McCall Co. v. Parson, May, Oberschmidt Co.

Smith, C. J., delivered the opinion of the court. On the 12th day of September, 1905, a contract was entered into between appellant and appellee, the parts of which material to this controversy are as follows: “The McCall Company, New York, N. Y. “Please deliver to . . . at New York City, addressed to us a stock of McCall Patterns, at the uniform price of seven and one-half cents for each pattern (excepting those retailing for ten cents, the price of which is five cents each), amounting to four hundred and ten dollars and twenty-four cents net, including the November issue, one hundred and- sixty-four dollars and twenty-four cents payable thirty days after shipment, and the balance, two hundred and fifty dollars is to remain as a standing credit during the term of this contract order, upon which interest is to be paid by us at the rate of five per cent per annum, semiannually, January and July 1; also ship us each month by . . . not exceeding an average of twenty-five dollars per month of your selection of the new monthly patterns, at same price as above, commencing with December issue; also Fashion Sheets and other publications in quantities, and at-prices specified below, during the term of this contract, commencing with November issue. “We will reorder at the prices above named, once each week, or oftener, all patterns sold, thus keeping patterns on hand as above specified. The patterns are not to be sold for other than catalogue retail prices, and the stock of patterns is to be kept and offered for sale on the first (main) floor. We will send you an inventory of our stock of patterns on hand at your request, not exceeding twice each year. — 875 — “All goods ordered for delivery are to be paid for on or before the 5th day of the month succeeding date of shipment; if not then paid, subject to sight draft. All prices quoted are net. “We will not sell any other patterns than the McCall Patterns received from you during the term of this contract order. “We will not transfer the stock o»f McCall Patterns from Brookhaven, Mississippi, without your written consent, and will pay all transportation charges to and from your New York office. “Discarded Patterns. “All patterns purchased from you under this contract order that are reported discarded by you semiannually— January and July — can be returned by us at one hundred per cent contract price, in exchange for other patterns at full contract price, at any time within sixty days from the date such discarded patterns are respectively reported by you, provided this contract shall be in force at the time of such return. All patterns returned by us under any such discard report are to be credited to a special account, to be known as our discard exchange account, the credit to same to continue for a period of six months from the date of such discard report unless this contract shall be sooner terminated; and all patterns ordered by us within such period of six months while this contract is in force, excepting our monthly standing order, shall be charged to such discard exchange account unless our credit to the same is earlier exhausted.” The contract further provided that it should remain in force for five years. Several months prior to the expiration of the five years for which this contract was to run, appellee decided to discontinue business, and so advised appellant. At that time there was a considerable balance due appellant, and, in addition, under the contract it was entitled to ship and — 876 — to receive payment from appellee for the several monthly shipments of patterns thereafter to be made as provided for in the contract. Appellant sent one of its agents, a Mr. Wright, to see what adjustment of the matter could be made with appellee, but nothing tangible resulted from his efforts. Afterwards this suit was instituted in the court below to recover from appellee the sum of three hundred and eighteen dollars and sixty-eight cents, the amount alleged by appellant to be due it under the contract. Two hundred and fifty dollars of this amount was the standing credit referred to in the contract, and the remainder was the balance due on the monthly shipments of patterns. To appellant’s declaration appellee pleaded the general issue, and gave notice of special facts to be set up in bar of appellant’s claim, and also a special plea, setting up practically the same facts as contained in the notice. The defense thus set forth is that in so far as the two hundred and fifty dollars is concerned, appellant does not owe it, for the reason that it was “understood and agreed that defendant was not to pay said sum, but was to take patterns to that amount, over and above what were paid for in cash, was then 'to pay interest on their value, and plaintiff would, at the expiration or breach of said contract, retake patterns from the stock in defendant’s possession to the value of two hundred and fifty dollars;” and in so far as the remainder of the account is concerned, appellee has more than paid it, for the reason that it had returned to appellant at various times discarded patterns worth, under the terms of the contract, more than this balance claimed to be due. Judgment over was requested against appellant for the amount claimed to have been so paid it in excess of the amount due. The cause was submitted to the jury and a verdict rendered for appellant in the sum of one hundred and eighteen dollars and sixty-eight cents. Both parties being dissatisfied with this result, each filed a motion for a new trial, and upon the overruling thereof — 877 — each has appealed to this court, appellant by direct and appellee by cross-appeal. Over the objection of appellant, Mr. Parsons, a member of appellee corporation, and who seems to have entered into the contract with appellant, on behalf of ap-pellee was permitted to testify that the agent who represented appellant in the execution of the contract told him, at the time the contract was executed, that the words, “standing credit,” in the contract meant that ap-pellees would-not be called upon to pay the sum of two hundred and fifty dollars