DONOVAN, District Judge.
Plaintiff brings this action to recover damages for breach of contract. Defendant pleads cancellation and counterclaims for alleged secret profits retained by plaintiff.
Plaintiff, a graduate engineer and a fluent speaker of several languages, among them Spanish, persuaded L. A. Wilkie, defendant’s chairman, to appoint Schenstrom •defendant’s representative to sell its products in Mexico for a period of six months. Defendant, a Minnesota corporation with its principal place of business in Minneapolis and factories in Savage, Minnesota, and Des Plaines, Illinois, is controlled by Wilkie and members of his family, who .are its directors and stockholders. The DoAll Company is a partnership also controlled by the Wilkie family, with offices in Minneapolis and Des Plaines, and used by defendant in its export trade.
Plaintiff’s appointment was obviously for the purpose of trying him out as to ability, integrity and business acumen during said period. From time to time there was correspondence between plaintiff and various officers of defendant having to do with the establishment of a sales policy for defendant in connection with the sale of defendant’s products in Mexico. The letters in evidence make clear that plaintiff did not want to be limited too much in the matter of sale prices. During June, 1944, communications by letter between plaintiff and defendant were to a considerable extent directed at the relationship existing between Schenstrom and SKF, a well-known sales organization, particularly with reference to the methods and practices of the Schenstrom-SKF combination in the matter of sale prices. Illustrative of this is plaintiff’s letter to L. A. Wilkie, dated June 2, 1944, advising that SKF was associated with him and it wanted to buy defendant’s machines and resell on 60-day credit terms, “ultimate resale price being decided by them.” On June 14, 1944, Wilkie acknowledged the foregoing suggestion and wrote to plaintiff, saying: "Your letter of the second explaining the program of the sales acceptances from the SKF organization is very interesting. We hope your plan will create a big volume of business. We will be glad to extend 60-day credit terms on the machines they purchase for resale(Italics supplied.) The credit terms were later changed by defendant to 30 days. The arrangement between Schenstrom and SKF was made in June, 1944, and is described in his testimony as follows : “I had an arrangement with SKF whereby they cooperated with me in the marketing of the DoAll products. They were going to lend their sales engineer’s efforts to the sale of these products. They gave me office space. They financed the machines. They sold supplies over the counter. They made out my bills for supplies. They did certain parts of my bookkeeping and cooperated with me in a general way to help me make these sales.” [376]*376By letter dated June 19, 1944, defendant’s export manager, manifestly concerned over Schenstrom’s apparent departure from defendant’s uniform practice of one price to all wherever its products were sold, emphasized its “insistence that SKF quote our established list price only.”
In August, 1944, as the six-month period was ending, plaintiff visited defendant’s plants at Des Plaines, Illinois, and Savage, Minnesota, and its offices in Minneapolis and Des Plaines. A conference between defendant’s executives and plaintiff followed at Des Plaines on or about August 25, 1944.
From the foregoing, it should be noted that prior to the conference in Des Plaines, defendant had knowledge of the Schenstrom-SKF combine. Defendant knew, of course, that it was selling its products to SKF f. o. b. factory, and that SKF was selling the same products in Mexico on a delivered basis in pesos, or, as described in the record of this case, at “7 pesos to the dollar” on the Minneapolis list price. With all this in mind, Wilkie called defendant’s lawyer in and directed him to draft the contract here in question. Plaintiff left for the East on August 26th, before the contract was ready for execution. He testified that prior to boarding the train at Chicago he telephoned Wilkie at Des-Plaines and said, “Remember our understanding about prices”, and that Wilkie replied, “All right, don’t charge too much.”' That plaintiff then went to Washington, DC. to facilitate the granting of export licenses. Following this he left for New York, where he received the contract in duplicate as executed by defendant. He signed both, retaining one and returning the other. The contract, as pertinent to this proceeding, is set forth in the margin.1
[378]*378The signatories carried on under the contract until it was cancelled by defendant pursuant to notice, infra. Schenstrom continued winding up mutual affairs for the parties until termination was completely effected.
