Case ID: ny-sup-ct_36/html/0219-01.html
Source: Caselaw Access Project
Author: {"author": "Barnard, P. J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

PATRICK J. McARDLE and PATRICK HART, Respondents, v. BENJAMIN ATHA, JOHN ILLINGSWORTH and ALBERT O. HEADLEY, Appellants.
    
      Executory contract— right of the vendee to object to the quality of the goods after theirr delivery and acceptance.
    
    The plaintiffs, through one Duffy, agreed to sell scrap steel to the defendants, at two cents per pound. There were to be fifteen tons of tool and fifteen tons-of file steel to' every twenty tons of other scrap steel. The tool and file steel was heavier and more valuable than the other. The plaintiffs had the right to deliver an unlimited amount of steel in these proportions. They delivered first eighty and then twenty tons. The last lot was assorted by Duffy, at the defendants’ request, after its delivery. There was so little tool and file steel delivered as to reduce the value of the lot to one and one-third cents per pound.
    In an action brought by the plaintiffs to recover for the steel so delivered, the referee held that the contract being an executory one was to be deemed performed, the steel having been, after an opportunity to examine it, accepted by the defendants, and that the plaintiffs were entitled to recover the full contract price.
    
      Held, that this was error.
    Appeal from a judgment in favor of the plaintiffs, entered upon the report of a referee in an action to recover for certain “ mixed steel ” sold and delivered by the plaintiffs to tbe defendants.
    
      B. B. Clark, for the appellants.
    
      E. A. Brewster, for the respondents.
   Barnard, P. J.:

The evidence shows that one John S. Duffy agreed to sell to the defendants fifty tons of scrap steel at two cents per pound. The steel was to be delivered in the following proportions : Fifteen tons tool steel and fifteen tons file steel to twenty tons of other scrap steel. Subsequently Duffy found at Newburgh a lot of steel scrap of about eighty tons, which belonged to the plaintiffs, which they agreed Duffy might sell to defendants for them on a commission. Duffy then agreed to sell the eighty tons in the proportions aforesaid. The steel was subsequently delivered, and was not in the proportions agreed upon. The plaintiffs then agreed to sell twenty more tons to defendants on the same terms and in the same proportions, and they had the right to deliver an unlimited amount of steel in those proj>ortions and at that agreed price. Upon' the deliveiy of the last twenty tons the steel was not assorted, and Duffy, on a request from defendants, did assort the lot. The tool steel and the file steel is the most valuable, being heavy steel. Of the entire amount delivered, there was such a deficiency of this heavy steel from the agreed proportions as to x-educe the value of the entire lot delivered from two cents to one and one-third cents per pound.

The referee decides that the defendants must pay the entire agreed px'ice for the steel, notwithstanding the non-delivery of the proper proportions of heavy steel. This conclusion seems to be ei’roneous. The learned referee puts the case upon those authorities which hold that an executoi’y conti’act is deemed pei’foi’med by an acceptance of the subject of the contract after opportunity to examine. It seems to me that those cases do not include the present one. The case of Reed v. Randall (29 N. Y., 358) was an executory contract for the sale of tobacco. The tobacco was delivered as merchantable, and was accepted, without objection, in execution of the contract. It was held that the vendee coixld not sue for damages based upon the xxnmei’chantable chai’acter of the tobacco.

The case of Beck v. Sheldon (48 N. Y., 365) was one similar in principle. The contract called for No. 1 and No. 2 pig iron at certain prices. The quality of pig iron is determined by the granulation. The skilled employer determines by the fracture to which grade it belongs. The grades thus determined were delivex’ed as the gi’ades called for; and it was held that after acceptance the contract was performed, and that the grades received and accepted were to be deemed thus contracted for. To the same purport is Dounce v. Dow (64 N. Y., 411).

The case of The Dutchess Company v. Harding (49 N. Y., 321) has no’ relevancy to the question presented. In that case the ■vendor had induced an acceptance of sumac by fraud. The case of McCormick v. Sarson (45 N. Y., 265) holds that after lumber is received as prime and xnerchantable it is too late to object. The contract was performed when the lumber was received in execution of it.

In tbe case under consideration there is no question made as to tbe quality of tbe goods or as to tbe performance of tbe contract. The proper proportions were not delivered so as to entitle tbe plaintiff to tbe price agreed upon. Tbe steel was not received in execution of tbe contract. There was no limit lo tbe amount which plaintiff might deliver, and there was no .requirement that the heavy steel could not be kept to the time of tbe last delivery. Tbe acceptance was of light steel and as such it was delivered and invoiced. To bold that such a delivery is to be held a delivery of heavy steel does not seem to be just. - Tbe plaintiffs under such a rule could obtain a premium for violating bis contract. The caséis not one of warranty, strictly so called. There is no question presented whether the steel delivered was as recommended, but whether the plaintiffs have performed their contract so as to entitle them to the contract-price. If the contract in reference to the proportions is a warranty, there was no obligation.to return' the goods but the defendants might recover their damages as an offset. (Hawkin v. Pemberton, 51 N. Y., 198.)

The judgment should be reversed, and a new trial granted, costs, to abide event, and order of reference vacated.

Dykman and Cullen, JJ., concurred.

So ordered.