Hannah v. Shirley

By the Court, Kelly, C. J.: On the eleventh day of February, 1876, J. Q. Shirley and J. W. Iliff entered into a written contract, which is as follows: “These articles of agreement, made and entered this eleventh day of February, A. D. 1876, by and between J. Q. Shirley, of Kelton, Utah, of the first part, and Join W. Iliff, of Denver, Colorado, of the second part, witnesseth: The party of the first part, for and in consideration of the sum of one dollar, to him in hand paid, and the promises and agreements hereinafter mentioned to be performed by him, do hereby promise to deliver to the party of the second part or his agent, at his ranch on Cow Creek, Wild county, Colorado, the following number of cattle, known as Oregon-American steers, to wit: Four hundred and twenty-five four-year-old steers, of the value of twenty-five dollars per head; seven hundred and twenty-five three-year-old steers, of the value of twenty dollars per head; seven hundred and twenty-five two-year-old steers, of the value of seventeen dollars per head; and sis hundred and twenty-five one-year-old steers, of the value of eleven dollars per head, the above number being two thousand five hundred head in all. In consideration whereof the party of the second part promises to pay to the party of the first part the several sums of money each per head, according to the value herein above mentioned, upon the delivery of the said cattle, as herein above stated. The above number of cattle are to be delivered on or before the tenth day of September, A. d. 1876,. to the said Iliff or his agent, at the time and place above stated. The party of the second part hereby agrees to place on deposit, on or before the twentieth day of March, A. D. 1876, in the First* National Bank of Boise City, Idaho, or some other bank in good — 126 — commercial standing that may be designated by the said Shirley, to the credit of J. Q. Shirley, party of the first part, the sum of twenty thousand dollars, to be paid to him on the delivery of said cattle mentioned in these articles of agreement; this sum to be deducted from the gross sum to be paid on the delivery of said cattle. It is further understood that the said Iliff may reject any poor, lame or injured cattle offered in delivery under this contract; and it is also understood that the party of the second part will receive and pay, in like manner, for any additional number of cattle, not exceeding five hundred head, that may be offered by the party of the first part, provided, the said Shirley notifies the said Iliff on or before May 1,1876; and the said party of the first part agrees to pay the said party of the second part the rate of one per cent, per month for money on this contract over and above twenty-five per centum of the contract price for said cattle. In consideration above the parties have set their hands this fourteenth day of February, a. d. 1876. “3. Q. Shirley, “ J. W. Ilh?e.” On the sixth of March, 1876, Shirley, who is the respondent, made the following assignment of one half of his interest in the contract to the appellants: “Ido hereby, on the sixth day of March, 1876, sign over to F. Nodine and S. Hannah, both of Union, Oregon, one half my interest in the within contract.” On the same day Shirley entered into the following contract with Nodine and Hannah: “An agreement entered into this, the sixth day of March, 1876, between J. Q. Shirley, of Helton, Utah, and S. Hannah and F. Nodine, both of Union, Oregon: 3. Q. Shirley hereby agrees to sign over to Hannah and Nodine one half of his interest of his contract with 3. W. Iliff for the following consideration: Hannah and Nodine to buy three thousand steers, according to the agreement in the Iliff contract, and one thousand head of those kind of cattle that can be bought at the best advantage, J. Q. Shirley to pay the interest on the twenty thousand dollars spoken of in the Iliff contract individually. He also agrees to furnish, at Look — 127 — out Mountain, two four-mule teams, two wagons and twenty saddle horses; these to be credited to him on the company books of Nodine, Shirley & Co. This property, then, to become company property; Nodine and Hannah to give satisfactory security to the First National Bank of Portland, Oregon, for the twenty thousand dollars spoken of in the said Iliff contract. All expenses of buying and driving said cattle to be charged on the company books. All horses, if their value can not be determined on by all the parties to this contract, all to be appraised and put on the company books at their appraised value. F. Nodine, of this contract, J. Q. Shirley, of this contract, S. Hannah, of this contract, all agree to form a copartnership under the name of Nodine, Shirley & Co., for the fulfillment of this and the Iliff contract, J. Q. Shirley to have one half interest and also to bear one half of the expenses, the other parties to represent the other half. “J. Q. Shirley, “Frederick Nodine, “ S. Hannah. “Witnesses: G. B. Grow, J. B. Eaton, Jr.” The appellants brought this action for a breach of the foregoing contract, and alleged in their complaint that in addition to the contracts above set forth, and in fulfillment thereof the respondent agreed with them to place on deposit in the First National Bank of Portland, Oregon, on or before the twentieth day of March, 1876, the twenty thousand dollars referred to in the Iliff contract and the contract of March 6, 1876; that respondent failed and refused to deposit that or any other sum of money in the said First National Bank of Portland on the twentieth day of March, 1876, or at any other time, and that in consequence of such failure and refusal they were unable to deliver cattle which they had purchased, to fulfill the contract on their part, and that they sustained damage by such failure. The respondent in his answer to the complaint denies all the allegations in it except as to the deposit of twenty thousand dollars in the First National Bank of Portland. He admits that he did not deposit that