Opinion
No. 31450.
November 26, 1934. Suggestion of Error Overruled, April 29, 1935.
1. EVIDENCE.
Parol evidence, by party signing contract for purchase of flour and shorts by partnership, that contract was not to be effective until approved by partners, held admissible, although contract stated that writing was the complete agreement and could not be changed except with written consent of buyer and seller, since such evidence was not inconsistent with writing but was to prove condition precedent to contract taking effect.
2. ESTOPPEL.
Estoppel by conduct arises from act or declaration of a person intended or calculated to mislead another, on which other has relied, and has so acted, or refrained from action, as that injury will befall him if truth of act or declaration be denied.
3. ESTOPPEL.
Buyers' failure to answer seller's letters acknowledging receipt of contract and asking for shipping directions held not to estop buyers from denying existence of contract, where the only act of seller which would damage it if contract were not sustained was the purchase of raw materials to manufacture to fill the contract, which was done previously and not in reliance on buyers' failure to reply to letters.
APPEAL from circuit court of Leake county.
HON. D.M. ANDERSON, Judge.
Action by the Plant Flour Mills Company against Sanders Ellis. Judgment for defendants, and plaintiff appeals. Affirmed.
Robertson Campbell, of Jackson, for appellant.
The testimony of appellees as to the oral agreement with the appellant's salesman Cobb not expressed in the written contract was inadmissible and should have been excluded.
McCaskey Register Co. v. Swor, 122 So. 489; Perrault v. White Sewing Machine Co., 127 So. 271; Tropical Paint Oil Co. v. Mangum Hatcher, 125 So. 248.
By failing to reply to the several letters of appellant and by failing to advise appellant in any way that the contract was not in force, or that it was subject to any agreement not expressed on its face, appellees are estopped to now set up such matters and to now avoid the contract.
Strauss Bros. v. Denton, 106 So. 257; Wellford Withers v. Arnold, 140 So. 220. F.E. Leach, of Carthage, for appellee.
The contention of appellees is that no contract in fact existed, for the reason that the alleged contract was never submitted to S.C. Ellis for approval, and that the salesman, Mr. Cobb, called Mr. Ellis by telephone and told him the home office would not confirm the sale on account of prices.
It is elementary that the minds of the parties to an alleged contract must meet and their agreement reduced to writing before a valid contract can be made.
Oswald v. McGehee, 28 Miss. 340; Harris v. Ransom, 24 Miss. 504; Davis v. Heard, 44 Miss. 50; Folkes v. Walter Pratt Co., 86 Miss. 254.
Where a unilateral contract is signed by a party, it may be withdrawn at any time before the other party has performed an act binding the contract upon his part.
Hollister v. Frellsen, 114 So. 285.
Acceptance of an offer must be evidenced by some conduct or acts actually communicated to offerer.
Pioneer Box Co. v. Price Veneer Lbr. Co., 96 So. 103.
Argued orally by Chas. S. Campbell, for appellant.
This is an appeal from a judgment denying the appellant a recovery for the alleged breach of a contract by the appellees, alleged to have been made by them with the appellant, for the sale to them of flour and shorts.
The appellant's complaints are that the court below erred (1) in admitting certain testimony offered by the appellees, and (2) in refusing to direct the jury to return a verdict for the appellant.
The suit is against L.J. Sanders and S.C. Ellis, alleged to have been doing business as copartners under the name of Sanders Ellis, and Horace Sanders.
The evidence for the appellant is, in substance, that Cobb, its traveling salesman, solicited the contract from Ellis, who agreed thereto, but stated that L.J. Sanders was his partner and should be consulted about it. Sanders had another place of business to which Cobb then went, accompanied by Ellis. Sanders then agreed to the contract, and signed it in the presence of Ellis as follows: "Sanders Ellis, by L.J. Sanders."
According to the evidence for the appellees, the partnership was composed of S.C. Ellis and L.R. Sanders; L.J. Sanders having no connection therewith. He (L.J. Sanders) was related to both Ellis and L.R. Sanders, had loaned both of them money, and was frequently consulted by them relative to their mercantile business; that L.J. Sanders, without authority so to do and without the knowledge of either Ellis or L.R. Sanders, signed the contract at Cobb's request, but with the distinct understanding that Cobb would submit it to Ellis Sanders for approval. This Cobb failed to do, and the making of the contract was not reported by L.J. Sanders to either Ellis or L.R. Sanders. Shortly after the execution of the contract, Cobb called Ellis Sanders over the telephone, the call being answered by Ellis, and stated to him that the appellant would not accept the contract because the prices of the flour and shorts were not satisfactory to it, and, therefore, had cancelled it.
According to the appellant, there were two such telephone conversations. In the first, Cobb advised Ellis that the appellant would not sell the flour at the price stated in the contract, and Ellis stated that his firm would not pay more therefor. Cobb then called the appellant over the telephone; was directed to, and did, advise Sanders Ellis, by telephone, that the contract would be accepted as written.
