The Buhler Mill & Elevator Company v. Jolly
| Decision Date | 05 May 1924 |
| Citation | 261 S.W. 353,217 Mo.App. 240 |
| Parties | THE BUHLER MILL & ELEVATOR COMPANY, Appellant, v. J. G. JOLLY and WILLIAM JOLLY, doing Business under the Firm and Trade Name of THE SEDALIA TRADING COMPANY, Respondents. |
| Court | Kansas Court of Appeals |
Appeal from Circuit Court of Saline County.--Hon. Robert M Reynolds, Judge.
AFFIRMED.
Judgment affirmed.
Lamm Bohling & Lamm, Harvey & Bellamy and Glen A. Wisdon for appellant.
Morrison Nugent, Wylder & Berger and D. C. Johns for respondents.
Plaintiff is a corporation located at Buhler, Kansas, where it is engaged in the manufacture and sale of flour. Defendants, for the purposes of this case, are to be regarded as partners engaged in the flour and feed business at Sedalia, Missouri, under the name of The Sedalia Trading Company.
Plaintiff's suit is for breach of contract with reference to the purchase of flour. Three contracts were entered into, the first made on October 1, 1920, in which The Sedalia Trading Company agreed, in writing, to buy of plaintiff 1000 barrels of "Uniform, Short Patent" flour at $ 12.30 per barrel, to be shipped within sixty days as ordered. Under this contract, defendants, on October 18, 1920, ordered 250 barrels and they were shipped, arriving at Sedalia on November 5, 1920. On this date the second contract was entered into in which defendants agreed to buy 750 barrels of the same grade and brand of flour at $ 10 per barrel, to be shipped within ninety days as ordered. Four days later, to-wit, on November 9, 1920, defendants requested that the remaining 750 barrels of the first contract and the 750 barrels called for in the second contract be merged, and the two contracts consolidated and rewritten, into a third contract.
Plaintiff acceded to this, and on November 12, 1920, a third contract was entered into for 1500 barrels of "Uniform, Short Patent" flour at $ 11.15 per barrel (which was the average of the prices in the other two contracts), to be shipped within sixty days as ordered. Said third contract contained the following clause: "This is in lieu of contract of October 1, 750 bbl. @ $ 12.30 and 750 bbl. of November 5th @ $ 10.00." In all respects, other than those above mentioned, the terms of this third contract were the same as the other two, and all three of them were prepared by plaintiff on forms or blanks furnished by it. Plaintiff's suit is on the third contract.
The answer set up the execution of the other two contracts, and alleged the above-mentioned merger and consolidation thereof into the third contract and charged that the term "Short Patent" was a trade name used to designate a certain quality, grade or standard of flour. The answer further alleged that the 250 barrels shipped to defendants were not "short patent" but were of an inferior grade known as "long patent" flour, unsatisfactory to flour users; that when customers discovered the quality of the flour, they invariably sent it back and refused to accept or pay for it and thereby defendants' flour market was greatly injured and they were unable to sell said flour to the trade they had; that the fact that said 250 barrels were of an inferior grade was not discovered until after the two contracts had been merged into the third or consolidated contract, and immediately upon learning this fact, defendants cancelled the contract and refused to take the rest of the flour called for in the contract sued on.
It was further set up that the "long patent" flour was worth much less in the market than the flour contracted to be sold, and a counterclaim was interposed for the loss sustained on the 250 barrels by reason of this difference in the market price of the two flours.
The evidence is that after the execution of the third contract, defendants learned from retail reports and by investigation and chemical analysis that the 250 barrels of flour were not of the required grade and standard; and thereupon plaintiff was notified the flour was unsatisfactory and that therefore the defendants cancelled the contract of November 12, 1920, and directed plaintiff not to ship any more. To this plaintiff replied that the contract would be terminated on the basis of the market difference in price, and later notified defendants that the 1500 barrels had been sold at the then market price, which involved a loss of the difference between the contract and the market price.
There would seem to be no question but that the floor that was shipped was not up to contract grade or standard, for in a letter dated January 3, 1921, written by plaintiff to defendants, the former, in referring to the flour, stated: "We concede that it is not exactly up to the standard."
The instructions submitting the defense to the jury conditioned the defendants' right to a verdict in their favor under the petition on the jury first finding that the flour delivered was of an inferior grade, and that this was not known to defendants until after the execution of the third contract.
Upon the issues under the petition, the jury found for defendants; and they also found for defendants and against plaintiff in the sum of $ 146 on the counterclaim, but a remittitur afterwards reduced the judgment thereon to $ 125. Plaintiff appealed.
Appellant's brief in one place apparently concedes that what the parties did was to consolidate and merge the two contracts into a third of date November 12, 1920. And yet it is urged that the third contract was merely the substitution of one independent contract for two other separate and independent contracts, and therefore no defense to the third can be based upon a violation of the first contract. It is no doubt true that, generally speaking, the substitution of a new contract for an old one is a sufficient consideration for the new; and doubtless one independent contract cannot be rescinded for the breach of another independent contract.
But suppose the two contracts had remained as they were drawn. Defendants agreed in the first to pay $ 12.30 per barrel and in the second to pay $ 10 per barrel. When the violation of the first, on account of the inferior quality of the 250 barrels, was discovered, defendants would have had the right to rescind that contract and escape the payment of $ 12.30 for each of the 750 barrels remaining thereunder, but would still be required to pay only $ 10 per barrel...
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