Sinclair Refining Co. v. Roberts

1949 OK 103, 206 P.2d 193, 201 Okla. 358, 1949 Okla. LEXIS 305
CourtSupreme Court of Oklahoma
DecidedMay 10, 1949
DocketNo. 33383
StatusPublished
Cited by14 cases

This text of 1949 OK 103 (Sinclair Refining Co. v. Roberts) is published on Counsel Stack Legal Research, covering Supreme Court of Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sinclair Refining Co. v. Roberts, 1949 OK 103, 206 P.2d 193, 201 Okla. 358, 1949 Okla. LEXIS 305 (Okla. 1949).

Opinion

CORN, J.

Between January 1, 1937, and October 15, 1941, plaintiff was the defendant’s commission agent, or bulk warehouse dealer, in Wagoner, Okla., under written contracts of agency, all their transactions being part of a continuous, running account. Defendant owned the warehouse and storage facilities, and retained title to all products distributed by plaintiff, who furnished trucks and employees for such distribution. During this period the parties negotiated several contracts, all of which were the same except as to prices to be charged for merchandise and the amount plaintiff was to receive as commissions.

Under the' terms of the contracts plaintiff was responsible for all losses or shortages of merchandise, and agreed that defendant could withhold amounts in payment of such shortages from the money earned and due plaintiff during the contract. It was agreed that the parties could terminate the contract at any time and without cause, [359]*359and that the written contract constituted the entire agreement and that no amendment or modification of the contract was valid unless evidenced by a writing signed by defendant’s authorized agent.

During plaintiffs agency defendant’s auditors would appear at irregular intervals to inventory and audit the business. These audits would reveal shortages of merchandise which would be charged against plaintiff. Being unable to reimburse defendant in cash, the plaintiff would be required to execute written authorization for the defendant to deduct the amount of the shortages from his future commissions, over a specified period of time. When the plaintiff surrendered his agency in 1941, the total of the commissions so withheld amounted to $1,298.35.

March 27, 1944, plaintiff brought suit in the county court to recover $1,000 of these withheld commissions. His petition admitted execution of the written contracts and his agency, but alleged the contracts had been vacated and altered by oral agreements over the years and had never been enforced except as to the price of merchandise and the commissions to be paid. He alleged defendant’s warehouse and storage facilities were old and defective, but that defendant consistently refused to repair or keep them in proper condition, and that the losses of gasoline, kerosene, and other petroleum products were occasioned because of leakage, evaporation, and theft resulting solely from the defective conditions, and not by his own fault. Further, that defendant acted arbitrarily and by means of menace, fraud, and duress to force his consent to authorize deduction of the shortages from his commissions.

By answer defendant alleged the contracts were in force during the period of plaintiff’s agency and constituted the entire agreement defining the rights and obligations of the parties; that the audits reflected shortages for which plaintiff was bound to account and which he acknowledged in writing, constituting an account stated between the parties, and all such amounts had been fully paid and discharged; that by executing the deduction authorizations he acknowledged his indebtedness and, having paid same, he was estopped to deny validity of the authorizations, execution of which amounted to reaf-firmance of the contracts and plaintiff therefore was estopped to deny the validity thereof, and defendant thus was not indebted to plaintiff in any amount.

Plaintiffs theory was that the written contracts never were enforced after execution of the first contract, except as to the provisions mentioned, and had been abandoned in favor of oral agreements and custom; that the losses of merchandise resulted solely from defendant’s failure to maintain adequate plant facilities and therefore he was not liable for the shortages, but defendant arbitrarily withheld the amount of same from his commissions and by coercion and duress forced him to agree to authorizing the deductions.

Plaintiff’s testimony was directed toward showing the defendant’s warehouse was poorly constructed and maintained, and the storage tanks and facilities were in such poor condition that losses resulted from undue leakage and evaporation, water entering the storage tanks, and thefts, all of which was without fault on plaintiff’s part; that he had often complained and directed defendant’s attention to the generally inadequate facilities and their poor condition, but defendant made no effort to correct any of the defects.

He further testified defendant’s auditors would call and take over his books, but, with one exception, was never given a copy of the audit although each time he was advised of the amount of shortage and the auditor would demand payment. Plaintiff would complain that the shortages were not his fault, but the auditors would require [360]*360him to execute a statement admitting the amount of indebtedness and authorizing deduction from his commissions. Plaintiff would protest, but would be told there would be a new agent if he did not make settlement. He was afraid to refuse to do as demanded even though the shortages were not his fault, because he was given to understand that his agency would be canceled if he refused. Testimony concerning the physical condition of the plant, manner of doing business, and the nature and extent of the losses was corroborated by plaintiff’s former employees.

Cross-examination of plaintiff concerning the alleged abandonment of the contracts brought out that there was no written agreement altering any provision, and plaintiff admitted he had followed instructions and complied with the terms of his contract, but denied the provision fixing his liability for the shortages and authorizing the deductions from his commissions ever was effective.

Defendant’s evidence was that no threats to cancel plaintiff’s contract had been made, and that the auditors lacked authority to make any statement concerning the agency. The equipment was not faulty, and if plaintiff had properly kept same there could have been no shortage resulting from water entering the tanks. Plaintiff never complained and always signed the authorizations. Correspondence from plaintiff regarding one audit was introduced, wherein he expressed complete satisfaction with the audit results charging him with a shortage. This audit was among those which made up the total amount withheld.

Defendant’s district managers never knew of any faulty conditions, or of water in the tanks causing losses, and plaintiff made no complaint, either concerning equipment or losses claimed to have resulted therefrom, and any legitimate complaint would have been adjusted. The audits establishing the amount of the shortages show that plaintiff received credits for coverages of merchandise on each inventory. Audits between May, 1937, and August, 1941, showed the following shortages: gasoline $482.58; kerosene $56.05; other products, including oil and grease in individual containers, $759.67.

Defendant’s motion for directed verdict was overruled and the jury returned a verdict for plaintiff for $850, and judgment was rendered thereon. The argument for reversal is presented under nine propositions, but for purposes of this discussion it is unnecessary to consider other than the following matters: (1) The contracts were executed, complete and unambiguous, and it was not shown that they were vacated, changed or abandoned by oral agreement. (2) For defendant to require plaintiff to perform the lawful obligations he assumed under the contract did not constitute duress.

The allegations of the petition regarding abandonment of the contracts have been noted.

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Cite This Page — Counsel Stack

Bluebook (online)
1949 OK 103, 206 P.2d 193, 201 Okla. 358, 1949 Okla. LEXIS 305, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sinclair-refining-co-v-roberts-okla-1949.