Neldon v. Smith

36 N.J.L. 148

• Court: Supreme Court of New Jersey
• Decided: February 15, 1873
• Status: Published

Opinion

Scudder, J.

The principal question of law in this case for our determination relates to the true construction of the written contract between the parties in this particular: whether the terms impose a reciprocal obligation to deliver and receive the coal bargained for within a certain time, with the condition that the sale shall be void if the coal does not arrive within such time; or whether the time may be extended at the option of the purchaser until delivery shall be made.

The defendant insists that after September 1st, 1865, he was not bound to deliver any coal to the plaintiff under this contract, and that the reciprocal obligations to deliver and receive ceased at that time; the plaintiff claims that whenever the defendant received coal from the company under his contract with them, he was entitled to demand and receive the same at his option'.

The two writings signed by the parties and entered in their memorandum books, are not alike in language, but they substantially agree, and were made at the same time to express the terms of the contract. The former entry was made in the plaintiff’s book with a pencil as they stood together and bargained on the bridge, and the latter a few minutes after when they entered the defendant’s store, and there the terms were written out more distinctly and fully in his book with pen and ink. They were intended to be originals not copies, and are to be construed together to arrive at the intention of the parties.

Taken together they constitute an agreement for the sale and purchase of three boat loads of coal (about 200 tons,) at five dollars and sixty-five cents ($5.65) per ton, to be delivered from the mines in boats at Waterloo, upon the condition that the Del., Lack. & Western Railroad Company deliver the coal to the defendant, Samuel T. Smith, agreeably to the terms of their contract with him. The contract with the company is based on the offer of B. S. French, agent, dated July 11th, 1865, with the time of acceptance extended to July 30th, the acceptance of which formed the agreement; and this offer is incorporated into the condition of the contract between the plaintiff and defendant.

The condition would' then be, provided the Del., Lack. & West. Railroad Co. make immediate delivery of 500 tons or more of coal to Smith at Waterloo, at $5.25 per ton. The words “ immediate delivery ” in ordinary language mean to deliver forthwith; but this expression is explained in the testimony as having a trade meaning among coal shippers and dealers, to which latter class- the plaintiff and defendant belong. It means a delivery during the current month in which the offer is made and accepted, unless the contract is made on the last day of the month, or within such limited time that it cannot be shipped, and then the whole of the following month may be given. According to this interpretation, the contract between the Del., Lack. & West. Railroad Co. and Samuel T. Smith having been made July 28th, 1865, an immediate delivery would be extended through the following month of August. As the company had that time to deliver to Smith, the defendant, so by the condition of his contract with Xeldon he had the same time to deliver coal to him at Waterloo, and Xeldon was bound to receive it if delivered within that time. If however another construction of this contract is made, and it should be held that Xeldon only agreed to take the coal according to the offer of July 11th, which limited an acceptance to the 20th inst. without the extension given to the 30th, and that an immediate delivery must be construed to be within that month, then neither party would be bound beyond that time. In either case, the sale of coal was made upon a proviso or condition that it should be delivered within a certain time and for a certain price. If the company delivered to Smith within the time and for the price stipulated he was to deliver to Xeldon under their contract, and Xeldon was bound to receive the coal. If however the company failed to deliver to Smith within the time and for the price stipulated, he was free from his obligation to deliver, and Xeldon was free from his promise to receive.- The condition affects the obligation of. each party, and is reciprocal.

