Majority
p. 251David Porter Templeton, Pl’ff and Resp’t, v. Julius Wile and Isaac Wile, Def’ts and App’lts.[1] (New York Common Pleas, General Term, Filed February 4, 1889.)
Headnote
A Contract—Mutual asset—When contract consummated.Where an action was brought for the price of a quantity of mineral water sold and delivered to defendants, which the defendants admitted had been received by them at the prices charged, but set up as a defense and counter-claim that the plaintiffs had entered into an agreement with defendants, appointing them their sole agents in the United States for five years, and that plaintiffs had refused to carry out and perform said agreement, by which refusal defendants had suffered greater loss than the value of the goods sued for, it appears that the alleged agreement was claimed to have been made by the acceptance of terms proposed by defendants"to ^plaintiff's assignor in Germany. Under date of July 5, 1886, defendants wrote- * * * “We kindly request you to wire us your reply to the following conditions: Pirst. Price for two hampers, 100 jugs, mark twenty-five dollars; two cases, 100 bottles, mark $29.50. Second. Five hampers of cases gratis as samples to any order not less than 100 of each” ■*■ * * “ conditionally that such arrangement is for the sole agency in the United States,” and requested plaintiff, if agreeable, to cable “ yes.” To this plaintiff cabled “yes,” and answered by letter dated same date of cablegram, July 20 th: “You have to guarantee us the sale of 3,000 packages per year. We beg you to send us contract for our signature.” And defendants wrote to plaintiff on same day, July 20th, letters crossing each other, “ Conditions named in our letter of July 5th, to which we have received your reply by cable saying yes, we accept your agency for the exclusive sale of your products in the United Sates, and we would kindly request you to send us contract to this effect for the term of five years.” "■* * * “Under these conditions please ship us 200 hampers,” etc , being part of the goods sued for. And the goods were then Sent to defendants. And under date of August 9, 1886, the defendants wrote to plaintiffs, “ In consequence of accident to steamer your letter of July 20th did not reach us until to-day. On the return of our Mr. Julius Wile from his western trip we will answer you more fully.” Under date of September 17, 1886, defendants say: “We enclose herein the contract; ” * * * “it contains all the stipulations agreed upon by each, excepting the part of obliging ourselves to consume 3,000 packages.” To this the plaintiffs replied by calling attention to the correspondence, “ that therein is fixed no time of duration of the possible agreement of the agency,” and also that one of the plaintiffs’ conditions required that defendants should guarantee the yearly sale of 3,000 packages; declining to execute the contract, and revoking the agency of the defendants’ firm, I-Ield, that there was no contract consummated, and the counter-claim could not be allowed.
% Same—Meaning -on words used in contract.
A party is bound not merely by bis own meaning, but by that meaning in which his language may fairly be taken by the other side. Parties can express their meaning and intent, as well by acts as by words, but the act must be susceptible of but one reasonable construction.
■3. Same—Proposal and acceptance.
The rule seems to be that as to a proposal, it is made when received by the party to whom it is addressed; and as to acceptance or refusal, it is made, and takes effect when mailed.
This appeal is from a judgment of the general term of the city court, affirming a judgment entered upon the re
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port of George H. Yeaman, Esq., referee, awarding judgment for plaintiff.
The action was brought for the agreed price of certain shipments of mineral water, made by “The Bellthal Brunnen Company,_ Limited,” near Cobern, on the Mosel, Germany, the plaintiff’s assignor, to the defendants in New Y ark. The defendants set up the defense that the plaintiff’s assignor made an agreement to sell defendants their product of mineral water, for the term of five years, giving the-defendants the sole agency for the United States, at prices-named, and that plaintiff refused to carry out the contract, to the great loss and damage of the defendants.
The plaintiff by stipulation, agreed that if there was any contract, as set forth in the answer, that plaintiff is not entitled to recover.
At special term of the city court, held July 11, 1888, by Hon. Wm. E. Pitschke, judge, the issues in this action were by consent, referred to George H. Yeaman, Esq., as sole-referee, to hear, try and determine the same.
The referee having heard the proofs and allegations of the respective parties, found that there was no contract entered into between the parties, as set up in the answer, and directed judgment to be entered for the plaintiff in the sum of $1,723.44, delivering the following opinion:
George H. Yeaman, Eeferee—This trial has been conducted on the theory that there is no question of fact in the case. The question is conceded to be one of law, whether the correspondence and the action of the parties resulted in a valid and binding contract, described in the stipulation, a contract by which the plaintiff’s assignee gave the defendants a five years’ exclusive agency for the sale of the. Bellthal mineral waters in the United States.