Plaintiff contends that the contract was of a dual character, pártaking of an agency and a sales contract; that grounds for cancellation did not exist and, in any event, such grounds must be limited to those stated in the notice; and finally, that in cancelling the contract defendant did not act in good faith.
Deféndant contends that the contract was one of agency even though plaintiff was designated an independent contractor, and that plaintiff had violated the terms of the contract, justifying cancellation. More specifically, defendant accuses plaintiff of fraud, false representation of material facts and breach of the contract terms, as set out in paragraph VI, XVI and XVII thereof.
The validity of the' contract is not questioned. The causa próxima is the claimed right of plaintiff to depart from defendant’s factory prices and sell defendant’s products in Mexico at prices exceeding those prevailing in the United States.
The record to some extent suggests that officers of defendant may have been working at cross purposes at times. The export manager clearly insisted on conformity to defendant’s list prices in correspondence with plaintiff had prior to the conference, while its chief executive merely cautioned plaintiff against charging “too much”.
The formal contract was prepared by defendant’s lawyer in its own law department, with all the conference data and correspondence available and in defendant’s possession. If the “7 to one” price scale was so important, why is the contract silent in respect to it? The difficulty defendant’s export manager was having with plaintiff relative to the scale of prices insisted upon, and which he refused to comply with, was warning of trouble to follow, if not controlled by the contract. One sentence in the written contract could have limited plaintiff’s authority and required him to conform at all times to defendant’s uniform list price. The absence of such a precautionary provision in the contract is creative of a situation against which defendant did not afford self-protection. Prepared by defendant, the instrument in writing is subject to interpretation- pursuant to Minnesota law, and must be construed most favorably to the plaintiff. E. I. Du Pont De Nemours & Co. v. Claiborne-Reno Co., 8 Cir., 64 F.2d 224, 89 A. L.R. 238.
While the earnest argument of counsel for defendant frankly charges Schenstrom with conduct prejudicial to the best inter[379]*379ests of his principal bordering on disloyalty, in the end it all boils down to the pertinent question of fact relating to Schenslrom’s authority to use the scale price of “7 to one”.
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DONOVAN, District Judge.
Plaintiff brings this action to recover damages for breach of contract. Defendant pleads cancellation and counterclaims for alleged secret profits retained by plaintiff.
Plaintiff, a graduate engineer and a fluent speaker of several languages, among them Spanish, persuaded L. A. Wilkie, defendant’s chairman, to appoint Schenstrom •defendant’s representative to sell its products in Mexico for a period of six months. Defendant, a Minnesota corporation with its principal place of business in Minneapolis and factories in Savage, Minnesota, and Des Plaines, Illinois, is controlled by Wilkie and members of his family, who .are its directors and stockholders. The DoAll Company is a partnership also controlled by the Wilkie family, with offices in Minneapolis and Des Plaines, and used by defendant in its export trade.
Plaintiff’s appointment was obviously for the purpose of trying him out as to ability, integrity and business acumen during said period. From time to time there was correspondence between plaintiff and various officers of defendant having to do with the establishment of a sales policy for defendant in connection with the sale of defendant’s products in Mexico. The letters in evidence make clear that plaintiff did not want to be limited too much in the matter of sale prices. During June, 1944, communications by letter between plaintiff and defendant were to a considerable extent directed at the relationship existing between Schenstrom and SKF, a well-known sales organization, particularly with reference to the methods and practices of the Schenstrom-SKF combination in the matter of sale prices. Illustrative of this is plaintiff’s letter to L. A. Wilkie, dated June 2, 1944, advising that SKF was associated with him and it wanted to buy defendant’s machines and resell on 60-day credit terms, “ultimate resale price being decided by them.” On June 14, 1944, Wilkie acknowledged the foregoing suggestion and wrote to plaintiff, saying: "Your letter of the second explaining the program of the sales acceptances from the SKF organization is very interesting. We hope your plan will create a big volume of business. We will be glad to extend 60-day credit terms on the machines they purchase for resale(Italics supplied.) The credit terms were later changed by defendant to 30 days. The arrangement between Schenstrom and SKF was made in June, 1944, and is described in his testimony as follows : “I had an arrangement with SKF whereby they cooperated with me in the marketing of the DoAll products. They were going to lend their sales engineer’s efforts to the sale of these products. They gave me office space. They financed the machines. They sold supplies over the counter. They made out my bills for supplies. They did certain parts of my bookkeeping and cooperated with me in a general way to help me make these sales.” [376]*376By letter dated June 19, 1944, defendant’s export manager, manifestly concerned over Schenstrom’s apparent departure from defendant’s uniform practice of one price to all wherever its products were sold, emphasized its “insistence that SKF quote our established list price only.”
