E. T. Gray Sonsv.Satuloff Bros

Supreme Court of AlabamaOct 15, 1925
213 Ala. 526 (Ala. 1925)
213 Ala. 526105 So. 666

8 Div. 781.

October 15, 1925.

Appeal from Circuit Court, Limestone County; James E. Horton, Judge.

J. G. Rankin, of Athens, for appellants.

A contract by which a creditor accepts a less amount than that admitted to be due by the debtor, and gives a receipt in full, discharging the debtor, is a nude pact, and void for want of consideration; mutual assent is not enough. Scott v. Rawls, 159 Ala. 399, 48 So. 710; Abercrombie v. Goode, 187 Ala. 310, 65 So. 816; Hodges v. Tenn. Dev. Co., 123 Ala. 572, 26 So. 490; Holloway v. Talbot, 70 Ala. 389; Montgomery Co. v. New Farley Bank, 200 Ala. 170, 75 So. 918; Shriner v. Craft, 166 Ala. 146, 51 So. 884, 139 Am. St. Rep. 19, 28 L.R.A. (N.S.) 450. For payment of less amount than that due to operate as accord and satisfaction, it must appear there was a bona fide contention by the debtor that the amount paid was all that was due. Ex parte Sou. Cot. Oil Co., 207 Ala. 704, 93 So. 662. A seller may sell to defaulting buyer on different terms, if care is taken not to waive damages for breach. It is the duty of the seller to minimize the damages by selling to defaulting buyer. 2 Williston on Sales (2d Ed.) 1373; New Bluegrass Can. Co. v. Dougan, 151 Ky. 522, 152 S.W. 566; Curjel v. Hallett Mfg. Co., 198 Ala. 609, 73 So. 938; Borden Co. v. Vinegar Bend Lbr. Co., 2 Ala. App. 354, 56 So. 775; Lawrence v. Porter, 63 F. 62, 11 C.C.A. 27, 26 L.R.A. 167. Acceptance after time of delivery does not waive right to damages, unless circumstances show intention to waive or if circumstances show compulsion. 23 R. C. L. 268.

R. B. Patton, of Athens, for appellees.

Where a party has an election to affirm or disaffirm a transaction, and he elects the one, he is afterwards estopped from doing the other. Goetter v. Norman, 107 Ala. 585, 19 So. 56; Clanton v. Scruggs, 95 Ala. 279, 10 So. 757; Kahn v. Peter, 104 Ala. 523, 16 So. 524; McIntosh v. Hill, 212 Ala. 136, 102 So. 102; Tobias v. Morris Co., 126 Ala. 535, 28 So. 517. After one contract is voluntarily entered into as a substitute for another, and has been fully performed, the original contract is completed and extinguished. McCabe Const. Co. v. Utah Const. Co. (D.C.) 199 F. 976; Munroe v. Perkins, 9 Pick. (Mass.) 298, 20 Am. Dec. 475. There was accord and satisfaction in this case. Brown v. Lowndes County, 201 Ala. 437, 78 So. 815.

The contract, evidenced by a series of telegrams between the parties was a contract in writing, to be construed by the court.

The existence of certain telegrams relating to the transaction being in dispute, a question for the jury was presented, in so far as such telegrams may affect the rights of the parties.

The affirmative charge being given for defendants, the plaintiffs' version of the existence and receipt of such disputed messages must be taken as true, in passing upon such ruling. The plaintiffs' theory is that the instruction to the carman to load out Monday was a waiver of the delay, an acceptance of the poultry at the contract price, and nothing remained but an obligation to pay on arrival at Buffalo; that there was no consideration for a release of a part of the purchase price, no bona fide dispute as a consideration for a compromise; that the promise to reduce the price was a nudum pactum; and the defendants still owe that balance.

We think the case does not require a consideration of the many rules of law relied upon in support of these contentions.

A shipment upon "draft with bill of lading attached" is a retention of title in the seller until the draft is paid. The carrier, as bailee, may not deliver to the consignee until the bill of lading is released by payment of the draft. It is a method of concluding the sale for cash at a distant point. There may be a binding contract to buy. All preliminaries, such as inspection, grading, weighing, fixing aggregate price, acceptance for shipment by the carrier, and caretaking en route, may be done, but until the price is paid no delivery from the carrier to the consignee is due, and the transaction, as a completed sale, is still in fieri.

Whether the bill of lading names the seller as consignee, with assignment to the buyer, effective upon payment of the draft, or names the buyer as consignee and is sent through banking channels to be delivered on payment of the attached draft, in either event the title remains in the seller, and no right of possession is in the buyer until the draft is paid. Armstrong v. Wilcox, 207 Ala. 390, 92 So. 645; L. N. R. Co. v. Sarris, 209 Ala. 217, 95 So. 903; Veitch v. Atkins Grocery Co., 5 Ala. App. 444, 59 So. 746; Robinson v. Pogue, 86 Ala. 257, 5 So. 685.

While a transaction is in fieri, or a contract is executory, the parties by mutual assent may abandon the transaction, or rescind the contract, or they may modify or alter the terms of the contract. No other consideration is necessary than the mutual assent of the parties. Dickey v. Vaughn, 198 Ala. 283, 73 So. 507; Elliott v. Howison, 146 Ala. 568, 40 So. 1018; Hembree v. Glover, 93 Ala. 622, 8 So. 660; Wellden v. Witt, 145 Ala. 605, 40 So. 126; Mylin v. King, 139 Ala. 319, 35 So. 998; 13 C. J. 593.

When a modified or substituted contract is fully executed by the performance of the terms thereof, by both parties, the question of consideration for the new contract becomes immaterial. Even a gift cannot be recalled, when fully executed. A chose in action may be the subject of a gift as other property. This may include a debt due from the donee to the donor. 28 C. J. 666. Without regard to the party at fault in the controversy up to the arrival of the car at Buffalo, the final agreement to reduce the price, followed by acceptance of the shipment, payment of the full price upon agreement to refund the amount here sued for, and this followed by actual payment of the refund, constituted a fully executed contract, and the transaction was closed. The situation is not altered, if we agree with plaintiffs that there was a binding agreement to receive the poultry and pay the full price, and defendants refused so to do. Plaintiffs had the election to stand on their contract, dispose of the poultry, and look to the defendants for resulting damages.

A new sale to the defaulting purchaser to minimize the damages would not defeat such action. But such is not this case. The transaction in writing shows an express purpose to modify the contract, to substitute the new price for the old, and this agreement was executed.

Plaintiffs seem to have proceeded on the view that defendants had wrongfully sought and obtained an advantage of position, and the agreement to reduce the price obtained by fraud or coercion.

It may be the testimony would afford an inference for the consideration of the jury to the effect that defendants, by instructions to Kyser, contemplated getting the poultry in Buffalo, with no bona fide purpose to pay the full price, but an advantage of position. It is no doubt the law that fraud in the procurement of a modified contract infects the transaction as any other; but it must be fraud in the procurement of the modified agreement. Here the facts were all known to plaintiffs at the time they agreed to refund the difference in price. The mere fact that they found themselves at a disadvantage, and liable to suffer loss, is not coercion in law.

The frank admission of plaintiffs that there was no intent to reduce the price, but to regain their position of vantage by making an agreement they did not intend to execute, and to go through the form of compliance by paying over the money and then reclaiming it, discloses business dealings having no sanction in the law. One wrong cannot be redressed by another.

The debt here sued for in essence is the money paid to defendants in execution of a contract made with full knowledge of the facts. Plaintiffs are estopped to say the agreement was merely colorable and made because the other party had obtained an unjust advantage.