Works v. Cont'l Can Co.

• Decision Date: 08 February 1922
• Docket Number: No. 13824.,13824.
• Citation: 301 Ill. 102,133 N.E. 711
• Court: Illinois Supreme Court
• Parties: ARMSTRONG PAINT & VARNISH WORKS v. CONTINENTAL CAN CO.

301 Ill. 102

133 N.E. 711

ARMSTRONG PAINT & VARNISH WORKS

v.CONTINENTAL CAN CO.

No. 13824.

Supreme Court of Illinois.

Dec. 22, 1921.

Petion for Rehearing Stricken from Files Feb. 8, 1922.

Error to Appellate Court, First District, Appeal from Municipal Court of Chicago; Charles A. Williams, Judge.

Action by the Armstrong Paint & Varnish Works against the Continental Can Company. Judgment for plaintiff was reversed by the Appellate Court (220 Ill. App. 90), and plaintiff brings certiorari.

Reversed and remanded, with directions.Eastman, White & Hawxhurst, of Chicago, (Homer C. Dawson, of Chicago, of counsel), for plaintiff in error.

Wheelock, Newey & Mackenzie, of Chicago, for defendant in error.

THOMPSON, J.

Plaintiff in error, the Armstrong Paint & Varnish Works, is a corporation engaged in the manufacture and sale of paint and varnish, and defendant in error, the Continental Can Company, is a corpration engaged in the manufacture and sale of tin cans and packages. March 11, 1916, the parties entered into a written contract whereby the can company agreed to sell, and the paint company agreed to purchase, ‘a minimum of $2,000 worth of tin packages or more, as required by them (as priced and described below), which buyers will need for actual use in their business between the date hereof and April 1, 1917.’ Between the date of the contract and February 19, 1917, the paint company ordered, and the can company delivered, $5,937.95 worth of tin packages. In the last seven weeks of the term of the contract the paint company ordered $6,404.75 worth of tin packages at the prices quoted in the contract, and the can company refused to fill the orders on the ground that the paint company was ordering more than it would ‘need for actual use’ in its business before April 1, 1917. During the year covered by this contract prices on tin packages had almost doubled, and the paint company brought suit for damages in the municipal court of Chicagoon account of the failure of the can company to deliver the packages covered by it in its six orders placed in the months of February and March, and recovered a judgment for $4,210.75. In its affidavit of defense the can company claimed that it had furnished all the cans the paint company needed in its business during the period covered by the contract, and that the cans ordered and not shipped were not needed by the paint company for actual use in its business prior to April 1, 1917. Subsequently the can company filed an amended affidavit of defense, claiming as an additional defense that the paint company first breached the contract by purchasing, during the life of the contract, some of its requirements from other tin package manufacturers, and that the can company was therefore no longer bound by the provisions of the contract. On appeal the Appellate Court found that the contract required the paint company to purchase from the can company all the tin packages it needed in its business during the life of the contract, and that the paint company had first breached the contract by purchasing some of its requirements elsewhere, thereby relieving the can company from further obligations under the contract. The Appellate Court reversed the judgment of the municipal court and rendered judgment nil capiat and for costs against the paint company. The cause comes here by certiorari.

The municipal court permitted the paint company, over the objection of the can company, to prove conversations between the representatives of the respective companies while negotiations leading up to the contract in question were in progress. This was error. In construing a contract it is proper for a court to take into consideration the surrounding circumstances. It should place itself as nearly as it can in the same situation as the parties who made the contract, so that it may view the circumstances as they viewed them, and so it may judge the meaning of the words and their application to the things described as the parties judged and applied them. 3 Jones' Com. on Evidence, § 453. But this does not give either party the right to establish a different contract from that expressed in the written agreement. When parties sign a memorandum expressing all the terms essential to a complete agreement, they are to be protected against the doubtful veracity of the interested witnesses and the uncertain memory of disinterested witnesses concerning the terms of their agreement, and the only way in which they can be so protected is by holding each of them conclusively bound by the terms of the agreement as expressed in the writing. All conversations and parol agreements between the parties prior to the written agreement are so merged therein that they cannot be given in evidence for the purpose of changing the contract or showing an intention or understanding different from that expressed in the written agreement. 3 Jones' Com. on Evidence, § 434. The can company asserts that the contract in question required the paint company to purchase from it all the cans needed in the paint company's business during the term covered by the contract, while the paint company contends that the contract obligated it to buy $2,000 worth of packages from the can company, and gave it an option to buy as many more as it desired, at the prices quoted in the contract, prior to April 1, 1917. But the contentions of the parties to the contract are not the criterion which should guide the court in determining whether the written contract is a full expression of the agreement of the parties. The court must determine this from the writing itself. If it imports on its face to be a complete expression of the whole agreement-that is, contains such language as imports a complete legal obligation-it is to be presumed that the parties introduced into it every material item and term, and parol evidence cannot be admitted to add another term to the agreement, although the writing contains nothing on the particular term to which the parol evidence is directed.

[4]The rules governing the admissibility of parol evidence to explain written instruments are not so difficult, but the real difficulty arises in determining in each case whether the language of the instrument is ambiguous, as shown either by the context or by the circumstances attending the same. While we feel that the language used in the contract before us is clear and unambiguous, we appreciate that the word ‘required’ has so many and such different meanings that a court would be justified, when a controversy arises as to the meaning given the word by the parties to the contract at the time the contract was signed, in admitting proof of the circumstances surrounding the parties and the object they had in view at the time the contract was made. Wolf v. Schwill, 289 Ill. 190, 124 N. E. 389. Sometimes the word ‘require’ is used in the sense of ‘need,’ and sometimes it is used in the sense of ‘ask’ or ‘want’ or ‘order,’ and for that reason a contract using the word might be rendered ambiguous. It was therefore proper for the court to hear evidence to the effect that the paint company had not theretofore bought cans from the can company, that the paint company had contracts with other can companies that had not yet expired, and that the can company knew this, and any other facts showing the...