Dilworth v. Bostwick — 31 N.Y. Super. Ct. 581

Majority

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FRANK A. DILWORTH, Plaintiff and Appellant, v. JABEZ A. BOSTWICK, Defendant and Respondent.

Headnote

A contract for the sale of goods must (within the case of Justice v. Lang, 2 Robt., 333^[1] ), be subscribed by both parties. A subscription by one only is not sufficient.

A broker employed to purchase goods is not, ex vi termini, broker for the seller also.

The rule, that a broker is considered the agent of both parties, rests upon a bare presumption, which may be rebutted.

The signing, therefore, of the broker employed to purchase held not sufficient to answer the statute; especially, as the evidence repelled the presumption that he was acting for the seller.

The note or memorandum-, required by the statute to be in writing, must contain all that is necessary to show what the contract is, and parol evidence is not admissible to supply any defect.

Held) that the writing relied on in this case did not show enough. It did not name the contracting parties, nor the subject of the contract, whether it was “oil,” or oil contracts, and was, by itself, wholly unintelligible.

Before Monell, McCunn, and Fithian, JJ.

[Decided October 30, 1869.]

The action was to recover two thousand five hundred and twenty dollars as liquidated damages for the breach of a contract. between the parties.

The defendant admitted the plaintiff’s claim, and set up as a counterclaim thereto an agreement between the parties, through their respective agents, by which the plaintiff agreed to sell and transfer to the defendant, at the rate of thirty cents per gallon, three certain contracts made by Wightman & Anderson, for the sale and delivery by them of five hundred barrels each, in all fifteen hundred barrels, standard white refined petroleum, deliverable at buyer’s option, in October, November, and December, 1861, at thirty-one and one half cents per gallon, difference to be paid by defendant on delivery of the oil; that said contracts were to be delivered within a reasonable time, and that ten days

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was a reasonable time for delivering. The defendant alleged performance of the contract by himself, and refusal of the plaintiff to deliver the said three contracts, and claimed damages for the breach. The reply of the plaintiff denied all the allegations of the counterclaim.

■ The action was tried before Mr. Justice Jones and a jury. Smith, one of the defendant’s witnesses, testified that on the twenty-seventh of August, 1867, he bought of one Crouch, plaintiff’s agent, fifteen hundred barrels of oil, deliverable x five hundred barrels each in October, November, and December; that the purchase was made through orders from Babcock & Cox, brokers in New York. He said Crouch told him they were to be Wight-man & Anderson’s contracts at thirty-one and one half cents, and. that he bought them of Crouch at thirty cents, the difference of one and one half cent to be paid by defendant on delivering of' the contracts. He then testified to sending telegrams on the day of their date, August 27, 1867, to Babcock & Cox, the defendant’s agents in New York.

The following telegrams were offered in evidence.

First, this telegram:

“ Philadelphia, August 27,1867.

“ To Babcock & Cox:

“ Can buy October, November, and December thirty (30)—old contracts—made originally at thirty-two (32), with obligations to pay difference, by Wightman & Anderson, on delivering oil. They are quite good. Working at Lawrence—no hope.

“W. H. SMITH.”

■ The following telegram was sent to the witness Smith by the defendant, in answer to the foregoing:

“ 27th of August, 11.50, 1867.

“ To W. H. Smith, Philadelphia:

“ Buy five hundred each, October, November, and December,' thirty.

“ BOSTWICK.”

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Also, the following:

“ Philadelphia, August 27, 1867.

" To Babcock & Cox:

. “ Closed" Wightman & Anderson’s contracts for Bostwick at thirty (30), they paying difference on delivery.

“W. H. SMITH.”

The plaintiff objected to the evidence, on the following grounds:

First—On the ground that Smith was not the agent of the parties in the suit—either the plaintiff or the defendant.

Second—That the telegram, purporting to be a contract, 'was not made by Smith at .the time of the alleged sale.

Third—That the alleged contract cannot be held to apply to or bind the plaintiff.

