Case Title: GENERAL MILLS INC v ZERBE BROTH

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Docket Number: 

State: montana

Court: Montana Supreme Court

Date: 1983-11-23T00:00:00Z

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No. 83-35 I N T H E SUPREME C O U R T O F THE STATE O F M O T J T A N A 1983 GENERAL MILLS, IEC. , P l a i n t i f f and Appellant, -vs- ZERBE BROTHERS, I N C . , a Pilont. Corp., e t ax., Defendants and Respondents. APPEAL FROM: D i s t r i c t Court of t h e Seventeenth J u d i c i a l D i s t r i c t , I n and f o r t h e County of Valley, The Honorable Leonard H. Langen, Judge p r e s i d i n g . COUNSEL O F RECORD: For Appellant r J a r d i n e , Stephenson, B l e w e t t & Weaver; K. Dale Schwanke, Great F a l l s , Montana For Respondents: Robert Hurly, Glasgow, Montana Submitted on B r i e f s : September 15, 1983 Decided: November 23, 1 9 8 3 F i l e d : NOV 2 3 1983 P l r . Justice L.C. Gulbrandson delivered the Opinion of the Court. This case comes on appeal from a judgment of the Seventeenth Judicial District Court, Valley County, finding the existence of an oral contract for the sale of 20,000 bushels of wheat and crediting the respondents with two deliveries of wheat rejected by the appellant. Otto (now deceased) and Paul Zerbe were brothers who grew wheat in Lustre, Valley County, Montana, and also owned an implement dealership known as Zerbe Brothers, Inc. On May 29, 1973, an agent for General Mills, Inc., Fred Page, phoned Paul Zerbe to negotiate a grain purchase by General Mills. Both parties acknowledge that an agreement was reached as to a price of $2.56 per bushel and a period for delivery, but the quantity of the purchase is in dispute. At trial, Page testified that Paul Zerbe agreed to sell General Mills 50,000 bushels of wheat, a quantity Page wrote on a confirmation form during the telephone conversation. However, Paul Zerbe testified he only agreed to sell General Mills "up to" 20,000 bushels, and that he did not have 50,000 bushels to sell. Zerbe also testified he never sold 50,000 bushels at one time or a whole crop in one transaction and claimed he never received the confirmation form reflecting the greater quantity. In prior sales transactions between the parties, the Zerbes did not sign confirmation forms or send them back to General Mills. No specific evidence that the confirmation form was mailed or received was presented, however, General Mills did offer testimony that it was its usual and customary business p r a c t i c e t o m a i l t h e c o n f i r m a t i o n forms t o a s e l l e r . Also, t h e Zerbes r e c e i v e d s e t t l e m e n t checks f o r t h e wheat t h e y d e l i v e r e d . Between J u n e 7, 1973 and J u l y 27, 1973, t h e Zerbes d e l i v e r e d a t o t a l of 16,593 b u s h e l s of d a r k n o r t h e r n s p r i n g wheat t o t h e G e n e r a l M i l l s g r a i n e l e v a t o r i n G r e a t F a l l s , Montana. I n a d d i t i o n , t h e Zerbes t e n d e r e d two a d d i t i o n a l l o a d s of wheat t o G e n e r a l M i l l s . One l o a d was t e n d e r e d on J u l y 24, 1973, and c o n s i s t e d of 800 b u s h e l s of wheat. Another l o a d of 800 b u s h e l s was t e n d e r e d on J u l y 28, 1973. Both l o a d s were r e j e c t e d by G e n e r a l M i l l s because t h e y