Hansen v. Consumers' Steam Heating Co.

Reed, J. — The verdict of the jury determines that defendant was bound, under the contract, to pay for the coal which should be' delivered during any month, on the 10th day of the following month. The important question in the case is whether plaintiffs had the right, on the failure or refusal of defendant to pay, at the time stipulated, for the coal which [79] had then been delivered, to terminate the contract. The district court instructed the jury that if the agreement as to the time of payment was as claimed by plaintiffs, they had the right, on the occurrence of a breach of defendant’s undertaking in that regard, to treat the contract as terminated; and, in that case, they would be entitled to recover the market value of such coal as they delivered after they notified defendant that they regarded the contract as rescinded. It is very clear, we think, that the contract was severable. Plaintiffs undertook to deliver so much coal as defendant might require in its business during the time covered by the agreement. The coal was to be delivered from time to time, as it would be required in the business, and defendant undertook to pay on the 30th day of each month, at the stipulated price per ton, for such coal as should be delivered during the preceding month. At the end of any month, the rights and obligations of the parties, so far as they related to the coal delivered during the month, were settled and determined by the contract, and they were not dependent upon whether anything further should be done under it or not. Plaintiffs were entitled, absolutely, to be paid for the property on the 10th day of the following month, and they could maintain an action at that time for the recovery of the stipulated price. We held in Myer v. Wheeler, 65 Iowa, 390; that a party is not entitled to rescind a divisible contract for a breach of its conditions, unless such breach goes to the whole consideration. The present case is not distinguishable from that. We think, therefore, that the district court erred in the instructions, the substance of which is set out above. Reversed. Adams, Oh. J., took no p'jrt in the decision.