend that if the Warehouse Act of Illinois (Smith-Hurd Rev. St. 1923, c. 114, §§ 189-214) is construed to apply to this warehouse it is in contravention of section 8 of article 1 of the federal Constitution, in that it interferes with interstate commerce.

The Bible Story is a copyrighted book, and the copyright is owned by the King-Richardson Company, which pays a royalty to the authors. The books are printed from electrotypes and half tones furnished by this company. As general manager of the publisher, Nevins ordered himself, as proprietor of the Springfield Printing & Binding Company, to print and bind the books in controversy. That this was a contract for labor and material seems too plain for argument. Furthermore, from the time they were taken from the bindery to the time they were placed in the warehouse these books were treated as the property of the King-Richardson Company. Nevins, the printer, had no customer in Chicago, and at no time during the negotiations did he pretend that the books belonged to him. All his representations were that he was holding the books as the representative of the publisher. If he had been holding them in any other capacity there would have been no basis for negotiations with appellant regarding the books, because appellant's relations were with the King-Richardson Company only. After the parties had failed to reach an agreement, the freight and other charges were paid by the King-Richardson Company, and Nevins, as treasurer, signed the check. Before appropriation, the title to the books was in the publishing company.

The next question to determine is whether title passed from the company to appellant. This, of course, is a question of intention, and that intention must be ascertained by certain established rules. Rule 4(1) of section 19 of the Uniform Sales Act (Smith-Hurd Rev. St. 1923, c. 121 1/2) provides:

‘Where there is a contract to sell unascertained or future goods by description, and goods of that description and in a deliverable state are unconditionally appropriated to the contract, either by the seller with the assent of the buyer, or by the buyer with the assent of the seller, the property in the goods...