Williams v. Ledbetter

• Decision Date: 18 February 1930
• Citation: 132 Or. 145,285 P. 214
• Parties: WILLIAMS v. LEDBETTER.
• Court: Oregon Supreme Court

285 P. 214

132 Or. 145

WILLIAMS v. LEDBETTER.

Supreme Court of Oregon

February 18, 1930

In Bank.

Appeal from Circuit Court, Union County; J. W. Knowles, Judge.

Action by H. Williams against E. L. Ledbetter, who filed two counterclaims. Judgment for defendant, and plaintiff appeals. Reversed and remanded.

Coshow C.J., and McBride, J., dissenting.

Geo. T. Cochran, of La Grande (Cochran & Eberhard of La Grande, on the brief), for appellant.

R. J Green, of La Grande (Green & Hess, of La Grande, on the brief), for respondent.

BELT J.

This is an action upon an express oral contract to recover for services rendered by plaintiff as an automobile salesman for defendant. Plaintiff claimed that he was to receive 5 per cent. of the price list of automobiles sold and 10 per cent. of the price list on accessories. Defendant asserted that, under the contract of employment, plaintiff was to receive 5 per cent. of the price list on the automobiles which he sold, but was to get no commission on the accessories. Defendant answered, denying the contract as alleged in the complaint and setting forth two counterclaims, one for gas and oil alleged to have been sold to plaintiff and the other for the reasonable value of the use of an automobile which plaintiff drove for his own benefit. Verdict and judgment were had for defendant.

Aside from the counterclaims, the vital issue was: What was the contract? Was plaintiff to receive compensation for accessories sold? The issue was clear cut. Defendant, in support of his theory of the case, over objection, was permitted to answer the following question: "I will ask you this question, if you know the custom, whether or not you know the general custom in the state of Oregon or in the Northwest generally, the general custom as to the amount of commission paid a salesman for the sale of automobiles?" Defendant answered: "The general custom is a percentage on the factory list price, and nothing else."

"Q. That is the universal custom is it throughout the Northwest? A. Yes."

It is elementary that custom or usage is not admissible to alter or contradict the terms of an express contract. There was no occasion for interpretation. The contract, relative to compensation, was plain and unambiguous. As was well said in Wilson v. Smith, 111 Ala. 170, 20 So. 134, 136: "While there is conflict in the evidence of the terms of the contract, there is no ambiguity in them from the standpoint of either party, and hence no room for evidence of custom." It was for the jury to say which contention was correct. Defendant should not have been permitted, under the guise of interpretation, thus to bolster up his case. The effect of this testimony was to lead the jury to believe that such usage and practice among automobile dealers was so universal, long established, and well known that the plaintiff must have contracted with reference to it and that, by implication, it became a part of their agreement. Obviously, plaintiff's case was substantially prejudiced by such evidence. The same character of evidence was given by other witnesses in behalf of defendant.

The rule is thus stated in 17 C.J. 502: "But where the making of an express contract is admitted, and its terms are disputed, such terms cannot be established by evidence of usage."

In Amer. and Eng. Ency. of Law (2d Ed.) vol. 29, p. 437, it is said: "Where both parties rely upon an express agreement on a particular point, and the only dispute is as to what were the terms of such agreement, proof of usage is not admissible on the point, since they cannot be presumed in such case to have intended to incorporate the usage into their contract."

Lawson on Usages and Customs, § 187: "Where a contract is by word of mouth, and the controversy is not as to the meaning of the terms used by the parties, but as to what precise terms had been in fact used, evidence of custom is not admissible."

In Wilkins v. Kessinger, 90 Wash. 447, 156 P. 389, there was a dispute as to a broker's commission under the terms of an oral contract. The court said: "The rule is that where the terms of the contract as alleged are not ambiguous or of doubtful meaning, evidence of a local custom or usage is inadmissible for the purpose of supporting the claim of either party as to what the terms of the express contract were."

Also, see, Holmes v. Pettingill, 60 N.Y. 646; Krueger v. Lake Trading Co., 150 Wis. 569, 137 N.W. 776; Currie v. Syndicate Des Cultivators Des Oignons a' Fleur, 104 Ill.App. 165; McIntosh v. Pendleton, 75 A.D. 621, 78 N.Y.S. 152.

