Sinnett v. J.R. Watkins Co.

• Decision Date: 20 April 1926
• Parties: SINNETT ET AL. v. J. R. WATKINS CO.
• Court: Kentucky Court of Appeals

282 S.W. 769

214 Ky. 76

SINNETT ET AL. v. J. R. WATKINS CO.

Court of Appeals of Kentucky.

April 20, 1926

Appeal from Circuit Court, Daviess County.

Action by the J. R. Watkins Company against J. L. Sinnett and others. Judgment for plaintiff, and defendants Sinnett and Norris appeal. Affirmed.

W. E. Aud, J. R. Higdon, and J. R. Hays, all of Owensboro, for appellants.

Tawney Smith & Tawney and E. D. Libera, all of Winona, Minn., and Slack, Birkhead & Slack, of Owensboro, for appellee.

CLAY J.

The J R. Watkins Company, a Minnesota corporation, brought this action against J. L. Sinnett, and Val C. Norris, E. K. Smith and I. B. Ware, who guaranteed the payment thereof, to recover a balance due for certain medicinal preparations and other articles alleged to have been purchased by Sinnett. From a judgment in favor of plaintiff, Sinnett and Norris have appealed.

The principal defense was and is that the contract was void, because appellee was engaged in doing business in this state without having complied with section 571, Kentucky Statutes, requiring every corporation to file in the office of the secretary of state a statement giving the name of an agent upon whom process can be served. With the exception of certain formal and immaterial portions, the contract sued on is as follows:

"This agreement, made at Winona, Minnesota, U.S. A., this 1st day of December, A. D., 1919, between the J. R. Watkins Company, a Minnesota corporation, hereinafter called the company, party of the first part, and J. L. Sinnett, of Whitesville, Ky. party of the second part, witnesseth that, for and in consideration of the promises and agreements hereinafter contained, to be kept and performed by the party of the second part, the company promises and agrees to sell and deliver to the party of the second part, free on board cars at Winona, Minn., or, at its option, at any of its regular places of shipment, any and all goods and other articles manufactured or sold, or which may hereafter be manufactured or sold, by it, unless prevented by fire, insurrection, invasion, strikes, or other cause, at the usual and customary wholesale prices as the party of the second part may reasonably require for sale by him from time to time, from the date hereof, in the following described territory, except the incorporated municipalities therein located, to wit: In the state of Kentucky, in Daviess county, the part east of the Louisville & Nashville Railway, including the town of Owensboro. In consideration of the sale and delivery to him, as vendee, f. o. b. cars at Winona, Minn., or other regular shipping point as above mentioned, by said company, of the goods and other articles manufactured or sold by it, in such reasonable quantities as he may require for sale in said territory as herein provided, upon the terms herein expressed, the party of the second part promises and agrees, as soon as practicable after said goods and other articles are received, to make a thorough and personal canvass of said territory at least four times a year at his own cost and expense, and to provide a proper outfit therefor, and to sell said goods, or so much thereof as possible, and at all times during said term said party of the second part agrees to keep a complete record of all goods disposed of by him and on hand, and to make to said company complete regular weekly written reports of the sales and collections, which reports, however, or any of them, may be waived by said company, and also to report the goods on hand and outstanding accounts when requested by said company so to do.

"And the party of the second part promises and agrees to pay to said company, at Winona, Minn., the wholesale price aforesaid for the goods and other articles sold to him from time to time, as herein provided, and the prepaid freight and express thereon, if any, during said term, at the time and in the manner and in accordance with the provisions of the weekly report blanks of said company to be furnished to the party of the second part, and at the termination of this agreement to pay the whole amount therefor then remaining unpaid, or in cash, within 10 days from date of invoice, with the understanding that said company will allow a discount of 3 per cent. from said wholesale prices on cash payments, provided full payment for all goods previously furnished shall then have been made; but such payments, or any of them, may be waived or extended by the said company without notice to the sureties hereon, and without prejudice to the rights or interests of said company, and if the party of the second part shall not pay cash for said goods and other articles so sold and delivered to him, and the payments at the time and in the manner and in accordance with said weekly report blanks, as aforesaid, are insufficient to pay therefor, said company may, in its discretion, thereafter either limit the sales herein agreed to be made, or discontinue the same until such indebtedness is paid or reduced as said company may require; and at the termination of this agreement the party of the second part agrees to return by prepaid freight to said company at Winona, Minn., or other point at which the same were delivered, in as good condition as when delivered to him, f. o. b. cars, all of the said goods undisposed of by him, and the company agrees to receive such goods, if the same are in such condition when received at Winona, Minn., or other point at which they were delivered to the party of the second part, f. o. b. cars, and pay or credit the party of the second part therefor at the same prices at which the same were sold and delivered, and if not in such condition when so received the company shall make a reasonable charge for putting them in such condition, if that can reasonably be done, and deduct such charge from the amount of the goods so returned, and pay or credit the party of the second part with the balance thereof, but no goods left by said party with his customers, on time or trial, not paid for by them, or by them partially used and then returned to him, shall be returned to said company, or be paid for by it, or credited to the account of said second party.

"And it is mutually agreed between the parties hereto that the party of the second part shall pay all transportation charges on goods he so purchases, and all expenses and obligations incurred in connection with the canvass and the sale of said goods, and shall have no power or authority to make any statement or representation or incur any debt,...