- The cases relating to goods sold on condition to arrive were elaborately cited and reviewed by the counsel in their arguments before the court. The conclusion to which we must come, after a careful examination of these cases is, that a sale to arrive is conditional, and that if the article contracted for does not arrive, either from the vessel being lost or other cause by accident, and without any fraud or fault of the vendor, the contract is at an end. The contract is executory, and does not pass the property in the goods to arrive. It is merely an agreement for the sale and delivery of the articles named, at a future period when they shall arrive. It is in the nature of a condition and not a warranty. Boyd v. Siffkin, 2 Camp. 326; Johnson v. McDonald, 9 M. & W. 600; Lovatt v. Hamilton, 5 Ib. 639; Gorrissen v. Perrin, 4 C. B. (89 E. C. L.) 681; Hale v. Rawson, 4 Ib. (93 Ib.) 85; Russell v. Nicoll, 3 Wend. 112; Shields v. Pettee, 2 Sandf. 262; S. C., 4 Comst. 122; Davis v. Shields, 26 Wend. 341; 1 Pars. Cont. 552, and notes.

The same principles of law are applicable to this case, as it is an agreement to sell upon an express condition. The difference between the cases cited and the different results arrived at in the courts, which are sometimes nice and quite close, are referable to the exact terms of the contract, which must control the usual form and the construction of suoh bargains.

The argument'of the plaintiff’s counsel that this condition, if it be such, to deliver within a certaiu time was for the benefit of the plaintiff, and that he only could avoid having an election, is based upon other facts, and another principle of law applicable to those facts. The. performance of the stipulation, where it is held a party has an option, depends on the acts of the parties themselves, and not upon the acts of others over whom they have no control. If either party therefore fail to perform, he would, by his own act, defeat the condition, and have the benefit of his own wrong. Take as an illustration, the case of Campbell v. Westcott, 5 Cow. 270. In articles for the sale of land by which the vendee covenants to pay and the vendor covenants to convey on payment, and the vendee agrees that if lie fails in his covenant the contract shall be void; or there is a general proviso that if the vendee do not perform it shall be void, here the contract is voidable only at the election of the vendor.

The reason is obvious. The vendee, by his own default, his refusal to pay, may defeat the contract and annul the sale.

The court held in that case that on the vendee’s default to pay, the vendor might consider the agreement void at his own election, or affirm it, and bring his action on the covenants.

To the same effect are the authorities cited in the notes to this case. See also Rede v. Farr, 6 M. & S. 121; Taylor’s Landlord and Tenant 492.

The case now under consideration differs, because the condition here is if the railroad company, a third party, with whom the vendor had contracted for coal, shall deliver it to him at a certain time and for a fixed price, he will sell and deliver to the vendee. This, as has been already said, is not a -warranty that he will deliver, but a condition. It is also a condition based on the act of another, and if that other party fail to deliver without the fault of the vendor, the contract falls. The terms of the condition and of the sale are not for the benefit of either party in exclusion of the other. It is not an indifferent matter to the defendant when he shall receive and deliver the coal. The price and time are both made essential by the terms of the condition, and by the facts of the case. If the goods are delivered at a different time, or at a different price than the one stipulated for, the situation of both parties is changed. The value of the article contracted for has probably increased or diminished, and if this be so, neither party should be able to hold the other to a performance against the plain intent of the agreement. It is only where the sale is absolute, and the title to the property passes by the agreement, or where it is construed as a warranty that this consequence follows. In Russell v. Nicoll, 3 Wend. , a contract was made in the city of New York for the sale of 500 bales of cotton, to be delivered, on its arrival at New York from New Orleans, at any time between the date of the contract, February 9th, and the first day of June thereafter, to be paid for in cash on delivery, the cotton to be weighed, &c. This was held to be an executory contract, and the title to the cotton did not pass. It was also said that the actual transfer of the property contracted to be sold depended upon the arrival of the cotton at New York, an event not absolutely in the control of either party, and which might never happen. The period for its delivery, on condition of its arrival, was also fixed, that the parties might' know how long they were to remain under the stipulations of the contract.

