Case Name: The Petersburg Fire Brick & Tile Co. v. The American Clay Machinery Co.
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1914-02-10
Citations: 89 Ohio St. 365
Docket Number: No. 13530
Parties: The Petersburg Fire Brick & Tile Co. v. The American Clay Machinery Co.
Judges: Nichols, C. J., Shauck, Newman and Wilkin, JJ., concur.
Reporter: Ohio State Reports, New Service
Volume: 89
Pages: 365–381

Head Matter:
The Petersburg Fire Brick & Tile Co. v. The American Clay Machinery Co.
Contracts — Sale of several articles for gross sum — Indivisible contract, when — Seller cannot recover until complete performance, when — Delivery of part not substantial compliance with contract, when — Rights of parties under contract stipulations as to delivery — Delivery to common carrier, deposit of bill of lading and requesting notes — Do not constitute delivery, when.
1. A written contract for the sale of several articles of personal property for a sum in gross is indivisible except by subsequent agreement of the parties, and the seller cannot recover the contract price or any part thereof unless he substantially performs or tenders performance of all the terms of the contract \ on his part to be performed.
2. Under such a contract the delivery of a part of the personal property sold, equal in value to about one-third of the total contract price, is not a substantial performance on the part of the seller.
3. Where a contract for the sale of personal property specifically provides for the manner and method of delivery, the seller has no right or authority to impose other or further conditions precedent to delivery than those named in the contract.
4. Delivery of personal property to a common carrier, the bill of lading being taken in the name of the seller, and forwarded to a bank in a city other than the purchaser’s place of business, with the demand upon the purchaser that he execute and deliver to this bank for the seller, notes covering the entire purchase price before the bill of lading will be de'ivered to him, does’ not constitute a delivery or a sufficient tender ol delivery under a contract of sale of personal property, which provides for delivery f. o. b. car's at shipping point for shipment to the purchaser, and which further provides for the payment of one-fourth of the purchase price within thirty days after the arrival of the property on the cars at its destination, the residue thereof to be paid in four, eight arid twelve months respectively, deferred payments to be evidenced by notes of even date with the bill of lading.
(No. 13530
— Decided February 10, 1914.)
Error to the Circuit Court of Lawrence county.
On the 8th day of March, 1906, The Petersburg Fire Brick & Tile Company accepted, in writing, a written proposition of The American Clay Machinery Company to furnish one two-mould dry-press brick machine, one eight-foot dry pan, and one agitating clay feeder, of certain styles and numbers as shown by the catalogue of the machinery company. This contract was approved on the 10th day of March, 1906, by' the secretary and manager of The American Clay Machinery Company.
On the 8th day of May, 1906, the dry pan mentioned in the contract was shipped to Coal Grove, Ohio. The bill of lading, being in the name of the machinery company, was transferred by it to the brick company, by endorsement thereon, and forwarded to the brick company by mail. The brick company received this dry pan, put it in place in its factory and continued to use same.
On the 28th day of July, 1906, the machinery company shipped to its own order to Coal Grove, Ohio, the dry-press brick machine and agitating clay feeder described in the contract, forwarding the bill of lading with four unsigned promissory notes covering the entire purchase price of all the machinery to The First National Bank of Ironton, Ohio. That bank was instructed upon the execution and delivery of these notes by the brick company to turn over to that company the bill of lading covering this shipment. The brick company refused to accept the shipment or to execute the notes, and thereupon the dry-press brick machine and the agitating clay feeder were returned to the machinery company. The dry pan still remained in the possession and use of the brick company.
On the 29th day of November, 1909, the machinery company filed its petition in the common pleas court of Lawrence county, Ohio, seeking to recover the value of the dry pan. The pleadings in the case are voluminous, consisting of petition, answer and cross-petition, reply to answer and answer to cross-petition, reply to answer to the cross-petition, amendment to petition, answer to petition and amendment thereto and cross-petition, answer to cross-petition and reply, and reply to the answer to the cross-petition.
