Cooke v. Millard

ETo exceptions were taken in this cause, except to the conclusions of law derived by the referee from the facts as found in the report. There are but two questions to be considered: One is, whether the contract is within the statute of frauds; the other is, if it be held that it is within the statute, were the acts, done by the parties, sufficient to comply with its terms, so as to make the contract enforceable in a court of justice ?

In order to determine whether the contract is within the statute, it is important briefly to state the exact acts which the plaintiffs were to perform.

The contract was plainly executory in its nature. There were no specific articles upon which the minds of the buyer and seller met, so that it could be affirmed that a title passed at the time of the contract. The seller was to select, from the mass of lumber in his yard, certain portions that would comply with the buyer’s order. The purposes of the parties could not even be accomplished by the process of selection. The lumber must be put in a condition to answer the order. It must be dressed and cut into required sizes. The contract called for distinct parcels of surface pine boards, clapboards and matched ceiling. Part of the lumber was surfaced, and a portion of it still in the rough. The clapboards were manufactured from stuff one and a quarter-inch thick. It had to be split, surfaced and rabbeted. The order for the various items was a single one, there being 15,441 feet of the surface pine, 10,144 feet of clapboards, and 8,000 feet of matched ceiling. The surface boards and the ceiling were in-existence, and only

The question is thus reduced to the following proposition: Is a contract which is, in form, one of sale of lumber then in existence for a fixed price, where the seller agrees to put it into a state of fitness to fill the order of the purchaser, his work being included in the price, in fact a contract for work and labor and not one of sale, and, accordingly, not within the statute of frauds ?

The Hew York statute is made applicable to the “ sale of any goods, chattels, or things in action ” for the price of fifty dollars or more. The words “ goods and chattels ” are, literally taken, probably more comprehensive than the expressions in the English statute, “ goods, wares and merchandise.” It will be assumed, however, in this discussion, that they are equivalent.

There are, at least, three distinct views as to the meaning of the words in the statute. These may be called, for the sake of convenience, the English, the Massachusetts and the Hew York rules, as representing the decisions in the respective courts.

The English rule lays especial stress upon the point, whether the articles bargained for, can be regarded as goods capable of sale by the professed seller at the time of delivery, without any reference to the inquiry whether they were in existence

The Massachusetts rule, as applicable to goods manufactured or modified after the bargain for them is made, mainly regards the point whether the products can, at the time stimulated for delivery, be regarded as “ goods, waves and merchamr disef in the sense of being generally marketable commodities, made by the manufacturer. In that respect, it agrees with the English rule. The test is not the non-existence of the commodity at the time of the bargain. It is, rather, whether the manufacturer produces the article in the general course of his business or as the result of .a special order. (Goddavd v. Binney, 115 Mass., 450 .) In this very recent

The Mew York rule is still different. It is held here by a long course of decisions, that an agreement for the sale of any commodity not in existence at the time, but which the vendor is to manufacture or put in a condition to be delivered, such as flour from wheat not yet ground, or nails to be made from iron belonging to the manufacturer, is not a contract of sale. The Mew York rule lays stress on the word sale. There must be a sale at the time the contract is made. The latest and most authoritative expression of the rule is found in a recent case in this court. (Parsons v. Loucks, 48 N. Y., 17 , 19.) The contrast between Parsons v. Loucks, in this State, on the one hand, and Lee v. Griffin (supra), in England on the other is, that in the former case, the word sale refers to the time of entering into the contract, while in the latter, reference is had to the time of delivery, as-contemplated by the parties. If at that time it is a

The ease at bar does not fall within the rule in Parsons v. Loucks. The facts of that case were, that a manufacturer agreed to make for the other party to the contract two tons of book paper. The paper was not in existence, and, so far as appears, not even the rags, “ except so far as such existence may be argued from the fact that matter is indestructible.” So in Sewall v. Fitch (supra), the nails which were the subject of the contract were not then wrought out, but were to be made and delivered at a future day.

