Howell v. Garrett & Co.

218 A.D. 322, 218 N.Y.S. 301, 1926 N.Y. App. Div. LEXIS 5928
CourtAppellate Division of the Supreme Court of the State of New York
DecidedNovember 5, 1926
StatusPublished
Cited by3 cases

This text of 218 A.D. 322 (Howell v. Garrett & Co.) is published on Counsel Stack Legal Research, covering Appellate Division of the Supreme Court of the State of New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Howell v. Garrett & Co., 218 A.D. 322, 218 N.Y.S. 301, 1926 N.Y. App. Div. LEXIS 5928 (N.Y. Ct. App. 1926).

Opinion

Jaycox, J.

The action was brought to recover damages for breach of contract. The plaintiffs entered into a written contract with the defendant for the sale of 7,500 bags of Argentine granulated sugar, each bag containing about 150 pounds of sugar, at twenty-one and three-tenths cents a pound, less two per cent thereof, F. O. B. New York city; shipments of sugar to be made by steamers from the Argentine Republic — during July, 1920, 2,500 bags; during August, 1920, 2,500 bags; and during September, 1920, 2,500 bags. If shipments were prevented upon the dates mentioned, the buyers were to accept delivery when made.

The proofs show that the plaintiffs purchased in the Argentine, in time for shipment according to the sales contract, something over 13,000 tons of sugar; that shipments of this sugar were made from Argentine to the plaintiffs in New York; that notice of the arrival of the sugar was given to the defendant and a request made for directions as to where the defendant desired the sugar to be delivered. The defendant gave no shipping directions, but delayed action and never actually accepted or refused the sugar. The matter continued in that way until at last, in January, 1921, the plaintiffs gave the defendant notice that the sugar must be accepted on or before February third, otherwise plaintiffs would resort to legal action. The sugar was not accepted. The plaintiffs proved the market price of the sugar on February 3, 1921, and the verdict directed is for the difference between the contract price and the market price on that date.

The complaint, in addition to the usual facts presented in a complaint upon a breach of contract, contained other facts, to which I will later refer. The answer contained some denials and then set up three separate defenses; the first of which was, in effect, that the claim upon which this action was brought belonged to the United States government; second, that the plaintiffs were not the real parties in interest, and third, the Statute of Frauds. (See Pers. Prop. Law, § 85, as added by Laws of 1911, chap. 571.) The latter defense is made the subject of the appellant’s first point.

The contract involved is printed as an exhibit annexed to the complaint. It contains all the essential elements of a contract. [325]*325unless by its terms the price of the sugar is not stated in the contract. The clause in relation to this reads as follows:

At Twenty-one and 30 /100 (21.30c) Cents per pound, less 2%, duty paid, F. O. B. New York City, net landed weights.

“ Should various estimated charges used in arriving at the above price prove less than expected, credit voucher for the difference will be rendered the buyer.”

It is the contention of the appellant that the price of the sugar was not fixed and determined by this clause, but was left open as a matter of future computation. The contention of the respondents is, mainly, that this action was not brought upon an oral contract, of which a memorandum in writing had been signed by the parties, but that the action was upon a written contract and, therefore, the Statute of Frauds has no application. This contention, in my estimation, is entirely erroneous. The character of a document cannot be changed by applying a name to it, and by calling this a contract the plaintiffs cannot make it a legal contract if it lacks any essential element to constitute a legal contract. The only difference, as I understand it, between an action brought upon an oral contract, of which a memorandum in writing has been signed, and one brought upon a written contract is, that where the action is brought upon an oral contract evidence of the contract, in addition to the memorandum, may be given; while if the action is brought upon a written contract the contract in writing cannot be helped out or elaborated by the oral negotiations. In either case, however, the written document must contain all the essentials of a contract. Therefore, in this case, if the written contract does not contain a provision fixing the price, the contract is not enforceable under the Statute of Frauds. In this situation no evidence of the understanding of the parties can be given. The only oral evidence admissible is evidence to place the court in the same situation as the parties were at the time the contract was made, so as to enable the court to construe the contract as made. This was the position taken by the trial court and all evidence as to the understanding of the parties excluded. At the time of the trial the judge announced his views during colloquies with counsel and by directing a verdict in favor of the plaintiffs. A motion was entertained to set aside the verdict; the judge received briefs and denied the motion, with an opinion in which he said: “ The contract contains two independent enforcible provisions; one is for the sale of goods to which the statute is applicable, and which meets all the requirements thereof; the other a promise of plaintiffs to give defendant a credit voucher under certain conditions subsequent, the terms of which are not all stated in detail, but as to which, however, the statute has no [326]*326application. If the contract had provided that the price was to be lessened by the difference between ‘ estimated charges ’ and actual charges, the situation would be different. But that is not the case. The price is fixed and unchangeable at 21.30 cents per pound, less two per cent duty paid. Upon the happening of the contingency (without deciding the effect of a breach by defendant), an obligation arises from plaintiffs to defendant which has no bearing on the price. The ultimate result in dollars, if both, obligations of this contract were met, would be the same as if the price were reduced, but the methods are legally different. If the price were reduced on the happening of the contingency, then defendant’s obligation would be to pay 21.30 cents per pound, less two per cent duty paid, less the difference between ‘ estimated charges ’ and the actual charges. But here defendant has obligated itself to pay the price named. Then upon the happening of the contingency plaintiffs are required to give a credit voucher for the diference. The latter obligation is not a contract for the sale of goods.”

I agree with the conclusion reached and the reasoning by which it was reached.

The parties have cited many cases, but none of them are in point. This point must be disposed of by determining whether the plaintiffs agreed to reduce the price or whether they agreed to give the defendant a credit voucher, which should be applicable to future dealings between the parties. The authorities cited by the appellant all bear upon the question of the necessity of the price being fixed in the contract. There can be no controversy about this question. It has been decided too many times. The only question in this case is, was the price contingent upon certain expenditures which the plaintiffs were to make, or was there a separate agreement by the plaintiffs to give the defendant a credit voucher applicable to future business dealings between them? In my estimation the contract, in so far as the price is concerned, is the same as if the defendant had agreed to pay twenty-one cents for the sugar and then had added a provision that if it sold the sugar for a lower price than had been discussed in their negotiations it would be entitled to a credit voucher, equal to the decrease in price. Under such a contract I think the price at which the goods were sold would be a fixed price, binding upon both parties.

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Cite This Page — Counsel Stack

Bluebook (online)
218 A.D. 322, 218 N.Y.S. 301, 1926 N.Y. App. Div. LEXIS 5928, Counsel Stack Legal Research, https://law.counselstack.com/opinion/howell-v-garrett-co-nyappdiv-1926.