Quigley Co. v. Asbestos Ltd.

44 A.2d 89, 23 N.J. Misc. 301, 1945 N.J. Ch. LEXIS 24
CourtNew Jersey Court of Chancery
DecidedOctober 8, 1945
StatusPublished
Cited by2 cases

This text of 44 A.2d 89 (Quigley Co. v. Asbestos Ltd.) is published on Counsel Stack Legal Research, covering New Jersey Court of Chancery primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Quigley Co. v. Asbestos Ltd., 44 A.2d 89, 23 N.J. Misc. 301, 1945 N.J. Ch. LEXIS 24 (N.J. Ct. App. 1945).

Opinion

Fielder, Y. 0.

The bill of complaint names Asbestos Limited, Inc., a corporation, and Nathan E. Newman its president, as defendants but Newman died a little more than a year after the institution of the suit and complainant abandoned its bill against him and proceeded against the corporate defendant alone.

Complainant seeks a decree that Asbestos Limited, Inc. (hereinafter referred to as the defendant), specifically perform a written agreement entered info by that defendant with complainant whereby said defendant granted to complainant the exclusive rights and franchises for the United States and Canada for the refractory field and industries in the distribution, marketing and sale of an asbestos insulating material newly put out by defendant under the trade name of “New Era Insulation,” for which product said defendant owned patent and trade rights. Complainant also seeks a decree restraining defendant from selling or distributing to others [302]*302the material and products covered, by the agreement and for discovery, accounting and damages occasioned by defendant’s breaches of the agreement.

The contract is dated January 29th, 1942, and was duly executed by the proper officers of both parties. There is a dispute as to the exact date it was executed by defendant and became effective. For complainant the contention is that although its officers executed it January 29th, 1942, it was not executed by defendant’s officers until February 13th, 1942, while defendant contends that its officers executed it January 29th, 1942. The evidence satisfies me that the contract was executed by defendant’s officers February 13th, 1942.

Defendant contends that the contract was canceled and abrogated about four days after January 29th, 1942, by oral consent of both parties and although the possibility of a new contract was discussed, none was ever agreed on and the relation between the parties thereafter was that of complainant purchasing defendant’s material and products merely as an ordinary customer of defendant. Complainant contends that the contract was never abrogated and that defendant continued to recognize its existence until October 18th, 1943, when defendant notified complainant that whatever arrangements had been made by complainant with defendant for the purchase of New Era insulation were canceled, the sole reason stated for that action being that complainant had failed to pay its bills as agreed.

It appears that after the contract with complainant had been executed, defendant found itself in a serious predicament because it had entered into a contract with the United States Government through the Navy Department, giving the Navy a first option on all its material, thus making it difficult and onerous for defendant to perform its contract with complainant. Prior to the date of defendant’s contract with complainant, defendant had been negotiating for a contract with the United States Government and had been advised as early as January 27th, 1942, that the Secretary of the Navy had decided to enter into a contract with defendant, which contract was actually executed February 5th, 1942. Because defendant’s obligations to complainant and to the Navy De[303]*303parment conflicted, I have no doubt that defendant was desirous of cancelling its contract with complainant. Defendant contends and complainant denies that complainant’s contract was then abrogated, complainant voluntarily surrendering its contractual preferences, yet as experienced business men defendant’s officers failed to secure actual surrender or destruction of the contract, or the exchange of mutual releases, or other written evidence of rescission and defendant continued to deal with complainant until defendant notified complainant in October, 1943, that it canceled its arrangements with complainant. The evidence does not sustain defendant’s contention.

The evidence satisfies me that defendant deliberately refused to fill complainant’s orders and while professing its inability to sell complainant, sold to others large quantities of its products covered by the contract, including some sales made to complainant’s customers, and that defendant also refused to allow complainant the discounts provided for in the contract and otherwise breached its contract with complainant.

Defendant contends that the contract is indefinite and uncertain and so obscure as to be incapable of enforcement. By the contract defendant represents that it owns patent and trade rights in an expanded asbestos material put out by it under the trade name of “New Era Insulation” and the contract states that complainant and defendant desire an arrangement for distributing and marketing that material and the products made therefrom. Then, according to the contract, defendant granted to complainant the exclusive rights and franchises for the refractory field and industries to market and sell New Era material and products which the contract states, are intended to cover all expanded asbestos materials under whatever name made and sold. Defendant covenanted that it would not compete with complainant in any way in the refractory field and the doubt or uncertainty stressed by defendant revolves around what meaning should be given to the words “refractory field.” It was known to defendant, of course, exactly what material it had patented and was producing under the New Era trade-name and what its capacities were for the purpose for which it was produced. I think the [304]*304intent and meaning of "refractory field” is that field in which defendant’s products as covered by its patents axe capable of bang used for refractory purposes. Refractory material is that material which is used for the lining of furnaces and crucibles and for similar purposes where a resistance of high temperature is required. The resistance qualities of New Era material are adaptable for temperatures up to 1,600 degrees and not for temperatures beyond that limit, so I think that the refractory field covered by the contract is dearly that field in which defendant’s products can be used successfully.

Defendant contends that complainant breached that provision in the contract whereby it (complainant) agreed to discontinue selling in the refractory field its own “Insulblox” product in competition with the New Bra goods and from talring on and selling in such field any asbestos competing goods. Complainant’s Insulblox is a material designed to withstand temperatures in excess of 1,600 degrees and the evidence is uneontradicted that all sales made by complainant of its own product were to customers whose requirements were for materials to withstand a temperature in excess of 1,600 degrees; hence sales of complainant’s Insulblox were for purposes for which New Era products were unusable and therefore were not made in competition with defendant’s products.

Defendant further contends that complainant breached the contract by failure to make payments according to the terms of the contract for merchandise delivered on its order and that complainant in that respect was in default many times. There was some delay on the part of complainant in making payment fox some of the goods billed to it but complainant insists that such delay was caused, in the main, by defendant billing complainant for goods not covered by the contract and which goods it appears complainant took on consignment to pay for as used, and also resulted from disputes over the proper discounts to which complainant claimed to be entitled.

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Related

Silverstein v. Abco Vending Service
117 A.2d 527 (New Jersey Superior Court App Division, 1955)
Burton v. Asbestos Ltd.
92 F. Supp. 310 (D. New Jersey, 1950)

Cite This Page — Counsel Stack

Bluebook (online)
44 A.2d 89, 23 N.J. Misc. 301, 1945 N.J. Ch. LEXIS 24, Counsel Stack Legal Research, https://law.counselstack.com/opinion/quigley-co-v-asbestos-ltd-njch-1945.