Nothing of this kind is found in the present case. The lumber, with the possible exception of the clapboards, was all in existence when the contract was made. It only needed to be prepared for the purchaser—dressed and put in a condition to fill his order. The court, accordingly, is not hampered in the disposition of this cause by authority, but may proceed upon principle.

Were this subject now open to full discussion upon principle, no more convenient and easily understood rule could be adopted than that enunciated in Lee v. Griffin. It is at once so philosophical, and so readily comprehensible, that it is a matter of surprise that it should have been first announced at so late a stage in the discussion of the statute. It is too late to adopt it in full in this State. So far as authoritative decisions have gone, they must be respected, even at the expense of sound principle. The court, however, in view of the present state of the law, should plant itself, so far as it is not precluded from doing so by authority, upon some clearly intelligible ground, and introduce no more nice and perplexing distinctions. I think that the true rule to be applied in this

The view that this case is one of sale is sustained by Smith v. The Central Railroad Company (4 Keyes, 180), and by Downs & Skillinger v. Ross ( 23 Wend., 270 ).

In the first of these cases, there was a contract for the sale and deEvery of a quantity of wood, to be cut from trees standing on the plaintiff’s land. The court held that it could not be treated as an agreement for work and labor in manu facturing fire-wood out of standing trees. The cases already cited were distinguished in the fact that no change in the thing sold and to be deEvered was contemplated, and that the transaction could be regarded as a sale in perfect consistency with the cases which hold that where the substance of the contract consists in the act of converting materials into a new and whoEy different article, it is an agreement for work and labor. It was further considered that the case of Towers v. Osborne (1 Strange, 506), where an agreement for the' manufacture of a chariot was a contract for work and labor, was extreme in its nature, and was not to be earned any further. (P. 200.) The cases of Garbutt v. Watson (5 B. & A., 613) and Smith v. Surman (9 B. & C., 561) were cited with approval. In Garbutt v. Watson, a sale of flour by a miEer was held within the statute, although not ground when the bargain was made.

In Downs, etc., v. Ross, there was a contract for the sale of

The fallacy in the proposition of Cowen, J., is in assuming that there is any “ work and labor ” done for the vendee. All the work and labor is. done on the vendor’s property to put it in a condition to enable him to sell it. His compensation for it is found in the price of the goods sold. It is a juggle of words to call this “ a mixed contract of sale and work and labor.” When the goods leave the vendor’s hands and pass over to the vendee, they pass as chattels under an executed contract of sale. While any thing remained to be done the contract was executory. There is abundance of authority for maintaining that a contract in its origin executory may, by the performance of acts under its terms, by one of the parties, become, in the end, executed. (Rohde v. Thwaites, 3 B. & C., 388; Benjamin on Sales, chap. 5, and cases cited.)

The cases of Donovan v. Wilson ( 26 Barb., 138 ), and Parker v. Schenek (28 id., 38) are to be upheld as falling within the principle of Parsons v. Loucks (supra). Both of these eases concerned articles not in existence, but to be pro

The only case in our reports appearing to stand in the way of the conclusion arrived at in this cause is Mead v. Case ( 33 Barb., 202 ). The court in that case recognized the distinction herein upheld. The only doubt about the case is, whether the court correctly applied the rule to the facts. These were that several pieces of marble put together in the form of a monument were standing in the yard of a marble cutter. That person agreed with a buyer to polish, letter and finish the article as a monument, and to dispose of it for an entire price—$200. The court held that there was no monument in existence at the time of the bargain. There were pieces of stone in the similitude of a monument, and that was all.

