Case Name: LOUIS ENGELHORN v. ALEXANDER H. REITLINGER, et al.
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1888-04-02
Citations: 23 Jones & S. 485
Docket Number: 
Parties: LOUIS ENGELHORN v. ALEXANDER H. REITLINGER, ET AL.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 55
Pages: 485–493

Head Matter:
LOUIS ENGELHORN v. ALEXANDER H. REITLINGER, ET AL.
Contract in writing, rule excluding parol testimony to vary or add to, applied.—Independent oral agreement collateral to contract in writing, breach of cannot be pleaded as a defence to an action on the writing.— Statute of frauds, rule as to pleading applied.
The assignor of the plaintiff sold through brokers to defendants, and defendants bought through the same broker from such assignors, certain sulphate of quinine. Defendants refused to accept or pay for the quinine, for the reasons set forth as a defense in their answer to the complaint, which counted on a written agreement of sale and purchase. The answer admitted the written agreement, and alleged that it was entered into by defendants on the express representation and warranty, made at the same time by the vendors, and upon the condition, that the price at which they were then selling and at which they would continue selling sulphate of quinine, was sixty-one cents per ounce, and on the further express warranty and representation, and upon the condition that said vendors would issue a circular to the trade to that effect. It then alleged that on the faith of such representations and warranty and trusting therein, they entered into the agreement counted on in the complaint, which fact was well known to the vendors. It then alleged that the representations and warranty were not true; that the vendors’ then price for sulphate of quinine was not sixty-one cents per ounce, nor did they issue any circular to the trade to that effect, but on the contrary they were then selling said sulphate and continued to sell the same at a price far less than said sum. It then alleged that by reason of said breach of warranty defendants refused to accept said sulphate of quinine. The evidence to support these allegations was the oral testimony of one of the defendants who testified: “ He (the broker) said if you make this contract the seller will issue a circular of the price that the moment you ' make this contract the price will be sixty-one cents, then I said, I will take it.” The broker gave testimony as to his authority to make the statement. The sale note was put in evidence by the plaintiff and read: “Dated New York, February 7th, 1887. Sold, for account Messrs. C. F. Boehringer & Soehne to Messrs. A. H. Reitlinger & Company, fifteen thousand ounces B. & S. "sulphate of quinine in one hundred ounce tins, at fifty-nine cents per ounce, cash ten days from delivery; delivery to be had from a March, 1887, shipment from the factory in Europe, subject to manufacturers’, clauses, and war risks. (Signed) St. John Brothers.”
Held, That whether the facts presented would have warranted the defendants in claiming the existence of an oral agreement as collateral to the written one, it was unnecessary to determine, as no counterclaim was set up, and the facts were so that if the oral agreement alleged be claimed to be collateral it was not available as a defense.
That the sale note presented a complete, perfect and certain contract in writing, containing every element of an entire contract, leaving nothing to be supplied, exhausting the final intention of both parties, covering both sides of an entire contract, designed to signify the terms of the contract, and adequate for that purpose, and therefore it could not be varied • or added to by parol evidence.
That the oral evidence did not warrant the conclusion that the written • agreement was made, not with the intention of making a present contract, but like an escrow to take effect only on condition of the happening of a future event and so be dependent for its existence on a condition precedent.
That the oral evidence did not bring the case within the principle of Chapin v. Dobson, 78 N. Y. 74.
That it was unnecessary to consider the point made by plaintiff that the contract sued on had the further protection of the statute of frauds; because among other reasons it did not appear in the pleadings that the statute-was relied on as a defense, the answer not showing that the re presentation and warranty claimed to have been relied on as a condition were not in writing. The fact that they appeared by the evidence not to be in writing is insufficient.
Before Sedgwick, Ch. J., and Dugro, J.
Decided April 2, 1888.
The court below directed a verdict for plaintiff, in the sum of $2,661. The exceptions taken by defendants were ordered to be heard in the first instance at a general term.
The facts sufficiently appear in the opinion and the head note.
Smith & Dougherty, attorneys, and J. Hampton Dougherty, of counsel for plaintiff, on the questions considered in the opinion, argued:
I. The bought and sold notes constitute a full and complete contract to sell and purchase quinine. “No element is wanting of an entire contract, exhausting the final intentions of both parties,” there is “ no uncertainty in subject matter or in terms, nothing which indicated some missing detail essential to be settled or supplied.” Such a contract falls within the rule which forbids parol evidence to modify any of its terms. Eighmie v. Taylor, 98 N. Y. 288 ; Wilson v. Deen, 74 Ib. 531; Johnson v. Oppenheim, 55 Ib. 280; Reynolds v. Robinson, 37 Hun 561. The facts in all these cases are closely similar to those in the case at bar. The rule of protection embraces all written contracts, whether under seal or not; and excludes all evidence dehors the contract. Bought and sold notes have often been held to form a written contract.