The difference between the construction put upon the contract by the plaintiff and defendant, appears to be this: the one interprets it without the condition and the other with it. If the sale stood upon the first sentence- as entered in the plaintiff’s book, and signed by both parties, thus : “ I agree to take from S. T. Smith, three boat loads of coal, delivered at Waterloo, for $5.65-100, to be either egg or stove, as soon as coal is delivered from the mine from this date, July 29th, 1865,” he would be clearly right,- and entitled to the coal when delivered from the mine. But when the condition is added, “ said Neldon is to take it in boats at Waterloo, and does not bind said Smith unless Delaware, Lackawanna and Western Railroad Company deliver the coal to him as per offer of B. S. French’s, per letter of July 11th, 1865,” and when that offer is of “ 500 tons or more for immediate delivery at $5.25 at Waterloo,” he is not entitled to the coal unless there is an immediate delivery, as explained, at the price and place named.

It is not said that if they deliver at any time under the contract, but if they make immediate delivery. The' entry in defendant’s book states more explicitly that the coal was to be delivered agreeable to price and conditions.

There is a mistake also in saying that the coal delivered in October and November, after the strike had ended, was delivered under the contract between Smith and the railroad company. It is true that it is so stated by Smith in his testimony, but he also calls it a compromise. The facts show that the company gave notice to Smith by a circular, dated September 27th, 1865, that they cancelled their obligation to deliver coal under their offer of July lltb, 1865 (by mistake called therein, August 20th, 1865). Smith went to their office in New York and insisted that they were bound to deliver; the company claimed that by their terms and customs and the rules of trade, in consequence of the strike, the contract was annulled. Smith threatened to sue for damages. The price had advanced, and Smith proposed to take the difference in satisfaction of damages, and finally he says: “ We came to a compromise, and he (Sykes, vice-president of the company,) ordered Mr. French to ship to me the coal to satisfy me, and satisfied my claim.”

After the company failed to make immediate delivery of the coal, Smith’s claim against them was for damages for nondelivery. If in settlement they agreed to enlarge the time for delivery and acceptance, it was a new contract; but it was within the statute of frauds, as it was not in writing, and could not be enforced while it remained executory. Addison on Cont. 236; Swain v. Seamens, 9 Wall. 272; Marshall v. Lynn, 6 M. & W. 109; Moore, v. Campbell, 10 Ex 323.

When the coal was accepted by a parol agreement made after the breach, it was by way of accord and satisfaction of the damages growing out of the breach of the former contract, and not a performance of that contract. There has therefore been no delivery under that contract. By this arrangement, the boat load (66 2-10 tons,) shipped July 18th, 1865, ten days before the contract was made between Smith and the company, was accepted as part of the quantity to be delivered, and in October and November 465 or 467 tons more were shipped and received, all for the price named in the former contract, so that both the time was enlarged for delivery and the quantity was increased more than thirty tons.

When the first boat load had been shipped from the mines, October 7th, and when the whole amount had been delivered, on November 30th, the defendant Smith was not in .a position to compel the plaintiff to accept the three boat loads he had bargained for, because he had never contracted to accept the coal which might arrive under any subsequent contract, compromise and settlement, which might grow out of the nonperformance of' the original contract with the company. Neither can he, when the price of the coal has risen, call upon the defendant to deliver, and claim damages for non-delivery, when the defendant has received the coal long after the time named in their contract. There must be mutuality in the obligation between the parties.

This conclusion settles the rights and duties of the parties under the contract in controversy, and renders it unnecessary to express any opinion an the rulings at the trial in the admission or rejection of evidence.

The postscript at the bottom of the entry in the defendant’s book, which was below the date and the signatures of the parlies, was excluded at the trial, on motion of the plaintiff’s counsel, because it could only be connected with the .writing above the signatures and date by parol proof. If it had been admitted, I think it would not have changed the result which has been reached.

It is not therefore necessary to express any opinion upon this point, aud noue is given. It is not within the ruling of this court in Johnson v. Buck, 6 Vroom 338, where the papers were separate and distinct, and the attempt was to connect ihem by parol proof, and is not free from doubt.

The legal position of the parties was not changed by the letters and conversations between them about September 1st, giving .notices and making counter claims under the contract. By its own term? it had then ended.

The verdict is set aside, and a new trial granted.