Fourth—That the telegrams are insufficient to constitute, in terms and conditions, a contract.

Each of which objections was overruled, and exceptions taken by plaintiff.

. The court then allowed the telegrams, which had already been marked for identification, to be read in evidence.

A motion was made by the plaintiff to have a verdict directed for him, overruling the counterclaim, which was refused, and the plaintiff 'excepted.

The justice held that Smith was the broker of both parties, to which the plaintiff excepted.

The court decided there was nothing for the jury except the question of damages, and refused a request made by the plaintiff to submit to the jury the question of agency, and whether Smith was the agent of both parties, and the plaintiff excepted.

The defendant had a verdict, and the plaintiff appealed from the judgment.

Mr. John R. Dos Passos for appellant.

The telegrams relied upon to sustain the counterclaim of respondent do not constitute a legal contract.

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The Revised Statutes (vol. iii., p. 222, sec. 3, Banks’ ed.) provide that “ every contract for the sale of any goods, chattels, or things in action for the price of fifty dollars or more shall be void, unless a note or memorandum of such contract be made in writing and be subscribed by the parties to be charged thereby.” And section 8 declares that “ every instrument required by any of the provisions of this title - to be subscribed by any party may be subscribed by the lawful agent of such party.”

The telegrams do not contain the name of one of the alleged contracting parties—the appellant. This is essential (Wheeler v. Collier, Moody & M., 123; Champion v. Plummer, 5 Esp., 240; 4 B. & P., 253; Jacob v. Kirk, Moody & R., 221; Sherburne v. Shaw, 1 N. H., 157 ; Webster v. Ela, 5 N.& H., 540; Nichols v. Johnson, 10 Conn., 192 ).

The telegrams do not contain a full and complete description of the subject-matter of the alleged agreement; although formal words and statements are unnecessary, the memorandum must contain all that essentially belongs to the agreement; there can be no recourse to parol evidence to supply any thing wanting in the writing (Boydell v. Drummond, 11 East., p. 142; Cooper v. Smith, King’s Bench, 1812; Clinan v. Coke, 1 Schoal & Lefroy, 22; Calkins v. Falk, 39 Barb., p. 621; Dodge v. Dean, 13 Johns. R., p. 508; Whiteman v. Meigs, 4 Cushing, 498).

The telegrams are not subscribed by the parties or their lawful agents.

¡¡Neither the appellant nor respondent participated in 'the ‘transaction out of which the controversy arose.

The negotiations were carried on by Smith as the representative of respondent, while Crouch acted for appellant.

The court below held that Smith was the broker of both parties, and had authority to bind them.

The exception to this ruling is well taken.

It cannot be disputed that if both principals had appeared, a memorandum signed by one would not have constituted a binding contract (Justice v. Lang, 2 Robertson, p. 333; Marcus v.

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Barnard, ib., p. 221; Johnson v. Mulry, 4 ib., p. 404; also Brabin v. Hyde, 32 N. Y., p. 523).

Mr. D. M. Porter for respondent.

“A notice of purchase signed by the broker” (agent) “is the signature of both parties, through their agent, and is conclusive, though the name or existence of the principal does not appear upon the instrument” (Dykers v. Townsend, 24 N. Y., 57 ).

The telegrams amount not only to a notice of sale, but contain an acceptance of the sale ; therefore there is a sufficient signing under the Statute of Frauds.

The telegrams were all delivered as fast as they could be made, and it matters not whether the contract is in one or many papers, they are all one transaction, and each expressly refers to the others (3 Parsons on Contracts, 2d ed., 17; Stow v. Tifft, 15 Johnson, 457; Allen v. Bennett, 3 Taunton, 167; Saunderson v. Jackson, 2 Bosan. & Puller, 238; Vassar v. Camp, 1 Kern., 441; Mactier v. Frith, 6 Wend., 103 ; Adams v. Lindsell, 1 Barn. & Ald., 681).

- The contract contained in the telegrams is certain as to amounts, time of delivery, price, and buyer and seller.

