Case Name: PARKER-WASHINGTON COMPANY et al., Appellants, v. JAMES R. DENNISON
Court: Supreme Court of Missouri
Jurisdiction: Missouri
Decision Date: 1916-03-01
Citations: 267 Mo. 199
Docket Number: 
Parties: PARKER-WASHINGTON COMPANY et al., Appellants, v. JAMES R. DENNISON.
Judges: All concur except Woodson, G. J., who dissents in opinion filed; Bevelle, J., concurs in separate ■opinion in which Graves and Blair, JJ., concur.
Reporter: Missouri Reports
Volume: 267
Pages: 199–249

Head Matter:
PARKER-WASHINGTON COMPANY et al., Appellants, v. JAMES R. DENNISON.
In Banc,
March 1, 1916.
1. LIMITATION: Written Promise to Pay. In order to bring an “action upon any writing . . . for the payment of money or property” it must appear in the statement of the cause of action that the money sued for is promised to he paid hy the language of the writing. If such promise arises only upon proof of extrinsic facts it is barred by the five-year Statute of Limitations.
2. -: -: -: Bad Faith on Part of Promisor. The plaintiff being the owner of asphalt used in paving streets in a certain city, and of a plant used in the preparation of asphalt for paving purposes, located in said city, entered into a written contract with defendant whereby defendant agreed to pay plaintiff (1) for the use of said plant, five cents per square yard for all asphalt paving laid under the contract to the extent of forty thousand square yards, and (2) for said asphalt, one-half the amount received for any pavement done by defendant, after deducting all expenses. The defendant was to make bids in good faith to obtain paving contracts from the city. The petition alleged that defendant made no effort in good faith to obtain any such paving contracts, and when he had obtained some such contracts did not perform them and never intended to perform, and never shipped any of the asphalt which had been tendered according to contract, and held the plant for a long time; and that the gain which would have accrued to plaintiff by the payment of said sum of five cents per square yard for all asphalt agreed to be laid by defendant Was two thousand dollars, and one half the profits agreed to be paid and delivered to plaintiff was twenty thousand dollars, for which amounts judgment was asked. The suit was not brought within five years. Held, that the contract contained a promise to pay money only on condition that the pavement was laid, and the petition, on its face alleges that no paving was laid, and therefore it does not state a promise to pay arising out of the words used in the written contract, but stated only a cause of action upon an implied promise arising in law out of the alleged torts of defendants: that such cause of action is not within the statute and was barred in five years.
Held, by WOODSON, C. J., dissenting, that all written contracts calling for things to be done in the future are conditional, and whether they have been performed or not must of necessity be shown, by parol testimony; that the contract in suit contained a definite promise in writing to pay two separate sums of money upon its performance; that defendant did not relieve himself from his promise to pay those sums by fraudulently refusing to perform; and that the promise to pay is found in the contract itself, and no evidence aliunde is required to show a promise to pay, and hence the five-year Statute of Limitations does not apply.
Appeal from Jackson Circuit Court. — Hon. Thomas J. Seehorn, Judge.
Affirmed.
Ball & Byland for appellants.
The action falls within Sec. 1888, R. S. 1909, providing what actions may be brought within ten years, and falls within the first paragraph thereof, “an action upon any writing, whether sealed or unsealed, for the payment of money or property.” Miner & Frees v. Howard, 93 Mo. App. 569; Shinn v. Wooderson, 95 Mo. App. 6; Howe v. Mittelberg, 96 Mo. App. 490; Mathis v. Knapp, 45 Mo. 48; Bridges v. Stephens, 132 Mo. 549; Carr v. Thompson, 67 Mo. 476; Curtis v. Sexton, 201 Mo. 217; Ball v. Cotton Press Co., 141 Mo. 26; Knisely v. Leathe, 256 Mo. 341.
Scarritt, Scarritt, Jones & Miller for respondent.