It is argued, however, that the question relative to custom was equivalent to an inquiry as to what was the customary or usual compensation of automobile salesmen. Certainly the question itself does not so indicate. Such is not the contention of counsel for defendant. The defendant has at all times stood squarely upon the proposition that evidence of custom was admissible. In Martin v. Fletcher, 77 Or. 408, 149 P. 895, the plaintiff was seeking to recover the "customary rental" for certain lands leased to the defendant. The lower court rejected the testimony tending to show the reasonable rental value of the land and construed the complaint as pleading custom as a basis for the cause of action. On appeal, Mr. Justice Bean, speaking for the court, clearly recognized the distinction between "custom" and "customary rental value" and held that the case was submitted to the jury upon the wrong theory. In view of this decision, it seems illogical to say that the question asked in the instant case relative to custom was the equivalent of one pertaining to "customary value."

If the defendant was talking about "customary value" of the services rendered and not the "general custom" among automobile dealers relative to such contracts of employment, a far different question would be presented. Perhaps, by the weight of authority, evidence of reasonable value of services is admissible where parties to a special contract are in dispute as to the terms of compensation, as tending to show which theory is more likely to be true. Such evidence would go to the probability or improbability of the alleged agreement. Of course, if A actually agreed to pay B $20 per day to split rails, the "customary" or reasonable value of such services would be immaterial. If, however, there was a dispute between the parties as to whether the compensation was $20 or $5 per day, evidence of value would aid the jury in determining which party was telling the truth. It would weigh heavily as to the probability of their respective statements. See note to Edelen v. Herman (162 Ky. 500, 172 S.W. 936) in L. R. A. 1915C, 1208, where conflicting authorities are collated. This court, in actions on a quantum meruit for services, has held evidence of an express contract admissible on the theory that the stipulated price becomes the quantum meruit in the case. Toy v. Gong, 87 Or. 454, 170 P. 936; West v. Eley, 39 Or. 461, 65 P. 798. But, as said in Schade v. Muller, 75 Or. 225, 146 P. 144, 147: "The rule is quite general that, in an action upon an express contract, the plaintiff cannot recover upon proof of an implied agreement"--citing 9 Cyc. 749. But, as before stated, the customary or reasonable value of the services rendered is not in the case. If the question was not thoroughly considered in Schade v. Muller, supra, it will be time to do so when the point is here for consideration. No case has been directed to our attention holding that evidence of custom is admissible under such circumstances. Neither have we seen any authority to the effect that the question asked is equivalent to an inquiry relative to reasonable value of the services rendered.

Plaintiff assigns error in admitting evidence in support of the third further and separate answer. It is his contention that the counterclaim is based on tort, and therefore not a proper answer to a complaint based on contract. No demurrer or motion was interposed to the counterclaim. Objection was first made on trial to the introduction of any testimony. The pleading, under such circumstances, is entitled to a liberal construction: Hackett Digger Company v. Carlson, 127 Or. 386, 272 P. 260. Viewing it in the light most favorable to the pleader, we think it was his intention to waive the tort and recover upon an implied agreement to pay the reasonable value of the use of the automobile.

We see no objection to the instructions given to which plaintiff took exception.

Judgment is reversed, and the cause remanded for a new trial.

COSHOW C.J. (dissenting).

This is an action instituted by plaintiff to recover from defendant for services rendered. Defendant, Ledbetter, maintains a garage in La Grande and sells automobiles. Plaintiff was employed by defendant to sell automobiles. Plaintiff claims that he was to receive 5 per cent. of the price list of every automobile and 10 per cent. of the price list of all accessories he sold. Defendant claims that plaintiff was to receive 5 per cent. of the price list of all automobiles he sold; nothing for selling the accessories. Defendant's contention is that 5 per cent. on the sale price of the automobiles was to compensate plaintiff for sale of accessories as well as for the sale of automobiles. Defendant pleaded two counterclaims: First, one for gas and oil alleged to have been sold to plaintiff by defendant, and the other for the use of an automobile which defendant claims plaintiff drove 2,760 miles for his own benefit and use and without permission, and that the reasonable value of the use of said automobile was 4 cents per mile, or a total of $110.40. The verdict was in favor of defendant. Judgment was entered that plaintiff take nothing from his complaint, and that defendant...