John Hurd Co. v. Consolidated Steel & Wire Co.

The plaintiff in this action is a domestic corporation engaged in the manufacture of lumber. The defendant is a foreign corporation, engaged in malting wire goods, etc., at Allentown, Pa., with an office in Hew York City. It was necessary in its business ‘to have wooden reels for convenience in packing and shipping its product, and it purchased the materials for these reels, sawed, planed, etc., ready to be put together, the work of assembling the parts being done at the factory at Allentown. On the 17th of January, 1895, the defendant had a conversation with one W. A. Grombie, resulting in a written memorandum, which was practically an agreed schedule of prices for goods during the year, and which at most was an executory contract, in which Mr. Grombie agreed to furnish the goods needed by the defendant, and the defendant agreed to receive and pay for them, at a given rate for the specified sizes and quantities. There was a stipulation in the memorandum that “any material unfit for our use to be thrown out, and deducted from your invoices,” and that, “unless otherwise mutually agreed, the reels are to be manufactured by Mr. Hurd,”—meaning, in all probability, the president and general manager of the plaintiff. It appeared upon the trial that Mr. Grombie had no materials for sale; that he had no mills, lumber yards, men to handle lumber, or any means of carrying out the agreement except by getting some one else to fill the contract; and that he was, as a matter of fact, employed as a broker by the defendant to procure purchasers for the output of the mills of the plaintiff, and that he was given a commission of 5 per cent, upon the goods shipped and paid for. The plaintiff, during the year 1895 and a portion of the year 1896, shipped goods to the defendant, the invoices showing that they were sold from the plaintiff to the defendant; and the latter paid for the earlier invoices directly to the plaintiff. The orders for the goods were, for the most part, sent to Mr. Grombie, and by the latter transmitted to the plaintiff; but there is nothing in this inconsistent with the idea that Mr. Grombie was merely a broker in the matter, and that the orders were passed through his hands for the purpose of informing him of the extent of the business. The trial court very properly held that the executory contract or agreement with Mr. Grombie was not involved in this action; that the contract of sale in each instance, in the matters sued upon, was between the plaintiff and defendant; and that payment on the part of the defendant to Mr. Grombie, or to the firm which he represented, could not relieve the defendant from its obligation to the plaintiff. While the case is complicated by certain shipments made on account of Mr. Grombie, and questions growing out of defects in materials, indirect payments, etc., the main question at issue, and upon which all others hinge, is whether the defendant purchased the goods from Mr. 'Grombie under the terms of the‘memorandum, and, if he did not, whether the latter was authorized to receive payment for the plaintiff. The learned trial court held as a matter of law "that the memorandum with Mr. Grombie was not involved in the proceeding, that the transactions embraced in the action were between plaintiff and defendant, and that payments made to Mr. Grombie did not discharge