In August, 1944, as the six-month period was ending, plaintiff visited defendant’s plants at Des Plaines, Illinois, and Savage, Minnesota, and its offices in Minneapolis and Des Plaines. A conference between defendant’s executives and plaintiff followed at Des Plaines on or about August 25, 1944.
From the foregoing, it should be noted that prior to the conference in Des Plaines, defendant had knowledge of the Schenstrom-SKF combine. Defendant knew, of course, that it was selling its products to SKF f. o. b. factory, and that SKF was selling the same products in Mexico on a delivered basis in pesos, or, as described in the record of this case, at “7 pesos to the dollar” on the Minneapolis list price. With all this in mind, Wilkie called defendant’s lawyer in and directed him to draft the contract here in question. Plaintiff left for the East on August 26th, before the contract was ready for execution. He testified that prior to boarding the train at Chicago he telephoned Wilkie at Des-Plaines and said, “Remember our understanding about prices”, and that Wilkie replied, “All right, don’t charge too much.”' That plaintiff then went to Washington, DC. to facilitate the granting of export licenses. Following this he left for New York, where he received the contract in duplicate as executed by defendant. He signed both, retaining one and returning the other. The contract, as pertinent to this proceeding, is set forth in the margin.1
[378]*378The signatories carried on under the contract until it was cancelled by defendant pursuant to notice, infra. Schenstrom continued winding up mutual affairs for the parties until termination was completely effected.
Plaintiff contends that the contract was of a dual character, pártaking of an agency and a sales contract; that grounds for cancellation did not exist and, in any event, such grounds must be limited to those stated in the notice; and finally, that in cancelling the contract defendant did not act in good faith.
Deféndant contends that the contract was one of agency even though plaintiff was designated an independent contractor, and that plaintiff had violated the terms of the contract, justifying cancellation. More specifically, defendant accuses plaintiff of fraud, false representation of material facts and breach of the contract terms, as set out in paragraph VI, XVI and XVII thereof.
The validity of the' contract is not questioned. The causa próxima is the claimed right of plaintiff to depart from defendant’s factory prices and sell defendant’s products in Mexico at prices exceeding those prevailing in the United States.
The record to some extent suggests that officers of defendant may have been working at cross purposes at times. The export manager clearly insisted on conformity to defendant’s list prices in correspondence with plaintiff had prior to the conference, while its chief executive merely cautioned plaintiff against charging “too much”.
The formal contract was prepared by defendant’s lawyer in its own law department, with all the conference data and correspondence available and in defendant’s possession. If the “7 to one” price scale was so important, why is the contract silent in respect to it? The difficulty defendant’s export manager was having with plaintiff relative to the scale of prices insisted upon, and which he refused to comply with, was warning of trouble to follow, if not controlled by the contract. One sentence in the written contract could have limited plaintiff’s authority and required him to conform at all times to defendant’s uniform list price. The absence of such a precautionary provision in the contract is creative of a situation against which defendant did not afford self-protection. Prepared by defendant, the instrument in writing is subject to interpretation- pursuant to Minnesota law, and must be construed most favorably to the plaintiff. E. I. Du Pont De Nemours & Co. v. Claiborne-Reno Co., 8 Cir., 64 F.2d 224, 89 A. L.R. 238.
