Tri-Bullion Smelting & Development Co. v. Jacobsen
| Decision Date | 09 May 1916 |
| Docket Number | 101. |
| Citation | 233 F. 646 |
| Parties | TRI-BULLION SMELTING & DEVELOPMENT CO. v. JACOBSEN. |
| Court | U.S. Court of Appeals — Second Circuit |
Milne Blake & McAneny, of New York City (L. G. McAneny and Richard T. Greene, both of New York City, of counsel), for plaintiff in error.
Sullivan & Cromwell, of New York City (Royall Victor and E. H. Green both of New York City, of counsel), for defendant in error.
Before WARD and ROGERS, Circuit Judges, and MAYER, District Judge.
The action was brought by Jacobsen against Tri-Bullion to recover damages in the sum of $25,000 for breach of contract by Tri-Bullion. The essential features of the written agreement expressing the contract between the parties, were as follows:
(1) Tri-Bullion was to sell and Jacobsen to buy the output of zinc concentrates produced at Tri-Bullion's plant at Kelly, N.M., for a period of two years from November 22 1911, to November 22, 1913, concentrates to be delivered in as nearly as possible equal monthly quantities, with the agreement by Tri-Bullion that the minimum should not be less than 600 tons per month.
(2) The price was to be arrived at by a method carefully set forth in the agreement.
(3) Delivery was to be made f.o.b. cars at different points.
(4) Payment was to be made by Jacobsen as soon as weights and assays were agreed upon.
(5) Average quotation of the Engineering and Mining Journal for spelter at East St. Louis during the month of arrival at buyer's works was to be taken as basis of final settlement.
The agreement also contained the following clause:
'Force Majeure.-- Sellers will be relieved from delivering, and buyers from taking the concentrates in case of strikes, fires, wars, revolutions, accidents to machinery, etc., etc., and in case of events of superior force of nature over which they have no control. * * *'
After a year and a half Tri-Bullion closed its mine, ceased delivering, and notified Jacobsen that it would not make any further deliveries to him; its reasons for this course being that because of the fall in the market price of spelter it could no longer mine the ore at a profit. Prior to July 7, 1913, Jacobsen had heard rumors that Tri-Bullion intended to cease producing and close its mine, and some time around June 20, 1913, Tri-Bullion, on a post card on which it gave advice of shipments of ore, wrote the words, 'This is our final shipment.'
Jacobsen, after some endeavor, succeeded in obtaining an interview on July 7, 1913, with Paschal, the president of Tri-Bullion, E.P. Earle, its agent (to whom under the contract all payments were to be made), and David Earle, another representative of Tri-Bullion. The position of the Tri-Bullion officials and representatives was that, as the contract had become unprofitable, the company was released from its obligations under the force majeure clause. None of the contingencies contemplated under that clause had happened. Jacobsen protested against this extraordinary attitude and stated that he would hold the company responsible for its breach.
On July 8, 1913, Jacobsen addressed a letter to Tri-Bullion stating that, if it did not immediately resume shipment, he would enter the market for monthly tonnage, charging the defendant with whatever difference he might be compelled to pay as between the contract price and the market price. On the same day Jacobsen wrote E. P. Earle substantially to the same effect and demanding that Tri-Bullion fulfill its contract. On July 9, 1913, Earle wrote Jacobsen, still insisting on the efficacy of the force majeure clause. To this Jacobsen replied on July 10, 1913, repeating that he would enter the market for the quantities still due and charge Tri-Bullion with the difference in price, if any. Jacobsen again asserted that the force majeure clause was not applicable. On July 11, 1913, Earle wrote Jacobsen to the effect that Tri-Bullion did not agree with Jacobsen's contention. Further correspondence ensued at a later date, which did not, however, change the relations of the parties.
The theory of Tri-Bullion seems to be that because, in the letter of July 8th, Jacobsen urged Tri-Bullion to proceed to fulfill the contract, he was thereby precluded from bringing action for an anticipatory breach, but must perform all of the provisions of the contract called for on his part, one of which was to pay the amount thereafter due for ore theretofore delivered and that Jacobsen could sue only for failure to deliver any installment as the installment became due month by month.
The question of fact in ...
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