II. There are only three classes of cases in which it is proper to show by evidence outside of the written instrument that a contemporaneous oral agreement was made which affects the apparent meaning of the writing: 1. Where the writing is manifestly informal and incomplete. 2. Where the oral agreement is a collateral contract consistent with the writing. 3. Where the oral agreement does not affect the terms of the writing, but qualifies its meaning by showing that it was conditional. Jones on Construction of Contracts, § 120. (a) The written contract was manifestly a complete contract of sale. (b.) An oral agreement collateral to the writing would not affect the contract. The contract was to buy 15,000 oz. quinine and defendants must pay therefor. Their only remedy, if the sellers made a collateral contract to advance the price, but broke it, is by action for damages. No damages were pleaded or proved—no counterclaim therefor was alleged in the answer, (c.) The contract when made was to be at once operative as a contract. There was no oral agreement that it was not to be a contract until some contingency occurred:
III. The present contract has the further protection which the statute of frauds furnishes to contracts of sale. The writing is deemed to express all the terms upon which the sale is made. The memorandum cannot be helped by parol; nor can parol evidence be given to modify the memorandum. Wright v. Weeks, 25 N. Y. 160; Stone v. Browning, 68 Ib. 598; Hill v. Blake, 97 Ib. 216; Williams v. Robinson, 73 Me. 186; Benjamin on Sales, § 206; Jones on Construction of Contracts, § 127.
IV. Chapin v. Dobson, 78 N. Y. 74, upon which the defendants relied below, is not inconsistent with the rules already enunciated, nor is it an authority for the defendants in their present contention.
V. The evidence does not establish the claim of the defendants that the agreement for the purchase of .the quinine was made upon condition that the price should be advanced, and a circular of the advance issued. Pym v. Campbell, 6 Ellis & Bl. 370; 27 L. J., Q. B. 277.
VI. The testimony shows that the defendants accepted the brokers’ warranty or representation in lieu of the sellers’ agreement. What the defendants really insisted upon was not that the price should be raised, but that they should be guaranteed that the price should be raised. The brokers gave them this guarantee.
Adolph L. Sanger, attorney and of counsel for defendants, on the questions considered in the opinion, argued:
I. It was proper to introduce in evidence the representations made by the agent as the inducement for the contract, and the letter written by the agent" which accompanied the contract was properly admitted as a part of the contract. Ahern v. Godspeed, 72 N. Y. 108; Bostwick v. R. R. Co., 45 Ib. 712 ; Johnson v. Oppenheim, 55 Ib. 293 ; Remington v. Palmer, 62 Ib. 33-34; Brewers Fire Insurance Co. v. Bunzer, 10 Hun 56; Matter of Commissioners, etc., 52 N. Y. 134; Benton v. Martin, 52 Ib. 570; Chapin v. Dobson, 78 Ib. 79-83; Greenleaf on Ev. §§ 277, 283; Wilson v. Randall, 67 N. Y. 338; Renard v. Sampson, 12 Ib. 566.
II. The contract was made upon the agent’s representations and was induced thereby, and the evidence shows that the contract would not otherwise have been made. The plaintiff’s assignors were therefore bound to perform their covenant before defendants could be called upon to accept delivery of the goods, inasmuch as defendants’ obligation to perform was dependent and conditioned on the performance by plaintiff’s assignors of their agreement. The plaintiff’s assignors not having complied with the condition could not demand that the defendants should perform their part of the contract. This condition was a substantial part of the consideration, and the impelling element which induced defendants to enter into a agreement. Performance, therefore, by plaintiff’s assignors was a prerequisite to plaintiff’s right of action. 1 Chitty on Contracts, 11 Am. ed. 73 ; 2 Ib. 1082-1084, 1090; Grant v. Johnson, 5 N. Y. 247; Crance v. Knubel, 34 Super. Ct. 455; Portage v. Cole, 1 Wms. Saunders 310 ; Morris v. Silter, 1 Den. 59 ; Rider v. Pond, 18 Barb. 179; Dey v. Dox, 9 Wend. 129; Mansfield v. N. Y. Central R. R., 102 N. Y. 211; Cross v. Beard, 26 Ib. 85, 88. The learned judge, at trial term, fell into the unintentional error of looking upon plaintiff’s assignors’ undertaking as an independent agreement. Under such a circumstance, if the ageement were independent, the failure of plaintiff’s assignors to perform would have given defendants a right to counterclaim for damages. But there is nothing in this case which shows that this was an independent agreement; and it cannot, therefore, be governed by the rule of law suggested by the court at- the trial. Where, from a consideration of the whole contract, it is clear that the defendants intended to rely on the performance of plaintiff’s assignors’ promise to raise the price and to issue the circular immediately upon the making of the contract, the performance by plaintiff’s assignors of their promise became a condition precedent and dependent. See 2 Benjamin on Sales, 4th Am. ed., §§ 854, 855; Tomkins v. Elliott, 5 Wend. 496; Mansfield v. N. Y. Central R. R., 102 N. Y., 211.

Opinion:
By the Court.—Dugro, J.
