Union Compress & Warehouse Co. v. Mabus

• Decision Date: 16 December 1968
• Docket Number: No. 45003,45003
• Citation: 217 So.2d 23
• Court: Mississippi Supreme Court
• Parties: UNION COMPRESS & WAREHOUSE COMPANY v. A. A. MABUS.

Page 23

217 So.2d 23

UNION COMPRESS & WAREHOUSE COMPANY v. A. A. MABUS.

No. 45003.

Supreme Court of Mississippi.

Dec. 16, 1968.

Wise, Carter & Child, M. Curtiss McKee, Jackson, Lott, Sanders & Gwin, Greenwood, for appellant.

Breland & Whitten, Sumner, for appellee.

INZER, Justice:

This case is an action on an oral contract brought in the Circuit Court of Leflore County, Mississippi, by A. A. Mabus against Union Compress & Warehouse Company, a Delaware corporation, authorized to do business in this State. Plaintiff Mabus, appellee herein, alleged in his declaration a contractual debt of one dollar commission for each of 1,032 bales of cotton stored with Union Compress Warehouse Company, appellant herein, during the 1964 cotton crop season and demanded payment therof. Issue was joined by the defendant's denial of the obligation and the trial was had from which the jury rendered a verdict for the plaintiff Mabus in the sum of $1,032 and judgment was entered thereon. From the judgment this appeal is prosecuted by Union Compress assigning as error various rulings of the lower court. We find no merit in any of these assignments and we affirm.

The jury by its verdict resolved the conflict in the evidence in favor of appellee and we state the facts accordingly. In 1962 appellant was operating a compress in Greenwood, Mississippi. Other compresses in that area had begun a practice of paying to cotton growers a commission on each bale that the growers stored with them. Appellant had not previously followed the practice but as the 1962 season approached it decided it would meet the competition. It adopted a corporate rule, referred to as Rule 19, which bound the corporation to the payment of a commission but reserved the right to decide the amount and the time of payment.

This warehouse plant will pay to the party shown as depositor on the warehouse receipt a commission of a uniform amount per bale on all bales of uncompressed (flat) cotton deposited for storage and compression at said warehouse. Not more than one (1) commission will be paid on the same bale. The decision of the Board of Directors of the Company as to the amount and time of payment of such commission shall be final.

This rule constituted a change of policy of which Union Compress desired to apprise its customers and potential customers. In order to effectuate this notice Union Compress had the new rule printed on leaflets and their agents and solicitors distributed them to all the potential customers in the area. McBee, who was appellant's assistant superintendent at the Greenwood plant and was well known to the area's cotton growers, was instructed along with appellant's other solicitors to pass around the rule change prior to the 1962 season. Appellee who lived in Tallahatchie County did not store any cotton with appellant in 1962 but had known McBee for many years. In 1962 appellee received a one dollar per bale commission from another compress. Appellant also paid one dollar per bale commission that year in accordance with its new policy.

Prior to the ginning season of 1963 McBee approached appellee in order to solicit his cotton. He told appellee that appellant would pay a commission and that it would be competitive with the other warehouses. Relying on this promise Mabus stored his cotton in Union Compress' Warehouse. Appellant made good on its promise by paying appellee one dollar per bale for 1963. At the beginning of the ginning season in 1964 McBee once again approached appellee to solicit his storage business. Prior to sending out its agents that year, however, appellant had amended Rule 19 which then read as follows:

After determining net earnings at end of current fiscal year and the competitive situation, the Board of Directors of the Company will consider the payment of a commission of a uniform amount to the depositor shown on warehouse receipt issued by the warehouse plants covered by this tariff. The decision of the Board as to the time and amount of payment, if any, shall be final.

The rule now left it to the discretion of appellant's Board of Directors whether to pay a commission or not. Appellant instructed its agents including McBee not to promise any commission for the 1964 season. It did not distribute leaflets with the amended Rule 19 to its customers, but a copy of it was posted on a bulletin board at the warehouse office along with the other compress rules and tariffs. Appellee had no actual knowledge of the rule change and McBee admitted that he did not inform appellee of the change when he went to solicit in 1964.

According to the testimony of appellee, which the jury accepted as true, prior to the 1964 cotton season McBee again conveyed the promise that appellant would pay a commission and be competitive with the other warehouses as to the giving of commissions. Pursuant to this promise Mabus delivered to appellant's warehouse 1032 bales of cotton for storage and warehouse receipts were issued for each of them. The other warehouses paid a commission of one dollar per bale after the 1964 season, but appellant declined to pay any commission. Shortly thereafter appellant sold its warehouse at Greenwood and is no longer operating in that area.

At the trial appellee offered not only his own testimony as to the representations of appellant's agent McBee, but also the testimony of other cotton growers as to similar representations by the same agent. This testimony was admitted over the vigorous protests of appellant.

The primary contention of appellant is that the trial court was in error in refusing to hold that the alleged representations of its agent, even if true, were no more than prior negotiations which were merged in the written contract of storage represented by the warehouse receipt, and that this contract cannot be varied by parol evidence. With this contention, we are unable to agree because there were two separate agreements between appellee and appellant, one written and the other oral. The written contract was actually evidenced by 1,032 warehouse receipts. This was a bailment contract for the storage of cotton. The oral contract was a separate agreement that appellant would pay appellee a commission if he would store his cotton with appellant. When appellee delivered the cotton to appellant's warehouse and stored it therein, he accepted appellant's offer as extended by its agent, McBee. The only thing left to be done under the oral agreement was for appellant to pay appellee a commission to be competitive with what the other warehouses in that area paid to their customers. This agreement did not merge with the bailment agreement for the storage of cotton.

It is contended by appellant that the commission amounted to a rebate which would have the effect of avrying the rates of the tariff for the storage of cotton which is by reference incorporated into the warehouse receipt. That this is not the case was brought out by counsel for the appellant on cross examination when he developed that the grower pays only the first month's storage for the cotton. If he puts the cotton into government loan or sells it during the first month, he is only charged with the first month's storage in the settlement. The proof in this case shows that the charge for storage for the first month was sixty-five cents in 1964. Thus, the grower by the selection of a commission-giving warehouse ordinarily would receive a bonus of thirty-five cents on each bale of cotton stored there. The holder of the warehouse receipt, usually the buyer of the...