Hanley v. Combs

Mr. Chief Justice Bean delivered the opinion. 1. The argument in support of the motion to dissolve the attachment is that the complaint does not state facts sufficient to constitute a cause of action, because it does not allege that the plaintiff was ready, willing and able to perform the contract on its part, or that it tendered or offered to pay the balance of the purchase price. This is not an action for a breach of the contract between the plaintiff and defendant. It is an action to rcover back- money paid by the plaintiff thereon as money had and received by the defendant for its use, on the ground that the contract has been wrongfully and unlawfully rescinded — 412 — and pnt an end to by tbe defendant. In such an action the plaintiff is not required to allege or prove an offer of performance on its part, nor readiness to perform, whatever might be the rule in an action to recover damages for a breach of the contract: Main v. King, 8 Barb. 535; Monroe v. Reynolds, 47 Barb. 574. If one of the parties to a contract wrongfully refuses to comply therewith, the other party, if not himself in fault, may elect to treat the contract as rescinded and recover back the consideration, or whatever else has been paid thereon: Bishop, Contracts, § 834. And he is not obliged to allege or prove a tender or offer to perform the rescinded contract. 2. An action to recover back the money paid on a contract which has been wrongfully rescinded is in form assumpsit, and is on an implied contract within the meaning of the attachment laws of this State: 2 Enc. Pl. & Pr. 1016; S. C. V. Peat Fuel Co. v. Tuck, 53 Cal. 304. The complaint therefore states a cause of action, and the motion to dissolve the attachment should have been denied. The record discloses that on August 20, 1905, the plaintiff’s manager, William Hanley, and the defendant met by agreement in Bear Yalley for the purpose of passing upon the quality of the cattle to be subsequently delivered by the defendant to the plaintiff at Baker City in pursuance of the written, contract; that defendant had at the time and place stated a band of 578 head of cattle which he offered to Hanley for the purpose of having him pass upon the quality; that after Hanley looked the band over he selected therefrom some 200 or 250 head as complying with the contract and such as he would be willing to accept when delivered, but the defendant, being dissatisfied with the manner in which Hanley was cutting the cattle, notified him that he would refuse to be further bound by the contract, and subsequently sold the cattle to other parties, and never delivered or offered to deliver to plaintiff any cattle whatever under the contract in question. There is much testimony in the record as to what was said and done by the respective parties at the time the cattle were offered by defendant to plaintiff for the purpose of having them passed as to whether they were of the — 413 — kind and quality called for by the contract, but this testimony is unimportant on this appeal. The question for trial was whether Hanley’s acts and conduct amounted to a repudiation or abandonment of the contract, and the evidence in question was important as bearing on that question, but its weight and value were for the jury. 3. Hpon this point the court instructed the jury: “If you should find from a preponderance of the evidence that at any stage of the passing upon the cattle in question the plaintiff refused to pass and accept a three or four year old steer which was not in fact thin flesh or rough or Holstein or Jersey blood, the defendant had the right to refuse any other or greater number of cattle for plaintiff’s inspection, and that it would amount to a repudiation of the agrément on the part of the plaintiff.” And the court further instructed: “If you should find that the defendant had at any place in Bear Valley at the time agreed upon 600 head of cattle of the kind, age and quality required, and was ready, able and willing to furnish them to the plaintiff to be then and there passed and accepted by it, and the plaintiff refused to pass and accept 278 head or any less number of such cattle, then the plaintiff made breach of and repudiated the agreement, and that in that case it is not entitled to recover back any part of the money advanced by it upon the agreement.” By these instructions the jury were told in effect that the refusal of Hanley, the plaintiff’s manager, to pass and accept any one animal which, in their opinion, the evidence showed to be of the kind and quality specified in the contract would be such a repudiation of the contract by the plaintiff as would defeat a recovery in this action; but this is not the law. The rule is unquestioned that a party who has advanced money in part performance of a contract, and then refused to proceed to its ultimate conclusion, the other party being ready and willing to perform on his part, will not be permitted to recover back what he has advanced: Ketchum v. Evertson, 13 Johns. 