While the earnest argument of counsel for defendant frankly charges Schenstrom with conduct prejudicial to the best inter[379]*379ests of his principal bordering on disloyalty, in the end it all boils down to the pertinent question of fact relating to Schenslrom’s authority to use the scale price of “7 to one”. It may well be that Schenstrom relied too much on finesse. Defendant may have lost confidence in him, after individual members of its official family concluded he was playing one against the other. I do not say he was. But his strategem, if such it was, while perhaps lacking in business good taste, cannot be said to be unlawful. On the plaintiff’s side of the case, counsel questions the good faith of defendant’s attempt to cancel, pointing to the visit by its emissaries to plaintiff in Mexico for the admitted purpose of obtaining a new contract based on what is described in the notice of cancellation as the “new basis”. Challenging defendant’s good faith, counsel cites: Ewing v. Von Nieda, 8 Cir., 76 F.2d 177; Appliances, Inc. et al. v. Queen Stove Works, Minn., 36 N.W.2d 121; Holton et al. v. Monarch Motor Car Co., 202 Mich. 271, 168 N.W. 539; White Co. v. W. P. Farley & Co., 219 Ky. 66, 292 S.W. 472, 52 A.L.R. 541.
Defendant makes the point, that the injection of the “7 to one” price feature into the case violates the parol evidence rule. With this I cannot agree. I appreciate that if the contract were complete in itself, setting forth the scale of prices, then silence on a related point that might have been embodied in it would not constitute an invitation to open the door to parol evidence in that respect. There is nothing here suggesting that plaintiff intends to incorporate by claimed oral agreement a meaning contrary to that expressed in the written instrument. The price scale authorization contended for by plaintiff is not inconsistent with the terms of the written contract. Under the circumstances, parol evidence was admissible to show that the scale of prices used by plaintiff in Mexico was in conformity with prices approved by defendant, and comes within the exception to the parol evidence rule. Staples v. Edwards & McCulloch Lumber Co., 56 Minn. 16, 57 N.W. 220; Hand v. Ryan Drug Co., 63 Minn. 539, 65 N.W. 1081; Osterberg et al. v. Section 30 Development Co., 160 Minn. 497, 200 N.W. 738; Bjornstad v. Northern States Power Co., 195 Minn. 439, 263 N.W. 289.
Defendant’s counsel insist that under the terms of the contract plaintiff was an agent or an employee of defendant. This in some respects is contrary to the express provision of paragraph XVIII set out above. But this aside, the lack of control by defendant over plaintiff with respect to the manner and means by which the details of his work were to be carried out, will not permit the conclusion that Schenstrom was an employee, as contended by defendant. Larson v. Le Mere et al., 220 Minn. 25, 18 N.W.2d 696; Castner et al. v. Christgau, 222 Minn. 61, 24 N.W.2d 228; Willner v. Wallinder Sash & Door Co., 224 Minn. 361, 28 N.W.2d 682.
Counsel for plaintiff argue that the contract before the court partakes of two natures, that of agency, and that of sales. See Marrinan Medical Supply, Inc., v. Ft. Dodge Serum Co., 8 Cir., 47 F.2d 458, 460, in which the situation was not unlike the controlling facts here. The court held the contract to partake of the nature of sale and factorage. Judge Booth, speaking for the court, said: “It is not always easy to determine into which class a particular contract falls. * * * all the court can do is to consider the various earmarks as disclosed by the contract, and' the surrounding facts and circumstances, and determine, as best it can, into which class the contract should be placed.”