(1) The sole question presented for determination upon this appeal is whether the five or ten-year Statute of Limitations applies to the pending action. The petition was demurred to on the ground that the action was barred within five years after it accrued and this appeal is from the order sustaining the demurrer. (2) If the action is one for the "recovery of money or property which the writing pleaded and relied upon, shows upon its face to be due or transferable to the plaintiffs, either expressly or by implication arising from the face of the instrument sued on, although evidence dehors the writing sued on may be necessary to discover the amount of the debt, then that action may be commenced within ten years from the time it accrued; but if the cause of action sought to be enforced does not fall within that category, the five-year statute applies to it. Carr v. Thompson, 67 Mo. 472; Menefee v. Arnold, 51 Mo. 536. (3) The nature of the action as well as the nature of the writing relied upon are both consequential in determining whether the five-year or ten-year period of limitation applies. The promise sued on, to pay money or transfer property, must he in writing if the ten-year and not the five-year period is to be applied; and furthermore, the written promise sued on must he one to pay money or to transfer property in order that the ten-year period and not the five-year period shall apply. Bridges v. Stephens, 132 Mo. 524; Kauz v. Great Council, 13 Mo. App. 341; State ex-rel. v. Brown, ,208 Mo. 619. (4) Nowhere in the contract now at bar did defendants’ promise to pay plaintiffs any damages for non-performance of the contract, nor promise to pay them anything under the circumstances expressly shown to exist by the allegations of the petition itself; nor does the petition charge, or contract show, that defendant promised in writing to pay plaintiffs any damages or any sum upon any contingency that is alleged to have existed. This action therefore, comes within section 1889. Gas Light Co. v. St. Louis, 11 Mo. App. 65, 84 Mo. 202; Brady v. St. Joseph, 84 Mo. App. 399; Ash v. Independence, 103 Mo. App. 299; Thomas v. Pacific Beach Co., 115 Cal. 136.

Opinion:
OPINION.
BOND, J.
This is an appeal by plaintiff from a judgment of the trial court sustaining a demurrer to defendants' third amended petition, on the ground that the cause of action therein alleged had accrued more than five years before the bringing of this suit. Plaintiff declined to plead further. Its suit was dismissed, from which judgment its appeal was duly taken to this court, since the amount in dispute exceeds the pecuniary limit of the jurisdiction of the Kansas City Court of Appeals.
This case turn on the question, whether the action is upon a writing for the payment of money or prop erty. [R. S. 1909, sec. 1888.] If that is the nature of the action, then the demurrer interposed below should have been overruled. The solution of this question necessitates an interpretation of the petition setting forth the plaintiffs' cause of action, and the contract exhibited therewith. The substance of the petition is, that plaintiffs and defendants entered into a written contract, on the 9th day of May, 1898, wherein defendants agreed tó, and did, purchase sufficient Trinidad Lake asphalt to construct forty thousand square yards of asphalt pavement. The price paid being the cost to plaintiffs on the date of payment when delivery of the asphalt should be made where it was located and which was thereafter to be shipped to Kansas City, where it was to be used by defendants in laying pavements in said city, after- proper preparation at an asphalt plant owned by plaintiffs in Kansas City, which it was agreed, should be put iñ the possession and control of the defendants up to September 15, 1898'; and in case defendants had not then obtained contracts for the laying of forty thousand square yards of pavement, then the said plant was to remain in his possession for such time as necessary, up to November 15, 1898, or later, if such paving contracts had been obtained, but not fully performed at that date. It was further provided that defendants should give their time to carrying out the paving contracts and engage in no other business during the existence of said agreement, which should be ended whenever forty thousand square yards of asphalt pavement had been laid by defendants; that they should bid on all such contracts when proposed to be let, until they were awarded forty thousand square yards of such paving. The contract between the parties also restricted the plaintiffs from bidding against defendants without their consent up to November 15, 1898, unless defendants had sooner gotten contracts for forty thousand square yards of asphalt paving. It further provided, that defendants should pay plaintiffs five cents per square yard for all asphalt paving laid pursuant to said contract, irrespective of any profit or loss in the matter, and that this payment should not he charged as an item of expense; that upon the completion of the work, the total price received (cash, bonds and special tax bills) should be divided equally, after deducting the actual cost and expense of the work, between plaintiffs and defenants ; but in the event of loss, the whole burden thereof should be borne by defendants.
The petition then alleges that although plaintiffs were ready and offered to deliver said asphalt, defendants did not promptly accept and pay for the same, but only did so after the lapse of more than a year, and then failed to transport it to Kansas City and made no bids in good faith to obtain the laying of paving contracts and made no effort to get the confirmation of such contracts as were awarded to them by Kansas City, and never intended to perform any of the contracts which were awarded to them, or for which they submitted bids. The petition concludes, to-wit:
"Plaintiffs state that, while certain of public contracts for street paving were let to the defendants by Kansas City, Missouri, subsequent to the making of the aforesaid contract, said defendants never performed any of said contracts, and never intended or attempted to obtain and perform any contracts for the laying of asphalt pavements in said city; that defendants never shipped any of the asphalt, bought and delivered to them as aforesaid, to Kansas City; that defendants never laid a single yard of asphalt pavement in Kansas City under said contract.