The plaintiff in the action sues as the assignee of Boehringer & Soehne. The action was brought to recover damages from the defendants for an alleged breach of an agreement in writing whereby the firm of Boehringer & Soehne agreed to sell and deliver to the defendants, and the defendants agreed to purchase and accept from said firm, fifteen thousand ounces of quinine of the manufacture of said Boehringer & Soehne, in one hundred ounce tins at fifty-nine cents per ounce, to be paid for in cash ten days from delivery. Delivery to be from a March, 1887, shipment from the factory of the sellers in Europe, subject to manufacturers' clauses and war risks.
Pursuant to this contract the quinine was shipped and duly tendered to the defendants, but they refused to accept or pay for the goods, for the reason set forth as a defense in their answer in the action, and which is as follows: " (Admitting the written agreement alleged in the complaint) The defendants allege that said agreement [that above set forth] was entered into by them under and upon the express representation and warranty made at the same time by the duly authorized agents of said Boehringer & Soehne, and upon the condition that the price at which they were then selling and at which they would continue selling the said sulphate of quinine was sixty-one cents per ounce, and upon the further express warranty and representation and upon the condition that the said Boehringer & Soehne would issue a circular to the trade to that effect; that the said contract was entered into by these defendants upon the faith of such representations and warranties, these defendants trusting in such representations and warranties, and not otherwise, and which fact was well known to said Boehringer & Soehne at the time.
" III. That said representations and warranty so made by the said Boehringer & Soehne were not true. That their price for said sulphate of quinine at time of the making of said contract was not sixty-one cents per ounce, neither did they issue any circular to the trade to that effect, but, on the contrary, the price at which said Boehringer & Soehne were selling the said sulphate of quinine at the time of the making of said contract with defendants and the price at which they continued to sell the same was far less than said sum, and the defendants by reason of said breach of warranty of said Boehringer & Soehne thereupon refused to accept the said sulphate of quinine from said Boehringer & Soehne."
The oral evidence was in effect (assuming the authority claimed to have been possessed by St. John) that Boehringer & Soehne stated through the broker, St. John, that as soon as the sale of fifteen thousand ounces was made, they would not sell sulphate of. quinine for less than sixty-one cents per ounce and would issue a circular to the trade to that effect.
The defendants duly excepted to the ruling directing a verdict, and also excepted to the denial of their motion that the case be submitted to the jury for them to pass on all the facts in evidence.
Whether the facts presented would have warranted the defendants in claiming the existence of an oral agreement as collateral to the written one, it is unnecessary' to determine, as no counterclaim is set up; and the facts are so that if the oral agreement alleged be claimed to be collateral it is not available as a defense.
The contract in writing contains a definite agreement of sale, it leaves nothing of a complete, perfect and certain agreement to be supplied. On its face no element is wanting of an entire contract exhausting the final intentions of both parties and in this respect it differs from the writing which appears in the case of Chapin v. Dobson, 78 N. Y. 74. The contract must therefore be conclusively presumed to contain the whole contract as made. The writing covers both sides of an entire contract, was designed to signify its terms, was adequate for that purpose and cannot be varied or added to by parol evidence.
It seems from the testimony of William Reitlinger, one of the defendants, that the making of the contract was the consideration on defendants' part for the oral agreement, for he says, " He (the broker) said, If you make this contract the seller will issue a circular of the price that the moment you made this contract the price will be sixty-one cents......And then I said..... I will take it."
The evidence does not warrant the conclusion that the agreement was executed or made not with the intention of making a present contract, but like an escrow or writing to take effect only on condition of the happening of a future event and so be dependent for its existence upon a condition precedent.
The answer admits that the contract between the parties was in writing, but the defendant claims it was made in reliance upon certain oral representations and inducements made under circumstances similar to those under which the representations and inducements were made by one of the parties in the case of Wilson v. Been, 74 N. Y. 531. The rule as applied and explained in the latter case will serve to show why in the case under consideration oral evidence is incompetent to effect the purpose proposed. That it would be improper in the case under consideration to apply the rule of law deemed pertinent in Chapin v. Dobson [supra) will be clearly perceived by a reading of Eighmie v. Taylor, 98 N. Y 288, and the authorities therein referred to.
I have deemed it unnecessary to consider the point made by the plaintiff that the oral evidence offered would have brought within the statute of frauds and so avoided a writing such as should be deemed in a case like this to express all the terms upon which a contract of sale is made; among other reasons, because it does not appear in the pleadings that the statute is relied upon as a defense. The facts set forth in the answer do not show that the representations and warranty claimed to have been relied on as a condition were not in writing. From the evidence it seems they were not, but this is not sufficient. If the' statute is relied upon as a defense it must be apparent from the pleadings that this is so. The Code of Civil Procedure provides that the answer must, among other things, contain a statement of any new matter constituting a defense in ordinary and concise language. In the pleadings no statement appears that the representation and warranty were by parol, and no facts are stated from which it can be inferred that the statute was intended as a defense. Marston v. Swett, 66 N. Y 206.
The exceptions of defendants are overruled and judgment for plaintiff, upon the verdict, with costs.
Sedgwick, Ch. J., concurred.