Corsicana Compress Co. v. Magnolia Petroleum Co.

253 S.W. 559, 1923 Tex. App. LEXIS 367
CourtCourt of Appeals of Texas
DecidedJune 15, 1923
DocketNo. 988.
StatusPublished
Cited by1 cases

This text of 253 S.W. 559 (Corsicana Compress Co. v. Magnolia Petroleum Co.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Corsicana Compress Co. v. Magnolia Petroleum Co., 253 S.W. 559, 1923 Tex. App. LEXIS 367 (Tex. Ct. App. 1923).

Opinion

O’QUINN, J.

This controversy grew out of a contract for the sale of fuel oil. On June 18, 1919, appellant and appellee entered into a contract, which contained the following:

“Said seller-hereby agrees to sell and deliver to said buyer, said buyer agrees to purchase and receive from the seller, between June 17th, 1919, and June 17th, 1920, the fuel oil necessary to supply fuel and operate a compress during the term of this contract and not thereafter, not to exceed a maximum of 4,000 barrels, which maximum the seller agrees to furnish and the buyer to take if required for said purposes, and not less than a minimum of 3,000 barrels, which minimum the buyer contracts and guarantees it will take and, the seller agrees it will supply, for such fuel purposes; it being understood that the seller represents and contracts that the oil to be furnished hereunder is fit only for fuel purposes. * * * Buyer expressly agrees to pay said seller for said oil the purchase price of $1.00 per barrel for each barrel of forty-two (42) gallons of oil furnished hereunder, from which said purchase price shall be deducted the proper cost of transportation paid as aforesaid by said buyer. * * * All shipments shall be made by the seller only upon the written orders therefor by the buyer.”

It is shown that appellant delivered 943.65 barrels, for which appellee paid the contract price. On June 4, 1920, written demand was made by appellant upon appellee for further compliance with its contract to furnish oil, which was refused by appellee, on the grounds: (1) That appellee had furnished all the oil that was necessary for the operation of the compress for the period of time the contract was to run; (2) that appellant desired the oil demanded for future use, that is, to be used after the contract had expired; and (3) that the contract only called for oil *560 to be supplied in sucb amount as was needed to operate tbe compress between June 17, 1919, and June 17, 1920, and not thereafter. At the time the last .order was given for oil, which the appellee refused to fill, the price of fuel oil had advanced from $1.00 per barrel to $3.00 per barrel. It is not shown whether appellant had any oil in its tank when the first oil under the contract was delivered, but there was a small amount, some 40 barrels, on hand at the time the last order was given, but appellant had to substitute coal for fuel for a few days before the contract expired. The greater portion of the oil last ordered would have been held in storage by appellant and used in the operation of the compress after the contract had expired. There is no contention that appellant desired the oil for any purpose other than to be used as fuel in the operation of its compress.

This suit was brought by appellant to recover damages at the rate of $2.00 per barrel for the oil not furnished under the contract. Tlie case was tried before a jury, and the court, construing the contract to bind appel-lee to furnish appellant only with the amount of oil necessary to operate the compress for and during the time between June 17, 1919, and June 17, 1920, which had practically been done, at the conclusion of the evidence instructed the jury to return a verdict for appellee.

Appellant presents a number of questions, but we think the proper construction of the above-quoted contract is controlling.

Appellee contends that under said contract, it undertook to furnish appellant only the amount of fuel oil necessary to operate its compress from June 17, 1919, to June 17, 1920, limited to a maximum amount of 4,000 barrels, and not to supply oil to be used in its operations after the expiration of said period of time, and that, as the oil demanded was not required for said purpose, then, under the contract, appellee was not bound to furnish same. Appellant contends that the use of the oil by appellant for fuel purposes within the stated period of time was incidental and not controlling. That the limitation mentioned in the contract related solely to the maximum amount to be furnished,, 4,000 barrels, if required for fuel purposes in the operation of the compress and not for speculative or other purposes, but that there was no limitation whatever as to the minimum of 3,000 barrels, other than its incidental use as fuel to operate the compress, for in that the contract expressly provided that for such purpose appellant was, at all events, obligated to buy and pay for a minimum of 3,000 barrels, “which minimum the buyer (ajipellant) contracts and guarantees it will take, and the seller (appellee) agrees it will supply.”

Appellee insists that the expression “said seller hereby agrees to sell and deliver to said buyer and said buyer agrees to purchase and receive from the seller, between June 17, 1919, and June 17,1920, the fuel oil necessary to supply fuel and operate a compress during the term of this contract and not thereafter,” shows, unquestionably, that oil was to be furnished for fuel to operate the compress during the term of the contract only — that is, that the oil furnished was to be actually used, burned, during that time— and that said language is not limited by anything that follows in the contract. It is urged that notwithstanding the subsequent clause, which obligates the purchaser to take and pay for “not less than a minimum of 3,000 barrels, which minimum the buyer contracts and guarantees it will take, and the seller agrees it will supply, for such fuel purposes,” that the last expression, “for such fuel purposes,” was intended to and did limit the amount of fuel to be supplied in any event to the bare necessities of the plant for and during the contract year — the amount of oil actually used — insisting that said words, “for such fuel purposes,” referred to the sentence above, which says: “Fuel oil necessary to supply and operate a compress during the term of this contract, and not thereafter,” and has the effect of repeating said clause after the minimum provision.

We cannot agree with appellee in this contention. We think the case is ruled by the case of Magnolia Petroleum Co. v. Farmers-ville Independent Gin Co., 243 S. W. 568. The Texarkana Court of Civil Appeals there construed a contract made by appellee here identical with the terms of the contract here in controversy, differing only in dates and quantities. We take it that the contract there and the one here were made upon the same form of blank contract that the record discloses is used by appellee. In that case, Chief Justice Willson held against the very contention here urged by appellee, and construed the contract to mean that the contract as to the minimum statement was absolute and not controlled by the limitations urged.

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Bluebook (online)
253 S.W. 559, 1923 Tex. App. LEXIS 367, Counsel Stack Legal Research, https://law.counselstack.com/opinion/corsicana-compress-co-v-magnolia-petroleum-co-texapp-1923.