Source: http://openjurist.org/215/f2d/503/packard-englewood-motors-v-packard-motor-car-company
Timestamp: 2016-12-03 12:39:19
Document Index: 104202123

Matched Legal Cases: ['§ 332', '§ 323', '§ 323', '§ 97', '§ 413', '§ 331', '§ 328']

215 F2d 503 Packard Englewood Motors v. Packard Motor Car Company | OpenJurist
215 F. 2d 503 - Packard Englewood Motors v. Packard Motor Car Company HomeFederal Reporter, Second Series 215 F.2d.
215 F2d 503 Packard Englewood Motors v. Packard Motor Car Company 215 F.2d 503
PACKARD ENGLEWOOD MOTORS, Inc., Appellant,
Irving Mariash, New York City (Seufert & Elmore, Englewood, N. J., I. Maurice Wormser, New York City, Charles Fishberg, Englewood, N. J., on the brief), for appellant.
James D. Carpenter, Jersey City, N. J. (Carpenter, Gilmour & Dwyer, James P. Beggans, Austin B. Johnson, Jr., Jersey City, N. J., on the brief), for appellee.
It was the plaintiff's contention in the district court that the defendant was obligated to deliver all 97 scrap bonus cars in 1948. It accordingly claimed as damages its loss of profit on the sale of 63 scrap bonus automobiles which were not delivered to it in 1948.1 The defendant contended, on the other hand, that it was not obligated to deliver scrap bonus cars at any particular time and that its offer of the cars in August and December, 1949 was therefore in full compliance with the contract. The district court, holding that such a contract as the defendant contended for would be no contract at all, concluded that the defendant's obligation would have been fulfilled by the delivery of scrap bonus cars as late as December 29, 1949, and that since the plaintiff failed to order the scrap bonus cars offered by the defendant in August and December, 1949 the latter was guilty of no breach of contract.
In order to resolve this controversy we must turn to the letters and press releases which constituted the defendant's offer to the plaintiff. The defendant's proposal was contained in a general letter to its dealers in the New York zone,2 dated December 18, 1947, reading as follows:
"So sure are we of this that we are prepared to offer Packard Dealers a special inducement in return for direct purchase of their scrap cast iron. Therefore, for each ton of scrap gray iron furnished us by a Dealer, one additional Packard car will be allotted to him. It is, of course, necessary that this offer be restricted to Zones within a given radius from Detroit, this radius being determined by the distance at which scrap can be handled and shipped on an economical basis. The following general rules will govern this arrangement:
"1. The Dealer will accumulate such cast iron scrap as is suitable for cupola remelt. This will include iron castings of any description such as cylinder blocks, cylinder heads, manifolds, transmission cases, differential carrier cases, water pump housings, cast iron flywheels, etc.
"4. Packard Motor Car Company will pay Packard Dealers the current Detroit market price for scrap cast iron and will pay the transportation f. o. b. the Dealer point to Detroit.
This proposal was further defined by subsequent letters and press releases. In a letter to dealers in the New York zone, dated December 30, 1947, the defendant's general sales manager said:
"Negotiations now in process with Dealers will be carried through to a conclusion and shipments will be accepted after approval has been received from this Zone Office."
"`The cooperation of your dealers enabled us to build cars that otherwise would have been deleted from the schedule due to the lack of this much needed material. However, due to the generous response of our dealer organization this program was oversubscribed beyond the total tonage that we had expected to receive and for which we had set aside 22nd series cars. It is therefore necessary to allot a certain portion of the cars due these dealers in 23rd series cars. The total 22nd series allotment figures (scrap bonus cars) cover approximately sixty percent of the cars due your zone based on tonage scrap iron received and credited through August. The balance (approximately 40%) due will be allocated against 23rd series cars.'
Before proceeding to consider the proper construction to be placed upon the contract thus created between the parties we must determine what law to follow. Since the district court sat in New Jersey it was, and we are, bound to apply New Jersey conflict of laws rules. Looking to the law of New Jersey we find that ordinarily reference is to be made to the law of the place of contracting to determine the obligations of the parties.3 Likewise we look to the conflict of laws rules of New Jersey to determine the place where the contract was made. Under the law of that state, since an informal unilateral contract of the kind here involved becomes binding when the requested act takes place, the place of contracting is where that act occurs.4 Here the required act was the shipment of scrap iron by the plaintiff to the defendant. Those shipments were made by the plaintiff to the defendant f. o. b. freight cars in New Jersey. The act of shipment was accordingly completed in New Jersey and the resulting contracts are, therefore, to be construed under New Jersey substantive rules of contract law.
Under the law of New Jersey the basic rule to be applied in the construction of such a contract is to ascertain and determine the intention of the parties, as of the time of making, as expressed by the language they employed, when read and considered as a whole and in the light of the surrounding circumstances and the purposes they sought to attain.5 For this purpose the several letters and statements of the defendant constituting its offer to the plaintiff are to be read together as one instrument.6
We accordingly conclude that the agreement between the parties which resulted when the plaintiff made a shipment of scrap cast iron to the defendant7 obligated the defendant to allot to the plaintiff the scrap bonus cars to which it was entitled as a result of that shipment for delivery, if ordered by the plaintiff, in the month in which automobiles produced from the supply of scrap iron to which the plaintiff's scrap had been added would be ready for delivery and in the subsequent months of the calendar year 1948, the allotments to be spread equally over those months. It will be seen that the only factor involved in determining the defendant's obligation under the agreements the extent of which is not determinable from the documents is the length of time which normally must elapse between the shipment of scrap cast iron to the defendant and the completion of deliverable cars manufactured from the scrap iron thus shipped or other scrap iron on hand when it was received. This is not clear from the present record although it is undoubtedly capable of being established by evidence.