The plaintiff pleads a contract and full performance on its part, and an averment that the defendant failed, neglected and refused to comply with the terms of the contract and refused to accept the dry-press machine and the agitating clay feeder, and that at the request of the defendant it took back these two pieces of machinery and credited it with $1,600 on the contract price. The defendant denies that plaintiff complied with the contract ■on its behalf, and avers that plaintiff failed to deliver the goods within the time specified in the contract; denies that plaintiff ever did deliver to it the press brick machine or agitating clay feeder, and denies that plaintiff took same back at the request of the defendant, or that it credited the contract price with $1,600 at the request of the defendant. By cross-petition, defendant asks $10,237 damages for breach of contract by the plaintiff in failing to ship this machinery within the time stipulated in the contract. In answer to this claim for damages, made by the defendant in its cross-petition, the plaintiff pleads a waiver on the part of defendant as to the time of shipment. It also recites certain other provisions of the contract with reference to delays that might be occasioned by specific causes named therein, and avers that these causes did occasion the delay in shipment. It also pleads the provisions of the contract in reference to exemption from liability on the part of plaintiff for failure to ship within the time specified. The defendant denies any waiver of the terms of the contract on its part as to the time in which this machinery was to be shipped or as to damages resulting from failure to ship the same. It also avers that the dry pan is of no value to it without the other machinery and not worth to exceed $700 in any event; that the contract was an entirety and contemplated each piece of machinery fitting in and becoming an integral part of the other in operating the plant,; and further avers that certain. terms and provisions now appearing to have been printed in the contract were not known to the defendant at the time it signed the same; that the manager of the brick company, by reason of failing eyesight and not having his spectacles at hand, was unable to read it, and relied upon the reading by the agent of the machinery company, and that the contract as read to him and as discussed and agreed upon by himself and the agent of plaintiff, contained no provision with reference to delay in shipment, no provisions releasing plaintiff from liability therefor, no provisions that the property should be insured against loss by fire, loss, if any, payable to plaintiff, and no agreement or understanding that the agent had no authority to contract for and on behalf of the company, and no provisions that the title to the machinery should remain in the plaintiff, and that it did not learn of such matters until recently, but avers that in any event the delays were not occasioned by any of the causes named in the contract, nor were they due to delay of the goods in transit, but were caused solely and alone by the neglect and default of the plaintiff.
The petition contains a second cause of action in which it is sought to recover $24 for certain items of merchandise furnished to defendant, claimed not to be included in the contract. This is denied by the answer, but no controversy arises in this record now as to these items.
Upon the issue so joined the case was submitted to the court without the intervention of a jury, and the court found on all the issues joined for the plaintiff, rendering judgment for the full amount on both causes of action, and denied the defendant any damages on its cross-petition. This judgment was affirmed by the circuit court, and error is now prosecuted in this court to reverse the judgment of the common pleas court and the judgment of the circuit court affirming the same.
'Mr. A. R. Johnson and Mr. Dan C. Jones, for plaintiff in error.
Messrs. Cooper & Russell and Messrs. Finley & Gallinger, for defendant in error.

Opinion:
Donahue, J.
The evidence material to the issues joined in this case is the written contract and the correspondence between the parties touching the subject-matter of the contract. This contract, in brief, provides that plaintiff shall furnish f. o. b. cars at Bucyrus, Ohio, or Willoughby, Ohio, or at factory where made, one two-mould dry-press brick machine; one eight-foot dry pan; and one No. 1 agitating clay feeder within thirty days, or sooner if possible. .For these three articles, to be delivered in the manner and at one of the places specified, the defendant was to pay $2,450. Six hundred dollars of this purchase price was to be .paid in thirty days after arrival of machinery on the cars at Coal Grove, Ohio, and the balance in three equal payments, due in four, eight and twelve months from date of the bill of lading. Bankable notes bearing legal rate of interest were to be given for deferred payments, these notes to be secured, if required by plaintiff, by personal or collateral security satisfactory to plaintiff. The contract further provided that deliveries should be made subject to delays caused by fires, strikes, accidents and causes beyond the control of the plaintiff, and that plaintiff assumed no liability for delays in shipment or while goods are in transit, and that the receiving of the material and machinery by the defendant would operate as a waiver of all claims for damages by reason of any delay in delivery however caused. It further provided that the title to the material and machinery should remain in the plaintiff until the full purchase price was paid in cash, with full right of access thereto until such payment was made, that such machinery was to remain the personal property of plaintiff and not be' attached as a fixture, and on payment of the full purchase price plaintiff agreed to transfer title to defendant. It further provided that the defendant should keep this machinery insured against fire in an amount sufficient to protect the plaintiff, the policies to contain a clause making them payable to the plaintiff as its interests might appear at time of loss, and in event such insurance was not obtained then the defendant to assume and pay all loss sustained by the plaintiff by fire from any cause.
