Ross v. Morrimac Veneer Co.

Holden, J., delivered the opinion of the court. This is an appeal from a decree of the chancery court dismissing the bill of appellant, J. L. Boss, against the ap-pellee Morrimac Veneer Company, in which appellant sought to recover damages for loss on account of the breach of a contraed wherein appellee agreed to purchase from appellant five hundred thousand feet of gum logs at forty-two dollars per thousand. The chancellor based his decree of dismissal upon the ground that appellant had no right of action by virtue of the contract sued upon. — 701 — The case is simply this: The appellee Yeneer Company in February, 1920, agreed to purchase one million five hundred thousand feet of gum logs from the Henry Maley Lumber Company at a price -of forty-two dollars per thousand feet delivered. Subsequently, in July, 1920, the Henry Maley Lumber Company assigned to the appellant, Eoss, a one-third interest in the contract above mentioned; that is to say, Eoss for a valuable consideration obtained from the Maley Company the right to deliver and receive pay for five hundred thousand feet of gum logs at forty-two dollars per thousand from the appellee Yeneer Company. A few days after this assignment was executed and delivered, the Veneer Company was notified of the assignment by the Maley Company, and the appellant, Eoss, began to fill the contract by delivering several carloads of the logs to the Veneer Company. The Veneer Company accepted and paid for the logs, and impliedly, if not expressly, consented and agreed that Eoss should carry out that part of the contract assigned to him by the Maley Company. After Eoss had delivered more than one hundred and fifty thousand feet of logs to the appellee Veneer Company, the delivery being made in .cars at different times, the Veneer Company refused to receive and accept the balance of the logs under the contract. Eoss tendered the balance of the logs, and after numerous notices and demands, all of which were refused by the Veneer Company, Eoss filed this suit to recover the value of the balance of the logs undelivered under the contract, less the price that he received* for the logs which he had to sell upon the open market. There seems to be no dispute as to the loss by Eoss on account of the breach of the contract by the Veneer Company. The written contract between the Henry Maley Lumber Company and the Morrimac Veneer Company is as follows: “Henry Maley Lumber Company, Jackson, Mississippi: It is agreed that the Morrimac Veneer Company is to take — 702 — one million five bundled thousand feet No. 1 gum logs, eighteen inches and up at forty two dollars delivered at our mill, within eighteen months from date. “It is understood that this contract is to cancel contract ive had with you July 1, 1919. [Signed] Morrimac Veneer Company, by E. N. English, Mgr. [Signed] Henry Maley Lumber Co., by C. E. Maley.” It will be observed this contract on its face obligates the Veneer Company to purchase the logs, but does not require the Maley Company to deliver the logs to the Veneer Company. And the point is made here, not in the loAver court, by the appellee Veneer Company, that the contract is unilateral and unenforceable, Avhich proposition we shall discuss later. The assignment of a one-third interest in the contract by the Maley Company to appellant, Ross, is as folloAvs: “This agreement made and entered into on this the 12th day of July, 1920, by and between C. E. Maley, party of the first part, of Jackson, Miss., and J. L. Ross, of Pela-hatchie, Miss., party of the second part, witnesseth: “That Avhereas, the party of the first part contracted to sell and deliver to the Morrimac Veneer Company a certain lot of gum timber in logs, to be delivered within a period of eighteen months from February 11, 1920, at a price of forty-two dollars per thousand f. o. b. cars at Jackson, Miss., said timber to be practically clear, eighteen inches in diameter and up; “And whereas, the party of the second part desires to purchase from the party of the first part the right to fulfill a part of said contract between the party of the first part and the Morrimac Veneer Company, by supplying five hundred thousand feet of the timber covered by the same contract between the said first party and the said Mor-rimac Veneer Company: “Now, therefore, in consideration of one thousand dollars paid and to be paid as folloAvs, to-wit: two dollars per thousand as logs are delivered on cars — the party of the first part hereby sells to the party of the second part, — 703 — and the party of the second part obligates himself to perform a part of the said contract between the party of the first part and the Morrimac Veneer Company by delivering' to the Morrimac Veneer Company five hundred thousand feet of Gmn timber as provided for according to the terms of the said contract between the first party and the Morrimac Veneer Company. “Executed in duplicate by the parties hereto the day and date first above written. Henry Maley Lumber Company, Party of the First Part. J. L. Eoss, Party of the Second Part.” It will be noted this instrument provides that the Maley Company “hereby sells to” Eoss the one-third interest in the contract. And the appellee contends that this is an invalid assignment of the interest because it uses the words “sells” instead of “assigns,” and further that the contract between the Maley Company and the Veneer Company is unassignable, and also that the instrument merely creates a subagency in Eoss to carry out the contract for the Maley Company, and that no contractual or binding relation, such