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Wells v. H. W. Lay Company Inc.

Court of Appeals of Georgia
Dec 3, 1948
78 Ga. App. 364 (Ga. Ct. App. 1948)


32195, 32203.


Complaint on contract; from Fulton Superior Court — Judge Hooper. July 13, 1948.

Robert B. Blackburn, Hewlett Dennis, T. F. Bowden, for plaintiff.

Smith, Kilpatrick, Cody, Rogers McClatchey, Harry S. Baxter, A. G. Cleveland Jr., for defendant.

1. When, in an action for breach of contract, the petition alleges in one portion that a parol agreement was entered into between the parties to do certain things, which things were a condition precedent to the purpose of the main contract alleged to have been entered into, but in another portion thereof affirmatively shows that the fulfillment of the condition precedent rests upon the independent act of a third party, upon the doing of which act the parties will enter into the main contract, no cause of action for breach of contract is set forth.

2. A contract, to be enforceable, must be so certain and complete in its terms that either party may have an action on it.

3. ( a) A petition, which alleged that upon the grant of an application for franchise as a contract carrier the parties will enter, or have entered, into a contract for twelve months next succeeding the date on which such application is granted, alleged a contract to be performed more than twelve months in the future, and coming under the statute of frauds.

( b) The part performance which will take such a contract out of the statute is performance of an essential part of the contract. The doing of an independent act, even though the act would not have been done but for the contract, is insufficient.


The plaintiff in error, Thomas Wells, hereinafter referred to as the plaintiff, brought suit against the defendant in error, H. W. Lay Company Inc., hereinafter referred to as the defendant, for damages of $15,000. The petition as amended alleges: that the plaintiff was the owner of a truck and trailer, and during March, 1946, "commenced to negotiate a contract" with the defendant, under which he was to operate and maintain a line of automobile trucks to be used for the purpose of transporting certain named goods from Atlanta to nine named cities; that, after agreeing on satisfactory terms, the defendant contracted with the plaintiff that, if he would apply for authority from the Interstate Commerce Commission to operate as a contract carrier for the defendant and obtain such authority, the defendant "would enter into a bilateral contract" with the plaintiff, and would cooperate with him in obtaining such authority, the contract to be the type required by order of the Interstate Commerce Commission in such cases; that during the month of March, 1946, the plaintiff, at the defendant's suggestion, consulted with the defendant's attorney, who agreed to represent him in the matter, and he thereafter paid the attorney a stated amount; that on May 1, the defendant furnished the plaintiff with a list headed, "Below is a list of towns to which you will operate your trucks," and "List of merchandise to be shipped"; that on May 3, the defendant wrote the Interstate Commerce Commission a letter setting forth the reasons for the desirability of a franchise being issued to the plaintiff, and added, "If this application is granted, the company will enter into a bilateral contract with Mr. Wells."

Other details of the parol agreement specifically alleged in the petition are: that "his contract with the defendant was to twelve months next succeeding the date at which permission to operate as a contract carrier for the defendant should be granted on a mileage basis of 19 cents per mile with not less than two trips per week to Louisville, Ky., and return; and that the net profits accruing to petitioner under said contract would be $800 per month." The petition as amended also alleges: that the plaintiff severed his connections with his previous employer on May 1, 1946, and from then through September 13 "kept his truck and trailer in readiness" parked in a garage, and held his driver on the pay roll at $12 per week net loss; that the hearing before the Interstate Commerce Commission on the granting of a franchise as contract carrier was set for September 13, and since the defendant was not present, the hearing was postponed to September 25; that the plaintiff notified the defendant of the reassignment, and the defendant company's president and vice-president, upon giving the matter further consideration, finally notified the plaintiff that they would not appear at the hearing and would not further co-operate with the plaintiff, stating that the defendant had already purchased trucks for making their own deliveries, and informed the plaintiff that they would not comply with the contract as agreed to be entered into, whereupon the plaintiff demanded full compliance, which demand was denied.