The contract provides that the flour and shorts should be shipped by the appellant as and when directed by Sanders Ellis, and "constitutes the complete agreement between the parties hereto and cannot be changed in any manner whatsoever without the written consent of both buyer and seller."
According to the appellant, the contract was received by it from Cobb on September 25, 1932; that it thereupon approved the contract and purchased wheat with which to make the flour and shorts. On October 4th, appellant wrote Ellis Sanders a letter, prefacing it with the words "Attention Mr. L.J. Sanders," acknowledging receipt of the contract, inclosing a copy thereof, and asking for shipping directions. Receiving no reply to this letter, it then again wrote the appellees on October 27th, November 8th, and November 21st, calling their attention to the contract and asking for shipping directions. No reply to any of these letters was received by the appellant. On January 13, 1933, the appellant again wrote Ellis Sanders calling their attention to the contract, and stated that "unless we should hear from you within the next few days," it would be compelled to assume that "you have no intention of taking it, and on January 23rd, 1933, terminate it as provided in the contract, and bill you for loss, carrying charge, etc." Ellis Sanders denied receiving the first of these letters, admitted receiving the others, and that no replies were made thereto. The letter of January 13th was replied to by Ellis Sanders as follows: "As per your letter of the 13th. The flour was booked in good faith, but it has been impossible for us to take any from it up to this time. So please cancel the order." Prior to the institution of this suit, Ellis Sanders sold their mercantile business to L.J. and Horace Sanders without complying with the Bulk Sales Law (Code 1930, sections 3353-3356).
The evidence admitted over the objection of the appellant is the oral agreement of Cobb with L.J. Sanders that the contract should not become operative until approved by Ellis Sanders. The ground of the objection is that the contract was complete on its face, and that contemporaneous oral agreements relative thereto are inadmissible to contradict or modify its terms.
If the evidence for the appellees be true, then L.J. Sanders was without any authority to execute the contract, and, therefore, whether he made an oral agreement relative thereto with Cobb is immaterial. But if it can be said from the evidence that he was authorized to execute the contract, the evidence of the oral agreement was admissible; for the rule is that, "Where parties to a writing which purports to be an integration of a contract between them orally agree, before or contemporaneously with the making of the writing, that it shall not become binding until a future day or until the happening of a future event, the oral agreement is operative if there is nothing in the writing inconsistent therewith." Restatement, Contracts, section 241; Ohio Pottery Glass Co. v. J.R. Pickle Son, 108 Miss. 51, 66 So. 321. The stipulation in the contract that it "constitutes the complete agreement between the parties hereto and cannot be changed in any manner whatsoever without the written consent of both buyer and seller" is not inconsistent with the oral agreement that it should not become operative until approved by Ellis Sanders. Schlater Mercantile Co. v. Brinly-Hardy Co., 109 Miss. 300, 68 So. 444.
The ground of the appellant's contention that the court below should have granted its request for a directed verdict is that Ellis Sanders are estopped, by their failure to reply to the appellant's letters, from now asserting that the contract did not become operative and binding upon them. "The principle on which the doctrine of estoppel by conduct rests is that it would be a fraud in a party to assert what his previous conduct had denied, when on the faith of that denial others have acted. When silence becomes a fraud, it will operate as an estoppel. Estoppel by conduct `arises from an act or declaration of a person intended or calculated to mislead another, on which that other has relied, and has so acted, or refrained from action, as that injury will befall him if the truth of the act or declaration be denied.'" Staton v. Bryant, 55 Miss. 261; Strauss Bros. v. Denton, 140 Miss. 745, 106 So. 257, 45 A.L.R. 341; Wellford Withers v. Arnold, 162 Miss. 786, 140 So. 220.
In order for the failure of Ellis Sanders to reply to the appellant's letters to estop them from now denying the existence of the contract therein referred to, it must appear not only that they knew the appellant was claiming that the contract had been executed, but also, because of such claim, it would so act as that injury would befall it if the truth of its claim be now denied; and, further, that because of their failure to reply to the letters, the appellant did so act. There is nothing in the letters indicating, or should have caused Ellis Sanders to suspect, that the appellant would do anything under the contract except to ship the flour and shorts as and when directed by them so to do. The only act of the appellant which would now result in damage to it, if the contract be denied, was the purchase by it of the wheat with which to manufacture the flour and shorts; and this was done, not in reliance on the failure of Ellis Sanders to reply to its letters, but immediately upon the receipt of the contract by it from Cobb. No estoppel, therefore, here arose. Hart v. Livermore Foundry Machine Co., 72 Miss. 809, 17 So. 769; Davis v. Butler, 128 Miss. 847, 91 So. 279, 709.
Affirmed.