as would warrant this suit, is created between Eoss and the Veneer Company. We shall discuss these contentions later on. The main point in the case is whether or not the contract between the Henry Maley Lumber Company and the Mor-rimac Veneer Company is unilateral and unenforceable, or bilateral by virtue of express or implied mutuality. And Avhen we have decided this question we do not think the other problems presented are troublesome to solve. Now let us examine the contract and ascertain the intention of the parties who signed it. It is clear the Veneer Company agreed to purchase a certain amount of Np. 1 gum logs eighteen inches and'up in size at forty-two dollars per one thousand feet delivered at the mill within eighteen months from date. The undisputed testimony in the case shows that the price of forty-two dollars means forty-two dollars per one thousand feet. So it is plain the Veneer Company obligated itself to purchase on the terms — 704 — mentioned. This contract seems to be in the form of a letter to the Maley Company in which, we will say, the Veneer Company. offered to purchase the logs’on the terms mentioned therein. The Maley Company accepted the offer by signing the letter or contract. And the evidence shows that the assignee Ross, appellant, entered upon the performance of the contract by delivering several carloads of the logs to the Veneer Company after the assignment to him. We are of opinion the contract is not unilateral, but the mutuality is implied, and the obligation on the part of the Maley Company to deliver the logs was reciprocal; while mutuality is not shown expressly on the face of the contract, yet the obligation to deliver may be implied from the intention of the parties and the consideration on which the expressed obligation to purchase is based. In other words, in such a contract the mutual obligation may be implied by inferences drawn from the other and remaining terms and conditions of the contract as to the intent of the parties. And we do not hesitate to say it is clear in the case before us that, when the Maley Company accepted and signed the offer made by the Veneer Company, the Maley Company intended to be bound to carry out the terms by delivering the logs as provided in the contract. Moreover, acceptance and part performance would create mutuality. Therefore it is bilateral and enforceable by the Maley Company or its assignee, appellant, Ross. 13 C. J. section 180, p. 334; 6 R. C. L., section 95, pp. 688, 689; Pullman Co. v. Meyer, 195 Ala. 397, 70 So. 763; L. & N. Railroad v. Coyle, 123 Ky. 854, 97 S. W. 772, 99 S. W. 237, 8 L. R. A. (N. S.) 433, 124 Am. St. Rep. 384. The proposition advanced by counsel for appellee that the use of the word “sells” instead of “assigns” is insufficient to pass an interest in the contract we think is without merit, because the two words for all practical purposes in the contract mean the same thing, and it was ample to convey the interest intended to be transferred. — 705 — As to the point made that the Maley contract was un-assignable in part, ire think is not well taken for two reasons: First, the contract is not personal or peculiarly individual, but is one for the delivery of common marketable material fully and definitely described and priced; but, if we be mistaken in this, then, second, the assignment of the one-third interest in the contract in this case was impliedly, if not expressly, agreed to and accepted by the Veneer Company through telephonic communications and letters, and the actual acceptance of the numerous cars of logs delivered by appellant, Eoss, to the Veneer Company, and paid for to Boss by the Veneer Company, after the assignment was made. Regarding the point made by appellee that the assignment only created a subagency in Eoss to carry out the contract for the Maley Company, we cannot agree with this contention, because it is plain that Eoss purchased and paid for the one-third interest in the contract, as was understood by all parties, and thereafter dealt directly and independently with the Veneer Company in carrying out the contract, with an expectation of profit, which the Veneer Company consented to and fully understood, as shown by the record. Many of the points urged here were not presented in the loAver court, neither in the pleadings or by the proof or argument; but it is contended by the appellee that the lower court erred in not permitting the appellee to show that there was an oral agreement made contemporaneously Avith the Avritten contract betAveen it and the Maley Company wherein it Avas understood that the Veneer Company should have a right to reject the contract at .any time it might desire. We think the loAver court was correct in excluding the oral understanding which contradicted the terms of the Avritten contract. We observe from the opinion of the chancellor in the record that his decision dismissing the bill Avas grounded upon the theory that appellant, Eoss, only occupied the position of a subagent of the Maley Company because the — 706 — character of contract involved was unassignable in whole or in part. We have above discussed these questions and endeavored to point out the unsoundness of the chancellor’s ruling. In view of the above conclusions the decree of the lower court will be reversed, and a judgment entered here for the appellant against the appellee as to liability, and the cause will be remanded for the assessment of damages only. Reversed. Judgment here for appellant on liability, and remanded for assessment of damages. Reversed and remanded. Smith, C. J., concurs in the judgment rendered.