"That had defendants shipped said asphalt to Kansas City as agreed, and had they endeavored to obtain contracts for paving as agreed, they could, and would have had awarded to them and confirmed during the time mentioned and stated in said contract sufficient paving contracts to have laid street pavement to the amount of 100',000 square yards with the asphalt purchased of the plaintiffs, and the failure of defendants so to keep and perform their contract, and to obtain awards and confirmations of contracts, as aforesaid, was solely due to their own neglect, bad faith and default as aforesaid.
• "That defendants agreed to keep a complete set of books showing the cost of all material and labor used in and about the carrying out of said contract, but said defendants failed to keep any such account.
"Plaintiffs state that the defendants, under the contract aforesaid, held and controlled for more than a year the plant of the plaintiff, The Parker-Washington Company; that the defendants, as stated, never performed any part of said contract; that the plaintiffs at all times kept and performed their part of said agreement; that finally, and prior to the institution of this suit, the defendants repudiated said agreement and refused to do and perform the same.
"That the gain to plaintiffs, which would have accrued to them by the payment of said sum of five cents per square yard for all asphalt agreed to be laid by defendants under said contract was two thousand dollars, and the value of one-half of the profits in cash and tax bills, agreed to be paid and delivered to plaintiffs as aforesaid, was the sum of twenty thousand dollars.
"Wherefore, plaintiffs pray judgment against the defendants for said sum of twenty-two thousand dollars, with interest from the date of-filing this suit at the rate of six per cent per annum. ' '
II. There are two causes of action alleged in the petition: The one for damages caused to plaintiffs by the alleged fraudulent failure of defendants to procure and perform contracts for street paving, and thereafter to pay to plaintiffs five cents per square yard for forty thousand square yards after that much street paving had been laid. Plaintiffs allege that these omissions prevented a "gain" to them of $2000. The other, for damages in the estimated sum of $20,000 as one-half of what would have been the earnings, if about one thousand tons of asphalt, sold to defendants by plaintiffs, had been properly prepared and laid in the form of street pavements under contracts let to defendants by Kansas City, which defendants fraudulently failed to obtain.
In order to bring an "action upon any writing . . . for the payment of money or property" (R. S. 1909, sec. 1888), it must appear in the statement of the cause of action, that the money or property sued for is promised to be paid or given by the language of the writing, and that such promise does not arise only upon proof of extrinsic facts. That nothing else meets the requirements of the statute, has been uniformly held whenever it has been under review. [Curtis v. Sexton, 201 Mo. l. c. 230; Menefee v. Arnold, 51 Mo. 536; Carr v. Thompson, 67 Mo. l. c. 476; Bridges v. Stephens, 132 Mo. l. c. 549 (separate opinion of Barclay, J.); Knisely v. Leathe, 256 Mo. l. c. 377.] Does the "promise sued on" in the present action, arise from the words of the written contract whose stipulations are recited in the petition? In support of that position, the learned counsel for appellant cites the following paragraphs from their contract with defendants:
"Said second parties shall pay said first parties five cents per square yard for all asphalt paving laid under this contract, said sum being in payment for the use of said plant, and shall be paid by second parties without regard to either profit or loss in the laying of any pavement, and in no event shall be charged as an item of expense.
"Upon the completion of any paving contract the actual cost and expenses shall he ascertained by said parties, and such,amount shall be deducted from the price received in cash, bonds or tax bills at their face, and the balance of such cash, bonds or tax bills shall be divided equally between the parties hereto, but in the event of loss upon any contract such loss shall be borne by said second parties."
