Wagner v. Rainier Mfg. Co.

• Jurisdiction: Oregon
• Parties: H. J. WAGNER, Respondent, v. RAINIER MANUFACTURING CO., a corporation, Appellant.
• Citation: 371 P.2d 74,230 Or. 531
• Court: Oregon Supreme Court
• Decision Date: 02 May 1962

Page 74

371 P.2d 74

230 Or. 531

H. J. WAGNER, Respondent, v. RAINIER MANUFACTURING CO., a corporation, Appellant.

Supreme Court of Oregon, Department 1.

Argued and Submitted Oct. 10, 1961.

Filed May 2, 1962.

Thomas H. Tongue, Portland, argued the cause for appellant. With him on the briefs were Parker & Duffy.

Malcolm F. Marsh, Salem, argued the cause for respondent. On the brief were Goodenough, Clark & Marsh, Salem.

Before McALLISTER, C. J., and ROSSMAN, PERRY, GOODWIN, and LUSK, JJ.

LUSK, Justice.

This is an appeal from a judgment for the plaintiff after a jury trial in an action to recover damages for breach of contract.

The principal question, and the only one that needs to be decided, arises out of the court's denial of the defendant's motion for a directed verdict based upon the ground that the contract sued upon was never entered into by the parties.

The plaintiff, H. J. Wagner, is a contract logger. The defendant, Rainier Manufacturing Co., is an Oregon corporation engaged in the timber business.

The complaint alleges, in substance, that on or about November 5, 1959, the plaintiff called to the attention of the defendant a sale of an estimated 6,629,000 board feet of timber in Tillamook County, Oregon, which was about to be conducted by the Bureau of Land Management, Department of Interior, United States Government; that on or about November 6, 1959, the plaintiff made an offer to the defendant to build the necessary roads and to cut, yard, load, and haul all of said timber for $27 per thousand board feet of logs, net truck scale; that defendant accepted said offer contingent upon it being the successful bidder at the sale; that the defendant bid in the timber on the basis of the logging figure in plaintiff's offer; that on or about December 3, 1959, the defendant confirmed the agreement between the parties and informed the plaintiff that it would have a written contract prepared setting forth the oral agreement theretofore made; that the defendant, on or about January 6, 1960, repudiated the agreement and advised the plaintiff that it had made other arrangements for logging the timber. There are appropriate allegations of damages.

The defendant, by its answer, denied all the allegations of the complaint respecting the making of the contract and damages.

The evidence discloses the following facts: Early in November, 1959, the plaintiff met Alexander Hill, a log scaler in the employ of the defendant and told him about the sale referred to in the complaint; through Hill, Wagner met William E. Leahy, manager of the defendant's timber department, and Hill, with the approval of Leahy, went with Wagner to look over the timber in question. Wagner was seeking the contract for logging the timber and told Hill he would do it for $27 per thousand board feet. Hill informed Leahy of this. The sale was held on November 17 and the defendant bought the timber, and a little later, possibly on the day of the sale, Hill told Wagner that 'he was sure I had the job of logging.' Hill gave Wagner the same assurance several times thereafter. Wagner conceded in his testimony that Hill had previously advised him that his dealings would have to be with Leahy and there is no evidence that Hill had authority to contract on behalf of the defendant.

In the latter part of November Wagner submitted to the defendant, at Leahy's request, the following proposal in writing, which is reproduced exactly as written:

'Rainier Manufacturing Co.

'Rainier Oregon

'H. J. Wagner Logging

'Summit, § Bid to Log Timber On tract W. 1/2 S.W. 1/4 Section 18 T 3 S., R.7.W And W. 1/2 N.W. 1/4 Section 18, T, 3 S., R.W.E. 1/2 S.E. 1/4 Section 13, T. 3.S., R. 8W., 35 Miles Southeast Of Tillamook Oregon. For the Sum Of $27.00 Net Truck Scale In the river at Salem Oregon. I own this Equipment Listed below And I am FInancial able to get whatI need to do the Job.

'2.D.7 Cats in good shape

1 B.U.30 Loadind Donkey

1 T.D.9. Cat to load Rock

2 GMC. Log Trusks

1 Weel Arch

5 Power Saws

1 B.U.20 Loading Donkey 3 Sets Tongs and plenty riggen to go with all my Equipment. Insurance in respect to bodily Injury. $100.000.00 And each Person and $300.000.00 for each occurrence. and in respect to property damage of $300.000.00 fo each occurrence.

Bank Referance The United States National Bank Mill City Oregon Banker Bob. Hill Logging Reference Oregon Pulp And Paper Company. R. E. Schaefer Or (Dick) Salem Oregon [Ditto marks under 'Logging Referance'] PLYWood Products Timber Co. Bob Cubic Albany Oregon. I am sending with this a copy of a Contract Witch I have Completed.

Road $2.25

Cutting $2.50

Hauling $12.50

Yarding & Loading $10.25

Total $27.00 Net Truck Scale

'H. J. WAGNER'

........

