Larrowe Milling Co. v. Lyons Beet Sugar Refining Co.

Scott, J.: This is an action for damages for the breach of an express warranty. The defendant was a manufacturer of beet sugar, and, prior to February, 1907, had sold to plaintiff, under the name of beet sugar pulp, the residuum of the beets after the sugar had been extracted. This was in use as a food for cattle, and plaintiff resold it for that purpose. In February, 1907, defendant wrote to plaintiff that it had been obliged to discontinue sugar making, and could not, therefore, fill the balance of plaintiff’s order for beet pulp. It stated that it had begun to slice the beets without having extracted the sugar from them. This came to be called “ dried beets,” and differed from beet pulp in that it- contained the natural sugar. The plaintiff was reluctant to purchase the dried beets, fearing that it might find difficulty in marketing them, .but defendant was very insistent and finally plaintiff agreed to- purchase. Prior to the purchase defendant sent on samples which plaintiff sent to possible consumers. There is no doubt that these samples were furnished for the purpose of inducing a sale of the dried beets, and that plaintiff and those to whom it resold the article purchased in reliance upon such sample. The plaintiff. finally succeeded in finding á purchaser in the person of one L. R. Wallace, a merchant of Middletown, 27. Y., to whom a sample of the feed had been sent. Plaintiff thereupon purchased fiom defendant, the dried beets, paying therefor $3,333.92, and ordered them shipped to Wallace. When received, the bulk Of the feed was found to be not only unfit for the purpose for which it was intended, but quite inferior to .the samples which had been furnished. Plaintiff made the best disposition it could of the feed, suffering a loss in the transaction' which is represented by the verdict which was rendered in its favor! The court submitted certain specific questions "to the jury and also directed that a general verdict be rendered. Upon the specific questions the jury found as follows: First. That the parties agreed to a sale by sample. Second. That the goods delivered were not equal in quality to the samples submitted. . [734] Third: That the plaintiff, in ■ buying said goods, relied upon, their being up to sample. Fourth. If there was a sale by sample, it was not superseded' by an agreement to return and refund for the defective material, if any: ■< • • . Fifth. That the plaintiff offered to .return the goods claimed to • be defective. The jury also found a general verdict in favor of the plaintiff for $1,459.91. All of these special findings were amply sustained by itlie evidence and'justified the general verdict.. The court, however, set aside the verdict and granted a reserved motion to dismiss the-complaint. The order dismissing the complaint does not state the ground upon .which, it proceeded, but it appears from a short opinion filed by the justice presiding that, in his. opinion,- the contract . proved did not admit of á recovery except on the theory of “ sale and return,” and that there was no proof of a failure or refusal of defendant to take back the goods and- repay the purchase, price.; and it is upon this view of the contract between the'parties that the respondent now attempts'to. sustain the judgment. The basis for this .view is found in the form of the complaint and in a certain, letter received in evidence. The complaint contained all the necessary allegations to set out a sale 'by. satfiple- arid consequent warranty of quality:,-breach of warranty and damages. The pleader interjected into the complaint the following paragraphs: “ Seventh. That before the delivery of all of the goods so shipped, in consideration that the plaintiff should endeavor to make further sales of the- said material and induce its customers to accept and receive ■ the • same,-the said L. R. Wallace having, expressed dissatisfaction with said' material and refused to accept certain of said shipments, of which the defendant was duly notified, and of other good and valuable considerations, the said defendant agreed with the plaintiff that if-any of the plaintiff’s said customers should refuse-to accept, any of said material and should, reject the same, it, the said defend-' ant, would take the same back and refund to the plaintiff - the price paid by the plaintiff therefor, whereupon the plaintiff,, relying upon the said agreement, did exert itself to' procure -other sales of said ' material and to induce its customers,, and among them the said L. R. Wallace to accept the same. [735] “Eighth,. That the material so shipped by the defendant to the plaintiff’s customers, among whom was the said L. R. Wallace, pursuant to the orders aforesaid, was shipped directly from the defendant to the plaintiff’s said customers without knowledge on the part of the plaintiff of its real condition, and that the same was not like and did not correspond to the said samples which the defendant had forwarded to the plaintiff as aforesaid, and was inferior in quality and otherwise thereto; that said material was inedible and unpalatable to stock and was not a fit food for stock and was vastly inferior in quality and otherwise to the article generally in use for such purpose and known as ‘ dried beet pulp; ’ that one of the plaintiff’s customers, the