Hamilton v. Thrall

Gantt, Ch. J. The question upon which this case depends, and upon which it must be decided, is the construction to be given to the written contract between John A. Horbach, trustee for the plaintiffs in error, and George Thrall, defendant in error. In this contract Horbach, trustee, party of the first part, “ agrees to furnish and rent for use, in the hotel known as the Grand Central Hotel in Omaha, carpets and furniture, including office safe, to cost by invoice with freight added at least twenty-five thousand dollars, to be in said hotel and ready for use in time to enable (George Thrall) the party of the second part to comply [217] with the condition of his lease of said hotel as to time of opening, and to rent the same to the party of the second part for the term of one year from the first of October, 1873, for the sum of six thousand dollars, and to sell the same to the said party of the second part at the end of this lease at cost, less eight per cent. The party of the second part agrees to take the furniture at the rate and for the time specified, and pay therefor monthly in twelve equal payments of five hundred dollars each, and buy the same on the first of October, 1874, at the price above named, provided he takes a new lease of the hotel as specified in the lease aforesaid. The party of the second part agrees that he will buy of the party of the first part that portion of the goods ordered for furnishing the hotel, which are commonly considered perishable, consisting mainly of sheets, .pillow slips, towels, napkins, and table damask, in A. T. Stewart & Co.<’s bill, and the goods ordered by said party of the first part from the Meridian Britannia Company, and also glassware ordered from J. T. Griffin, and the crockery-ware ordered from S. Burns, aggregating approximately six thousand dollars, and to pay for the same on the first day of October next. In consideration of this purchase the party of the first part agrees that in the event the party of the second part does not continue the lease of the said hotel according to the provisions of his lease aforesaid, he, the said party of the first part, will purchase of the said party of the second part, at the expiration of the said lease, such of the above described goods, together with such additions as from time to time may be required to be added, as are fit for use in said hotel, at three-quarters of the cost thereof, and pay for the same October first, 1874.” On the part of the plaintiffs in error, it is insisted that all the stipulations in this contract are dependent on each other and must be construed together as one [218] entire transaction. On the part of the defendant in error it is contended that the provisions of this contract in regard to the leasing of the furniture, and those in regard to the purchase of the perishable goods by defendant, and their repurchase by the trustee, are independent stipulations, each resting upon different, and independent considerations; and that, according to this construction, by the terms of the leasing of the furniture, the plaintiffs covenanted to furnish the hotel with furniture to cost, with freight added, the sum of twenty-five thousand dollars in excess of the value of the perishable goods purchased by defendant. We think that the construction contended for by the defendant, cannot be maintained, because it seems quite clear from an examination of the instrument that the different stipulations are so dependent on each other, that neither one can be effective without the other. The covenant to purchase perishable goods by the defendant could not be enforced without the lease of the furniture; and the lease of the furniture could not be enforced without the purchase of the perishable goods, for the enforcement of the one stipulation depends upon compliance with the other. In Bank of Columbia v. Hagner, 1 Peters, 465, it is said that : “ Although many nice distinctions are to be found'in the .books upon the question whether the covenants or promises of the respective parties to the contract'are to be considered independent or dependent; yet it is evident the inclination of the courts has strongly favored the latter construction as being obviously the most just;” and even where several instruments are made at the same time relating to the same subject matter, they must be construed together as one transaction to discover what was the true contract between the parties. Makepeace v. Harvard, 10 Pick., 298. Penniman v. Hartshorn, 13 Mass., 90. [219] Therefore, “ the great object, and indeed the only foundation of all rules of construction of contracts, is to come at the intention of the parties; and any rule which leads us aside from this grand object, is to be disregarded.” Gray v. Clark, 11 Verm., 385. And it is a familiar principle in the construction of contracts that the common intention of the parties must be collected from the entire contract; that is, one clause or condition must be interpreted by the others in the same contract, whether they precede or follow it. The maxim is ex a/ntecedentibus et eonsequentibus fit optima interpretatio. Another rule is that when the parties have reduced their contract to writing, the law presumes that all the previous and contemporaneous negotiations, and conversations leading to the contract, are merged in it, and cannot be varied by parol testimony. Coffing v. Taylor, 16 Ill., 470. Stevens v. Cooper, 1 John. Ch., 429. In the light of these principles, the contract must be construed. Then from an examination of the contract as one entire transaction, it seems clear that the leading purpose of the parties was to have the hotel supplied with furniture to the value of at least twenty-five thousand dollars, and that this amount of furniture was ordered before the contract was executed. The trustee acting for the plaintifis, agreed to furnish and rent for use in the hotel, furniture to cost by invoice, with freight added, not less than twenty-five thousand dollars; the language of the contract clearly indicates that this was the extent of the covenant to furnish goods, and also that these goods were then ordered, for the defendant agreed to “ buy that portion of the goods ordered for furnishing the hotel (referring to the goods mentioned in the first clause of the instrument) commonly considered perishable,” aggregating approximately the value of six thousand dollars; and at least some invoices of goods are specially referred [220] to by the names of the persons from whom they were purchased. But it is further stipulated that in case the defendant shall renew his lease of the hotel, the trustee will then sell to him the remainder of the goods ordered at cost, less eight per cent; or that in the event he shall not continue his lease of the hotel, then the trustee will purchase from him the perishable goods sold to him, and such additions as from time to time may be required to be added, as are fit for use in the hotel, at three-quarters the cost thereof, and pay for the same. October 1, 1874. Therefore, when we view this instrument as one entire contract, with conditions dependent on each other, and take into consideration the situation of the parties, the risks incurred in the use for which the goods were furnished, and the fact that the defendant did voluntarily pay the rent for eleven months, it seems clear that the common intention of the parties as collected from the entire transaction is, that in consideration of the several conditions to be performed by the trustee, the defendant agreed to pay the rent stipulated to be paid by him. It is only necessary to further observe that, according to the views expressed in this opinion, the court below erred in giving to the jury the instructions excepted to, and in refusing to give those asked by the plaintiffs in error. The judgment must be reversed, and the cause be remanded. Reversed and remanded.