It is unnecessary to quarrel with this case. If unsound, it is only a case of a misapplication of an established rule. If sound, it is a so-called “border case,” showing the refinements which are likely to arise in applying to various transactions the rule adopted in Sewall v. Fitch,, and kindred cases. It is proper, however, to say that the notion that such an arrangement of marble placed in a cemetery over a grave can not be regarded as a monument, in the absence of an inscription, seems highly strained. Then there could not be a memorial church without an inscription. Then it could not have been said of Sir Christopher Wren, in his relation to one of his great architectural productions, “ Si quce/ris morm

In the view of these principles, the defendants had the right to set up the statute of frauds. I think that this was so even as to the clapboards. Although not strictly in existence as clapboards, they fall within the rule in Smith v. Central Railroad Company. They were no more new products than was the wood in that case. There was simply to be gone through with a process of dividing and adapting existing materials to the plaintiffs’ use. It would be difficult to distinguish between splitting planks into clapboards, and trees into wood. Ho especial skill is required, as ail the work is done by machinery in general use, and readily managed by any producers of ordinary intelligence. The case bears no resemblance to that of Pa/rsons v. Loucks, where the product was to be created from materials in no respect existing in the form of paper. The cases would have been more analogous had the contract in that ease been to divide large sheets of paper into small ones, or to make packages of envelopes from existing paper. In Gilman v. Hall ( 36 N. H, 311 ) it was held that a contract for sheep pelts to be taken from sheep was a contract for things in existence and a ^sale.

The next inquiry is, whether there have been sufficient acts done on the part of the buyers to comply with the statute. In order to properly solve this question, it is necessary to look more closely into the nature of the contract. As has been already suggested, the contract was in its origin executory. It called for selection on the part of the sellers from a mass of materials. At the time of the bargain there was no sale. There was at most only an agreement to sell. The plaintiffs, however, lay much stress on the fact that after the oral bargain and after the defendants had inspected the lumber, they gave directions, also oral, to the plaintiffs to place the lumber after it had been made ready for delivery

It will be observed that all of these directions were given while the contract was still wholly executory, and before any act of selection had been performed by the plaintiffs. It will thus be necessary to consider whether these directions are sufficient to turn the executory contract of sale into an executed one, independent of the statute of frauds, and afterwards to inquire whether there was any sufficient evidence of “ an acceptance and receipt ” of the goods to take the case out of the statute. These questions are quite distinct in their nature and governed by different considerations: (1.) If the contract had been for goods less than fifty dollars in value, or for more than that amount, and ordered by the defendants in writing, it would still have been executory in its nature, and would have passed no specific goods. It would have been an agreement to sell and not a sale. The case would not have fallen within such authorities as Crofoot v. Bennett ( 2 N. Y., 258 ) and Kimberly v. Patchin ( 19 N. Y., 330 ). Since the goods could not have been identified at all, except by the act of the seller in selecting such as would comply with the order, nor could the purposes of the contract have been performed except by the labor of the plaintiffs in adapting the goods to the defendants’ use, the case falls within a rule laid down by Hr. Blackburn in his work on Sales (pp. 151, 152): “ Where, by the agreement, the vendor is to do any thing to the goods for the purpose of putting them into that state in which the purchaser is to be bound to accept them, or as it is sometimes worded, into a deliverable state, the performance of these things shall, in the absence of circumstances indicating a contrary intention, be taken to be a condition precedent to the vesting of the property.” (Acraman v. Morrice, 8 C. B., 449 ; Gillett v. Hill, 2 C. & M., 530; Campbell v. Mersey Docks Company, 14 C. B. [N. S.], 412.)

Proceeding on the view that this was an executory contract, it might still pass into the class of executed sales by acts “ of

The result is, that if this sale, executory as it was in its nature, had not fallen within the statute of frauds, there would have been no sufficient appropriation by the vendor to pass the title. The transaction, so far as it went, was, even at common law, an agreement to sell and not an actual sale.

(2.) But even if it be assumed that this would have been an executed contract of sale in its own nature, without reference to the statute of frauds, was there “ an acceptance and a receipt ” of the goods, or a part of them, by the buyer, so as to satisfy the statute ?