were a l l e g e d l y contaminated by i n s e c t s . However, t h e Zerbes s o l d t h e same l o a d s of wheat t o a n o t h e r e l e v a t o r i n G r e a t F a l l s w i t h o u t d i s c o u n t f o r c o n t a m i n a t i o n . A f t e r r e j e c t i o n of t h e two l o a d s , t h e Zerbes d i s c o n t i n u e d d e l i v e r i e s under t h e c o n t r a c t . On A p r i l 11, 1974, G e n e r a l M i l l s l e a r n e d t h a t t h e Zerbes were n o t going t o make any f u r t h e r d e l i v e r i e s . The market p r i c e f o r d a r k n o r t h e r n s p r i n g wheat i n G r e a t F a l l s on A p r i l 11, 1974 was $4.44 p e r b u s h e l . On J u l y 1 0 , 1975, G e n e r a l M i l l s b r o u g h t s u i t a g a i n s t t h e Z e r b e s a l l e g i n g b r e a c h o f c o n t r a c t and s e e k i n g $61,802.95 i n damages. On November 4, 1982, t h e c a s e was t r i e d b e f o r e t h e D i s t r i c t Court s i t t i n g w i t h o u t a j u r y . A f t e r h e a r i n g t h e e v i d e n c e p r e s e n t e d by t h e p a r t i e s t h e District Court h e l d : (1) t h e o r i g i n a l c o n t r a c t was f o r 20,000 b u s h e l s o f wheat; ( 2 ) t h e d e f e n d a n t s t e n d e r e d o r d e l i v e r e d a t o t a l o f 18,193 b u s h e l s t o p l a i n t i f f , a q u a n t i t y t h a t i n c l u d e d t h e two 800 b u s h e l l o a d s t h e p l a i n t i f f r e j e c t e d on J u l y 24, 1973 and J u l y 28, 1973; ( 3 ) t h e d e f e n d a n t s f a i l e d t o d e l i v e r 1,807 b u s h e l s under t h e terms o f t h e c o n t r a c t ; and ( 4 ) t h e p l a i n t i f f was e n t i t l e d t o a judgment i n t h e amount of 1,807 b u s h e l s times $1.85 which was t h e d i f f e r e n c e b e t w e e n t h e $2.56 p e r b u s h e l t h e d e f e n d a n t s a g r e e d t o a c c e p t f o r t h e wheat and t h e $4.41 p e r b u s h e l m a r k e t p r i c e on A p r i l 11, 1974. The p l a i n t i f f now a p p e a l s c l a i m i n g t h e D i s t r i c t C o u r t e r r e d i n f i n d i n g t h a t t h e o r a l c o n t r a c t was f o r 20,000 b u s h e l s r a t h e r t h a n 50,000 b u s h e l s and c r e d i t i n g d e f e n d a n t s f o r t h e two 800 b u s h e l l o a d s t e n d e r e d on J u l y 24, 1973 and J u l y 28, 1973. S p e c i f i c a l l y , a p p e l l a n t a r g u e s t h e r e is a presumption under Montana law t h a t a m a i l i n g h a s been r e c e i v e d i f customary o f f i c e m a i l i n g p r o c e d u r e s have been f o l l o w e d and r e s p o n d e n t s f a i l e d t o p r o d u c e c r e d i b l e e v i d e n c e t o r e b u t t h a t presumption. I n a d d i t i o n , a p p e l l a n t asserts t h e r e s p o n d e n t s s h o u l d be e s t o p p e d from c l a i m i n g t h e y o n l y a g r e e d t o s e l l up t o 20,000 b u s h e l s o f wheat r a t h e r t h a n t h e T0,000 c l a i m e d by a p p e l l a n t b e c a u s e o f t h e r e s p o n d e n t s ' p a s t p r a c t i c e of n o t s i g n i n g and r e t u r n i n g c o n f i r m a t i o n forms b u t d e l i v e r i n g t h e q u a n t i t i e s o f wheat a g r e e d t o by t h e p a r t i e s . F i n a l l y , a p p e l l a n t c o n t e n d s t h e D i s t r i c t C o u r t e r r e d i n c r e d i t i n g t h e r e s p o n d e n t s