Accompanying this proposal was a copy of a logging contract between Wagner and a corporation called Plywood Products Timber Company under which, apparently, Wagner had previously worked.

Early in December, 1959, there was a meeting at the office of the defendant in Rainier, Oregon, attended by Wagner, Leahy, Hill, and others, at which there was a general discussion of the terms of a contract that might be entered into between the plaintiff and the defendant. No agreement was reached at this time; on the contrary, Wagner testified that Leahy told him 'he would let me know what the outcome was.'

In the latter part of November or the first part of December (the exact date is not disclosed) Wagner asked for a writing from the defendant giving him 'assurance on the job.'

After the meeting in Rainier, under date of December 3, 1959, Leahy sent the following letter to the plaintiff, written on the letterhead of the defendant:

'Mr. H. J. Wagner

'Box 124

'Mehama, Oregon

'Dear Sir:

'In regard to logging the timber on Section 18-T3S-R7W and Section 13-T3S-R8W, which we have discussed with you, we wish to state that we consider your logging bid favorable. We will have our attorney draw up a contract covering points generally outlined in your Plywood Products Timber Company contract.

'We shall need a performance bond, and no doubt a financial statement. However, we can discuss these points later.

'This memo will give you an assurance that we will work out this matter with you subject to such points as our attorney brings up.

'Yours very truly

'RAINIER MANUFACTURING CO.

'/s/ Wm E. Leahy

'W. E. Leahy, Manager

'Timber Department

'WEL/sp

'CC: Mr. Alex Hill

'Rainier, Oregon'

There were no further communications between the parties until Wagner, having been informed that the contract had been given to another concern, took the matter up with Leahy, who told him that 'it was their privilege to send a man in there to see whether I had bid the sale too high or too cheap' and that 'they should be through in a few days and he would let me know what the outcome was.' Under date of January 6, 1960, the defendant wrote to the plaintiff:

'Portland 1 Oregon

'January 6- 1960

'Mr. H J Wagner

'Box 124

'Mehama, Oregon

'Dear Sir

'I regret to advise you that we have arranged with other parties to contract the logging of the timber we purchased near Beaver Oregon in Tillamook Co. We wish to state that your bid was favorable and that our decision was enfluenced [sic] by our having had many years of satisfactory dealings with the parties engaged.

'We are returning the form contract you presented for our consideration.

'Yours Very truly

'Wm E Leahy---- Rainier Mfg Co'

The filing of the complaint in this action followed the receipt of the foregoing letter by Wagner.

The alleged contract, if it ever came into existence, must be found in the written proposal of the plaintiff and the defendant's letter of December 3, 1959 (Exhibit D), for it is undisputed in the record that prior to the passing of these communications, the minds of the parties had never met. The last oral negotiations at the office of the defendant in Rainier ended not in an agreement, but in Leahy's promise to Wagner to let him know the outcome.

The trial judge submitted the question of contract vel non to the jury. This, we think, was error, for the rule in this state is that where the evidence of the alleged contract is all contained in letters or other writings, it is the province of the court to construe them and see if they constitute a contract. Northwestern Agencies v. Flynn, 138 Or. 101, 106, 5 P.2d 530; Jones v. Marshall-Wells Co., 104 Or. 388, 396, 208 P. 768; Shaw Wholesale Co. v. Hackbarth, 102 Or. 80, 93-94, 198 P. 908, 201 P. 1066; Dodge v. Root, 83 Or. 21, 24, 162 P. 254. It is so held generally elsewhere. See cases from numerous jurisdictions cited in 100 A.L.R. 971-972.

The written proposal of the plaintiff was an offer to enter into a bilateral contract with the defendant to log its timber, and the question is whether the defendant's letter of December 3, 1959, constituted an acceptance of the offer. Before it can be said that a bargain has been made, the acceptance must be 'positive, unconditional, unequivocal and unambiguous, and must not change, add to, or qualify the terms of the offer.' Shaw Wholesale Co. v. Hackbarth, supra, 102 Or. at 94, 201 p. at 1067. See, also, Killam v. Tenney, 73 Adv.Sh. 699, 713, Or., 366 P.2d 739, 746; Hubbs v. Warehouse Service Corp., 149 Or. 559, 569, 42 P.2d 180; Strong et al. v. Moore et al., 105 Or. 12, 22, 207 P. 179, 23 A.L.R. 1217, and cases there cited; 1 Williston, Contracts (3d ed.) § 72.

With respect to the requirement that the acceptance must be unequivocal, it is said in the comment to section 58, Restatement, 1 Contracts 65:

'An offeror is entitled to know in clear terms whether the offeree accepts his proposal. It is not enough that the words of a reply justify a probable inference of assent.'

In Minar v. Skoog, 235 Minn. 262, 265, 50 N.W.2d 300, the court thus elaborated upon the subject:

'Do we have a valid acceptance by the lessee of the terms of the option offer? In passing upon questions of offer and acceptance, as determinative of whether a contract has thereby...