The claim made by the defendant in its cross-petition that it was not fully advised of all the terms of this contract when it signed the same is not important at this time. Nor do we think it was error for the trial court to reject evidence in reference thereto. It appears from the record that a copy of this contract remained with the defendant during all the time it was insisting upon performance. If the manager of the defendant could not, for the reason assigned, read this contract at the time he executed the same on behalf of the defendant, he could have read it and should have read it within a much shorter time thereafter than the date of the last demand by the defendant that plaintiff fully comply therewith.
In the absence of an action to reform for mutual mistake or to rescind the contract for fraud on the part of plaintiff, the terms of this contract must fix the rights and liabilities of both parties thereto.
That this contract is indivisible except by subsequent agreement of the parties is too plain for dispute. The delivery of part of the merchandise agreed to be delivered by the plaintiff is not a compliance with the contract, and, nothing else appearing, would not authorize plaintiff to .recover the value of any part of the merchandise furnished substantially less than named in the contract.
It is, therefore, important to determine, first, whether plaintiff performed the conditions and covenants of the contract on its part to be performed; or, if it did not, was its failure to do so justified by the conduct of the defendant? This machinery was to be furnished within a time certain named in the contract. It is claimed that this provision as to the time of shipment was waived by the defendant. Upon this question there is a conflict of evidence, and, therefore, the judgment of the common pleas court in that behalf will not . be disturbed by this court. Upon the question of the delivery, however, the facts are not in dispute. On this subject there is no conflict in the evidence whatever, and it becomes solely a question of law whether delivery was made or tendered at any time before the bringing of this action to -recover the purchase price.
The contract provides for the delivery f. o. b. cars Bucyrus, or Willoughby, Ohio, or factory where made, for shipment to the defendant at Coal Grove, Lawrence county, Ohio. The dry pan that was shipped on the 8th day- of May was not consigned to the brick company. The bill of lading was taken in the name of the machinery company, endorsed by it and mailed to the brick company at Coal Grove, Ohio. This was not a serious departure from the provisions of the contract. It worked no inconvenience to the defendant-Even if it did, the purchaser accepted it without protest or complaint as to the manner of delivery. If the shipment of the dry-press machine and the agitating clay feeder had been so made, then if the time of delivery was in fact waived there would have been a substantial, if not a literal, compliance with the terms of the contract. When this second shipment was made the bill of lading was taken in the name of the machinery company, but it was never endorsed, delivered or tendered unconditionally to the brick company, as was done with the bill of lading for the dry pan. This merchandise was not delivered f. o. b. cars at Bucyrus, or Wil loughby, or factory where made, for shipment to the brick company at Coal Grove, but was delivered to the common carrier for shipment to the machinery company at Coal Grove. The delivery to the common carrier was not actual or constructive delivery to the purchaser. There was no time in the history of this transaction when the machinery company parted with the possession or right of possession of this machinery, nor was there a time when the brick company had a right to demand or require the common carrier to deliver this machinery to it.
