Smith v. Johnson

• Decision Date: 22 January 1940
• Docket Number: 27729.
• Parties: SMITH v. JOHNSON.
• Court: Washington Supreme Court

98 P.2d 312

2 Wn.2d 351

SMITH v. JOHNSON.

No. 27729.

Supreme Court of Washington

January 22, 1940

Department 2.

Action by the Marriott & Smith, Incorporated, against Frank C Johnson, doing business as Johnson Feed & Seed Company and Harry S. Smith, to recover amount allegedly advanced on purchase price of quantity of peas. A. R. Smith, trustee for Marriott & Smith, Incorporated, was substituted as party plaintiff, and defendant Smith asked judgment against defendant Johnson for breach of contract to purchase quantity of peas. From judgment for plaintiff against defendant Johnson, and for defendant Smith against defendant Johnson defendant Johnson appeals.

Affirmed.

Appeal from Superior Court, Skagit County; W. L. Brickey, judge.

Welts &amp Welts, of Mount Vernon, for appellant.

Hamlin & Hamlin, of Seattle (Henderson & McBee, of Mount Vernon, of counsel), for respondent.

BEALS Justice.

During the year 1934, and for some time prior thereto, Marriott & Smith, Inc., a corporation, was engaged in business in the city of Seattle as a dealer in farm produce. Frank C. Johnson was engaged in business in the city of Mount Vernon as Johnson Feed & Seed Company, and H. S. Smith was a farmer living at Coupeville, in Island county. The corporation, wishing to purchase a quantity of marrowfat communicated with Mr. Johnson, who, after some investigation, found that Mr. Smith had two hundred tons for sale. Mr. Johnson telephoned the corporation, stating that Smith demanded a down payment, whereupon the corporation stated that it would purchase the peas and reimburse Johnson for the down payment, which it did by promptly mailing Johnson a check for three hundred dollars, the amount which Johnson had paid Smith upon being advised by the corporation that it was satisfied with the terms suggested. With the check, the corporation mailed Johnson a memorandum of agreement, requesting that Johnson sign the same, which Johnson did, returning to the corporation the copy which he had signed. This memorandum, written on the corporation's form, and with its heading, reads as follows:

'Johnson Feed & Seed Co.,

'Mt. Vernon, Washington.

Oct. 2, 1934

No. 203

"We confirm Purchase from YOU TODAY:

"Quantity 150 tons

"Commodity Good quality Marrowfat Peas

cleaned ready for shipment.

"Price $56.50 per ton.

"Basis F. O. B. dock Coupeville

"Time of shipment October buyers option

"Terms Draft against documents

"Weights and Well graded packed in 100# net

Grades good bags

"Remarks We are attaching $300.00 advance.

Definite shipping instructions to

follow.

Be sure these are packed in good

bags.

"E. & O. E. Marriott & Smith, Inc.

'Accepted Frank C. Johnson (Sd.) By A. R. Smith (Sd.)

'We are not responsible for delayed or non-shipment arising from strikes, lock-outs, fires, railway embargo or any other contingencies beyond our control. It is understood that the retention of this confirmation without notifying us of error therein, is an acknowledgment and acceptance of contract as above. Subject to Seattle Merchants Exchange rules.'

Immediately after the conversation over the telephone with the corporation, Johnson and Smith, who were in the former's office, signed the following agreement:

'Mr. H. S. Smith agrees this 2nd day of October 1934 to sell to Frank C. Johnson and Frank C. Johnson agrees to buy One Hundred Fifty tons (150) of Marafat peas as follows:----

'The peas are to be delivered to the Coupeville Warf in Coupeville, Wash. and is to receive Fifty Three and Fifty Cents ($53.50) per ton for the peas after they are run over a No. 12/64-3/4 slot screen.

'The peas are to be taken out in the month of October.

'Frank C. Johnson is to pay for the cleaning.

'Frank C. Johnson agrees to take another fifty tons at the same price if Mr. Smith offers then on or Before Saturday October 6th. 1934.

'The peas are to be paid for as they prepared for shipment at the dock on delivery of the dock certificates.

'A payment of Three Hundred and No/100 Dollars is hereby acknowledged.

'Signed Harry S. Smith

'Frank C. Johnson'

Under date of October 10, 1934, the corporation signed another similar memorandum, covering the purchase of an additional fifty tons of peas at the same price, this document being practically identical with the memorandum above set forth. Smith was to receive three dollars a ton less for the peas than the corporation agreed to pay Johnson, the latter agreeing to furnish new sacks for the peas and pay for cleaning and processing the peas for shipment. The sacks in which the peas were shipped were to belong to Johnson, it being understood that he would sell the sacks back to Smith for six cents each. The corporation sent shipping instructions to Johnson, who relayed them to Smith, together with instructions for preparing the peas for shipment.