It is not deemed material to decide whether that question is controlled by the law of New York or of Germany, as the rules of law in the two countries seem to be practically the same, so far as applicable to the question in hand, the negotiation of a contract by letters and telegrams.
The letter of Casper of January 22, 1887, denying the existence of the contract, and that of defendants of February 18, 1887, claiming its existence, though put in evidence with out objection cannot be allowed to be conclusive either way. They were both written after the contract is alleged to have-been made; and in any event they neutralize each other.
Neither is-the fact that both sides suggested a formal written contract which was prepared and never signed, conclusive either way. The fact is susceptible of two meanings, either that the parties were only negotiating and did. not deem that any contract yet existed; or that they had substantially agreed, and desired the agreement to be reduced to a formal written document. As the contract could exist-
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without such document, a refusal to sign it is not conclusive that no contract had been made.
The dealings and correspondence of these parties prior to March twenty-fourth, have not been explained. Casper’s letter of that date speaks of prices, and of “ this year,” and “ the next year,” but no term of five years is mentioned and the expressions quoted may well have referred to an expected course of dealing for several years between the parties, simply as vendor and vendee.
In defendant’s letter of July 5, 1886, they request a reply by cablegram to the “following conditions.” Then follows a schedule of prices and closing with the expression, “all other conditions in your favor, March twenty-fourth, are satisfactory, of course conditionally that such arrangement is for the sole agency in the United States.” Here the word “conditions” seems to be used synonymously with terms or prices and times of payments, but the expression, “ of course conditionally that such arrangement is for the sole agency in the United States,” cannot be so construed. To this letter the telegram “yes” was sent and received July seventeenth. As the answer was not restricted to terms or prices, it must be held to cover the whole-letter. A party is bound not merely by his own meaning, but by that meaning in which his language may fairly be taken by the other side. Here then was a contract, the-grant of a sole agency for the United States. But it was not for five years and therefore not the contract described in the stipulation. If it had appeared that by the previous correspondence of the parties an agency for five years was contemplated and discussed, the case would then be with defendants.
On July 20, 1886, the defendants wrote “under the conditions named in your letter of March twenty-fourth, this-year, and those contained in our own of July fifth, to which we have received your reply by cable saying yes, we accept your agency for the exclusive sale of the Bellthal water within the limits of the United States, and we would kindly request you to send us contract to this effect for the term of five (5) years.
Of course this acceptance of the agency was not needed. A mere agency was already agreed upon. But now for the first time the term of five years is proposed, and that needs to be agreed to. This may or may not have been the reason for asking for a written contract. Whether that was the reason or not, it is perfectly clear that no such contract yet existed.
The next sentence in the letter is “ under these conditions please ship us, by way of Rotterdam or Amsterdam, 200 hampers ” etc., etc. Such goods were shipped about the twenty-fifth of August, following. Subsequently, in the same letter, the defendants say, we should also suggest making us an allowance for advertising in our trade jour
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znals, etc., etc. Whether this was only a suggestion, or was also to be embraced within the expression “under these ■conditions ” would be hard to say, but it is at least a new feature, and though it be intended only to initiate a negotiation on that subject, yet taken in connection with the-request for a written contract, shows clearly that the defendants did not consider that there was yet in existence such a contract as they wished, just as the demand for five years ¡shows that the cablegram “yes” had in their mind created a sole but revocable agency, without a term of years for the whole United States.
On the same day, July 20, 1886, plaintiff’s assignee wrote to defendants saying, after giving some details of shipments: “You have to guaranty us the sale of 3,000 packages per year, etc.,” and after some further business details, concludes the letter as follows: “Sole agency of the United .States of America. Should our London house make any sales in the United States, you will receive a commission of five per cent on such sales. Those conditions we hope will be satisfactory to you, and we beg you to send us contract for our signatures.” These two letters crossed each other ■on the water.
Here we have each party, on the same day, asking the other to send a written contract. One party putting in the letter the additional requirement of five years, and at least the suggestion of an allowance for advertising, and the other putting in his letter the requirement of a guaranty of .sale of 3,000 hampers a year, and reserving the right to continue to make sales through their London house. Nothing •can be plainer than that none of these terms have yet been agreed to by both parties.
There being no contract contained in the letters, it is forcibly contended by defendant’s counsel, that the action of plaintiff’s assignee in shipping goods to fill the order in defendant’s letter of July twentieth, was an acceptance of "the proposed terms of contract; that the order was made ■-conditionally, and filling it was an agreement.