sum in the bank on the — 128 — twentieth day of March, 1876, but avers that the sum was deposited in said bank on the twenty-first day of March, 1876. The case being on trial, S. Hannah, one of the appellants, was called as a witness, and testified as follows: * ‘ That defendant agreed to place twenty thousand dollars in the First National Bank of Portland, to the credit of plaintiffs, on. the twentieth day of March, 1876, upon plaintiffs furnishing security at said bank for said twenty thousand dollars, in pursuance of a contract entered into between the parties hereto, dated March 6, 1876. • That plaintiffs and defendant were to deliver three thousand head of cattle, in quality to correspond with the terms of the Iliff contract, mentioned in the complaint; that he went to the bank on that day with Mr. Shirley to get the money.” Counsel for the defense inquired of the witness if the contract, about which he was testifying, was in writing, and on receiving a negative reply moved the court to strike out all the evidence heretofore stated by said witness. The court sustained said motion and withdrew said testimony from the consideration of the jury. To this ruling of the court exception was taken, and it now comes here as an assignment of error. It is now urged by the respondent’s counsel in support of this ruling of the court, that oral evidence was inadmissible to show that the written contract was varied by a parol agreement made at the' same time; and also that a subsequent parol agreement to change the terms of the written contract must be founded upon a good and sufficient consideration. These are undoubtedly correct principles of law, and the only question is whether they §,re applicable to this case. While it is true that parol evidence can not be admitted to change the terms of a written contract, it may, nevertheless, be received to explain some ambiguity in it consistently with the written instrument. Thus where it is apparent upon the face of the contract that something is contemplated and agreed upon by the parties which they have not distinctly defined, or expressed with sufficient clearness, parol proof connecting the instrument with its — 129 — subject-matter is always allowable to show what the parties intended and meant. In regard to the contract between Shirley and Iliff, the respondent claims that the twenty thousand dollars to be deposited in the First National Bank of Boise City or other good bank was merely a deposit of that sum to secúre a faithful performance of the contract by Iliff, and that it was not to belong to Shirley until he should deliver the cattle. We think that is not the correct construction of this agreement. It is true it says that Iliff is to deposit “the sum of twenty thousand dollars, to be paid to him (Shirley) on the delivery of said cattle mentioned in these articles of agreement.” But the next sentence is as follows: “This sum to be deducted from the gross sum to be paid on the delivery of said cattle,” clearly implying that the balance of the purchase price was to be paid on delivery, and the twenty thousand dollars was to be accounted for as having been paid at that time by deducting it from the final payment of the balance due. This view is strengthened by a further provision, which required Shirley to pay interest on this sum, less one fourth of the contract price of the cattle. The contract price being forty-four thousand three hundred and twenty-five dollars, Shirley agreed to pay interest on all the twenty thousand dollars, less eleven thousand and eighty-one dollars, that being twenty-five per centum of the contract price for the cattle. Why would he pay interest on that sum of money unless it belonged to him or he could use it? In short, we regard the contract of Shirley and Iliff to be substantially this: Shirley agreed to purchase and deliver to Iliff, in Colorado, on or before September 10, 1876, two thousand five hundred head of cattle, of the aggregate value of forty-four thousand three hundred and twenty-five dollars, in consideration of which Iliff agreed to deposit twefity thousand dollars in the First National Bank of Boise City “or some other bank in good commercial standing that may be designated by the said, Shirley, to the credit of J. Q. Shirley.” He (Shirley) was to use it in the purchase of the cattle and pay interest on the twenty thousand dollars placed to his credit, less eleven — 130 — thousand and eighty-one dollars, that being twenty-five per cent, of the contract price of the cattle. Half of this contract was assigned on the sixth of March, 1876, by the respondent Shirley, to the appellants, Nodine and Hannah. They were to buy the cattle and give security to the First National Bank of Portland, Oregon, for the twenty thousand dollars which Iliff was to advance, which sum was to be used .by them in paying for the cattle they should buy. Respondent was to pay the interest on the twenty thousand dollars, less eleven thousand and eighty-one dollars, and with him rested the right to designate in what bank the twenty thousand dollars to be advanced by Iliff should be deposited on or before the twentieth day of March, 1876. He had a right to direct Iliff to deposit the money in the First National Bank of Boise City or the First National Bank of Portland. Which did he select? In what bank did he agree with appellants that the twenty thousand dollars should be placed to their credit? This could only be ascertained by evidence outside of the written contract, and this the testimony of S. Hannah tended to show. We think that evidence was proper to go to the jury, not to contradict or vary the terms of the written instrument, but to show what place was agreed upon for the performance of an act which the written contract itself left open for future designation. Parol evidence was admissible for this purpose, and the testimony of Hannah should not have been withdrawn from the consideration of the jury. (1 Greenl. Ev., secs. 282, 304.) The judgment is reversed and a new trial ordered.