That the contract was valid and enforcible cannot be seriously questioned. Bendix Home Appliances Inc. v. Radio Accessories Co., 8 Cir., 129 F.2d 177; Emerson et al. v. Pacific Coast & Norway Packing Co., 96 Minn. 1, 104 N.W. 573, 1 L.R.A.,N.S,, 445, 113 Am.St.Rep. 603, 6 Ann.Cas. 973. It only remains to determine whether there was good cause to cancel, as provided in paragraph XV. The [380]*380notice of cancellation2 partakes more of an expression of regret than of a notice of cause. It suggests the desirability that defendant’s products “be distributed on the same basis as they are in the United States”, and goes, on to say, “We regret that you are unable to continue representing us on the new basis(Emphasis supplied.) In my opinion, this notice falls short of providing a sufficient basis for terminating the contract. Whether the additional reasons adduced at trial and during argument would be a sufficient basis for defendant’s terminating the contract is questionable on the record here made. Railway Co. v. McCarthy, 96 U.S. 258, 24 L.Ed. 693; McCreary v. Strongman et al., 3 Cir., 6 F.2d 441; Chevrolet Motor Co. v. Gladding, 4 Cir., 42 F.2d 440; Fruit Growers’ Express Co. v. Plate Ice Co., 4 Cir., 59 F.2d 605.
The burden to prove that, cancellation was justified is upon the defendant. That burden has not been carried to' the extent required. Liberty Bell Gold Mining Co. v. Smuggler-Union Mining Co., 8 Cir., 203 F. 795; Greenhut Cloak Co. v. Oreck, 130 Minn. 304, 153 N.W. 613; Anderson v. M. Burg & Sons, 170 Minn. 53, 212 N.W. 9.
Plaintiff’s counsel, arguing against the validity of .cancellation herein, question the good faith of defendant, pointing to L. A. Wilkie’s knowledge and alleged approval by implication at least, of the criticised practice of plaintiff’s price quotations of “7 to one”. True, defendant’s export manager had prohibited the use by plaintiff of anything other than factory prices. But defendant's chief executive was informed of the practice and acknowledged receipt of the information, adding, “We hope your plan will create a big volume of business.” It may well be, therefore, that plaintiff was encouraged to rply on his demonstrated success in dealing with the chairman of defendant’s board of directors, realizing he could not prevail upon other members of defendant’s official family.
The briefs and oral argument of able counsel for the defendant have not been overlooked. The conduct of Schenstrom, relied upon by defendant as amounting to a breach of contract, is answered in the record by testimony of the plaintiff denying the breach in each instance, or justifying the alleged shortcomings of plaintiff.
On the question' of damages, defendant’s counsel contend there is no showing . that damage was sustained by plaintiff, and describe Schenstrom’s claimed damage as “astronomical”. Defendant argues that the .record shows Schenstrom was “operating at a loss during the 18 months of operation” as its representative in Mexico, and that “only those commissions under the contract can be used in assessing damages.” This court is confined .to the record of the case in assessing, damages. The court cannot speculate in determining the damages plaintiff may be entitled to, but in this type of case damages need not be proved with absolute certainty. The damages sought by plain[381]*381tiff exceed the amount the court considers reasonable. Counsel for plaintiff rely to some extent on the claim that once the machines were sold to the trade in Mexico, the profit to Schenstrom from the sale of tools and supplies would “pyramid” from year to year. Future damages are proper, of course, but they are dependent on what the plaintiff accomplished during the period prior to cancellation. Eastman Kodak Co. v. Southern Photo Materials Co., 273 U.S. 359, 47 S.Ct. 400, 71 L.Ed. 684; Calkins v. F. W. Woolworth Co., 8 Cir., 27 F.2d 314, certiorari denied F. W. Woolworth Co. v. Calkins, 278 U.S. 645, 49 S. Ct. 80, 73 L.Ed. 558; Wakeman v. Wheeler & W. Mfg. Co., 101 N.Y. 205, 4 N.E. 264, 54 Am.Rep. 676.
In my opinion plaintiff, for the balance of the period he may have carried on under the contract, had it not been can-celled, sustained damage in the sum of $40,000. This takes into consideration any and all possibility of past and future employability of plaintiff in mitigation of damages.
Defendant’s counterclaim is dismissed.
Plaintiff’s counsel may submit findings of fact, conclusions of law, order for and form of judgment, consistent with the above, and upon proper notice.
An exception is allowed defendant