said' L. R. Wallace, refused to accept or pay for a large part thereof, of all of which the defendant was duly notified by the plaintiff. “ Ninth. That the plaintiff duly offered to return to the defendant that part of said, material which its said customer, the said L.R. Wallace, had refused to accept and which was inferior to said ‘ dried beet pulp ’ and unequal to the samples and unfit and unpalatable- as stock food, and demanded of the defendant the shipping directions and information as to where the same should be shipped, but that the defendant refused to accept the same or to furnish such shipping directions, whereupon a large part of the said material remained at the point of delivery and was thereafter destroyed by fire-and another part thereof was sold by the plaintiff at the best price obtainable," all of which happened prior to the 15th day of April, 1907.” The evidence shows that, after some of the feed had been delivered and had proved unsuitable, defendant did write such a letter as is above set forth, and that plaintiff frequently but unsuccessfully asked for shipping directions in order to make return, but that defendant refused to give such directions. The defendant’s contention is that even if the original sale was by sample the complaint and the evidence show that there was afterwards substituted a contract of the character known as “ sale and return,” under which, as it is claimed, the plaintiff was bound, in order to recoup any part of the purchase price, to make ’ an actual return of the rejected goods to the seller. There is iiothing in the complaint, or in the proofs, as we read them, to justify the claim that the plaintiff ever [736] consented to substitute one form of contract for' another.' As has . been said, .the complaint set forth and the evidence established a complete case of a sale by sample. This established an express warranty by defendant that the bulk of the material would be equal in kind' and quality.to the sample (Henry & Co. v. Talcott, 175 . N. Y. 385), and in such case retention of the goods after inspection, or even after knowledge of the defects, does-not, bar an action for breach of wárranty. (Staiger v. Soht, 116 App. Div. 874; affd., 191 N. Y. 527; Cafre v. Lockwood, 22 App. Div. 11.) The plaintiff, when the goods proved to be unequal to sample, had the option to return them, or offer to return them, and sue for the purchase price which lie had already paid, or to keep them and sue for liis damages for the breach of warranty. Yor does it bar the plaintiff’s right to recovery that it sorted out the goods.and sought to return only such as failed to come up to sample. (Gilbert v. Alton, 88 App. Div. 62.) This was evidently, done in a -laudable attempt to reduce the: damages as far as possible..,*Indeed, the correspondence between the parties shows a continuous and consistent effort on plaintiff’s part to make thé damages as small as possible, and a growing, indisposition on defendant’s part, after it had sold the goods and received the purchase price, to escape liability on account- of the defective -quality of the goods. It was the plaintiff’s right and duty to red nee the' damages as much as reasonably possible, and it is not to be prejudiced because it sought to fulfill this duty. It Vvas not incumbent upon plaintiff to actually return the rejected goods at its own cost. It was sufficient that.it offered’ to return them, - (Gilbert v. Alton, supra.) The most that can be .said about the complaint is that it was drawn in a two-fold aspect. It may be that defendant could, by proper motion timely made, have compelled the plaintiff to' separately state the two causes of action, but,even then, as now, the plaintiff would be entitled to recover upon either' cause 'of action sustained by the proofs. In truth, the defendant’s offer to accept'a return of the rejected and defective goods created no new contract, and it thereby assumed no obligation 'that"it was not bound to assume if plaintiff elected to make returti. ■ We are, therefore, of the opinion that it was error to dismiss the complaint. ■ Whether or not judgment should -have been entered upon the verdict depends upon the question whether Or not the court committed reversible [737] error prejudicial to the defendant, for, as has been said, the evidence fully sustained the verdict. The counsel for the respondent calls our attention to certain alleged errors which we have examined. The rulings excepted to are either free from error or cannot reasonably be presumed to have affected the verdict.' A letter written to plaintiff by the dealer to whom the feed was sold was properly admissible as evidence of rejection, and the court was careful' to limit its effect and to instruct the jury that they must not consider the statements contained therein as to the bad quality of the goods, which, indeed, was amply established by other unexceptionable evidence. The other exceptions do not require comment. It follows that-the order and judgment appealed from must be reversed, and judgment directed for the plaintiff upon the verdict, with costs to the appellant in this court and in the court below. Ingbaham, P J., McLaughlin, Claeke and Dowling, JJ., concurred. Judgment and order reversed and judgment directed for plaintiff-on verdict, with costs to appellant in this court and in the court below.