These clauses of the contract show on their face and by express terms, that the only promises to pay any money were: First* a promise to pay five cents per square yard for all asphalt paving laid under this contract; and second, a promise to pay one-half of the profits of the paving work after its completion. The'petition states no asphalt was laid; no paving work was done and no price received for any such work in cash, bonds or tax bills, by defendants. It is clear, therefore, that neither of the conditional promises recited in the two above clauses, ever 'became absolute obligations on the part of the defendants, for no promise based upon a condition, can be enforced as such, until the contingency upon which it depends has happened. The fact that defendants tortiously prevented the happening of the contingency upon which their contractual obligations would have arisen, cannot be held to make a contract for them contrary to the terms in which their contract was expressed in the written agreement. Such wrongful conduct would constitute a legal basis for an implied assumpsit on their part to pay the damages caused thereby, but it could not alter the terms of the conditional promise to pay, as used in the written contract.
The petition alleges bad faith of the defendants in failing to procure lettings of paving contracts, thereby disabling them from performing the work, and thereby disabling plaintiff from enforcing the promise to pay five cents per square yárd for forty thousands square yards of asphalt which had been laid in the construction of a pavement, and thereby-preventing plaintiffs from enforcing the general promise to pay to them one-half of the net profits of the performance of all completed paving contracts. These allegations of the petition would entitle the plaintiffs to recover damages for the non-performance and breach by defendants of the terms of their written contract. Such a recovery is justified on elementary principles applicable to redress for breaches of contract. But they do-not state a cause of action on a written contract to pay money upon certain conditions which never happened. Their whole legal intendment is to set forth a cause of action for damages for a tortious breach of a contract to do certain things, for the doing of which defendants promised to pay money or property to plaintiffs.
Under the contract referred to in the petition, if the' defendants had laid the pavement, or if defendants had obtained the laying of paving work from Kansas City, and had performed such work and reaped a profit therefrom, and had failed to pay the specific or general sum agreed by them to be paid on said contingencies, then plaintiffs could have sued defendants on the promises to pay contained in their contract, and could have recovered in that action, whatever amount the evidence showed was due. For in that event, the promises to pay made by defendants, would have become consummate by the happening of the condition upon which th$y were made, and such promises could have been established by the intrinsic evidence of the language of the contract between parties, and would have been a proper foundation for a suit, and it would not have been necessary (as it was in this case), to go outside of the writings and show by evidence aliunde, certain tortious acts on the part of defendants as a legal basis of an implied assumpsit to pay the damages thereby caused to plaintiffs.
In the case at bar, the action of plaintiffs is not based upon tbe promise to pay five cents per square yard on all the asphalt laid by defendants, nor one-half of the net profits of such work when completed. For if the action had been predicated upon the simple averment of such promises, coupled with the further averment that no asphalt pavement had ever been laid, and no paving business had ever been carried on, then the petition would have been subject to a general demurrer, for the reason, that it showed on its face two conditional promises, which had never ripened into legal obligations. To avoid that predicament, it was necessary for the pleader to allege some other ground of liability than the two conditional promises made in the written contract. And this was done in effect, when it was alleged in the petition that by reason of the torts, frauds and negligences of defendants, the contract made by them, and the promises to pay therein expressed, became unenforceable. For upon those allegations the law would imply a promise on the part of the tortfeasor to pay the damages caused by his wrongdoing. Hence, it is the implied assumpsit created by law upon the wrongful conduct of defendants in breaking the terms of their written agreement, which is the sole basis for the maintenance of the present action, which is therefore one limited by the Statute of Limitation of five years. [R. S. 1909, section 1889.]
This distinction between a suit for the enforcement of a conditional written promise to- pay money or property, and a suit for damages caused by tortious failure to perform the conditions upon which such promises are made to depend by the terms of the instrument, necessarily arises from a consideration of the language employed in entering into a contract of the kind referred to in the petition. It is also fully recognized in the learned opinion of Graves, J., Knisely v. Leathe, supra, l. c. 368, in contrasting the positions taken by the parties to that case, one of which was that the suit then brought was not on the contract "but was one for damages of which the written contract might be purely evidential."
That is the distinction which justifies the action of the trial court in sustaining a demurrer to the petition in this case. It was not, and could not be, under the terms of the contract referred to, a suit upon a written promise to pay money or property, but was an action upon an implied promise imputed to defendants by the law to answer in damages for their tortious breach of the stipulations upon which the promises in the contract were conditioned.
The judgment of the lower court is correct, and is affirmed.
PER CURIAM. — The foregoing opinion of Bond, J., in Division is adopted as the opinion of the Court in Banc.
All concur except Woodson, G. J., who dissents in opinion filed; Bevelle, J., concurs in separate opinion in which Graves and Blair, JJ., concur.