Per Lee v. Beebe

Osborn, J.: The plaintiffs appeal from the judgment entered against them on the report of a referee, dismissing the complaint with costs. The plaintiffs are merchants in Norwich, N. Y., and the defendants hotel keepers in the same place. From April, 1870, to February, 1871, the plaintiffs had sold and delivered goods to the defendants, amounting to the sum of $572.60. On the 17th of May, 1870, and while this account was being made, the plaintiffs entered into an agreement with defendants (in parol), by which they agreed to sell and deliver to the defendants quantities of coal at an agreed price. It is in "eference to this coal contract and the proper construction to be given thereto, that this litigation seems to have occurred. Under this contract, whatever it was in fact, the plaintiffs did furnish between the day it was made and January, 1871, at different times and in different amounts, a large amount of coal, in the aggregate seventy tons, or thereabouts. During this time the defendants had paid said plaintiffs money at different times, and which, after paying the store account, amounted to the sum of $335.10, to be applied upon the coal which had been delivered. But this did not pay the coal account in full, and hence this action was brought. [91] There was a serious difference between the parties as to what were the actual terms of the coal contract, but as the referee has found the defendants’ version to be the correct one, it remains to be seen whether he gave it a proper or rather a legal construction. He finds the contract to be as follows: “ That May 17, 1870, the plaintiffs entered into a verbal agreement with the defendants, whereby the plaintiffs agreed to sell and deliver to the defendants all the coal they should want for their use, of all sizes, for a year, or until the next spring, or the opening of navigation the next spring, at five dollars and fifty cents per ton, and to deliver it along as defendants should want it, the defendants agreeing to receive the same at the said price. Nothing was said by the parties or either of them, as to the time of payment.” And the referee adds to this finding the following words: “Yet they did not contemplate a settlement and payment for each parcel when it should be delivered.” The referee then finds, that in pursuance of this agreement and in part performance thereof, the plaintiffs commenced delivering coal to defendants on many d^ys, from time to time, until and including January 23, 1871, amounting in all to seventy-six tons or over. That in February, 1871, defendants were out of coal, and wanted plaintiffs to furnish them more under this contract, which the plaintiffs did not do, and no more was furnished afterwards. The referee finds that coal in the meantime had advanced in price, and that defendants were compelled to pay an advanced price for what coal they wanted after that, and that they required several tons more to carry them to the time provided for and specified in the contract. He also finds that from August, 1870, to February, 1871, defendants had paid plaintiffs on divers days divers sums of money, aggregating $907.70, but such payments were not applied to any particular demand. As a conclusion of law, he finds that, after paying the store account, there remained to apply on the coal account $335.10, which plaintiffs conld retain, but that they could not recover the balance alleged to be due for coal for the reason that such contract was entire and indivisible, and that, by the terms thereof, nothing was due until the same was fully completed and performed; “ that full performance was a condition precedent to payment or to a right of recovery.” [92] Tbe plaintiffs gave a different version of this contract, bnt, as I stated before, tbe rights of tbe parties must be determined according to tbe contract as found; and just bere it is proper to state tbat tbe statement of tbe referee following tbe contract, as found by bim, “ tbat tbe parties did not contemplate a settlement and payment for eacb parcel of coal wben it should be delivered,” amounts to nothing, and there is no evidence to sustain it aside from tbe contract itself. He says nothing was said by tbe parties as to tbe time of payment. "Whether they did or did not mentally contemplate payment amounts to nothing. Tbe question is, under tbe precise contract as found, were tbe legal conclusions of the referee correct ? Was this an entire and indivisible contract, in such a sense tbat, before plaintiffs could exact payment for any amount, they were bound to wait until tbe time bad expffed and tbe last ton bad been delivered ? I think not. It seems to me entirely clear, on principle and authority, tbat tbe referee erred in bis conclusions. By an examination of tbe contract, it will be seen tbat nothing is said as to tbe time of payment. Tbat tbe quantity to be delivered is not suggested ; it is left wholly indefinite. It may require ten tons or a thousand to complete it, and so of tbe time when tbe several deliveries were to be made. By its very terms it is a contract to be performed in parts. Indeed, it is difficult to see bow, in any sense, it can be regarded as an entire and indivisible contract, and, with due respect to tbe referee who finds differently, it would seem quite evident tbat tbe parties did not so treat or understand it, for tbe defendants paid and plaintiffs received a large amount of money at different