National Wholesale Grocery Co. v. Mann

146 N.E. 791, 251 Mass. 238, 1925 Mass. LEXIS 1062
CourtMassachusetts Supreme Judicial Court
DecidedFebruary 24, 1925
StatusPublished
Cited by17 cases

This text of 146 N.E. 791 (National Wholesale Grocery Co. v. Mann) is published on Counsel Stack Legal Research, covering Massachusetts Supreme Judicial Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
National Wholesale Grocery Co. v. Mann, 146 N.E. 791, 251 Mass. 238, 1925 Mass. LEXIS 1062 (Mass. 1925).

Opinion

Rugg, C.J.

This action of contract is brought to recover a part of the contract price paid for Java sugar purchased by the plaintiff of the defendant. There are two counts in the declaration on which the case was tried: One alleges that the defendant owes the plaintiff $13,000 with interest. The other alleges a written contract whereby the defendant sold to the plaintiff Java sugar; that the defendant made use of a letter of credit in payment thereof before the time permitted by the contract and collected full price for the sugar, namely $47,600; that the defendant, although required to make delivery in sound packages, delivered a large number of unsound packages, which the plaintiff refused to accept and offered to return, and thereafter sold same on account of defendant, and that the defendant owes the plaintiff $13,000.

The contract was in writing. It was dated May 6,1920, [243]*243but apparently was finally executed and delivered by the plaintiff on May 12,1920. So far as material to the present controversy, its terms were,

“This is to confirm sale made by Wm. Mann, Boston, Mass, to National Wholesale Grocery Co., Fall River, Mass, about one hundred tons of 2,240 lbs. each White Java Sugar packed in bags of about two (2) cwt. each. Sound packages only to be delivered.
At twenty one and twenty five (21.25) cents.
C. I. F. New York, In bond.
Net landed weights to govern. Adjustment on final weights.
Shipment to be made approximately as follows:—
100 tons May /June Seller’s Option from the Island of Java.
Payment to be made by net cash upon presentation of delivery order or warehouse receipt against irrevocable letter of credit, to be opened by buyer immediately with some Boston Bank in favor of Wm. Mann for the full amount of the Invoice.”

■The sugar sold to the plaintiff was part of a larger lot previously purchased by the defendant under a contract similar in all respects. Under date of May 11, 1920, the plaintiff wrote to the defendant a letter, the material parts of which are: “Referring to your confirmation of May 6th, covering about one hundred (100) tons of White Java Sugar for May or June shipment, we are enclosing you herewith thirty-day sight letter of credit opened in your favor by the National Exchange Bank of this city, [Providence] under their No. 102 in the amount of fifty thousand dollars ($50,000). You will please note same is made available until August 15, 1920 and can be negotiated against either warehouse receipt, delivery order or bill of lading. The National Exchange Bank is writing you direct confirming same.” On May 12,1920, the plaintiff wrote to the defendant enclosing the contract above quoted, signed by it. The defendant accepted the letter of credit after the plaintiff had agreed to pay the defendant the charges for revenue stamps [244]*244and for discounting the thirty day draft offered in payment of the net cash required by the contract. The letter of credit was not in evidence.

The admission in evidence of the letter of the National Exchange Bank to the defendant under date of May 11,1920, was error. The statement of the terms of the contract between the plaintiff and the defendant therein contained was inaccurate and contained important variations. It differed in its statement of the terms of the letter of credit from those contained in the plaintiff’s letter of the same date to the defendant already quoted. The bank was bound by its letter of credit, which it entrusted to the plaintiff as its customer to deliver to the defendant and which the defendant accepted. That was a distinct contract from the one between the plaintiff and the defendant. Moss v. Old Colony Trust Co. 246 Mass. 139, 151, 152. This letter of the bank was not acknowledged by the defendant, who apparently paid no attention to it. He was not bound by it in any particular. His rights are not affected by it. He was under no legal obligation to answer it. Jennings v. Wall, 217 Mass. 278, 282. Moreover, this letter of the bank antedated the delivery by the plaintiff of the contract between the parties hereto and could not affect its terms. All previous or contemporaneous oral or written negotiations were merged in the contract as finally phrased in writing. Jennings v. Puffer, 203 Mass. 534. Goldenberg v. Taglino, 218 Mass. 357, 359. Snider v. Deban, 249 Mass. 59.

There was no violation of the contract by the defendant in collecting on the letter of credit when he did.

It was undisputed or established that on August 10, 1920, the defendant sent a delivery order and a pro forma invoice covering two hundred and twenty-four thousand pounds of sugar to the bank, and on August 14, 1920, collected on the letter of credit $47,600. The delivery order was addressed to the delivery clerk of the S.S. Rondo at a New York dock, directing him to deliver to the order of the plaintiff the sugar called for by the contract. Consular invoice and extracts from the original bill of lading respecting the sugar were sent by the defendant to the plaintiff on August 21,1920, the ship [245]*245having arrived the day before. It began discharging cargo, and a representative of the plaintiff examined bags as they were put on the pier. Ultimately one thousand and four bags purporting to contain the sugar called for by the contract were delivered to the plaintiff and taken into its possession and either shipped or stored by it. Confessedly seven hundred and forty-eight of these bags conformed to the contract.

The present controversy centers about the remaining two hundred and fifty-six bags. The plaintiff contends that these were not “sound packages,” as required by the contract, forty-four being “stained” or wet, forty “slack” and one hundred and seventy-two “torn and mended.” The plaintiff notified the defendant on September 27, 1920, that it rejected these bags and that it was drawing on him for the contract price thereof with warehouse receipt annexed indorsed to his order. The defendant refused to accept the draft. The present action was brought in October, 1920. Evidence was introduced in support of the plaintiff’s contentions respecting the two hundred and fifty-six bags, and to the contrary, by the defendant.

The contract of the parties was in writing. Its statement of price was followed by the letters, “ C. I. F.” These letters mean that the price named covered cost, insurance and freight. The common meaning of a c. i. f. contract is that the seller agrees to put the goods on board, to procure the ordinary or stipulated shipping documents, whether bill of lading or other evidence of title, to pay the freight and to cause insurance of the customary kind to be placed on the shipment in the usual way. The seller performs his contract by seeing that the cargo is on board and by forwarding seasonably to the purchaser the shipping documents and making appropriate arrangements at his own expense for the payment of freight and for insurance for the benefit of the buyer. Commonly a bill of lading and policy of insurance are to be delivered to the buyer. Where the goods are distinct and separate, among the documents to which the buyer is entitled and which the seller must tender to be entitled to payment, is a policy of insurance in the name of the [246]*246buyer.

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Bluebook (online)
146 N.E. 791, 251 Mass. 238, 1925 Mass. LEXIS 1062, Counsel Stack Legal Research, https://law.counselstack.com/opinion/national-wholesale-grocery-co-v-mann-mass-1925.