Botany Worsted Works v. Wendt

McAdam, J. The plaintiff, a manufacturer, consigned a quantity of goods to the defendants, as commission merchants, for sale. The action is to recover $1,067.26 as a balance of proceeds unaccounted for. The defendants set up a counterclaim for “ return commissions ” — a phrase which in the trade means that on goods taken away by a consignor before sale the'consignee receives, an equitable allowance to cover the expense of handling, insuring and storing the goods while in his charge. The consignees in this instance handled, insured and stored the goods, and the action of the •consignor in recalling the goods and revoking the authority to dispose of them deprived the consignees of an opportunity to reimburse themselves by the agreed commission of eight per cent, on a sale of the property. It appears that" a'like- claim for. return commissions was made by the defendants in regard to a previous consignment, and the plaintiff, under date of July 13, 1894, recognized it by writing: “ While we agree that the storing of goods costs some, expense for insurance, we think these expenses are a part of conducting commission business, but can be claimed in fairness while [157] goods are returned.” The plaintiff, therefore, knew as early as July, 1894, that return commissions were expected by the defendants on goods recalled by the consignor, and the subsequent dealings became impressed with this understanding. Story on Oont., § 651. The entire system of brokerage has its origin in custom, which has regulated the cases in which it is payable and the rate chargeable in the particular instance. “All trades have their usages, and when a contract is made with a man about the business of his craft, it is framed on the basis' of its usage, and becomes part of it, except when its place- is occupied by particular stipulations.” Laws & Usages, p. 53, § 24; Addison on Cont. (2d Am. ed.), 851. The usage of a particular business “ when it is reasonable, uniform, well settled, not in opposition to fixed rules of law, not in contradiction of the express terms- of the contract, is deemed to form a part of the contract and to enter into the intention of the parties.” Walls v. Bailey, 49 N. Y. 464, 468; S. C., 10 Am. Rep. 409; Johnson v. De Peyster, 50 N. Y. 666; Harris v. Trumbridge, 83 id. 92; Rickerson v. Hartford Ins. Co., 149 id. 315, 316; Broom’s Leg. Max., 682, 889, 891; 1 Gr. Ev., §§ 292, 294; Clark on Cont. (Hornbook ed.), 583, 584; 6 Wait’s Act. & Def. 624; 1 Laws, R. & R., p. 468; Kraft v. Fancher, 44 Md. 204. The custom, however, must be shown to have been known to the parties when the contract was made, or to have been so generally known as to raise a presumption that they had it in mind at the time. Rickerson v. Hartford Ins. Co., supra.. The custom in this case was of a general character, and, moreover, the letter of July 13, 1894, shows that the plaintiff was made aware of such custom before the transaction in suit. The actual expense to which the defendants were put was equal to about four per cent, of the value of the goods returned, but by the custom, which is a reasonable one, they became entitled to charge but two and a half per cent.' If the defendants had been guilty of misconduct whereby they forfeited all right to equitable consideration, or had voluntarily sought to terminate the edntract, and the plaintiff had been compelled in consequence to accept a return of the goods as upon rescission or revocation by the consignees, it might well be that commissions could not be claimed. But that is not the case. Nothing having been said at the time about indemnifying the consignees for their expense, it was quite proper to revert to the general custom of the trade, which may be done “ to annex* unexpressed incidents to contracts.” 8 Wait’s Act. & Def. 516; Clarke’s Brown on Usages, note, p. 23; 1 Cooley’s [158] Bl. 76, note; Story on Cont., § 15; 2 Pars, on Cont. (6th. ed.), 547. Upon these conclusions, the plaintiff is entitled to judgment for $149.36, with interest from October 3l, 1894. ,• Ordered accordingly.