w i t h t h e two 800 b u s h e l l o a d s because t h e e v i d e n c e p r e s e n t e d a t t r i a l showed t h e a p p e l l a n t was j u s t i f i e d i n r e j e c t i n g t h e l o a d s a s c o n t a m i n a t e d . Montana law presumes t h a t a l e t t e r m a i l e d i n t h e o r d i n a r y c o u r s e of b u s i n e s s h a s been r e c e i v e d . S e c t i o n 26-1-602(20)(24), MCA. I n t h i s case, w h i l e it is t r u e t h a t t h e r e is no d i r e c t e v i d e n c e o f a c t u a l m a i l i n g o f t h e c o n f i r m a t i o n form, t h e presumption of r e c e i p t n e v e r t h e l e s s a r i s e s . C r i s s e y v. S t a t e Highway Commission ( 1 9 6 6 ) , 147 Mont. 374, 413 P.2d 308. It is enough t h a t t h e r e is a n o f f i c e p r a c t i c e o r custom and t h a t t h i s p r a c t i c e o r custom was c a r r i e d o u t . C r i s s e y , 147 Mont. a t 379. However, i n t h i s c a s e t h e r e s p o n d e n t d e n i e s r e c e i p t o f t h e c o n f i r m a t i o n o r d e r . I n Crissey, w e h e l d t h a t a n a d d r e s s e e ' s p o s i t i v e d e n i a l of r e c e i p t d o e s n o t n u l l i f y t h e presumption, b u t l e a v e s t h e q u e s t i o n f o r t h e d e t e r m i n a t i o n of t h e j u r y , o r t h e c o u r t s i t t i n g w i t h o u t a j u r y , w i t h such weight g i v e n t o t h e presumption a s t h e y t h i n k it is e n t i t l e d t o . C r i s s e y , 147 Mont. a t 379; a l s o see James T a l c o t t , I n c . v. Reynolds ( 1 9 7 4 ) , 165 Mont. 404, 529 P.2d 352 and Renland v . F i r s t N a t i o n a l Bank ( 1 9 3 1 ) , 90 Mont. 424, 4 P.2d 488. The presumption is n o t c o n c l u s i v e and may be c o n t r o v e r t e d by o t h e r e v i d e n c e . S e c t i o n 26-1-602, MCA. Also s e e g e n e r a l l y 31A C.J.S. Evidence, S e c t i o n 136, p. 291. Af t e r c o n s i d e r i n g t h e e v i d e n c e and a s c e r t a i n i n g t h e w i t n e s s e s ' c r e d i b i l i t y , t h e D i s t r i c t C o u r t determined t h a t r e s p o n d e n t d i d n o t r e c e i v e t h e c o n f i r m a t i o n form r e f l e c t i n g t h e 50,000 b u s h e l q u a n t i t y and t h e terms of t h e c o n t r a c t p r o v i d e d f o r d e l i v e r y of 20,000 b u s h e l s . The D i s t r i c t C o u r t p r o p e r l y w e i g h e d t h e p r e s u m p t i o n o f r e c e i p t a g a i n s t r e s p o n d e n t ' s d e n i a l and t h e o t h e r e v i d e n c e p r e s e n t e d a t t r i a l and a r r i v e d a t its c o n c l u s i o n . W e cannot d e v i a t e from our f u n c t i o n a s an a p p e l l a t e c o u r t and r e v e r s e t h e D i s t r i c t C o u r t ' s d e c i s i o n . Our f u n c t i o n s d o n o t i n c l u d e a r e t r i a l of t h e c a s e . W e w i l l n o t s u b s t i t u t e our judgment f o r t h a t of t h e t r i a l c o u r t . W e a r e " c o n f i n e d t o d e t e r m i n i n g whether t h e r e i s s u b s t a n t i a l c r e d i b l e e v i d e n c e t o s u p p o r t t h e f i n d i n g s of f a c t and c o n c l u s i o n s o f law." Cameron v. Cameron ( 1 9 7 8 ) , 179 Mont. 219, 227, 587 P.2d 939, 944; - I n t h e M a t t e r o f t h e E s t a t e of LaTray ( 1 9 7 9 ) , 183 Mont. 141, 598 P.2d 619; Olson v. Westfork Properties, Inc. (1976), 171 