Case ID: f_248/html/0393-01.html
Source: Caselaw Access Project
Author: {"author": "WARD, Circuit Judge.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

LEVI STRAUSS & CO., Inc., v. SILVERSTEIN. SILVERSTEIN v. LEVI STRAUSS & CO., Inc.
    (Circuit Court of Appeals, Second Circuit.
    January 16, 1918.)
    No. 126.
    1. Salks <s=>8S — Contract by Correspondence — Sale by Sample.
    Where, by correspondence unambiguous in its terms, the buyer ordered thread according to sample previously furnished by the seller, the contract was one by sample, and it is the duty of the court to so declare it.
    2. Sales €=>120--Ri:ftjsal to Accept — Action—Province op'Court and Jury.
    Where a sale was by sample, the only question for the jury, in an action wherein the seller claimed damages for the buyer's refusal to accept deliveries, and the buyer damages for the seller’s failure to deliver the goods bought,'is whether those tendered conformed to the sample.
    3. Sues <§==>166(5) —Sale by Sample — Effect.
    Where thread was sold by sample, and the sample on which the price was based was manufactured of Egyptian yarn, the buyer is entitled to demand that the thread delivered be manufactured of that same yarn.
    4. Sales <§=»166(5) — Samples.
    Where thread is sold by sample, ihe seller is hound to furnish thread according to the sample, even though, having no 3/24 in stock, it substituted a better and stronger thread, which by mistake it labeled 3/24.
    In Error to the District Court of the United States for the Southern District of New York.
    Action by Isaac J. Silverstein, doing business as the Globe Thread Company, against Levi Strauss & Co, Incorporated, begun in the state court and removed to the federal court, where it was consolidated with an action by Levi Strauss & Co. against Silverstein, plaintiff in the other action. There was a judgment for Silverstein and Strauss & Co. brings error.
    Reversed.
    Leventritt, Cook, Nathan & Lehman, of New York City (Emil Gold-mark and Mortimer Brenner, both of New York City, of counsel), for Levi Strauss & Co, Inc.
    Blandy, Mooney & Shipman, of New York City (Edmund L-Mooney and Eli S. Wolbarst, both of New York City, of counsel), for Silverstein.
    Before WARD, ROGERS, and HOUGII, Circuit Judges.
   WARD, Circuit Judge.

Eevi Strauss & Co, Inc, are manufacturers of overalls at San Erancisco, having an office in New York City, and Silverstein is a manufacturer of thread in New York City, trading under the name of the Globe Thread Company. Isaac J. Silverstein sued Strauss & Co. in the state court to recover the price of thread delivered by him to Strauss '& Co. under a contract for 10,000 tubes, together with damages for their refusal to accept full deliveries. Strauss & Co. sued Silverstein in the District Court of the United States for the Southern District of New York to recover damages for his failure to deliver 10,000 tubes of thread conforming to sample, and removed his suit from the state court to the United States court. These two causes were consolidated, tried together, and this is a writ of error to a judgment entered on the verdict of the jury in favor of Silverstein. v

The whole question in the case is whether the sale of 10,000 tubes of orange-colored thread was by sample or by description, and the contract, whichever it was, is contained in the correspondence of the parties. A contract prior to the one sued upon was entered into by the following order :

“January 8, 1916.
“Messrs. Globe Thread Co., 147 Spring Street — Gentlemen: We herewith order from you one (1) case each 50 tubes per case dark red, orange thread silk' finish as follows:
Silk. Soft.
S/24 9600 yards at. §1.25 §1.18
8/30 9600 “ “ 1.15 1.10
3/36 12000 “ « 1.10 1.05
3/40 12000 “ “ .J.95 .90
3/50 12000 “ “ 90 .84
“The above are all to be left twist and to be wound on tubes universal wind and to be delivered f. o. b. our New York office 377 Broadway. You are to take out two (2) tubes from each case and pack separately and mark Levi Strauss & Co., San Francisco, California, and deliver with "the rest of the goods. We remain,
“Kespectfully yours, Levi Strauss & Co.,
“Per Simon E. Davis.”

One copy of this order was kept by the Thread Company and the other by Strauss & Co. The order was subsequently filled, paid for, •and is admitted to have been satisfactory. The next day negotiations began for the contract in suit, the Thread Company putting in the following offer:

“New York, Jan. 4, 1916.
“Messrs. Levi Strauss & Co., 377 Broadway, New York City — Gentlemen: As we are anxious to be favored with your contract order on the dark red orange thread, we have refigured once again very carefully the cost, and are herewith giving you the very lowest prices which we can accept an order:
No. Silk. Soft.
24/3 9600 yards @ §1.25 §1.18
30/3 9600 “ 1.15 1.10
36/3 12000 “ 1.10 1.05
40/3 12000 “ .95 .90
50/3 12000 “ .90 .84
“All the above quotations are figured on the very best quality cotton, all left twist, to be put up on tubes, universal wind, f. o. b. New York. Thanking you for your sample order, and hoping to receive your further order for this goods, we are,
“Yours very truly, ° The Globe Thread Co.”

Strauss & Co. say they answered this letter by one dated January 5th, which the Thread Company says was unequivocally turned down by it in a letter dated January 6th, which Strauss & Co. say they never-received, though the verdict of the jury shows they must have found to the contrary; therefore we will omit both in considering this record.