The plaintiff’s counsel replies that if filling an order will •amount to acceptance of a proposed contract, then the defendants accepted the terms of Casper’s letter of July twentieth, because in the letter of August ninth, acknowledging its receipt, they make an additional order for goods, that thus a contract was concluded, with a guaranty of the sale of 3,000 hampers ver year, as well as the five year term of agency; that therefore it is not the same contract mentioned in the stipulation, and the plaintiff cannot recover. It is not necessary now to determine whether the defendants’ ■counsel is right in replying that it would be the contract described in the stipulation, although it might contain a provision or covenant not mentioned in that stipulation. The answer to plaintiff’s contention is obvious.
The letter of defendants’ of August ninth, in answer to
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Casper’s of July twentieth, says: “On the return of our Mr. Julius Wile from his western trip we will answer you more fully, and in the meantime we beg to confirm our dispatch of this day, reading 250 hampers, fifty cans Hew Orleans, which you no doubt will understand,” etc., etc.
This letter thus becomes simply an order for goods, in the course of business, between buyer and seller, and the-writer expressly reserves for further consideration, “Your letter of July twentieth,” by saying that on the return of Mr. Julius Wile they would answer more fully.
This leaves but one question in the case: Did the act off plaintiff’s assignee, in shipping the goods ordered in defendants’ letter of July twentieth, amount to a meeting of minds on the five year agency ? And so as to make a completed contract, without regard to other propositions made by either party? If so intended, it was certainly sufficient; and it might be sufficient, without such intent, if it could not be otherwise correctly interpreted by the defendants. Parties can express their meaning and intent, their assent, or dissent, as well by acts as in words. But the act must be susceptible of but one reasonable construction. If one merchant sends to another an order, and says plainly, “ship these goods only if you will give me a sole agency for five years,” and the goods are sent' without other advice, and nothing further appears, there would seem to be a meeting of minds, though whether in a contract for more than one year, there would be a sufficient signing under the statute of' frauds is not now considered..
But there are other elements in this case. The defendants’ letter of August ninth acknowledges receipt of Casper’s letter of July twentieth. The goods, conditionally ordered in defendants’ letter of July twentieth, were shipped August twenty-fifth. It is not shown when they reached Hew York, and that may not be material.
Presumably they could not be taken from the custom house until the consular invoice reached defendants. That was inclosed in Casper’s letter of September third, advising the shipment. If the act of shipping was not completo until advised by letter inclosing the invoice, if the two must be taken as one act, it was finished on the third of September. But if we hold the act of shipment as sufficient of itself, and treat it as the law would treat a letter,, the rule seems to be that as to a proposal, it is made when received, and as to acceptance or refusal, it is made and takes effect when mailed. So that, in this view, whatever effect the act of shipping had, it had that effect on the-twenty-fifth of August, and, nothing further appearing, would amount to an acceptance of the contract proposed by the defendants in letter of July twentieth.
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But when Casper wrote on September third, he evidently lias received defendants’ letter of August ninth, as he refers to “the 250 hampers and fifty cans for New Orleans.” The time by mail is usually ten to twelve days, so that he must •also be held to have received defendants’ letter of August ninth before August twenty-fifth, when he shipped the goods.
The situation of the parties then was this: They had exchanged proposed terms of contract, with material differences. Their minds had not met on paper. The defendants had made an order for goods conditioned on plaintiff’s assignor agreeing to a five-year agency, but before that order was filled they had received Casper’s letter of same date, July twentieth, containing the additional and unacceptable proposition of 3,000 hampers a year. Also before it was filled they had written, and Casper had received the letter of August ninth, advising that the terms of his letter of July twentieth would be more fully_ answered on Julius Wile’s return. The expression, “in the meantime we beg to confirm our dispatch of this day,” referring to an order for goods, would seem to remit that order to the usual line of commercial transactions, without reference to a permanent contract. Each party had the proposal of the other, and neither had yet definitely answered. Casper knew that his demand for the sale of 3,000 a year was held under consideration, and could not know that it would not be accepted. There is no proof of its rejection earlier than defendants’ letter of September 17th, when they inclosed to Casper a contract containing all the stipulations agreed upon by each in our letters, •excepting the part of obliging ourselves to consume 3,000 packages.” This letter of defendants, written 17th September, twenty-three days after the date of the shipment that is claimed to be decisive, shows that the defendants "themselves still deemed the negotiations pending and undetermined, at least in the matter of getting a formal contract signed. In their letter of October 1st, they say that Casper’s letter of September 3d was received since their letter of September 14th. It is, therefore,' only a presumption that it was received before the 17th. If it was, they knew of the shipment when they wrote on the 17th, and still did not treat it as making a contract, but continued the negotiations by inclosing a proposed contract on that day. Such knowledge on the 17th would only make inevitable the conclusion that there was then in.the judgment of the parties themselves no contract. But such conclusion is still fairly reached without any proof, and without the aid of the presumption, based on the usual course of.