times on account of tbe coal tbat was being delivered. But tbe language of tbe contract must control. From an examination of tbe authorities,,I have come to tbe conclusion tbat this contract is one susceptible of part performance — one calling for tbe sale and delivery of coal at different times — making no provision in terms for any credit, and tbat, by its performance, a full and complete performance is not a condition precedent to payment for any part actually dehvered. Tbat tbe defendants could be called upon to pay for eacb parcel on dehvery; tbat is, having delivered all tbe coal tbe defendants wanted at any particular time, tbe plaintiffs could demand and receive payment therefor, and tbat upon such payment being refused an action would lie. [93] In a word, that, under tbis contract, plaintiffs were entitled to recover for tbe coal actually delivered, subject to tbe defendants’ right to recoup such damages as they may have sustained by tbe non-performance of tbe full contract. Tbis would seem to be tbe equitable construction, and clearly sanctioned by authority. (Tipton v. Feitner, 20 N. Y., 423; Withers v. Reynolds, 2 Barn. & Adol., 882, cited and approved in 20 N. Y., 423; Pattridge v. Gildermeister, 1 Keyes, 93; Sickels et al. v. Pattison, 14 Wend., 257; Talmage v. White, 3 Jones & Spencer, 35 N. Y. Superior Ct. R., 218.) In tbis ease it was shown that tbe defendants’ actual damage was on account of the alleged non-performance. If tbis only bad been allowed them, there would still have remained a balance due plaintiffs for which they would have been entitled to recover. Entertaining tbe views already expressed in reference to tbis contract, it is unnecessary to examine tbe other points raised, for it follows that tbe judgment appealed from must be reversed, tbe reference discharged, and a new trial granted, costs to abide the event. Bockes, J.: Tbe conclusions of tbe referee, to which tbe attention of tbe court is called on tbis appeal, have reference to tbe coal contract only. Tbe referee found that tbe parties entered into a parol agreement, by which tbe plaintiffs were to furnish to tbe defendants all tbe coal they should want for their use for and during tbe year preceding tbe opening of navigation in 1871, at five dollars and fifty cents per ton, to be delivered from time to time as tbe defendants should want it; that nothing was said as to time of payments, but that they did not contemplate a settlement and payment for each parcel when it should be delivered; and, as matter of law, be decided, that although several parcels were delivered and accepted by tbe defendants, yet, because tbe plaintiffs in February and thereafter refused to make further delivery, tbe plaintiffs bad no right of action for tbe coal delivered. Tbe decision was put on tbe ground that tbe contract to deliver was entire and indivisible; and that no recovery could be bad by tbe plaintiffs until tbe end of tbe year, and on its fulfillment by them during tbe entire time tbe contract was to run. I am of tbe opinion that tbe referee was in error in bis construction of tbe agreement entered into by the [94] parties. It was understood that the coal should be delivered in parcels as the defendants should want it; and the calls were left optional with them as to time and quantity. Delivery was to be made on call, and the calls were to be answered by the plaintiffs from time to time, as they should be made during the period the contract was to run. The agreement was that the plaintiffs would deliver from time to time on call, at the price specified, during a year, or until navigation opened in 1871. Extend the time during which the contract was to continue for two, three, five, ten or twenty years, and could it be maintained that no claim for payment for any coal delivered could be made until the expiration of the full time the contract was to continue ? Now, as no time of payment was expressly agreed upon, the ordinary legal inference must apply ; that the plaintiffs were entitled to payment on delivery. This, we think, is the fair, reasonable and legal construction to be put upon the agreement according to the proof submitted. This construction, is entirely just in application, too. The evidence fairly, and as we think, necessarily, sustains it. The referee’s findings, both of law and fact, which are in conflict with this construction, are, as we think, erroneous. The contract was fulfilled by the plaintiffs when they answered the defendants’ calls for coal to the extent of the several parcels delivered to and accepted by the defendants. For the value of the coal so delivered, estimated according to the contract-price, the plaintiffs have a complete right of action. Of course the defendants might recoup such damages as they should sustain by the refusal of the plaintiffs to deliver during the time the contract was to run; in the answer claimed to be sixty-two dollars and sixty-nine cents. The amount would depend upon the evidence. The defendants, therefore, should have been charged'with the coal delivered and accepted by them according to the contract, deducting from the claim by way of recoupment, the damages sustained by the refusal of the plaintiffs to deliver as they had agreed. Judgment reversed, new trial ordered, costs to abide the event, and reference discharged. Learned, P. J., concurred. Judgment reversed, new trial ordered, reference discharged, costs to abide event.