October 21 following, 54,500 pounds of peas were shipped to Johnson, pursuant to instructions from the corporation, Smith naming himself as consignee at Seattle. Smith called at the corporation's office and received from the corporation payment for the shipment. During the month of October, three other shipments were made, for which the corporation paid Smith. Of the two hundred tons covered by the two contracts, all were delivered and paid for except seventy-six tons. The value of peas on the market declined, but December 29th the corporation ordered from Smith an additional 7,500 pounds, which Smith furnished, and for which he received payment from the corporation.

January 9, 1935, the corporation wrote Johnson, advising him that the eastern market was slack, and that the corporation had disposed of all its peas save seventy tons under the Smith contract. It was suggested that it would be helpful if Johnson could find some market for the seventy tons. It appears that nothing more was done until March 12, 1936, when the corporation wrote Smith the following letter:

'Mr. Harry Smith

'Coupville, Washington.

'Dear Sir:

'In the fall of 1934, we advanced to you through the Johnson Feed Co. of Mt. Vernon, $300.00 on marrowfat pea contracts. These peas have all been disposed of now, we taking the majority and you have disposed of the balance.

'We have not been able to move any additional quantities this year and it does not look like we will be able to do anything more this year. Should we be able to handle more peas next season, we will make new arrangements and advances.

'We would like to straighten our books up and wish you would send us your check for $300.00 so we can balance our account with you.

'Thanking you for your prompt attention, we are,

'Yours very truly,

'Marriott & Smith, Inc.

'A. R. Smith (Sd.)'

Smith ignored this letter.

Smith kept the balance of the peas until the fall of 1936, when he sold them for less than the contract price, suffering also some loss from resacking and storage.

October 16, 1936, the corporation wrote Johnson the following letter:

'Frank C. Johnson, doing business as

'Johnson Feed & Seed Co.,

'Mount Vernon, Washington.

'Dear Sir:

'Under our contract with you dated October 2, 1934, a true copy of which is attached hereto, we bought one hundred fifty (150) tons of peas therein mentioned, of which you have made delivery and have been paid to date for 123 and 3-8th tons.

'Also at the time this contract was made, we advanced you in cash the sum of three hundred dollars ($300.00) no part of which has ever been repaid or absorbed by shipments.

'There is a balance of 26 and 5-8th tons or approximately 53,250 pounds remaining undelivered under this order, and we hereby demand of you the complete performance of said contract and stand ready to adjust our accounts upon the tender of such performance.

'Kindly advise us of such action as you may take.

'Marriott & Smith, Inc.,

'By A. R. Smith, President.'

October 28, 1936, the corporation sued Johnson for three hundred dollars, alleging in its second amended complaint its contract with Johnson; the payment of three hundred dollars as an advance on the purchase price of the peas; the delivery of some of the peas, for all of which plaintiff paid the contract price; that plaintiff had demanded delivery of the remaining portion of the peas; that no delivery had been made; and that the three hundred dollars was due and owing to the plaintiff either from Johnson or Smith, the latter having been made a defendant in the action.

Smith answered the amended complaint, alleging his contract with Johnson; denying any liability, either to the plaintiff or Johnson, and asking judgment against Johnson for the sum of $260.50 damages for breach of contract, and for his costs. Defendant Johnson answered, alleging that he acted merely as the corporation's agent, and that if defendant Smith had any claim, such claim was against plaintiff and not against Johnson. By a trial amendment, he pleaded fraud and mistake, if the court should hold that he had contracted to sell the peas to the corporation. He also filed a cross-complaint against Smith, asking judgment for ninety dollars for sacks delivered Smith by Johnson. He also alleged that if the plaintiff had not received all of the peas covered by the contracts, such fault was chargeable to plaintiff, and not to Johnson.

The issues having been duly made, the action was tried to the court, sitting without a jury, and resulted in findings of fact and conclusions of law in favor of both the plaintiff and Smith, and against Johnson, followed by a judgment in plaintiff's favor against Johnson for the sum of three hundred dollars, and in favor of Smith against Johnson for $197.70. From the judgment against him and in favor of Marriott & Smith, Inc., Johnson has appealed, assigning error upon the entry of judgment against him and...