Opinion
No. 32246.
October 5, 1936.
1. SALES.
Acceptance by buyer of installment defective in quality is not of itself equivalent to an assent to receive subsequent installments of similarly inferior goods.
2. SALES.
Under contract for sale of flour whereby buyers could not inspect it for defects without breaking sacks and without paying for it, buyers held justified in declining to receive future deliveries of flour after first defective delivery, where seller, when advised of defects in flour, indicated to buyers that seller considered flour delivered to be of required quality and would continue to deliver flour of same quality.
APPEAL from the circuit court of Yazoo County. HON. J.P. ALEXANDER, Judge.
Robertson Robertson, and Chas. S. Campbell, all of Jackson, and Campbell Campbell, of Yazoo City, for appellant.
The appellees having elected to retain and use the defective flour, and not having offered to return the same, are bound by such election and cannot defend on the ground of breach of warranty of quality.
Tropical Oil Co. v. Mangum and Hatcher, 155 Miss. 876, 125 So. 248; Attala County v. Morrissey-Eastern Tractor Co., 162 Miss. 768, 139 So. 866; Rouse Drug Co. v. Columbia Scale Co., 164 Miss. 640, 146 So. 297.
Appellees having accepted and used a part of the flour purchased, after knowledge of its defective quality, elected to treat the contract as binding and are bound to accept the unshipped balance.
Hytken Bros. v. International Dress Co., 155 Miss. 469, 124 So. 653.
Where contract is for delivery of goods in separate installments a defect in quality in one installment will not affect the seller's right to recover damages for breach by the buyer as to the remaining installments.
55 C.J. 1029; 24 R.C.L. 284, sec. 564; Cahen v. Platt, 69 N.Y. 348, 25 Am. Rep. 203; Craig v. Lane, 212 Mass. 195, 98 N.E. 685; Guernsey v. West Coast Lbr. Co., 87 Cal. 249, 25 P. 414; Clark v. Wheeling Steel Works, 3 C.C.A. 600, 3 U.S. App. 358, 53 Fed. 494; Stelwagon v. Wilmington Coal Gas Co., 2 Marv. (Del.) 184, 42 A. 449; Henderson Elevator Co. v. North Georgia Mill Co., 126 Ga. 279, 55 S.E. 50; Whiting Foundry Equipment Co. v. Heisch, 121 Ill. App. 373; McMullar Coal Co. v. Champion Coated Paper Co., 138 S.W. 755; Maynard v. Render, 95 Ga. 652, 23 S.E. 193; Morris v. Wilbaux, 159 Ill. 627, 43 N.E. 837; Jones Service, Inc., v. Goodnow-Pearson Co., 242 Mass. 594, 136 N.E. 623, 29 A.L.R. 1513; Thomas-Huyck-Martin Co. v. Gray, 94 Ark. 9, 140 Am. St. Rep. 93, 125 S.W. 659; C.A. Wooten v. Baine-Adams Co., 146 Ark. 162, 226 S.W. 134; Miller v. Moore, 83 Ga. 684, 6 L.R.A. 374, 20 Am. St. Rep. 329, 10 S.E. 360; Lyon v. Bertram, 20 How. 149, 15 L.Ed. 847.
To constitute an anticipatory breach it must appear that the seller has unequivocally refused to ship goods of the quality required by the contract.
23 R.C.L. 1408, sec. 234; 13 C.J. 654, sec. 727; Blackburn v. Reilly, 47 N.J.L. 299, 54 Am. Rep. 159, 1 A. 27; Harding W. C. Co. v. York Knitting Mills, 142 Fed. 228; United States v. Smoot, 82 U.S. 660, 21 L.Ed. 107; J.W. Ellison Sons Co. v. Flat Top Grocery Co., 69 W. Va., 380, 38 L.R.A. (N.S.) 539, 71 S.E. 291; Oswega Pulp Co. v. Stecher Lithographing Co., 215 N.Y. 98, 109 N.E. 92, L.R.A. 1916B 257; Haring Whitman Co. v. York Knitting Mills, 142 Fed. 228; John Deere Plow Co. v. Shellbarger, 140 Tenn. 123, 203 S.W. 756.
Appellees by their notice of recoupment under the general issue and their failure to give notice of anticipatory breach or justification for their breach of the contract admitted appellant's right to recover, and this admission was not affected by their withdrawal of their notice of recoupment.
Hoover Commercial Co. v. Humphrey, 66 So. 214, 107 Miss. 810; Bessler Co. v. Leakesville Bank, 140 Miss. 537, 106 So. 445; Tittle v. Bonner, 53 Miss. 578; 57 C.J., page 359, sec. 1, and page 525, sec. 195.
J.G. Holmes, of Yazoo City, for appellees.
There can be no doubt, under the evidence in this case, and the finding of the jury, that the appellees promptly complained to the appellant of the inferior quality of the flour and notified the appellant that they could not accept further shipments of this same inferior quality. The appellant did not offer to ship a better quality of Keno flour or a quality of Keno that would give satisfaction as guaranteed by the contracts, but it insisted that the quality of Keno flour had not changed, and would never change. In other words, the effect of this was to say to the appellees that they were going to get in subsequent shipments the same quality of Keno flour that had been sent in the last two shipments. We think as a matter of law that this was sufficient to justify the appellees in declining to accept the subsequent shipments, but the trial court ruled more favorably to the appellant than we think the appellant was entitled to, submitting to the jury the question as to whether or not the appellant insisted upon filling the balance of the contracts with the same quality of flour as that contained in the last two shipments and shown to be defective. On this favorable ruling of the trial court the jury found against the appellant and found that the appellant had insisted upon filling the remainder of the contracts with the same character of defective flour as that complained of. We say, therefore, that as the record stands, the appellant must be held to have declined to fill the balance of the contracts with a quality of flour other than that shown to have been defective, and that appellees were therefore justified in declining to accept further deliveries under said contracts of such defective quality of flour.