We, of course, do not pass upon the question whether the plaintiff subsequently agreed to the modification of these agreements. The defendant calls attention to its letter of September 23, 1948 and argues that thereby the terms of its agreements with the plaintiff were modified so as to require only 60% of the scrap bonus cars to be allotted out of the 22d series cars (which the evidence indicates were delivered up to about the end of March, 1949) and to permit it to deliver 40% of the scrap bonus cars out of the 23d series cars which followed the 22d series in April, 1949. We cannot agree that the defendant could by such a unilateral act modify its obligations under its existing contracts although such a modification could, of course, be made with the plaintiff's consent. But whether such consent was given is a question of fact as to which the district court made no finding.
The defendant points to the fact that the plaintiff accepted delivery of four scrap bonus cars in January, 1949 and contends that this amounted to a waiver of the provisions of the agreement for delivery in 1948 and an acceptance of the letter of September 23, 1948. We do not agree. As we have pointed out the defendant's obligation under the agreements included a duty to allot scrap bonus cars in December, 1948 for delivery, if ordered, in 1949. Here, since the four cars in question were allotted in 1948, the fact that they were delivered in 1949 is without significance. Likewise the fact that the plaintiff cancelled orders for seven cars which it had ordered in December, 1948 is immaterial since its refusal to take particular allotted cars can have no bearing on its right to be allotted the remaining scrap bonus cars to which it was entitled. Of course, the plaintiff could not recover damages with respect to cars properly allotted to it under the agreements but which it failed to purchase.
Since the court has made no findings upon the question of damages we need not consider that subject.8 It may be useful to point out, however, that if upon the new trial the plaintiff establishes a breach of the agreements by the defendant it will be entitled to compensatory damages to the extent that the evidence affords a sufficient basis for a finding that it suffered a loss of profits as a result thereof and for estimating that loss with reasonable certainty,9 and that in any event it would be entitled to nominal damages.10
1. It made no claim in respect to the 4 cars delivered to and accepted by it in January, 1949.
2. Englewood, New Jersey, was in the defendant's New York zone.
3. Hinkly v. Freick, 1914, 86 N.J.L. 281, 283, 90 A. 1108, L.R.A.1916B, 1041; James H. Rhodes & Co. v. Chausovsky, 1948, 137 N.J.L. 459, 462, 60 A.2d 623, 626; Restatement, Conflict of Laws, § 332.
4. Northampton Mutual Live Stock Ins. Co. v. Tuttle, 1878, 40 N.J.L. 476, 479; Restatement, Conflict of Laws, § 323; Goodrich on Conflict of Laws, 3d ed., Sec. 107; 2 Beale, Conflict of Laws, § 323.1; 1 Williston on Contracts, § 97.
5. Corn Exchange Nat. Bank & Trust Co. v. Taubel, 1934, 113 N.J.L. 605, 608-609, 175 A. 55, 57; Heurer v. Rubin, 1949, 1 N.J. 251, 255, 62 A.2d 812, 814; Stanbery v. Aetna Life Ins. Co., 1953, 26 N.J. Super. 498, 502, 98 A.2d 134, 136.
6. Schlein v. Gairoard, 1941, 127 N.J.L. 358, 360, 22 A.2d 539, 540-541; Schlossman's, Inc. v. Radcliffe, 1950, 3 N.J. 430, 435, 70 A.2d 493, 495; Lawrence v. Tandy & Allen, 1953, 14 N.J. 1, 6, 100 A.2d 891, 894.
7. Since each shipment constituted an acceptance of the defendant's offer it is clear that each shipment resulted in a separate agreement for the allotment of scrap bonus cars to the shipping dealer which must be considered independently of the others in determining the defendant's obligations.
8. It appears that under the conflict of laws rules of New Jersey the law of the place of performance of a contract determines the measure of damages for its breach. Healy v. Gorman, 1836, 15 N.J.L. 328; Swetland v. Swetland, 1930, 105 N.J.Eq. 608, 617, 149 A. 50, 54. This is also the generally accepted rule. Restatement, Conflict of Laws, § 413; Goodrich, Conflict of Laws, 3d ed., p. 255. Here the plaintiff was to be notified at its place of business in New Jersey of the allotments of scrap bonus cars made to it under the agreement. The damages, if any, to which the plaintiff is entitled are, therefore, to be determined under the law of New Jersey.
9. Feldman v. Jacob Branfman & Son, 1933, 111 N.J.L. 37, 41-42, 166 A. 126, 127, 128; Casler v. Weber, 1953, 27 N.J.Super. 396, 399, 99 A.2d 537, 538. See Restatement, Contracts, § 331(1), and New Jersey annotations thereto.
10. Furniture Co. v. Board of Education, 1896, 58 N.J.L. 646, 647, 35 A. 397; Van Schoick v. Van Schoick, 1908, 76 N.J.L. 242, 244, 69 A. 1080, 1081; Car & General Ins. Corporation v. Davimos, 1934, 12 N.J.Misc. 569, 173 A. 150, affirmed 114 N.J.L. 192, 176 A. 320. See Restatement, Contracts, § 328, and New Jersey annotations thereto.