Mont. 154, 557 P.2d 821; Hornung v. Estate of Lagerquist (1970), 155 Mont. 412, 473 P.2d 541. We have elaborated on this standard numerous times and several well-settled principles have emerged. We view the evidence in the light most favorable to the prevailing party. Cameron, supra; Olson, supra; Hellickson v . Barrett Mobile Home Transport, Inc. (1973), 161 Mont. 455, 507 P.2d 523. The evidence may be inherently weak and still be deemed "substantial." Campeau v. Lewis (1965) , 144 Mont. 543, 547, 398 P.2d 960, 962. Moreover, Rule 52(a) M.R.Civ.P. provides, in part, that "[£]indings of fact shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge of the credibility of the witnesses." The record before us does not evince a clear error in the District Court's decision to find the parties contract was for 20,000 bushels rather than 50,000 bushels. Likewise, appellant has failed to point out any clear error in the District Court's decision that the respondents be credited with the two 800 bushel loads they tendered to appellant on July 24, 1973 and July 28, 1973. Appellant also asserts that respondents should be estopped from denying the contract was for 50,000 bushels because in prior transactions between the parties the respondents never signed or returned confirmation forms. The essential elements of estoppel are the following: (1)l there must be conduct, acts, language or silence amounting to a representation or concealment of facts; (2) facts must be known to party estopped at the time of his conduct; (3) truth concerning the facts must be unknown to the other p a r t y ; ( 4 ) t h e conduct must be done w i t h t h e i n t e n t i o n t h a t it be a c t e d upon by t h e o t h e r p a r t y o r under c i r c u m s t a n c e s s o t h a t it is b o t h n a t u r a l and p r o b a b l e t h a t it w i l l be s o a c t e d upon; ( 5 ) t h e conduct must i n f a c t have a c t e d upon it t o h i s d e t r i m e n t . I n r e t h e Matter o f Shaw (Mont. 1 9 8 0 ) , 615 P.2d 910, 37 St.Rep. 1480; Kenco v. C a n t r e l l ( 1 9 7 7 ) r 174 Mont. 130, 568 P.2d 1225; Smith v. K r u t a r ( 1 9 6 9 ) , 1 5 3 Mont. 325, 457 P.2d 459. The f a c t s of t h i s case do n o t w a r r a n t an a p p l i c a t i o n of t h e d o c t r i n e o f e s t o p p e l . The r e c o r d d o e s n o t c o n t a i n e v i d e n c e of any conduct o f t h e r e s p o n d e n t t h a t would be c o n s i d e r e d a r e p r e s e n t a t i o n o r concealment t h a t t h e p a r t i e s c o n t r a c t was f o r 50,000 b u s h e l s r a t h e r t h a n 20,000 b u s h e l s . A l s o , t h e D i s t r i c t C o u r t determined t h e e v i d e n c e showed t h e p a r t i e s a g r e e d t o a 20,000 b u s h e l q u a n t i t y on t h i s p a r t i c u l a r o c c a s i o n s o t h e 50,000 q u a n t i t y claimed by a p p e l l a n t c a n n o t be c o n s i d e r e d a " f a c t " w i t h i n t h e knowledge of t h e r e s p o n d e n t s . E s t o p p e l is n o t f a v o r e d and w i l l be s u s t a i n e d o n l y upon a p p e l l a n t ' s showing o f c l e a r and c o n v i n c i n g e v i d e n c e . T r i b b l e v. Reely ( 1 9 7 6 ) , 1 7 1 Mont. 201, 557 P.2d 813. I n sum, we f i n d no r e v e r s i b l e e r r o r and t h e r e f o r e a f f i r m . W e concur: V44A$&&fJgJ Chief J u s t i c e Jqd ices A