Marquette Cement Manufacturing Co. v. Treas Lumber Co.

60 S.W.2d 88, 249 Ky. 32, 1933 Ky. LEXIS 467

Opinion

Opinion op the CotjRt by

Judge Dietzmapt

Reversing.

This suit was brought by the appellant, Marquette Cement Manufacturing Company, hereinafter called the “cement company,” to recover the sale price of two carloads of cement sold by it to the appellee, Treas Lumber Company, hereinafter called the “lumber company,” in the year 1930. The lumber company by its answer admitted the debt but pleaded a counterclaim in a sum of $391.30, leaving a balance due the cement company of $74.14, for which it confessed judgment. By reply, the cement company controverted the grounds of the counterclaim, and on the issue thus formed, the case went to the jury, which found in accordance with the claims of the lumber company. From the judgment entered on that verdict, this appeal is prayed. ■

The main insistence of the cement company on this appeal is that 'the lower court erred in overruling its motion for a peremptory instruction made at the close of the lumber company’s case, it haying been awarded the burden of proof, and renewed at the close of all the evidence in the case. In this, we think the cement company is correct. The counterclaim of the lumber company was based on the allegation that it was, during the years 1923 to 1930, inclusive, the exclusive dealer in Marshall county for the sale of the cement company’s cement; that it had been established as such exclusive dealer through an • express agreement and contract with the cement company, but that the cement company in violation of its contract and agreement establishing the lumber company as its exclusive agent had in 1929 sold directly to N. E. Stone, a road contractor, for the purpose of building a highway, 3,649 barrels of cement; that according to the terms of the contract establishing it as such exclusive agent, the cement company, when it sold directly to a customer as in the case of this Stone highway contract, was under the' obligation to pay the lumber .company 10 cents a barrel' for all cement so sold, and it was for this 10 cents per barrel for. the 3,649 barrels so. sold to the Stone company that the lumber company sought judgment over against the cement company. There were some other items of a minor nature embraced in the counterclaim which were conceded by the cement company and hence are not noticed here. To establish the allegations of this counterclaim, so far as this express contract was concerned, the lumber company produced but one witness, its president and manager, Mr. Cliff Treas. After testifying that his company had been handling the products of the cement company since 1923, he was then asked:

“Q. Did you ever have any agreement with them about the sale of cement? If so, tell the jury what it was,' what was said. A. I had none, my brother was manager at the time this business was accepted.

“Q. You have had.no agreement since you have been in charge? A. No sir.

“Q. There being no agreement, tell the jury how you have handled their cement, to what extent you handled their cement, and upon what terms, and in what territory, and with whom, for them, you have had your dealings. (Italics ours.)

■A.-I cannot .give you tlie amount-we Rave ■handled. T did -not. refresh niy memory, on -that .but we .have handled their cement continuously to my certain knowledge .since 1923. Prom 1923 to'1930,'it was •handled on a cash basis of ten cents per barrel cash discount and ten cents per barrel- dealer’s commission.’.’ .

Thus'we'see that Mr. Treas'did not even-attempt’to say tliat there was an express ■ agreement establishing his company as the exclusive dealer or agent of the cement company in Marshall county, and of' course he did'not essay to give the terms of the agreement of which he knew not. The lumber company’s counsel by that part of his question which we have italicized indicated how thoroughly he understood Mr. Treas’ inability to testify concerning' the express"contract alleged in the'countér claim.

. Úówhere else in the testimony of Mr; Treas do w© find any .evidence'setting .out the terms, of an' express contract or the fact that there was an express contract between his companyand the. cement company creating, and establishing the. lupiber company as the exclusive agent, of, the cement 'company in Marshall county, or by .which .the, lumber company.was fo be allowed g commission ;of ,10 cpnfs a barrel or of any other amp unt..on. cement sold-by .the. cement company .directly to the customer. .To thp.■argument ,that such .contract was established by the .fact..that from .1923 to 1928 no cement was. sold in Marshall: county except .through the lumber company,. it may be .said, .that such fact of itself establishes no ..exclusive, agency, since the. failure to sell cement other than through the.,lumber 'company may have been caused by the fact that there was no other call'for;thé ’cement Company V cement. Indeed, the evidence of tlie: cement company uncontradictéd: shows that the’lumber' company was''handling the cement of 'other manufacturers" as' well as the cement of the cémént' company and during the years from 1923 to 1930 comparatively! little cement of the cement company was bought even by the lumber company. '