Various demurrers to the petition were filed, following which the plaintiff amended and set forth in more detail the transactions between himself and named officers of the defendant company. He further alleged: that he informed such officers that the expense of applying for a permit would be a named amount for attorney fees, which he paid at their suggestion; that he further informed them that, if he made application for a permit, he would have to give notice to his present employer; that he did not desire to apply for such permit unless he was assured that the defendant company would obligate itself to assist and cooperate in making and prosecuting such application; and that on May 1, the defendant agreed and constituted the plaintiff its contract carrier on the terms set out in the petition, and agreed to co-operate with the plaintiff in applying for the permit, and that the plaintiff should have in readiness trucks and equipment essential to the transportation of the defendant's products. The defendant renewed all its demurrers, and on the hearing the trial judge sustained certain of the grounds of general demurrer and dismissed the petition. This judgment is assigned as error by the plaintiff on the main bill of exceptions. Certain grounds of the demurrers were overruled, and this part of the judgment is assigned as error by the defendant on the cross-bill of exceptions.

1. The allegations of the petition are conflicting, and have been set forth at some length above. Although the plaintiff attempted, in paragraph 5 of his amendment, to show that a valid contract had been entered into on May 1, he controverts this fact in paragraph 11 of his original petition by alleging that the contract was for twelve months next succeeding the date on which permission to operate as a contract carrier should be granted. In paragraph 2 of the original petition, it is alleged that, if the application is granted, the company would enter into a bilateral contract with the petitioner. The petition also alleges a letter to this effect written by the defendant to the Interstate Commerce Commission, dated May 3. The pleadings, therefore, in this respect are ambiguous as to whether the contract had already been made or was to be entered into after the permit to operate as a contract carrier had been secured from the Interstate Commerce Commission. Ambiguous pleadings are to be construed unfavorably to the pleader. See many cases cited under catchwords "Ambiguous pleadings," Code (Ann.) § 81-101. Thus construed, the petition alleges that the contract will be entered into after securing the permit. The act of the plaintiff in relinquishing the contract on which he had previously been engaged, and in keeping his truck and driver in readiness after May 1 must, therefore, be considered voluntary on his part.

Nor does it appear that all the terms of the contract were ever agreed upon. The petition alleges that the plaintiff was the owner of one truck, yet it contains as an exhibit a letter from the vice-president of the defendant company referring to "a list of towns to which you will operate your trucks." (Italics ours.) The number of vehicles, their size, the number of trips per week, size of the load, routes, volume of business, number of drivers, and other essential facts on which a contract must be predicated are absent.

"If there was in fact any essential part of the contract upon which the minds of the parties had not met, or upon which there was not an agreement, even through the negotiations evidenced a complete willingness, or even an announced determination, to agree in the future upon such issues as might subsequently arise, it must still follow that a valid and binding contract was not made as of the earlier date." National Bank of Kentucky v. Louisville Trust Co., 67 Fed. 2d, 97, 102. "Unless all the terms and conditions are agreed on, and nothing is left to future negotiations, a contract to enter into a contract in the future is of no effect." 17 C. J. S. 394. See also Board of Drainage Commissioners v. Karr Moore, 157 Ga. 284 ( 121 S.E. 298). "An agreement to reach an agreement is a contradiction in terms and imposes no obligation on the parties thereto." Rosenfield v. United States Trust Co., 290 Mass. 210 ( 195 N.E. 323, 122 A.L.R. 1210, 1216).

2. However, even if the allegations of the petition should be construed in favor of the pleader as an attempt to make a sort of preliminary contract as of May 1, 1946 — the plaintiff promising to endeavor to obtain the requisite franchise, and the defendant to help him do so, in order that a contract of carriage might be entered upon — it is obvious that no agreement was ever entered into, the terms of which could be enforced by either party. Suppose that, at the time of the I. C. C. hearing in September, the plaintiff had decided that he no longer wished to obtain the franchise in question. No contract existed under the terms of which the defendant could have compelled him to go forward with such a hearing. "The rule as to certainty is, that the agreement must be so certain and complete that each party may have an action on it." Jernigan, Lawrence Co. v. Wimberly, 1 Ga. 220; Parks v. Harper, 43 Ga. App. 269 ( 158 S.E. 454).

The situation would be similar to that wherein there was an agreement that, if the plaintiff would erect a first-class hotel and accommodate therein employees of the railroad company at half rate, the company would maintain and support the hotel. "Although the declaration set forth various facts, such as building a hotel, maintaining the same, etc., as constituting full performance by plaintiff, the contract itself was too vague and indefinite to afford any safe, satisfactory, or proper basis for computing damages arising from its non-performance by either of the parties." Hart v. Georgia Ry. Co., 101 Ga. 188 ( 28 S.E. 637).

