Diamond Alkali Co. v. Ætna Explosives Co.

107 A. 711, 264 Pa. 304, 7 A.L.R. 495, 1919 Pa. LEXIS 642
Supreme Court of Pennsylvania·Decided April 14, 1919·No. Appeal, No. 164·Published·Cited by 7 cases

Opinion

Opinion by

Mr. Chief Justice Brown,

The decree brought up on this appeal is that the appellant, the defendant below, account to the appellee for profits which it realized on the sales of soda ash delivered to it by the appellee in pursuance of a written contract between them, dated October 15, 1915. It is as follows: “The Diamond Alkali Company (seller) hereby agrees to [307] manufacture for and sell to .¿Etna Explosives Company, New York, N. Y., (Buyer) and Buyer hereby agrees to buy from Seller: Quantity: Buyer’s entire requirements during 1916; minimum quantity 180 tons per month and maximum 250 tons monthly. Also 230 tons for shipment in equal monthly quantities during November and December 1915. Kind: 58% Light Soda Ash. Shipment: In carload lots. Price: $1.00 per hundred pounds, basis 58%, packed in bags. If shipped in bulk, 7-%c. per cwt. to be deducted from above price. Deliveries: F. O. B. Plainesville, Ohio. Terms: Cash in 10 days, less 1%. Payable in New York or Pittsburgh Exchange. Each shipment to constitute a separate sale, but failure of Buyer to fulfill terms of payment or to accept any shipment tendered in accordance herewith shall, at Seller’s option, operate as an express refusal to receive any and all further shipments. Buyers must give Sellers at least 30 days’ notice of their requirements for each ensuing month. Claims for errors, deficiencies or imperfections must be made in writing by Buyer to Seller within ten days after receipt of goods. Serious fires, strikes, differences with workmen, accidents to machinery, shortage of cars or any other causes unavoidable or beyond Seller’s reasonable control, shall excuse any delay in shipments caused thereby. There are no understandings or agreements relative to this contract or its subject matter that are not fully expressed herein.”

The case was disposed of below on bill and answer, from which the learned chancellor found six facts, the third and fifth being the only ones material in considering the question before us. They are: “Third. The shipments of soda ash, pursuant to orders from defendant, were less than the minimum specified in the agreement.” “Fifth. Defendant purchased and plaintiff delivered soda ash which defendant did not use in its business as a manufacturer of explosives, and the excess quantity so obtained was sold by defendant at a profit.” The decree was made on this last finding, the court below [308] sustaining the chancellor’s construction of the contract, that under it the appellant could order only such quantities of soda ash between the minimum and maximum limits as were required in its manufacture of explosives.

There is not a doubtful or ambiguous word in the contract, and its concluding clause is, “There are no understandings or agreements relative to this contract or its subject matter that are not fully expressed herein.” Notwithstanding this explicit declaration by the parties, the court below read into the contract, “Buyer’s entire requirements in its business as a manufacturer in 1916.” What the appellant’s business was at the time the contract was entered into cannot be gathered from it. As a matter of fact it was a manufacturing concern, and the requirements of its business as a manufacturer during 1916 may not have been 180 tons of soda ash a month; but whether they were or not, it was bound by the terms of its contract to take that quantity from the plaintiff. The latter furnished it less. The minimum and maximum quantities fixed in the contract were not merely probable estimates of the quantities which the appellant Avas to take, as was the case in Marx v. American Malting Company, 169 Fed. Bep. 582, one of the authorities relied upon by learned counsel for appellee, but were definitely fixed quantities which the appellant could demand and the appellee was required to deliver. The latter was bound to hold itself in readiness to make shipments ordered by the appellant under the contract, and it, in turn, was bound to receive from the appellee the minimum quantity contracted for: Dimmick v. ■ Banning, Cooper & Company, 256 Pa. 295. Though the appellant was so bound, it could not, under the lower court’s construction of the contract, resell any portion of the minimum quantity which it was required to take, if it found that the entire quantity was not actually required in its business. There is no averment in the bill that it had acted in bad faith, or even knew that its orders, when given, were in excess of its requirements. [309] The mere averment is that it had ordered soda ash in excess of its requirements in its business of manufacturing explosives, and had resold the same. The question of bad faith on its part towards the appellee is not to be regarded as involved in this controversy between them. Their mutual rights and obligations under the contract are alone involved, and they are that for one year the appellee was to be prepared to deliver, and the appellant to take, not less than 180 - tons of soda ash per month, with the right to demand 70 more each month. The right of each party to the contract is to enforce it against the other. The learned chancellor below, however, was of opinion, “If 250 tons monthly was the quantity required to meet defendant’s needs it could have called for delivery of that quantity; but if 50 tons were sufficient it could not demand more.”

Free access — add to your briefcase to read the full text and ask questions with AI

Diamond Alkali Co. v. Ætna Explosives Co., 107 A. 711, 264 Pa. 304, 7 A.L.R. 495, 1919 Pa. LEXIS 642 (Pa. 1919).

107 A. 711 (Diamond Alkali Co. v. Ætna Explosives Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Bayer Corp. v. DX Terminals, Ltd.
214 S.W.3d 586 (Court of Appeals of Texas, 2007)
Utah International, Inc. v. Colorado-Ute Electric Ass'n
425 F. Supp. 1093 (D. Colorado, 1976)
Connell v. Avon Garage Co.
137 A.2d 765 (Supreme Court of Pennsylvania, 1958)
Stradling v. Allied Housing Associates, Inc.
37 A.2d 585 (Supreme Court of Pennsylvania, 1944)
Ætna Explosives Co. v. Diamond Alkali Co.
121 A. 201 (Supreme Court of Pennsylvania, 1923)
Louisville Soap Co. v. Taylor
279 F. 470 (Sixth Circuit, 1922)