Extraneous evidence is admissible to show who the real principal is (Dykers v. Townsend, supra ; Higgins v. Senior, 8 Meeson & Weis., 834; Truman v. Loder, 11 Adolphus & Ellis, 589, and 14 Howard U. S. R., 446).

Parol evidence was also admitted to explain the abbreviations (Salmon Falls Manufacturing Company v. Goddard, 14 Howard U. S., 446; Cross v. Eglin, 2 Barn. & Ald., 106; Fish v. Hubbard’s Executors, 21 Wend., 657 ; Smith v. N. Y. C. R.R. Co., 43 Barb., 225 ; Bradley v. Washington, 13 Peters, 89; Spencer v. Babcock, 22 Barb., 326 ; Scovill v. Griffiths, 2 Kern., 509).

A contract miist be construed by all the surrounding facts (Bancroft v. Winspear, 44 Barb., 209 ; Le Sage v. Gt. Western R.R. Co., 1 Daly, 306 ).

The signature to the telegram is binding (Dunning v. Roberts, 35 Barb., 463 ).

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By the Court:

The only written evidence of a contract in this ease is contained in the several telegrams which passed between Smith and the defendant. Those telegrams were signed by Smith only. He was confessedly the defendant’s agent; and, unless in his character of broker he was also the agent of the plaintiff, the case, would fail under the authority of Justice v. Lang (2 Robt., 333).

The léarned justice held, at the trial, that Smith was the agent of both parties, which, if correct, would make his signing a signing by both parties, and not within the statute.

The contract, as proved by parol, was to purchase three several contracts, made by Wightman & Anderson, to deliver to Graham Brothers five hundred barrels of petroleum in each of the months of October, November, and December, 1867, at thirty-one and a half cents, deliverable at the buyer’s option. The purchase of the contracts was made by Smith of Crouch, and not directly of the plaintiff. Grouch was the agent of the plaintiff. The answer alleged that'the contract was made by the plaintiff through his agent Crouch. Smith testified that he “ bought the contracts of Crouch, the agent .of .Dilworth.” He said Grouch, the plaintiff’s agent, offered him the oil, and that he bought them for Bostwiclc He said he knew that Crouch was the plaintiff’s agent and representative in Philadelphia. Throughout Smith’s evidence, he stated clearly and distinctly that Crouch was the plaintiff’s agent, aiid acted in that .capacity for him in the agreement for the sale and delivery of the petroleum contracts, and that Groueh came to him as DilwortWs' agent, and offered to sell to him the oil contraéis. Crouch also testified that he was the plaintiff’s agent, and as such agent made the sale of the contracts. He said he did not disclose the name of his principal until after the contract had been made.

But in the course of Smith’s examination he was asked who paid his brokerage, or was to pay it, and he answered, Hr. Dilworth was to pay the brokerage, but he did not get any. On

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the same subject, the following testimony was given by the same witness:

Q. Then you were acting for him as well as for Mr. Bostwiek ?

A. Tes, sir; Mr. Crouch offered me the oil.

Q. Is not it a custom for a seller of the oil to pay the bro kerage ?

A. Yes, sir, always. Mr. Dilworth, being the seller, was to pay the brokerage.

Q. You do the business of a broker?

A. Yes, sir.

Q. You say the seller pays the brokerage ?

A. Yes, sir, the seller pays the brokerage always.

Q. Mr. Dilworth, being the seller, was to pay you the brokerage here ?

A. Yes, sir. I received no authority from Mr. Dilworth in this matter at all. I had no communication with him.

Upon this evidence, and the general evidence that Smith was a broker, the learned justice held that his signing was the signing of both parties.

The rule that a broker is to be considered the agent of both parties, rests upon a mere presumption of fact, which may be rebutted by the particular circumstances of the case. He is not ex vi termini "agent for both (Dunlap’s Paley Ag., 315 ; 2 Parson’s Con., 292 ; Bartlett v. Burnell, 4 Ad. and Ell., 792). It may, therefore, very properly be questioned whether the presumption of agency was not fully rebutted in this case.