The acceptance and receipt are both necessary. The contract is not valid unless the buyer does both. These are two distinct things. There may be an actual receipt without an

There are some dicta, of various judges, cited by the plaintiffs to the effect that acceptance and receipt are equivalent. (Per Cromptoít, J., and Cookburr, Oh. J., in Castle v. Sworder, 6 H. & N., 832; per Earle, J., in Marvin v. Wallis, 6 E. & B., 726.) These remarks cannot be.regarded as of any weight, being contrary to the decided current of authority. Indeed, a late and approved writer says: “ It may be confidently assumed, however, that the construction which attributes distinct meaning to the two expressions, ‘acceptance ’ and ‘actual receipt,’ is now too firmly settled to be treated as an open question, and this is plainly to be inferred from the opinions delivered in Smith v. Hudson” (6 B. & S., 436; Benj. on Sales).

It cannot be conceded that there was any acceptance in the present case by reason of the acts and words occurring between the parties after the parol contract, and before the goods were prepared for delivery. There could be no acceptance without the assent of, the buyers to the articles in their changed condition, and as adapted to their use. If the case had been one of specific goods to be selected from a mass without any preparation to be made, and nothing to be done by the vendor but merely to select, the matter would have presented a very different aspect. This distinction is well pointed out by Willes, J., in Bog Lead Company v. Montague (10 C. B. [N. S.], 481). In this case, the question turned upon the meaning of the word “ acceptance,” in another statute, but the court proceeded on the analogies supposed to be derived from the construction of the same word in the statute of frauds. The question was as to what was necessary to constitute an “ acceptance ” of shares

This view is confirmed by Maberley v. Sheppard (10 Bing., 99). That was an action for goods sold and delivered, and it was proven that the defendant ordered a wagon to be made for him by the plaintiff, and, charing the progress of the work, furnished the iron work and sent it to the plaintiff, and sent a man to help the plaintiff in fitting the iron to the wagon, and bought a tilt and sent it to the plaintiff to be put on the wagon. It was insisted, on these facts, that the defendants had exercised such a dominion over the goods sold as amounted to an acceptance. The court, per Tutdal, Oh. J., held that the plaintiff had been rightly nonsuited, because the acts of the defendant had not been done after the

The plaintiffs, in the case at bar, rely much upon the decision in Morton v. Tibbett (15 Ad. & El. [N. S.], 428). They maintain that this case clearly establishes that there may be an acceptance and receipt of goods by a purchaser, within the statute of frauds, although he has had no opportunity of examining them, and although he has done nothing to preclude himself from objecting that they do not correspond with the contract.

The expressions in Morton v. Tibbett are not to be pressed any further than the facts of the case require. The buyer of wheat by sample had sent a carrier to a place named in a verbal contract between him and the seller on August twenty-fifth. The wheat was received on board of one of the carrier’s lighters for conveyance by canal to Wisbeach, where it arrived on the twenty-eighth. In the meantime, it had been resold by the buyer, by the same sample, and was returned by the second purchaser because found to be of short weight. The defendant then wrote to the plaintiff on the thirtieth also rejecting it for short weight. An action was brought for goods bargained and sold. There was a verdict for plaintiff, with leave to move for a nonsuit. The question for the appellate court was, whether there was any evidence that the defendant had accepted and received the goods so as to render him liable as buyer. The court held that the acceptance under the statute was not an act subsequent to the receipt of the goods, but must precede, or, at least, be contemporaneous with it, and that there might be an acceptance to satisfy the statute, though the purchaser might, on other grounds, dis-affirm the contract.