designated therein as standing credit, but that at the expiration or discontinuance of the contract appellant would accept in settlement thereof patterns of the value of two hundred and fifty dollars. This evidence should not have been admitted, for the reason that it was simply an attempt to vary by parol the terms of a plain and unambiguous contract. This feature of appellee’s defense was presented to the jury by means of the following instruction: “The court instructs the jury for the defendant that if they believe the defendant was induced to sign the contract by false representations made by plaintiff’s legal representative empowered to make contracts for fraudulently inducing defendant to sign the contract, they will find a verdict for the defendant. ’ ’ And appellee’s counsel place the competency of the evidence not so much upon a right in appellee to show by parol what the parties to this contract at the time of its execution understood to be the meaning of that clause of the contract here under consideration, but upon the ground that appellee was induced to enter into the contract by reason of the false and fraudulent statement of appellant’s agent that under the terms of the contract appellee could not be called upon to pay the two hundred and fifty dollars in money, but could only be called upon to deliver to appellants patterns of that value, and that on account of this fraud perpetuated upon appellee it is — 878 — released from the obligation of that portion of the contract. There is no merit in this contention. The same argument can always be made when it is sought to vary a contract by parol on the ground that the parties thereto placed a construction upon it at variance with its plain meaning. Another of appellee’s instructions was that: “The court instructs the jury for the defendant that if they believe from the evidence that the contract between the plaintiff and defendant was by mutual consent terminated, and the defendant’s tender of patterns on hand accepted in settlement of its debt, then their verdict will be for the defendant.” This instruction was based upon the evidence of the attempted settlement of this controversy by appellant’s agent, Wright. The testimony on this point was that Wright, appellee, and the firm of May & Cameron entered into an agreement that appellees should be released from all liability to appellant, that its stock of patterns should be turned over to May & Cameron, who would assume appellee’s liability therefor and carry out appel-lee’s contract after certain modifications had been made therein, and that this agreement would have been carried out by May & Cameron had it not been violated by appellant. Conceding that appellant’s agent was authorized to enter into a contract of this character, and to thereby release appellee from further liability, the evidence clearly discloses that he did not assume any such authority. While such a contract was agreed upon and reduced to writing, it was to be submitted to appellee for approval. This was done, and it was signed by appellant and returned for appellee’s and May & Cameron’s signature. For the reason that in their judgment the contract as written was different from the one agreed upon with Wright, both appellee and May & Cameron refused to sign it, so that it never became operative, and consequently appellee was not released from liability thereby. The instruction therefore, should not have been given. — 879 — One of appellee’s contentions on the cross-appeal-is that it has not received the proper credit for discarded patterns returned to appellant under the last clause of. the contract, which reads as follows: “All patterns purchased from you under this contract order that are reported discarded by you semiannually— January and July — can be returned by us at one hundred per cent contract price, in exchange for other patterns at full contract price, at any time within sixty days from the date such discarded patterns are respectively reported by you, provided this contract shall be in force at the time of such return. All patterns returned by us under any such discard report are to be credited to a special account, to be known as our discard exchange account, the credit to same to continue for a period of six months from the date of such discard report unless this contract shall be sooner terminated; and all patterns ordered by us within suchperiod of six months and while this contract is in force, excepting our monthly standing order, shall be charged to such discard exchange account unless our credit to the same is earlier exhausted” —and upon the testimony of one of appellant’s employees, which was to the effect that at various times appellee returned to it discarded patterns the value of which was in each instance credited to the special exchange account provided for by the contract, and that on several occasions appellee failed to order a sufficient number of new patterns to exhaust its credit for those returned before such credit lapsed under the terms of the contract. Appellee’s claim is that it is entitled to have the difference between the value of all patterns returned by it and of the new patterns ordered credited on its indebtedness for the patterns originally purchased by it, and the amounts due by it for the patterns shipped to it under the regular monthly order provided for in the contract. There can be no merit in this contention, for the contract in express language provides otherwise. — 880 — Another of appellee’s contentions is that since this contract contains the following clause: “We will not sell any other patterns than the McCall Patterns received from you during the term of this contract order” —it is illegal and void under our anti-trust statutes, and therefore that appellant cannot recover the value of the patterns sold and delivered under it. Granting that this provision of the contract violates our anti-trust laws, it has been expressly held in McCall v. Hughes, 102 Miss. 375, 59 So. 794, 42 L. R. A. (N. S.) 63, that appellee is not released thereby from the payment of the amount due by it for the patterns received. Reversed and remanded.