Gargiulo v. California Wineries & Distilleries

103 Misc. 691
CourtNew York Supreme Court
DecidedJune 15, 1918
StatusPublished
Cited by2 cases

This text of 103 Misc. 691 (Gargiulo v. California Wineries & Distilleries) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gargiulo v. California Wineries & Distilleries, 103 Misc. 691 (N.Y. Super. Ct. 1918).

Opinion

Ford, J.

After rendition of a special verdict finding the market price from which the damages could be computed, a general verdict was directed in favor of the plaintiff. The question here arises upon a motion [693]*693to set aside the verdict and for a new trial. Plaintiff was doing business as a wine and liquor merchant under a trade name, and entered into a contract with the defendant, a California corporation, for the shipment to him in New York of 750 barrels of wine by monthly deliveries, extending over a year beginning December, 1912, as directed by plaintiff, and to be paid for thirty days after each shipment arrived. The contract was negotiated through the New York manager of the defendant, subject to the approval of the home office in San Francisco. Notification dated October 2, 1912, was sent by mail to the plaintiff from the New York office advising him of defendant’s final acceptance of the contract. About December first or second plaintiff ordered the first shipment of seventy-five barrels through the New York manager, who promised to forward the order to the California office at once. Plaintiff heard no more from the defendant for several weeks, when he called upon the New York manager about December twenty-two or twenty-three, who declared that he did not understand the defendant’s failure to ship as directed, but ascribed the delay to the rush of business at that season. In the meantime plaintiff had caused to be organized a corporation (since legally dissolved) under the name P. Gargiulo and Company, Inc.,” which took over his business, up to that time transacted under the name P. Gargiulo & Co.” The certificate of incorporation was dated October 16, 1912. The plaintiff owned practically all the issued stock, was president and treasurer, and signed the checks for the company. His brother acted as vice-president and his bookkeeper as secretary, neither of whom owned any stock. In brief, the business and assets of the corporation were plaintiff’s, and were managed and controlled by him and through him for all practical purposes as absolutely as when he [694]*694possessed them under the name of P. Gargiulo & Co., as was fully explained to defendant’s New York manager. On January 4,1913, he ordered by letter another shipment, as required by his contract. This was directed to the defendant at its New York address, but was signed P. Gargiulo '& Company, Inc.” This letter was acknowledged by defendant’s New York office, with a promise that it would have immediate attention. On January 17, 1913, the New York manager called plaintiff on the telephone and inquired about the incorporation of the business, and asked plaintiff to write a letter stating that he had transferred all the assets of the old business to the corporation. When plaintiff replied that the contract for the wine had not been transferred, the manager told him to put that in too. Accordingly plaintiff wrote the letter, adding that the new concern had ‘‘ assumed all the responsibilities of the former concern’s contraer with you people.” Under date of January 24, 1913, the defendant sent from the home office a letter addressed to P. Gargiulo & Co., Inc.,” stating “ we have no order from or contract with you for any port wine.” To this plaintiff replied by telegram in the name of the corporation, asserting the existence of the contract for 750 barrels of wine and insisting upon its performance. Hearing nothing further from defendant, plaintiff sent another telegram to it, dated February 13,1913, and signed “ P. Gargiulo and Co.,” his old trade name, directing the shipment of seventy-five barrels of wine on his contract of September 13, 1912. He testified that the corporation had reassigned the contract to him before this message was sent. Defendant replied by wire, denying that it had any contract with plaintiff, and suggesting that he see its New York manager, to whom it was writing fully. Plaintiff did call, as suggested, but never received any [695]*695further explanation. No wine was ever sent to him under the contract, and he brings this suit, claiming substantial damages for the breach. Defendant’s defense is that by the assignment or attempted assignment of the contract to the corporation it was relieved of its obligations to the plaintiff, because, as it contends, the contract was not assignable without its consent. Upon this question Devlin v. City of New York, 63 N. Y. 8, is the leading New York case. It involves the assignability of a street cleaning contract which contained no provision relating to its assignability as the appeal book discloses. In that case the Court of Appeals laid down these general principles: ‘ ‘ The assignability of a contract must depend upon the nature of the contract and the character of the obligations assumed rather than the supposed intent of the parties, except as that intent is expressed in the agreement. Parties may, in terms, prohibit the assignment of any contract and declare that neither personal representatives nor assignees shall succeed to any rights in virtue of it, or be bound by its obligations. But when this has not been declared expressly or by implication, contracts other than such as are personal in their character, as promises to marry or engagements for personal services requiring skill, science or peculiar qualifications, may be assigned, and by them the personal representatives will be bound. In Hyde v. Windsor (Cro. Eliz. 552) it was said that executors are bound by all covenants of their testator, whether named or not, ‘ unless it be such a covenant as is to be performed by the person of the testator, which they cannot perform. ’ If the contract be personal and the performance of the party himself be the essence thereof, it neither devolves upon his representatives, nor can it be assigned. White’s Ex’rs v. Commonwealth, 39 Penn. St. 167. When the contract is executory in its nature, and an assignee or [696]*696personal representative can fairly and sufficiently execute all that the original contractor could have done, the assignee or representative may do so and have the benefit of the contract.” In brief public policy favors the assignability of contracts as facilitating commerce and its complex transactions unless forbidden by the contract itself or by the other consideration mentioned. There are dicta to be found in some New York cases which indicate that an extension of credit, as in a contract of sale, for example, would destroy its assignability unless the other party assented to the assignment. But in no case called to our attention in the voluminous brief submitted by defendant’s counsel is this question squarely passed upon. Here we have one of the original contracting parties seeking to enforce a right against the other original party under the contract made between them. Nearly all the cases cited involve the assertion of some right by the alleged assignee against one of the contracting parties or vice versa. It has been repeatedly held that an assignee has no enforcible rights where the contract was not assignable, but those decisions are not in point here. If the rights of one of the parties to a contract could not pass by assignment to a third party they must of necessity remain in the party who attempted to assign. In New England Iron Co. v. Gilbert El. R. R, Co., 91 N. Y. 153, where the question was whether a contract that had been assigned by a corporation to trustees by a trust deed and by them reassigned to the same corporation could be enforced by it against the other original contracting party, the court significantly remarks: ‘ ‘

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Bluebook (online)
103 Misc. 691, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gargiulo-v-california-wineries-distilleries-nysupct-1918.