The next letter is as follows:

“February ,10, 1016.
“Messrs. Globe Thread Co., 147 Spring Street, New York, New York— Gentlemen: We just now received the following telegram from our San Francisco house which is no doubt prompted by their receipt of two (2) tubes each of thread that you expressed February 2: ‘Confirm order Globe Thread Co. 2000 tubes three cord fifty 500 tubes three cord forty 7500 tubes three cord twenty four half silk finish and half soft finish. Ship 1000 tubes per mouth rush first shipment.’ We therefore direct you to book the following order to apply against the contract made between your Mr. Silverstein and our Mr. Davis on January 3:
2000 Tubes 3/50 500 Tubes 3/40
7500 “ 3/24
half silk finish, half soft finish. Ship the above via Morgan & Sunset line to Levi Strauss <& Co., Sau Francisco, California, as per the attached form, at the rate of 1000 tubes per month and rush the first shipment. As soon as shipment is made, send us three bills here and original bill of lading.
“Respectfully yours, Levi Strauss & Co.
“1*. S. — This thread must be the same color, qual. and finish as those expressed.”

The reference to the contract of January 3d is, evidently a typographical error for the contract proposed by the letter of January 5th, which was rejected by the Thread Company, because admittedly the first contract of January 3d was wholly independent, was for different quantities and varieties of thread, and had been filled and shipped. When the New York agent of Strauss & Co. presented this letter to the Thread Company, its bookkeeper pointed out that there was no unfilled contract of January 3d and that the company had no thread in stock corresponding in color to that order. J5he asked the agent to say which shade of five samples of different shades of orange they had received from Strauss & Co. he wished the color of the thread to be, whereupon he selected one to be used, which was used. Then came the following letter, confirming the letter of February 10th, and inclosing Order No. 646 for 10,000 tubes:

“February 14, 1916.
“Messrs. Globe Thread Co., 147 Spring Street, New York, New York — ■ Gentlemen: Herewith please find the official confirmation No. 646 for the thread purchased from you by our Mr. Davis. We hereby confirm the phone conversation had with you this morning regarding the color of the thread. We just received a telegram from our San Francisco house reading: ‘Globe thread Is right shade.’ So kindly go ahead and make the shade of the thread like the samples you have expressed February 2d, and kindly acknowlege this by return mail to this office.
, “Respectfully yours, Levi Strauss & Co.”
“No. 6-16 Dep’t P 2/9/3916. If this order is not exactly as trade was made, return to our New York office. Address all correspondence concerning this order to New York Office.
“New York, 196 West Broadway.
“Levi Strauss & Co., San Francisco, Cal.
“To be delivered below
“Morgan Sunset
“Bought of Messrs. Globe Thread Co. Address: New York Oily. Sample to New York office. Terms 2/10 — 60x not later than % per annum allowed for unexpired time.
“We reserve the right to cancel any number of which samples and good§, are not delivered promptly on time.
“Packed
Original No. Call No. Bought. Description of Goods. Price.
1,000 tubes 3/50 soft finish thread .84
250 tubes 3/40 soft finish thread .00
3,750tubes 3/24 soft finish thread 1.18
1,000 tubes 3/50 silk finish thread .90
250 tubes 3/40 silk finish thread .95
3,750tubes 3/24 silk finish thread 1.25
“Delivery: 1000 tubes per month. Rush first shipment all possible.
“Freight allowance ewt. Est. Ain’t $11,315.00.
“When goods are ready, send three bills to our New York office and get S/D.”

This order was accepted by the following letter of the Globe Thread Company:

“New York, Feb. 15, 1916.
“Levi Strauss & Company, 377 Broadway, City- — Gentlemen: We have entered your order #646, dated February 9th for the following:
“Terms: 2% 10/60X, f. o. b. New York.
1,‘000 tubes #50/3 soft finish .84
250 tubes #40/3 soft finish ..90
3,750tubes #24/3 soft finish .:. 1.18
1,000 tubes #50/3 silk finish .90
250 tubes #40/3 silk finish .93
3,750tubes #24/3 silk finish . 1.25
, “All above is to be orange shade, put up on tubes, to be delivered about 1,000 tubes per month, and we expect to begin shipment about March 10th. Thanking you for same, we are,
“Very truly yours, ' The Globe Thread Co.”

The Thread Company made a number of deliveries, which were rejected by Strauss & Co. as not up to the sample, and they ultimately refused to receive any more.

The contract in our opinion results from the foregoing correspondence. We cannot accept the contention of the Thread Company that the letter of February 10th is to be disregarded. The effect of doing so would be to make the sale one by description, whereas it expressly required the thread to he of the same color, quality, and finish as the samples expressed February 2d. The Thread Company never rejected the proposition contained in this letter; on the contrary, it accepted the offer, asking only for specific directions as to the shade of the orange-colored thread to be manufactured, about which particular there never has been any dispute. This correspondence being plain and unambiguous, it was the duty of the court to construe it and to construe it as a sale by sample as Strauss & Co. requested. The shade of the goods delivered was acceptable to Strauss & Co. and the question for the jury was whether 'they conformed to the samples expressed February ,2d of the original order of January 3d in other respects, as required by the letter of February 10th.

Strauss & Co. likewise assign error to the refusal of the court to' charge that the thread was to be manufactured of combed Egyptian yarn. As it is admitted by the Globe Thread Company that the sample thread of January 3d was combed Egyptian yarn, and that the price fixed in order 646 plainly indicated that yarn, the refusal of the request was error.

In filling the original order of January 3d the Thread Company, having no 3/24 in stock, substituted a stronger and better thread, 4/30, which it is said was labeled 3/24 by mistake. Assuming that this was an honest mistake, nevertheless the samples of the thread furnished on that original contract were expressly made the samples to which the goods ordered under the contract in suit must conform, and Strauss & Co. could not be required to take anything else.

The judgment is reversed.