Samuel Bowman Distilling Co. v. Nutt

The opinion of the court was delivered by Valentine, J.: This was an action brought in Atchison county, by the Samuel Bowman Distilling Company, a corporation, against A. R. Nutt, for intoxicating liquors previously sold and delivered by the plaintiff to the defendant. The plaintiff is a wholesale liquor dealer at St. Louis, Missouri, and its sales there made of intoxicating liquors are legal and valid. The defendant is a saloon-keeper in Atchison, Kansas, and his sales there made of intoxicating liquors are illegal, and contrary to the statutes of Kansas. The liquors sold in the present case were first ordered by letter by the defendant at Atchison, Kansas, at the instance of the plaintiff’s agent, who [728] was then in Atchison and had knowledge of the kind of business in which the defendant was engaged, and presumably had knowledge also of the laws of Kansas, and therefore had knowledge that the defendant was engaged in the sale of intoxicating liquors in violation of law, and that he desired to purchase the liquors in the present case for such unlawful purpose. The order of the defendant for the liquors was subject to the approval or disapproval of the plaintiff at St. Louis, Missouri. The plaintiff, however, approved the order, selected the liquors from its stock of liquors at St. Louis, Missouri, and then delivered the same to a railroad company, to be by it transported to the defendant at Atchison, Kansas, at the defendant’s cost, and the defendant was to pay the plaintiff the value of such liquors at the end of 90 days, which time elapsed before this action was commenced, and the defendant had not then and has not since paid for such liquors. The defendant claims that the plaintiff sold the liquors to him knowing that he would again sell them in Kansas in violation of the laws of Kansas; and therefore he claims that the sale, though legal in Missouri, was illegal and void as to Kansas, and that the plaintiff cannot recover in Kansas anything from the defendant for the liquors sold and delivered by the plaintiff to the defendant. The plaintiff constructively had knowledge, in Missouri, through the actual knowledge of its agent, in Kansas, that the defendant purchased the liquors for the purpose of unlawfully selling the same in Kansas; but there is no pretense that the plaintiff in any manner participated in this unlawful purpose, and no pretense that it was to derive any benefit from any of the illegal acts perpetrated, or intended to be perpetrated, by the defendant in Kansas. So far as appears from the record, the plaintiff sold these liquors in the same manner and for the same prices as it sells like liquors to its other customers, who purchase the same for lawful and legitimate sale or use. Nor did the plaintiff pack the liquors in such a manner as to conceal their real character, or pack them in any manner different from the manner in which it packs like [729] goods for its other customers, who purchase for lawful and legitimate purposes. So far as anything is shown in the record, it sold the goods for the same prices and packed them in the same manner that it would sell and pack like goods sold to legitimate druggists in Kansas, who have permits to sell intoxicating liquors and who do sell them only in accordance with the statutes of Kansas. Under all the authorities, the sale of these liquors was a sale in Missouri and not a sale in Kansas; and the sale was legal and valid in Missouri. Therefore, the only thing that can be urged against the plaintiff’s right to recover in this action -is its constructive knowledge of the defendant’s wrongful intent to sell the intoxicating liquors in an unlawful manner and for an unlawful purpose. Now mere knowledge by the vendor of goods lawfully sold in one state that the vendee intends to use them in violation of law in another state, will not defeat an action brought in such other- state by the vendor against the vendee for the purchase-price of the goods. (Feineman v. Sachs, 33 Kas. 621, 625, 626, and cases there cited, to wit: Hill v. Spear, 50 N. H. 253; Holman v. Johnson, 1 Cowper, 341; Gaylord v. Soragen, 32 Vt. 110; McIntyre v. Parks, 44 Mass. 207; Smith v. Godfrey, 8 Foster, 379; Orcutt v. Nelson, 67 Mass. 536; President &c. v. Spalding, 12 Barb. 302; Tracy v. Talmage, 14 N. Y. 162.) See also upon this same subject, and supporting the foregoing proposition, the following authorities: Webber v. Donnelly, 33 Mich. 469; McKinney v. Andrews, 41 Tex. 363; Dater v. Earl, 69 Mass. 482; Tegler v. Shipman, 33 Iowa, 195; Pellecat v. Angell, 2 Crompt., Mees. & Rose. (Eng.