3( a) The plaintiff in error contends that the various negotiations between the parties, as set out in the petition, were merged into an actual agreement by the parties, as set out in paragraphs 2 and 3. Paragraph 2 states that, "if plaintiff would apply for (a franchise) . . defendant would enter into a bilateral contract." Paragraph 3 shows that the attorney was employed in March. Paragraph 11 states that the contract was for "twelve months next succeeding the date at which permission to operate as a contract carrier should be granted." Paragraph 5 of the amendment further alleges: "On May 1, 1946, defendant . . did constitute and appoint plaintiff, and plaintiff did agree to become the contract carrier of defendant . . for the period of twelve months."

We do not believe that the allegations of the amendment, where no portion of the original petition was stricken, cure the defect appearing on the face of the petition, from which it affirmatively appears that the contract should begin to run from the time at which permission should be granted to act as a contract carrier. The same ambiguity exists regarding the employment of an attorney, paragraph 3 of the petition alleging that the plaintiff employed the attorney, on the advice of the defendant, in March, 1946, while the amended petition alleges that on May 1 they "agreed that (a named attorney) should be employed."

As hereinbefore pointed out, contradictions must be resolved in favor of the defendant, a petition being most strongly construed against the plaintiff on an appeal from a judgment sustaining a demurrer thereto. Maynard v. Atlanta Gaslight Co., 24 Ga. App. 5 ( 99 S.E. 472).

The alleged contract, therefore, falls within the statute of frauds (see Code, § 20-401 (5); Morris v. Virginia-Carolina Chemical Corp., 48 Ga. App. 702 (1), 173 S.E. 486), unless there has been such part performance of the contract as would render it a fraud on the part of the party refusing to comply (see Code, § 20-402 (3)).

( b) The question then arises as to whether the acts of the plaintiff as set forth in the allegations of the petition are sufficient to show a part performance which would remove the case from this statute. It is apparent that his actions were not in the performance of any essential element of the contract, as he never entered upon the business of acting as contract carrier for the defendant. Whatever contract there was must be taken to be a contract of carriage. In reliance upon the defendant's word that he would secure such a contract, the plaintiff did incur definite expenses. But his is the unfortunate position of having proceeded in the mere hope of obtaining the contract, rather than in the actual performance thereof. "The doing of an independent thing, even though the act would not have been [done] but for the contract, is not sufficient. Graham v. Theis, 47 Ga. 479; Lane v. Lodge, 139 Ga. 93 (2) ( 76 S.E. 874); Giradot v. Giradot, 172 Ga. 230 ( 157 S.E. 282); Taylor v. Boles, 191 Ga. 591, 599 ( 13 S.E.2d 352); Lamons v. Good Foods Inc., 195 Ga. 475 ( 24 S.E.2d 678)." Smith v. Davidson, 198 Ga. 231, 238 ( 31 S.E.2d 477).

It appearing that the petition fails to set forth a cause of action, it is deemed unnecessary to pass upon the ruling of the trial court on each ground of the demurrer. Since the case is being affirmed on the main bill of exceptions, a decision on the cross-bill is unnecessary. Massee v. Parrott, 29 Ga. App. 109 (5) ( 114 S.E. 225); Tift v. McCaskill, 171 Ga. 289, 290 (4) ( 155 S.E. 192).

The judgment of the trial court dismissing the petition on general demurrer is without error.

Judgment affirmed on the main bill of exceptions. Cross-bill of exceptions dismissed. MacIntyre, P. J., and Gardner, J., concur.

Summaries of

Wells v. H. W. Lay Company Inc.

Court of Appeals of Georgia
Dec 3, 1948
78 Ga. App. 364 (Ga. Ct. App. 1948)
Case details for

Wells v. H. W. Lay Company Inc.

Case Details

Full title:WELLS v. H. W. LAY COMPANY INC.; and vice versa

Court:Court of Appeals of Georgia

Date published: Dec 3, 1948


78 Ga. App. 364 (Ga. Ct. App. 1948)
50 S.E.2d 755

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