Jackson v. Builders' Wood-Working Co. — 70 N.Y. St. Rep. 802

Majority

p. 802

Charles E. Jackson et al., Resp’ts, v. Builders’ Wood-Working Company, App’lt.

(Supreme Court, General Term, First Department,

Filed December 18, 1895.)

Headnote

1. ©ontracts—Construction.

As between two constructions of a writing, other things being equal, that one should be adopted which is most "unfavorable to the party who formulated it.

2. Same.

Where the writing is only part of the contract and paroi evidence admissible to establish the whole contract, the written portion not being contradicted but only explained, the court must examine such evidence as bear upon the subject-matter, the relation of the parties, and their acts- and declarations, so as to enable the court to put itself in the place of the contracting parties, and to determine what was the contract between them.

3. Evidence—Written contract.

In an action to enforce.a written contract, it is error to permit plaintiff and others to testify to a conversatipn which took place between themselves at the time the contract was made though? the treasurer of defendant was sitting at a desk, in a position where, if he desired, he might possibly have heard the conversations, in the absence of any proof that the defendant took part in, heard, or assented to them.

Appeal from a judgment in favor of plaintiffs. *

Frank H. Field, for app’lt; Wallace Macfarlane, for resp’t.

The defendant was indebted to one Stone, representing himself and the firm of' B. B. James & Co., in the sum of $2,102.65. With knowledge that some of the defendant’s nptes had gone to protest, and-in anticipation of the failure of defendant, Stone and Harris, one of the firm of B. B. James & Co., eame on from Boston, and, together with the plaintiff Jackson, a lumber dealer, went, on November, 12, 1892, to the defendant’s factory in Brooklyn, where they remained during the day, endeavoring to arrange a settlement by a sale to Jackson of a sufficient amount of moldings to cover the .indebtedness to Stone and E. B. James & Co. of $1,102.65. After negotiations had lasted through most of the day, an agreement was reached by the parties, a memorandum of which, in writing, was drawn by Harris, reading as follows:

“Brooklyn, N. Y, Nov. 11th, 1892.

“C. B. Jackson & Co., Paterson, N. J., to Builders’ Wood-Working Co., Dr.

“Lot of moldings, being all those in both molding rooms at our manufactory, described in our inven- , tory of Oct. 2, 1892, as of to-day, f. o. b. cars Brooklyn........... ■........................ $2,018 00”'

Upon this bill the defendant wrote the following:

“Messrs."C. E. Jackson &. Co.: Please pay the amount of the above to F. 0. Stone. Builders’ Wood-Wkg. Co.,

“Jas. R. Ferine, Treas.”

And the plaintiffs thereupon wrote the following acceptance:

“We hereby accept the above order.

“11-12-92. Chas. E. Jackson & Co.”

p. 803

Stone then surrendered to the defendant its obligations, and on or about the 14th day of November, 1892, and before delivery of any of the moldings, plaintiffs -paid to Stone, as requested by defendant, the sum of $2,018. Thereafter, and between November 15 and December 29, 1892. the defendant shipped and the plaintiff received four car loads of moldings. While not admittingnor disputing the fact that’all the goods in both molding rooms were included in the delivery, the plaintiffs, after measuring the moldings delivered, and finding that they amounted to less than two-thirds of the quantity and value stated in the inventory, made a demand upon the defendant to supply the short shipments, or to pay back the difference between the full inventory price paid by them and the inventory price of the quantity delivered. This balance amounting to $829.11, was the amount sued for, and for which a recovery, was awarded by the referee.

It will thus be seen that the plaintiffs contend that the mouldings were sold according to the inventory, and that the agreement was that they should receive the full inventory quantity; while the defendant contended that the sale was in bulk of such mouldings as then were in the moulding rooms, without reference to the inventory, and that the memorandum drawn by Harris expressed the contract. In determining which contention is right, resort must be had to the written memorandum, and if clear and explicit in terms, then under well-settled principles of law, paroi evidence would not be admissible to vary or contradict it. The ambiguity in the written memorandum, if any, is created by the use of the words, “ as of to-day,” which, the déféndant claims, means “as found in the moulding rooms to-day,” and which the plaintiffs claim, means that the inventory should be made good as of to-day. In other words, the plaintiffs claim that that the phrase “as of .today," instead of meaning the mouldings described in the inventory as they exist to-day, was intended to be a warranty that, if there was not as much now as described in the inventory, the defendant would make the difference good. As between these contentions, and irrespective of any contemporaneous paroi evidence we should be inclined to "adopt the defendant’s version, because taking the form of the memorandum, if it was intended to be a sale of mouldings, not in bulk, but according t'a an inventory; which so far as it,was taking in quantity was to be made good, then the language used was most inapt and ill chosen.