The plaintiff had another agent who was transacting the business, and with whom alone Smith negotiated, knowing him, as he says, to be Dilworth’s agent. Smith says expressly that he received no authority from Dilworth at all, and had no communication with him. Smith’s agency, therefore, must stand upon a mere custom, testified to by him, for the seller of oil to pay the brokerage, arid that Dilworth, being the seller, was to pay him the brokerage, not under any agreement with him, but by reason of a custom to that effect.

Where a person intervenes between the seller and the buyer,

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and acts for both, then it may be said he is the agent of both. He is the broker to purchase and the broker to sell, and, his acts are binding upon both. That, however, is not this case. Dilworth had a broker of his own, authorized to negotiate and contract for him, but such broker had no power to appoint, either expressly or impliedly, a sub-agent who could bind his principal.

The presumption of agency, therefore, seems to me to be completely rebutted. Crouch, acting as the plaintiff's broh-er,' offered to sell the six contracts to Smith, and Smith agreed to purchase them. Smith was the defendant’s broker, and had all the authority necessary to act on his behalf. But he did not become the agent of the plaintiff by merely agreeing to purchase from his agent, knowing that he was dealing with the agent and not with the principal. To adopt the rule laid down in this pase would place any seller of property in the power of the person employed to make the purchase, to make for the seller just such a,contract as he saw proper to make; and having put it in writing, it could not be contradicted by parol. Smith, therefore, not being the agent of the plaintiff, and there having been no signing of the contract by the plaintiff, the contract was, within the 'statute, null and void.

There is, however, a further reason which is conclusive against the counterclaim in this case. The rule is well established that, the note or memorandum must contain every thing necessary to show the contract between the parties, so' that there may be no need of parol proof to explain the intention of the parties, or the terms of the agreement (Boydell v. Drummond, 11 East., 142; Dodge v. Lean, 13 John. B., 508; Abell v. Radcliff, id., 296; Baily v. Ogden, 3 John. R., 419; Merritt v. Clason, 12 id., 102; Trustees First Bap. Ch. v. Bigelow, 16 Wend., 28 ; Calkin v. Falke, 38 How. Pr. R., 62). For the purpose of making out the contract, the three telegrams may be read together, although the last contains the only note of any contract. Do these telegrams show precisely, and without the supplement of additional facts (not mere explanations), what the contract was? I am

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unable, upon reading them, to make out any contract whatever, the terms of which I can understand.

■ It does not state who are the contracting parties, buyer and seller (Champion v. Plumner, 5 Esp., 240). If any thing, it was a contract with Wightman & Anderson.

The subject-matter of the contract is nowhere mentioned or described. Any commodity whatever might have been the subject; and it is impossible to determine from it whether it was oil or oil contracts or any other merchandise or thing.

If it were proper to explain or supply by parol that the purchase was of oil contracts, then how many of such contracts described as “ old contracts ” was agreed to be sold ? The second telegram does not aid the defect: “ buy five hundred each,” is descriptive of nothing, and by itself wholly unintelligible.

In short, the memorandum relied on does not contain enough of the contract to enable the court to see what were the terms of the agreement; and resort to parol proof was, therefore, neces-' sary, not to explain technical or equivocal terms on the face of the instrument (Salmon Falls Mfg. Co. v. Goddard, 14 How. R., 446), but'to supply the omissions and defects in it. That seems to have been thought necessary at the trial, as the defendant, instead of relying upon the written memorandum, proved the whole of the contract by parol, and such parol contract was the only basis for any recovery in the case. Even, therefore, if the signing was within the statute, the memorandum signed did not contain the terms of a contract which was capable of being enforced.

The motion to overrule the counterclaim ought to have been granted.

As the rulings of the learned justice on these branches of the case were in our opinion erroneous, it is not necessary to express any opinion upon the rule of damages adopted at the trial.

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