The petition avers that the defendant company is a corporation, with its office and place of business located at Coal Grove, Lawrence county, Ohio. This contract does not provide for any conditions precedent to the delivery of this machinery, yet the defendant in error, instead of making delivery as contemplated in the contract, shipped the goods in its own name to Coal Grove, and sent the bill of lading with four unsigned promissory notes to evidence the purchase price thereof to The First National Bank of Ironton, Ohio, and notified the defendant, as a condition precedent to its receiving this bill of lading, that its officers must travel to Ironton, Ohio, and there execute these notes and deliver them to the bank at Iron-ton, and upon that condition and not otherwise the bank would deliver to the defendant the bill of lading. These facts appear from the evidence offered by the machinery company in support of the averment of its petition that it delivered the property to the purchaser. This was not a compliance with the terms of this contract. It was not the delivery contemplated in the contract. It was merely a conditional tender of delivery, and a condition that the machinery company had no right to impose. It was demanding payment in advance, while the fair construction of the contract, is -that the merchandise shall be delivered at one of the points named to a common carrier for shipment to the brick company, and that the brick company shall thereupon pay $600 thirty days after the arrival of the machinery on cars at Coal Grove, Ohio, and the balance in three equal payments, due in four, eight and twelve months from date of bill of lading, bankable notes, bearing legal rate of interest, to be given for deferred payments, bearing the same date as bill of lading. Applying to this transaction the same rule that would apply to a cash sale, under the provisions of this contract payment before delivery could not be demanded, nor could the purchaser be required to travel to Ironton and there make payment to the bank either before or after delivery. The fact that Ironton is not many miles distant from Coal Grove is not important. The petition avers that the purchaser's place of business is Coal Grove, Ohio. It follows that if the seller could demand that payment be made at Ironton it could have demanded that payment be made in Columbus, Cincinnati of New York. The brick company had the full legal right to refuse any delivery other than the delivery provided for in the contract itself. The machinery company had no right to demand performance of any conditions precedent to delivery other than provided in the contract.
j; In answer to this contention made by counsel on 'behalf of the plaintiff in error, counsel for defendant in error call our attention to paragraph 6 of the contract, in which paragraph it is agreed that the title to the material and machinery furnished shall remain in the machinery company until the full purchase price is paid, and insist that it is of no importance whether the machinery was delivered to the common carrier consigned to the brick company or consigned to the machinery company, as the machinery company had by the terms of the contract reserved to itself the ownership of this property. But with this contention we cannot agree. The brick company was to have possession, at least, of this property, and the possession of the property was never delivered to it, either in the manner provided for in the contract or in any other manner. On the contrary, delivery of possession was tendered to the brick company at a place and under circumstances not contemplated in the contract and upon its doing and performing certain things prior to the delivery that the contract did not require it to do.
I/ It is also insisted that delivery was complete j under the contract when the machinery was placed 'on cars at Bucyrus or Willoughby ready for shipment. That would have been true had the goods been consigned to the purchaser as the contract provided; but even if that had been done, under no possible construction of this contract would the purchaser have been required to travel to Bucyrus or Willoughby to deliver these notes before or even at the time of the consignment. A fair construction of the contract is that the notes were to be delivered at Coal Grove, Ohio, or mailed from Coal Grove, Ohio, upon the arrival of the machinery there subject to the purchaser's order, or at the very earliest, after they had been delivered to the common carrier unconditionally, consigned to the purchaser.
It is also urged that the brick company made no objection to the manner of shipment or to the demand that it should execute these notes and deliver them to the bank at Ironton and there receive the transfer of the bill of lading, but that defendant's objection was based solely upon a claim it made for damages, and which it insisted must be allowed' before it would receive the property. We do not consider this of any importance whatever if plaintiff was not misled thereby. The burden is on the plaintiff to show compliance on its part. Defendant did refuse to execute and deliver these notes to the bank at Ironton. In its letter of August 22, 1906, in reply to the letter of the machinery company under date of August 21, 1906, it used this language: "We decline to accept the machinery upon the terms you state, and you had just as well order the machinery back." If there was any reason why it had a right to refuse to accept the terms of delivery then proposed by the machinery company, that reason is now available to it. If it were willing to comply with the conditions proposed by the machinery company upon the condition that certain allowances be made it, it had the right to make such a proposition, but there is nothing in all this correspondence or any of this evidence that shows any waiver as to the manner and method of delivery provided in the contract itself. The machinery company cannot claim that it was misled by the conduct of the defendant, for the account, dated August 31, 1906, was disapproved and returned to it. An explanation was demanded. The brick company answered : "The reason your statement is not correct is that we never received the machinery up to this date and not according to contract." It is very evident from the record that they were then dealing at arms' length, and there appears absolutely nothing to show that either was induced by the other to depart from the express terms of the contract itself.