In 1928,- a road-was built in Marshall'bounty known as the:'Egner’s1 Kerry road. The cement company contracted directly with-the contractor on this road for the cement- which it used, and ultimately and after a' controversy ydth/the lumber company paid.the lumber'com pany 10 cents a- barrel on tbe cement thus sold- directly to that road' contractor. 'How this' came about is told in different fashions by tbe cement company -and The lumber company. Tbe cement company claims that tbe reason for tbe payment of this 10 cents a barrel to- the lumber company was this:- Tbe road contractor bad no place to store bis cement, so tbe traveling salesman of tbe cement company who sold this cement arranged with the lumber company to permit tbe road contractor to store this cement in tbe lumber company’s warehouse, in return for which this traveling salesman agreed that bis company would pay tbe lumber company a warehousing .fee of 5 cents a barrel and would further use bis influence with tbe road contractor to get it to give to tbe lumber company tbe lumber contract on tbe road. Tbe lumber company was to charge tbe road contractor an additional 5 cents a barrel for. tbe warehousing privilege. Following this' agreement, through tbe influence and help of this traveling salesman, tbe lumber company did get tbe lumber contract and tbe cement was stored in tbe warehouse of tbe lumber company. Tbe cement company never questioned its liability for tbe 5 cents a barrel warehousing fee, but tbe lumber company insisted that it was entitled to tbe full 10 cents a barrel from the cement company, and it was about this additional 5 cents that tbe controversy raged, finally being settled by tbe cement company giving in and paying tbe 10 cents a barrel. On the other hand, tbe lumber company’s explanation of this transaction is that while it is true tbe cement was- warehoused in its warehouse and while it is true tbe traveling salesman of tbe cement company at least helped it to get tbe lumber contract, the’ 10 cents a barrel which it claimed on tbe cement sold tbe contractor was due it because tbe traveling salesman of tbe cement company came and told it that be would allow it this 10 cents a barrel because tbe cement bad been sold directly to tbe customer. But even as to this, Mr. Treas 'testified that be relied, in bis controversy with tbe cement company over this matter for bis right to tbe 10 cents a barrel, not on any terms of tbe general agency contract which tbe lumber company bad with tbe cement company, but on tbe specific agreement with this traveling salesman in this particular case. It is very difficult to understand why .the lumber, company would have to. rely on tbe specific agreement of tbe traveling salesman in this particular case if the terms of its general agency contract gave it this 10 cents a barrel. Mr. Treas admits that after the Stone contract was let in 1929 following the completion of the Egner’s Ferry road and the settlement of the controversy growing ont of it, his company never made any demand or claim for a commission on the cement sold Mr. N. E. Stone, although he does claim that he did make a mild inquiry about it and was told that none was due his.company. Some 18 months after the Stone contract had been let and all controversies had been settled about the Egner’s Ferry road and. after a car of cement, in the summer of 1929 had beeu bought and paid for, the lumber company in the latter part of 1930, and without apprising the cement company of its position in the matter, ordered the two carloads of cement, for which the present suit was brought, for the sole purpose of getting into debt to the cement company so as to .assert, locally a counterclaim for the alleged commission due on the Stone, contract. There is an entire absence of. proof to show any express contract on the part of ,the. cement company establishing the lumber company as its exclusive agent or dealer in Marshall county or.to show that the lumber company-was entitled to 10 cents a barrel, or any commission on -cement sold in that county otherwise than through the lumber company, which, being, true, the court should have-peremptorily instructed the jury to find • against the counterclaim. - asserted by. the lumber company. . • , .

' 'For its failure so to do, the appeal prayed is granted, and’ 'the judgment' is reversed for a new .trial consistent with this opinion. • ■ - - • ■