This view is strengthened when we recall the rule, applicable to the construction of a writing, which requires that as between two constructions, other things being equal, that should be adopted most unfavorable to the one who formulated it, or as it is exr pressed, most strongly contra proferentem, i. e. against the author of it. j Here it is conceded that it was written by Harris, who, with Jackson and Stone, made up the party that was endeavoring to obtain from the.defendant some benefit.

Assuming, however, as the referee did, that the writing in question was only part of the contract, and that paroi evidence was admissible to establish the whole contract, the written portion not being contradicted, but only explained, then we must examine

p. 804

such as bear upon the subject-matter the relation of the parties, their acts and declarations, to enable the court to put itself in the place of the contracting parties, and to determine what .was the meaning of the language used and what was the contract between them.

The testimony shows that the subject-matter of the contract was the sale of a lot of mouldings to Jackson with a view to satisfying the claim, held by Stone, which the latter was anxious to have adjusted, anticipating the insolvency of the defendant. The plaintiff Jackson went with Stone and Harris to the factory of the defendant in Brooklyn on the day stated. There they examined a large quantity of these mouldings, which were in the moulding rooms in the factory, and were shown defendant’s inventory of the mouldings. It appeared that this inventory had beeiimade about October 2d, nearly six weeks before the purchase. Jackson noticing this, asked the defendant’s treasurer, Ferine, about the quantity of mouldings that was still in the rooms as compared with the inventory, and also at what price they were inventoried. Ferine replied that, while they had sold some mouldings since the inventory was made the additions from new stock manufactured by the defendant would in his opinion, offset the sales, and that the quantity then in the moulding rooms was fully equal to that stated in the the inventory, and his foreman, when questioned on the subject, at Ferine’s instance, made the same statement. Then the question'was presented, what would result if the quantity delivered fell short or was in excess of that stated in the inventory? Plaintiffs’ testimony was that Ferine agreed that if it fell short the shortage was to be made good, and that for any excess the plaintiffs were to pay.

.This statement as to shortage and excess was flatly contradicted by Ferine, who testified that the only proposition that he entertained, and the only contract that he made, was a sale in bulk. That there was a discussion about what was to result in the event of a shortage or excess, between Jackson, Stone, and Harris, while engaged in examining the mouldings in the rooms, or while in the outside office, is evident.- But it is by no means so clear that any of this conversation was in the presence of the defendant’s agents, other than what has already been referred to a statement by Ferine that since the making of the inventory some mouldings had been sold, and in his opinion, the new mouldings manufactured and placed in the rooms would replace what had been sold and removed.

If we construe so much of the contract as is written in the light of some of the surrounding circumstances and some of the acts of the parties, it militates against the view that this was a sale according to a guaranteed inventory. Thus, we have the fact that the insolvency of the defendant was anticipated, it being problematical, in such an event, if the sale had been -made by inventory and a shortage resulted, whether the defendant would have been able to make it' good. In addition, we have the further fact that after the agreement, whatever it was, between the parties, Stone immediately surrendered to the defendant its obligations, and

p. 805

thereafter, and before the delivery of any of the mouldings, the plaintiffs paid to Stone the amount of the agreed price. As against tlie force and weight to be attached to these circumstances, supported by the evidence of the defendant’s treasurer and the man in charge of the moulding rooms, we have the positive statements of Stone,'Harris, and Jackson that the contract between the parties was a sale, by the terms of which the plaintiffs were to receive the full inventory quantity. Their testimony had a controlling influence on the mind of the referee, and if incompetent as against the defendant, it cannot be regarded as harmless. ,

This brings us to a consideration of the objection, made by the defendant, which we regard as fatal to this judgment. Under objection and reception, these three witnesses were allowed to testify as to their understanding of the words “ as of to-day.” It is not claimed that the conversations in which such understanding was reached were joined in by the defendant’s treasurer, though an attempt was made to show that the latter was sitting at his desk in an inside office, and could have heard the conversation. These three witnesses were in constant communication during the whole day, examining the moldings, discussing between themselves the kind of memorandum that should be drawn, and there was no duty on the part of the defendant’s treasurer to obtrude himself into or listen to such conversations when not addressed to him; and it would be going very far to hold, because they were thus engaged in conversation during the greater portion of a day, that the defendant is bound, because its treasurer was sitting at a desk, in a position where, if he desired, he might possibly have heard the conversations. We think that the admission of evidence of such conversations, in the absence of any proof that the defendant took part in, heard, of assented to them, was error, and entitles the defendant to a new trial.

The judgment, therefore, should be reversed, and a new trial ordered, with costs to appellant to abide the event.

All concur.