Owensboro Wagon Co. v. H. L. Riggan & Co., 151 N.C. 303 (1909)

Nov. 18, 1909 · Supreme Court of North Carolina

151 N.C. 303

OWENSBORO WAGON COMPANY v. H. L. RIGGAN & CO.

(Filed 18 November, 1909.)

1. Contracts of Consignment — Indefinite Duration — Termination at Will.

A contract for consignment of goods without fixing a date for its duration is terminable at the will of either party.

2. Same — Notification.

When, under the terms of a contract for consignment of goods, it is provided that if the defendants keep the goods for eight months they were to purchase at a stipulated price, there is a failure of mutual agreement of sale upon the notification by the consignee within the eight months’ period that he would not keep the goods.

3. Same — Plaintiff’s Liability — Measure of Damages.

When plaintiff has consigned goods to defendants under an ' agreement terminable at will, and therefore fails in his suit to recover the price of the goods in his action for goods sold and delivered, he is liable to defendant for storage of the goods after being notified of the termination, for freight paid by him, and for necessary repairs made.

Appeal by plaintiff from J ones, J., at September Term, 1909, of Fobsyth.

Tbe contract between tbe parties is contained in tbe following letter:

“FORM X.

“Owensboro Wagon Company,

“INCORPORATED.

“Owensboro, Ky., March. 18, 1907.

“To II. L. Riggan & Co.,

Winston-Salem, N. 0.

“Dear Sir: — Respecting your request to handle our wagons on consignment in your vicinity, we shall be pleased to commission same to you as your orders may be approved by us from time to time; proceeds of sales, less invoice price, to be your commission. In consideration of our so doing, and extending you this business, we ask you to undertake and contract as follows:

“1. Of such goods, handle and sell ours to the exclusion of all other makes.

“2. Until goods consigned hereunder are sold, diligently do all business required for selling said goods, pay all taxes, freight and any other expenses on same, keep same well housed and protected from the weather and in good order, keep same insured' with loss clause payable to us, and in case of loss or damage by fire or other cause, pay us invoice price.

“3. On the first of each month, and whenever requested so to do by us or our authorized traveling men or collectors, to render a statement of all goods on hand.

“4. Invoice prices shall be as mutually agreed upon at the time orders are accepted for shipment.

“6. At the end of each month, or whenever requested, you will remit to us your four-months note for all sales made, and if requested by us, approved collateral notes endorsed by you and attached as security, or cash, less a discount of five per cent., the cash discount not to be allowed on sales made after eight months from date of each invoice. Tour monthly remittance, so made, we will place to the credit of your account, and you will continue to make monthly settlements for sales as hereinbefore provided.

“7. You will, if we so demand, purchase at invoice price with your four-months note, with approved collateral notes attached, if requested, or in cash, less five per cent, on all goods unsold after eight months from date of each invoice, or at once, in case you sell or dispose of the merchandising business in which you are engaged.

“8. To extent of invoice price, money, notes, proceeds or securities taken or received by you on account of goods shall be our property, received and held in trust for us and kept by you as a separate fund for us until goods are settled for us as above, and the title of all goods shipped on this contract shall bo and remain in Owensboro Wagon Company until we receive settlement therefor.

“9. We can revoke this contract at any time if you fail to discharge any obligation hereundter, or if we have reason to believe you unable to perform same; and upon the return of goods for any cause, or upon termination or revocation of this contract, you will deliver to us in your town all our goods then on hand, in as good condition as when received, paying for any damages to same, free of all charges. If, however, termination hereof is made other than by reason of your act or breach, then we will pay actual freight, which shall be a claim against us, subject to offset of any claim we may have against you.

“10. We deliver all goods free on board Owensboro, Ky., and will endeavor to ship by cheapest route, making freight as low as possible, but will not be responsible for any overcharges.

“11. Our failure to enforce at any time any provision of this contract, to exercise any option reserved to us herein, or our waiving performance on your part of‘any provision hereof, for the time being, shall in nowise impair or affect the validity of this contract, or of such provision, or of our right to enforce the same at any time thereafter.

“If this is satisfactory, please sign as indicated below, and return to us, on receipt of which we will, at this office, at which place this contract shall be considered executed, consummate same by our signature between us, sending you a copy, which embodies our entire understanding and cannot be modified, except by writing, duly executed by us.

Owensboro Wagon Company.

“Consummated:

Owensboro Wagon Company,

By S. D. Kennedy.”

“The above is satisfactory. H. L. Riggan & Co.”

On the same day the contract was signed, the defendants signed an order for plaintiff to ship them six wagons, at a price of $385.05, and this order specifically provided that they be sold on the following conditions as to payment:

■ “Terms: We agree to settle for the above by terms of consignment contract, eight months limit. No collateral notes.” '

The plaintiff shipped the wagons on 19 April, 1907, and 25 May, 1907, and they received them soon after. In June, 1907, the defendants notified the plaintiff’s agent personally, and the plaintiff twice by letter, that they could not sell the wagons, and requested plaintiff to appoint another agent. In October they wrote the following letter:

“Winston-Salem, N. C., October 5, 1907. “Owensboro Wagon Company,

Owensboro, Ky.

“Gentlemen:— . . . As we wrote you some time ago, we must insist tbat you bave another' agent appointed at tbis place, or allow us to turn tbe wagons over to some one else, as we bave tried bard to sell tbem and we cannot do it, as tbe people cannot be convinced tbat tbis make or, style of wagon will take tbe place of tbe kind tbey bave been using. . . .

Tours truly, etc. H. L. Riggan & Co.”

Tbis is an action by plaintiff to recover tbe price of tbe wagons, having refused tbe defendant’s offer to return tbem. Tbe jury found tbat the defendants bad terminated the contract ■within eight months, and tbat tbe plaintiff was indebted to tbe defendant $52 for storage (after tbe notice to remove; given by defendants in February, 1908), freight' paid and repairs. Plaintiff appealed.

L. M. Swinh for plaintiff.

Manly & Hendren and Watson, Buxton & Watson for defendant.

Clark, C. J.,

after stating tbe case: Tbis was a contract for consignment. No definite date was fixed for its duration, and therefore it was terminable at the will of either party. Solomon v. Sewerage Co., 142 N. C., 445; Currier v. Lumber Co., 150 N. C. 694.

Under tbe terms of tbe contract, if tbe defendants should keep tbe wagons without objection, not offering to return tbem for a period of eight months, then they agreed to purchase them at the invoice price; but when tbey indicated tbat tbey did not want to keep tbe wagons, there was a failure of tbe minds to meet upon tbe proposition to sell.

Tbe letters from defendant were admissible to show tbe termination by tbem of tbe contract and tbe notice to remove tbe wagons. Tbe defendants were entitled to recover storage therefor, freight paid by tbem, and repairs. ,

No error.