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the mail, that on the 17th of September the defendants had received Casper’s letter of the 3d of that month.
Casper, by his letter of September 3d, had declined the proposed “allowance for advertisements,” and by rejecting only that, had presumably assented to the five year term ■of sole agency contained in defendants’ letter of July 20th. But that did not make a contract, for he did not accept the offer as made. He rejected the expense of advertising, .and his own demand of 3,000 a year, then under consideration, had not been accepted, and was rejected on the 17th September, so that there was as yet no agreement by letter. If his letter of September 3d must be held an acceptance of the five year term because not objected to, there was yet no contract. He did not withdraw his demand, and the sale of 3,000 hampers a year, which had not yet been acted on, and without such withdrawal his assent to the five years would not bind defendants to 3,000 hampers a year, so that there was still no contract binding on both parties.
We thus see that each party knew, and by every letter was showing, that a negotiation was pending, that the proposals made by each were materially different, and, as it turned out, each rejected something the other had proposed, and Casper knowing when he did the act that is supposed to indicate assent, that one of his proposals was still held under consideration. It is true that the rejection of the advertising expenses by Casper, and the rejection by the defendants’ covenant for 3,000 hampers a year were after the act that is claimed to be decisive. But they are in the correspondence about the subject matter. They are the acts of the parties who would be mutually bound if a contract existed, and they throw light on the state of mind of the parties, and that state of mind, whether two minds had met and assented, is the question in this case.
Under these circumstances shall the act of shipping the •goods be held an unconditional assent to the contract proposed by defendants, without regard to, or amounting to a withdrawal of the counter proposition of the shipper. If it made a contract, what contract was made ? Only that proposed by the defendants ? Or that and the counter-proposition welded into one ? The latter inference is wholly untenable. Shipping the goods clearly did not bind the defendants to the 3,000 hampers a year, a proposal they had not accepted and afterwards rejected. Did it bind the plaintiff’s assignee to a five year agency % Taken by itself, it might well be so held. Taken in the light of the situation and of the correspondence of the parties, to allow it this effect would be to give one item of evidence an undue probative force, allowing if to that there was
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a meeting of minds when other evidence in the case clearly shows that there were material differences still under negostiation.
It may be that in this attitude of the parties towards, each other, the defendants, who seem to have acted in entire-good faith and with no desire to defeat or postpone the* payment of just bills were not bound to receive the goods. But having received them, the obligation to pay attaches.
The only question before me, under the stipulation, is whether the contract therein described existed. I find that it did not, and that therefore judgment must be ordered for the plaintiff.
Findings may be proposed on the 15th day of August, 1888, or any subsequent day that may be agreed upon by counsel.
The only doubt I have is, whether I and counsel have-been quite correct in treating it as a pure question of law. If the case had been tried before a judge and jury, it may be that the court would have submitted to the jury the-question of fact whether the shipment and the letters of September 3d amounted to an acceptance of defendants’" demand for a five year agency or were so intended. If that is deemed a question of fact, I should find it in the-affirmative. That is, it determined one subject of negotiation by consenting to that much. But as a matter of law,. I should still find that there was no contract, because the outstanding demand to guaranty 3,000 hampers a year was; not accepted, and if that is held to depend on the question of fact whether the shipment and the letters amounted to a. withdrawal of that requirement, so as thereby to leave nothing open between the parties, I should find that question of fact in the negative.
- So that treating the case either as one of pure law, or as-one of law and fact, the result reached is the same.
Solomon F. Higgins, for app’lts; H. Wehle, for resp’t.
Judgment was thereupon entered upon the referee’s report, and this being affirmed at general term of the city court, the defendants appealed to the common pleas, who, after hearing, rendered the following opinion:
—The only issue which was tried before the referee arose upon the counter-claim set up in the answer and the reply to the same, as appears by_ the stipulation entered into between the parties, whereby it was stipulated that if there was any contract as set forth in the answer, the defendants were entitled to judgment.
The entire testimony is contained in the correspondence-between the parties. From this it appears that on the
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17th day of July, 1886, the plaintiff confirmed a proposition made by the defendants that they would be plaintiff’s agents in the United States for the sale of certain mineral waters.
Had the parties rested there, the contract set forth in the .•answer would have been sufficiently established. But it is clear from the subsequent correspondence that neither party to the transaction regarded the contract as then completed, for both parties subsequently proposed additional terms, which were never ratified, and consequently we think the referee was right in his finding, that the contract as set forth in the answer was never consummated. Hence, the conclusion to which he arrived in ordering judgment for the plaintiff was correct.
The judgment should therefore be affirmed.