— Exch.), 311; Sortwell v. Hughes, 1 Curtis U. S. C. C. 244. About the only authorities which are seemingly opposed to the foregoing proposition are the following: Territt v. Bartlett, 21 Vt. 184; McConihe v. McMann, 27 id. 95; Webster v. Munger, 74 Mass. 584; Adams v. Coulliard, 102 id. 167; Davis v. Bronson, 6 Iowa, 411; Second Nat. Bank v. Curren, 36 id. 555; Banchor v. Mansel, 47 Me. 58. .But these authorities last cited do not furnish much opposition to the general doctrine above enunciated. The yermont decisions, for instance, [730] make a distinction as between mere knowledge by the vendor of the illegal purpose of the vendee, and knowledge with the intent by the vendor to assist in carrying out such illegal purpose. See 21 Vt. 189, 190; 27 Vt. 99; and the later case of Gaylord v. Soragen, 32 Vt. 112, where the following language is used: “ Mere knowledge by the vendor of goods selling them in a foreign state, that the vendee intends to use them in violation of the laws of this state, is not sufficient to invalidate the contract, when it is sought to be enforced in our courts. Our own courts have recognized this rule, (MaConihe v. McMann, 27 Vt. 95;) and it is now generally adopted in this country and in England, though the contrary doctrine has received the support of some eminent judges and jurists.” The decisions in Massachusetts, reported in 74 Mass. 584, and 102 id. 167, do not purport to overrule the previous decisions made in that state, but attempt to make a distinction. It is not held in that state that knowledge alone of the intended illegal sale will defeat the action, but it is knowledge of such intended illegal sale “with a view” that the intended illegal sale shall be consummated, (74 Mass. 584;) and “reasonable cause of belief” of such intended illegal sale is not sufficient; (102 Mass. 167.) The decisions in Iowa are made under a special statute; but even in that state it is held that mere knowledge of the law alone will not render the contract invalid, (Second Nat. Bank v. Garren, 36 Iowa, 555;) and in the case of Tegler v. Shipman, 33 Iowa, 195, 200, it is stated that it is not held that mere knowledge on the part of the seller of the intended violation of the laws by the purchaser would necessarily vitiate or avoid the contract. The case of Banchor v. Mansel, 47 Me. 58, is also decided under an express statute. But in that case it was merely held that knowledge on the part of the vendor and “acts beyond the mere sale which aided the purchaser in his unlawful design,” would defeat the vendor’s action. (See also Torrey v. Corliss, 33 Me. 333.) [731] Intoxicating liquor; action Sefeatedlüeu when not. [730] It may be urged with much reason that knowledge alone by the vendor of the intended unlawful use of the property by the vendee, should defeat the vendor’s action against the vendee [731] for the purchase-price of goods sold and delivered, but the great weight of authority is on the other side; and we have chosen to follow the authorities. Knowledge alone by the vendor in such cases is not sufficient. In order-. . , that the action bv the vendor m such cases may be defeated by the vendee, it must further be shown that the vend or sold the goods for the purpose that the law should be violated, or that he had some interest in the violation of the law, or that he participated in some manner in the unlawful purpose. In fact, courts do not like to relieve parties from their contracts after the contracts have been executed and performed on the other side, and after the parties asking to be relieved have received and enjoyed all the fruits and benefits which they expected to receive or enjoy from their contracts. And especially courts do not like to relieve those parties in such cases who have committed the principal wrongs themselves, and who plead their own wrongs for the purpose of being so relieved. Besides the distinction made between mere knowledge and knowledge with something more, there is also a well-recognized distinction between executed and executory contracts. The judgment of the court below will be reversed, and the cause remanded with the order that judgment be rendered in favor of the plaintiff and against the defendant upon the special findings of fact made by the court below. All the Justices concurring.