Not only does it appear from this contract that the machinéry company had no right to demand the execution and delivery of these notes prior to the delivery of this machinery to a common carrier consigned to the brick company, or at a place other than the defendant's place of business, but it also appears that by the terms of this contract the purchaser was not required to give a note for the first six-hundred-dollar payment to be made in thirty days. It is true that the contract provides that notes shall be given for deferred payments. It is also true that a payment to be made in thirty days is, in the absence of language expressing a contrary intention, a deferred payment, but it is very clear from the terms of the contract that it was not so considered by the parties and not intended to be evidenced by any promissory note whatever, but was in fact reckoned as a cash payment, and those payments that were to be deferred for four, eight and twelve months were considered the deferred payments within the meaning and intent of the contract. This is made to appear from the fact that this $600 was to be paid in thirty days after the arrival of machinery on cars at Coal Grove, Ohio, while the notes that were to be given for the deferred payments should bear the same date as the bill of lading, even though the goods were delayed a fortnight in transit. If the payment of the $600 that was to be made in thirty days was intended to be included as one of the deferred payments, for which a note was to be given, then that note would be required under the language of the contract to bear the date of the bill of lading, notwithstanding the further terms of the contract provided for the reckoning of this thirty days from the date of the arrival of the machinery on cars at Coal Grove. A. note for thirty days bearing the same date as the bill of lading would not allow the purchaser thirty days in which to pay the same after the arrival of the machinery on cars at Coal Grove. In fact, under some circumstances of extraordinary delay occasioned by disastrous floods or other destructive agencies, the larger portion or the whole of the thirty days might expire between the date of the bill of lading and the arrival of the shipment at its place of destination. It is clear that this contract distinguishes between this $600 to be paid in thirty days after delivery and these payments to be made in four, eight and twelve months after date of bill of lading, and it is equally evident that it was not intended that any note should be given for the $600, or that this amount should bear any interest whatever; otherwise the contract would not have fixed a different date from which to reckon the time of payment of this particular sum. Upon this construction of the contract the machinery company had no right to demand a note for this $600 prior to or after the delivery of the machinery sold.
It is averred in the petition that the plaintiff took back this dry-press brick machine and agitating clay feeder from defendant at its request and credited the defendant with the sum of $1,600 on the full contract price. There is no evidence whatever in support of this averment except the refusal of the defendant to accept delivery and to comply with the conditions precedent imposed by the plaintiff to a delivery of this machinery. Under the terms of this contract the plaintiff upon default in payment was entitled to take this machinery, but it was not entitled to. take part and leave part. In the absence of an agreement to that effect, it was not authorized to divide this contract and leave the dry pan with the defendant at a price fixed by it and retake the dry-press brick machine and agitating clay feeder, crediting an amount, also fixed by plaintiff, as the value of these two articles.
By the express terms of this contract defendant in error is still the owner of this dry pan. If it had fully performed the conditions of this contract, it would have the right to sue for the contract price, notwithstanding the provisions of the contract that it is to remain the owner of this property until the purchase price is fully paid, but a court can afford no relief to a plaintiff in a suit to recover upon a contract when it appears that the plaintiff did not substantially perform the terms of the contract on his part to be performed.
In the absence of a subsequent agreement waiving the actual delivery of the balance of these goods or authorizing the defendant to retake them after delivery and credit the contract price with the value of the goods so retaken, the rights of the defendant in error as owner of this dry pan must be asserted in some other way than by an action predicated upon the contract to recover the portion of the contract price represented by its value.
The judgment of the circuit court affirming the judgment of the common pleas court on the first cause of action is reversed, and the judgment of the common pleas court on the first cause of action is reversed, and judgment here rendered for plaintiff in error on the first cause of action. The judgment of the circuit court affirming the judgment of the common pleas court on the second cause of action is affirmed.
Nichols, C. J., Shauck, Newman and Wilkin, JJ., concur.