Kaiser Motors Corporation v. Mary F. Savage, as of the Estate of John A. Savage, Deceased

229 F.2d 525
CourtCourt of Appeals for the Eighth Circuit
DecidedMarch 5, 1956
Docket15339_1
StatusPublished
Cited by3 cases

This text of 229 F.2d 525 (Kaiser Motors Corporation v. Mary F. Savage, as of the Estate of John A. Savage, Deceased) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eighth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kaiser Motors Corporation v. Mary F. Savage, as of the Estate of John A. Savage, Deceased, 229 F.2d 525 (8th Cir. 1956).

Opinion

VOGEL, Circuit Judge.

John A. Savage, doing business as John A. Savage & Co., commenced this action against Kaiser Motors Corporation, defendant, alleging that he and the defendant entered into an agreement whereby the plaintiff was hired as exclusive agent of the defendant in procuring iron ore from the Lake Superior iron mining district for the operation of a certain blast furnace known as No. 5 owned or leased by the defendant at Cleveland, Ohio. Plaintiff claimed that by agreement the defendant was obligated to pay to the plaintiff for each gross ton of iron ore purchased 2% of the seasonal price, etc., at the time of shipment. Plaintiff alleged that pursuant to such exclusive agency and contract there was furnished to said furnace 1,500,000 gross tons of iron ore of a value of $12,542,-332.19 and that accordingly he was enT titled to a commission of ’$250,846.64, on which he. had been paid only the sum of $48,000.00. During the first day of trial John A. Savage died. ' Thereafter, a stipulation was entered into whereby the executrix of John A. Sayage’s estate was substituted as party 'plaintiff and the case was tried to the court without a jury. Based upon its memorandum opinion, findings of fact and, conclusions of law, the trial court entere‘d judgment in favor of the plaintiff.’ Defendant appeals to this court. The trial court was sitting as the trier of. the facts; therefore its conclusion must have the same force and effect as a jury verdict,' hnd we niust view the evidence in the light most favorable :to sustaining the judgment obtained by the plaintiff. Cleo Syrup Corp. v. Coca-Cola Co., 8 Cir., 1943, 139 F.2d 416, 418, 150 A.L.R. 1056, certiorari denied 321 U.S. 781, 64 S.Ct. 638, 88 L.Ed. 1074.

For the sake of clarity, the appellant, Kaiser Motors Corporation (formerly Kaiser-Frazer Corporation) will be referred to as the defendant and the present appellee, Mary F. Savage, executrix of the estate of John A. Savage, deceased, will be referred to as plaintiff or as John A. Savage.

The record before us is voluminous, but for the purposes of this appeal the facts may be stated as follows:

In 1948, the defendant, haying entered into the automobile manufacturing business, encountered great difficulty in procuring steel. In an attempt to remedy that situation, defendant leased from the Defense Products Corporation a. large blast furnace, herein known as No. 5, which was partially integrated with the Republic Steel plant at Cleveland, Ohio. Thomas M. Price, vice president of the defendant, and in charge of procurement of raw materials to be used by the company, testified:

“The reason that Kaiser-Frazer had made the deal with the Defense Plant Corporation-for the leasing of that furnace was in order to get steel and pig iron which it was having trouble purchasing from the steel companies. There was a great shortage of steel at that time for anything. * * * Our hope after getting a furnace was to work out a deal with Republic by which they would continue to operate it. It would be difficult to take over that furnace immediately and continue its operation. It would be difficult to do it and not delay the produetion of the furnace. But it wouldn’t be difficult if one had time to separate it from Republic and operate it.
* •» •» •*
“Our hope then was to get in a position where Republic would operate the furnace but would furnish *527 us the steel or pig iron from it that we desired. And that was the aim or hope that we were trying to accomplish at that time. However, in accomplishing that, we also had alternate plans of separate operation by Kaiser-Frazer and so forth. We tried not to overlook any possibility in any manner in any way that would help us get materials to build automobiles. We were not at all sure that we could ever agree with Republic because of the feeling of Republic over our obtaining the furnace and our relations were strained at the time and very difficult and we were making any plans we could conceive of to operate that furnace and to get the steel out of it to use, our hope being all the time that in the final analysis we could make a deal with Republic to operate so as to give us some of the benefit from the furnace. And after we had the furnace, during this period, we discovered that the obtaining of an iron ore supply for it was a very difficult problem. We found that iron ore was just as scarce as steel, so far as being able to obtain a supply was concerned.”

Defendant tried every avenue it could think of to procure iron ore, at first with no success. Among other things, it interviewed the president of the Oliver Iron Mining Company, a subsidiary of the United States Steel Corporation. Mr. Elstad, Oliver’s president, told defendant that Oliver had more commitments for iron ore than it could meet but recommended that the defendant contact plaintiff, an independent iron ore operator in Duluth, Minnesota, who had had many years of experience in the iron ore business. As a result of negotiations between plaintiff and defendant, the contract here in question was finally entered into.

The primary document indicating the agreement between the parties is the plaintiff’s letter to the defendant dated November 15, 1948, (Exhibit 6(A)). This consists of an offer by the plaintiff to the defendant to become,

“ * * * your sole agents, ad-visors and engineers in examination and development re iron ore and iron ore property acquisition by lease or purchase, and in the engineering planning and development and operation management of such properties obtained and acquired by you, for a period of two (2) years beginning when you sign and make effective this agreement.”

For such services plaintiff was to receive

“On any iron ore and iron ore stockpiles purchased and on any iron ore properties purchased or leased, for each gross ton shipped, a payment equalling (at time of shipment) two (2) per cent of the so-called Seasonal Price * *

There was also a provision for a retainer of $10,000.00 upon execution of the agreement and $1,583.33 on the 15th of each month for 24 months beginning December 15, 1948. The agreement was accepted December 30, 1948, by the defendant. Defendant’s letter of December 10, 1948, to the plaintiff, dealing with their negotiations, stated as follows :

“(6) All of the conditions contained in your letter refer to Stack No. 5, Cleveland, and any addition thereto.”

In pursuance of the understanding between the parties, and with defendant’s knowledge and consent, plaintiff entered into negotiations on behalf of the defendant with Oliver Iron Mining Company and otherwise made efforts to secure iron ore or iron ore properties for the defendant. Some of such efforts were taken prior to and in contemplation of the final execution of the written contract between the parties.

Plaintiff, in negotiating with the Oliver Iron Mining Company, was informed that the latter had more demands for ore than it could supply. Plaintiff then suggested to Oliver that he could make available a property on the Cuyuna *528 Iron Range, herein referred to as the McGinty Mine, which contained an estimated 1,500,000 tons of iron ore.

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229 F.2d 525, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kaiser-motors-corporation-v-mary-f-savage-as-of-the-estate-of-john-a-ca8-1956.