Peck v. McCormick Harvesting Machine Co.

Mr. Justice Sears delivered the opinion of the court. By the peremptory instruction given to the jury to return a verdict for appellee, the trial court determined as matter of law that under the evidence there could be no valid claim to recoupment. The oral contract and breach of it by appellee is established. The right to recoup for a breach of this contract is attacked by appellee upon two grounds, viz : First, that the oral contract was merely a contract to make five several annual written contracts; and because the terms of the proposed written contracts were undetermined, therefore the oral contract was so lacking in certainty as to be not enforceable; and, secondly, that the oral contract not being possible to be fully performed in one year from the time of the making of it upon the part of either party, it is within the statute of frauds. We are of opinion that the direction of the verdict by the court can not be justified upon the ground first noted. It is true, as a general rule, that when the terms of an agreement are left so uncertain as to require a further convention of the parties to make it complete, and the terms left for future agreement are essential, then no contract is made which is enforceable. In other words, an agreement is not enforceable as a contract, because of its uncertainty, when any of its essential terms are left unsettled. If the contract here relied upon be treated merely as an oral agreement to make a written contract, and the breach sued for be merely the default in making such written contract, then the rule invoked might apply. But we do not so view the oral contract. It was not alone an undertaking to make written contracts for the several years covered by its terms; it was an agreement upon the one part to serve as agent for five years, the period covered by the notes, and to give guaranteed notes as purchase price of certain goods, and upon the other side an agreement to give exclusive right to sell the appellee’s manufactures within the territory named and use of a certain warehouse. It is true that in carrying out this contract it would become necessary from year to year to enter into a further agreement as to the rate of commissions. But as applied to the year 1896, this had been done; all details had been fixed by agreement for that year; the guaranteed notes had been given, and nothing remained but the rendering of service as agent by Chapman and the granting of exclusive right to sell the goofls by appellee, together with the use of warehouse. The breach and the damages sought to be availed of in recoupment were in part for an invasion o.f this exclusive right to sell the goods in the territory named in the year 1896. It is established that in 1896 the appellee sold its manufactures within Chapman’s territory, contrary to the terms of the oral contract. There are no uncertainties remaining as to the terms of the service of Chapman in 1896, which could .operate to make the contract void for uncertainty. Appellee could not be heard to assert as a defense for violating its agreement to give Chapman exclusive right in that year, that possibly the parties might not agree as to the commissions or other details of the agency. Hor is it altogether clear that there could be no recoupment for the breach of the oral agreement in 1897, upon this ground. The annual contracts are shown to have been such as the company made from year to year with all its local agents. If appellee had tendered such a contract and Chapman had declined it, the position would be different. But' having simply broken the agreement altogether, it is a defense of doubtful validity that the details of the agency were unsettled and uncertain. That question, however, it becomes unnecessary to determine by reason óf the consideration of the second ground of objection to a recoupment. That ground is that the oral contract is -within the provision of the statute of frauds. We see no escape from the force of this contention. The, contract was not to be performed within one year, but extended over five years. It is not in writing. ISTor can it be held that there has been a complete performance by Chapman of his engagements. It is true that the guaranteed notes were given. But the one consideration which, according to Chapman’s testimony, moved the appellee to the making of the contract, was that Chapman should serve as agent for the period of five years, or, as he expresses it in his testimony, “ during the life of these notes.” He testified that the president of appellee said “ they would not think of selling to me without I did, or something to that effect.” There has been no complete performance by Chapman of this essential part of his agreement. A partial performance may sometimes avail to avoid an application of the statute in equity; but the rule does not obtain at law. Warner v. Hale, 65 Ill. 395; Wheeler v. Frankenthal, 78 Ill. 124; The C. A. Co. v. The D. S. M. Co., 142 Ill. 171; Marr v. Ray, 151 Ill. 340; Leavitt v. Stern, 159 Ill. 526; Browne on Statute of Frauds (4th Ed.), p. 350. It is a harsh rule in its application to this case and works an apparent injustice to appellant and to Chapman, who had performed his part of the agreement in so far as he was permitted to by appellee, and who was prevented from performing in full by the disregard of appellee for its oral agreement. But in a court of law this state of facts affords no ground for avoiding the application of the statute. We are of opinion that under the statute of frauds the oral agreement between appellee and Chapman can not be enforced, and hence that no recoupment could be had for damages for breach of it by appellee. The breach could no more be availed of by recoupment than if an action at law had been brought by Chapman to recover his damages for the breach. McGinnis v. Fernandes, 126 Ill. 228. Therefore the trial court properly directed the verdict. The judgment is affirmed.