Even when interpreted in this way, Morton v. Tibbett cannot be regarded as absolutely settled law in England. (See Coombs v. Bristol and Exeter Railway Company, 3 H. & N., 510; Castle v. Sworder, 6 id., 832.) The Court of Queen’s Bench recognizes it, while the Court of Exchequer has not received it with favor. Later cases distinctly hold that the acceptance must take place after an opportunity by the vendee to exercise an option, or after the doing of some act waiving it. Bbamwell, B., said, in Coombs v. The Bristol and Exeter Railway Com/pamy: “ The cases establish that there can be no acceptance where there can be no opportunity for rejecting.” All the cases were reviewed in Smith v. Hudson (6 Best & Smith, 431, a. d. 1865), where Hunt v. Hecht was approved.

In Hunt v. Hecht the defendant went to the plaintiffs warehouse and there inspected a heap of ox. bones, mixed with others inferior in quality. The defendant verbally agreed to purchase those of the better quality, which were to be separated from the rest, and ordered them to be sent to his wharfinger. The bags were received on the ninth and examined next day by the defendant, and he at once refused to accept them. There was held to be no acceptance. The case was put upon the ground that no acceptance was possible till after separation, and there was no pretence of an acceptance after that time. Martin, B., said that an acceptance, to satisfy the statute, must be something more than a mere receipt. It means some act done after the vendee has exercised or had the means of exercising his right of rejection.

In Smith v. Hudson (supra) barley was sold on November 3, 1863, by sample, by an oral contract. On the seventh it was taken by the seller to a railway station, where he had delivered grain to the purchaser on several prior dealings, and where it was his custom to receive it from other sellers. The barley was left at the freight-house of the railway, consigned to the order of the purchaser. It was the custom of the trade for the buyer to compare the sample with the bulk as delivered, and if the examination was not satisfactory to reject it. This right continued in the present case, notwithstanding the delivery of the grain to the railway company. On the ninth the purchasór became bankrupt, and on the eleventh the seller notified the stationmaster not to deliver the barley to the purchaser or his assignees. The court held that there was no acceptance sufficient to satisfy the statute. The most that could be said was, that the delivery to the company, considered as an agent of the buyer, was a receipt. It could not be claimed that it was an acceptance, the carrier having no implied authority to accept. The buyer had a right to see whether the bulk was according to the sample, and until he had exercised that right there was no acceptance. (Opin. of Oookburn, Oh. J., 446;

The case at bar only differs from these cases in the immaterial fact that the defendants, after the verbal contract was made, gave verbal directions as to the disposition which should be made of the goods after they were pnt into a condition ready for delivery. All that subsequently passed between them was mere words, and had not the slightest tendency to show a waiver of the right to examine the goods to see if they corresponded with the contract. Whatever effect these words might have had .in indicating an acceptance, if the goods had been specific and ascertained at the time of the directions (see Cusack v. Robinson, 7 Lond. Jurist [N. S.], 542), they were without significance under the circumstances, •as the meeting of the minds of the parties upon the subject to be selected was necessary. (Shepherd v. Pressey, 32 N. H., 57 .) In this case the effect of subsequent engagements by the buyer was passed upon as to their tendency to show a receipt of the goods by him. The court said: “ As mere words constituting a part of the original contract do not constitute an acceptance, so we are of opinion that mere words after words used, looking to the future, to acts afterwards done by the buyer towards carrying out the contract, do not constitute an acceptance or prove the actual receipt required by the statute.” The case was stronger than that under discussion, as the goods were specific and fully set apart for the purchaser at the time of the subsequent conversations. 27o distinction is perceived between future acts to be done by the buyer and by the seller, as both equally derive their force from the buyer’s assent.

I see no reason in the case at bar to hold that the defendants receimed the goods, independent of the matter of acceptance. There was no evidence that Percival became their agent for this purpose. The most that can be said is that they promised the plaintiffs that they would make Percival their agent. This promise being oral and connected with the sale, is not binding. They did not, in fact,- communicate with

The whole ease falls witMn the doctrine in Shindler v. Houston ( 1 N. Y., 261 ), there being no sufficient act of the parties amounting to transfer of the possession of the lumber to the buyer and acceptance by him.

The judgment of the court below should be affirmed.

All concur.

Judgment affirmed.