359 (7 Am. Dec. 384); Hansbrough v. Peck, 72 U. S. (5 Wall.) 497 (18 L. Ed. 520); Gibbons v. Hayden, 3 Kan. App. 38 (44 Pac. 445); Neis v. O’Brien, 12 Wash. 358 (41 Pac. 59, 50 Am. St. — 414 — Rep. 894) ; Walter v. Reed, 34 Neb. 544 (52 N. W. 682). But it is not every breach that will amount to such a. repudiation or authorize the other party to rescind the contract and retain what has been paid or advanced thereon. The nature of each case must be considered, and, as Mr. Bishop says, it is probably impossible to state a rule applicable to all the varying facts. After quoting from some of the decisions he says: “In general terms, the doctrine is that the breach, to- justify a rescission, must be of a dependant covenant, or willful, or in a substantial part comprehending the root of the whole:” Bishop, Contracts (En. Ed.), § 828. And if the breach by a vendee be not of such a character as to amount to a repudiation of the contract or a refusal to proceed to its ultimate conclusion, and the seller, without a demand or offer to perform and without notice to the vendee, disposes of the subject of the contract, the latter may treat it as a wrongful rescission, and the law will give him a right of action to recover back the consideration paid in part’ performance: Monroe v. Reynolds, 47 Barb. 574; Fancher v. Goodman, 29 Barb, 315; Raymond v. Bearnard, 12 Johns. 274 (7 Am. Dec. 371). 4. Now, in this case, the cattle which defendant agreed to sell and deliver to the plaintiff were to be passed as to quality in Bear Valley before being driven to Baker City for final delivery. It was the duty of the plaintiff to comply in good faith with this part of the contract, and if by words, or by their equivalent in acts, it refused to do so, the defendant could lawfully rescind. But before he could treat the contract as at an end, dispose of the property to other parties and keep the $3,300 advanced thereon by the plaintiff, it must appear that the plaintiff’s words, acts or conduct were willful or amounted to a repudiation or abandonment of the contract “in some substantial part, comprehending the whole.” The mere refusal to pass cattle which in fact complied with the contract, if done in good faith, would not of itself amount to such a repudiation, and would not justify the defendant in rescinding the contract, although it might render plaintiff liable in damages for a breach thereof. The case turns upon the question whether the plain — 415 — tiff abandoned or repudiated the contract, or, in other words, refused to proceed to its ultimate conclusion, and not whether its agent may have been mistaken in his judgment as to the quality of some of the cattle offered to him by the defendant for passing, or whether he may have been unnecessarily exacting in his requirements as to quality. 5. The case should have been submitted to the jury upon this theory, leaving them to find from the entire testimony whether plaintiff’s acts and conduct amounted in effect to an abandonment or repudiation of the contract or a refusal to comply with its terms. The instructions as given were erroneous because they did not conform to this principle. 6. These instructions and others given by the court were also erroneous because they imposed the duty upon plaintiff, not only to pass the cattle as to quality in Bear Yalley, but to accept them at that place, while the contract expressly provides that the cattle shall be delivered, accepted and paid for at Baker City. They were to be passed as to quality only in Bear Yalley, and no acceptance was contemplated until final delivery. 7. The defendant was permitted to prove on the trial, over plaintiff’s objection and exception, that about the time the plaintiff’s manager began inspecting the cattle in Bear Yalley he made arrangements with one Brown to turn in on his contract with plaintiff 150 head belonging to Brown if necessary. This evidence was, we think, under the circumstances, incompetent. The plaintiff was not informed of the arrangement between defendant and Brown, nor was it advised that the Brown cattle were to be considered as a part of the number which the defendant agreed to sell to it, nor was any such cattle offered to it for passing as to quality. The arrangement was wholly between Brown and the defendant, and had no connection with the contract in question. 8. Moreover, no objection was made by plaintiff to passing upon the cattle offered because the entire number was not tendered at the time, nor did it refuse to proceed with the contract on that account. It therefore cannot now claim that the defendant did not comply with his contract because he did not offer — 416 — for passing at the time the entire number of cattle which he agreed to deliver at Baker City. Judgment reversed, and new trial ordered. Reversed.