24 R.C.L. 284, sec. 564.
The real and only issue tried in this case was that of the right of appellees to decline to accept further deliveries of flour of the same quality as that shown to have been defective. It must be remembered that these contracts had written therein the provision, "satisfaction guaranteed." The flour, of course, was sold to the appellees, who were wholesalers, for the purpose of resale by them to merchants or dealers, and by the merchants or dealers to the consumers. It certainly must be admitted that if the flour was of such inferior quality as that it could not be disposed of to the trade, and therefore could not serve the purposes for which the appellees bought it, it could not give satisfaction as guaranteed by the contracts, and could not, in fact, be satisfactory to any reasonable man.
In view of the fact that the contracts involved were for flour, which is an article for human consumption and a commodity that addresses itself to the fancy, taste, sensibility or judgment of the individual, and in view of the further fact that the contracts contained the provision, "satisfaction guaranteed," we think that there is a serious question in this case as to whether or not the appellant did not render the appellees the sole judges of their satisfaction, without regard to the justice or reasonableness of their decision.
13 C.J. 675.
This is an appeal from a judgment denying the appellant, the plaintiff in the court below, a recovery for an alleged breach of a contract by which the appellees agreed to purchase flour from it. The appellant's complaint is that the court below erred in not directing the jury to return a verdict for it.
The evidence, in substance, is as follows: The appellees, Lillie and Abraham Moses, doing business at Yazoo City, Miss., under the name of the Mississippi Grocery Company, are wholesale merchants selling to retail dealers only. The appellant is domiciled at Wichita, Kan., and is there engaged in the manufacture and sale of flour to dealers. On February 12, 1934, the Mississippi Grocery Company entered into a written contract with the appellant for the purchase and immediate delivery to it of two hundred and fifty barrels of Keno flour, and on the same day entered into another contract with the appellant for the purchase of three thousand barrels of Keno flour for shipment on or before May 20, 1934, the buyer "to furnish the seller, at least fourteen days before the time for shipment, complete shipping instructions." Each of these contracts contain the stipulation "Satisfaction guaranteed," and provide that bills of lading for the flour, when shipped, should be attached to a draft and forwarded to the Bank of Yazoo City for collection. The deliveries hereinafter referred to were dealt with in this manner, and the Mississippi Grocery Company, on payment of the draft, received the bill of lading, and the railroad company, on presentation thereof, delivered the flour to it. Two carloads of flour, together containing five hundred barrels of flour, were shipped to the Mississippi Grocery Company under these contracts shortly after their execution, and no complaint is made of the quality thereof. Another carload was delivered on March 28th, and another on April 2nd, together also containing five hundred barrels of flour. After part of the flour contained in the last two carloads thereof was distributed to the customers of the Mississippi Grocery Company, it was ascertained by them to be "black, lumpy and gummy," and unfit for human consumption, at least, the jury were authorized to so find. The Mississippi Grocery Company credited its customers with the price of the flour, and, by common carrier, forwarded a sample of it to the appellant, but it does not appear whether the appellant received this sample, or, if so, what inspection, if any, was made of it.
Several letters then passed between the parties, from which it appears that the appellant did not admit that any of the flour delivered was defective, and would continue to deliver flour of the same quality as that previously delivered, which deliveries the appellees indicated they would decline to receive. This suit was then begun.
The question for decision is: Did the appellees have the right to decline to receive further delieveries of the flour? There is some confusion in the cases as to whether a buyer, in a contract for the purchase of goods to be delievered in installments, who has accepted an installments, defective in quality may refuse to accept future installments, but the conflicts therein are, probably, more apparent than real.
According to the weight of authority, the acceptance by the buyer of an installment defective in quality is not, of itself, alone, equivalent to an assent to receive subsequent installments of "similarly inferior goods." 2nd Williston on Contracts, Rev. Ed., section 741. But this is not the exact question here.
The appellees could not receive the flour until they had paid for it, and could not inspect it, for defects, without breaking the sacks containing it. But, aside from that, when advised of the defects in the flour, the appellant, as hereinbefore set forth, indicated to the appellees that it considered the flour delievered to be of the required quality, and would continue to deliver flour of the same quality. This being true, were the appellees justified in declining to receive future deliveries? Both reason and high authority answer this question in the affirmative. 24 R.C.L., p. 286, sec. 564; 2nd Williston on Sales, sec. 467D; McDonald v. Kansas City Bolt Co. (C.C.A.), 149 F. 360, 8 L.R.A. (N.S.) 1110. Others appear in cases cited in 55 C.J. 268 and 269, and annotations of cases in 8 L.R.A. (N.S.) 1110, 38 L.R.A. (N.S.) 539, and 29 A.L.R. 1517.
This rule was applied by the Supreme Court of the United States, as to defects in quantity, in Norrington v. Wright, 115 U.S. 188, 6 S.Ct. 12, 29 L.Ed. 366. To so hold is also in accord with modern legislative thought, as evidenced by subsection 2 of section 45 of the Uniform Sales Act.
We are, therefore, of the opinion and hold that the appellees were justified in declining to receive future deliveries of the flour, and that the court below committed no error in refusing to direct a verdict for the appellant.
Affirmed.