Case Name: GILBERT PORTEOUS, et al., Respondents, v. FRANCIS W. WILLIAMS, et al., Appellants
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1886-05-03
Citations: 21 Jones & S. 242
Docket Number: 
Parties: GILBERT PORTEOUS, et al., Respondents, v. FRANCIS W. WILLIAMS, et al., Appellants.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 53
Pages: 242–249

Head Matter:
GILBERT PORTEOUS, et al., Respondents, v. FRANCIS W. WILLIAMS, et al., Appellants.
Contract, cancellation of, by acceptance of subsequent contract tendered on condition of cancellation of former—Agent, conflicting testimony as to authority conferred—evidence as to object principal had in view admissible. .
Where one of the parties to a contract,—e. g., a charter-party,—executed a subsequent one, and sent it to the other party with a letter that he executed it “ .the former being canceled,” to which that other replied in effect that the former contract was not canceled; whereupon he who sent the subsequent one, replied by telegram, in substance, that former 'contract, “was canceled, or I would not have signed another. Do you confirm charter upon copy sent you or not ?” To which this reply came by telegram “We accept charter as per copies sent us,” and subsequently one by letter confirming the copies sent,—Held, that the party sending the copies of the subsequent charter, first made the cancellation of the former one a condition of being bound by a subsequent one; which condition was accepted by the other; the legal effect of which was to discharge all parties thereto from all liabilities and obligations thereunder (By Sedgwick, Oh. J., and Ingraham, J.).
In the case at bar, one of the questions was as to what authority was given to one Card, who made the contract sued on, as agent of defendants. The contract sued on was a charter party whereby a chartered vessel was to proceed to Charleston with reasonable dispatch, subject to any delay caused by the perils of the sea, and there take on a cargo of phosphate rock, to be shipped by defendants. Card testified to a certain conversation with the acting partner of defendant, which, as testified to by him, gave him authority to make the contract as sued on. The acting partner testified that in that conversation an April shipment only was spoken of, and that the conversation had reference to an April shipment and that only. Held, that evidence, that at the time of the conversation, defendants had in the course of their business, made a contract for the shipment of phosphate rock in bulk, in the month of April, was admissible (By Sedgwick, Oh. J.).
Before Sedgwick, Oh. J., and Ingraham, J.
Decided May 3, 1886.
Appeal by defendants from judgment entered on verdict in favor of plaintiffs.
The facts appear in the opinion.
L. JS. Arnold, Jr., attorney and of counsel for appellants,
on the questions considered in the opinion, argued :— I. This charter party, upon which the respondents base their cause of action, was canceled by mutual consent. This appears from the correspondence between Seager Brothers and Mr. Card. Mr. Card notified Seager Brothers by letter, dated April 17,1882, that the appellants were the charterers under the charter party of March 20, and that they had given him notice that if the “ Limosa” did not arrive in time for an April shipment, they would can cel the charter; and he added that he would cancel the charter if the steamer did hot arrive in time. On April 2, Mr. Card wrote again as follows : “I would say that Messrs. Williams, Black & Williams, of this city, are in reality the charterers of the S. S. ‘Limosa’ and are ready and willing to assume all the responsibility of the charter made in my name, believing that they had a legal right to cancel the charter, in which opinion I concur. If, however, you do not consider them as the charterers, but look to me, then I will assume the responsibility, and now notify you that I cancel the charter dated March 20, ulto, and positively refuse to load the S. S. ‘ Limosa ’ under the same.” The offer of the appellants to re-charter was made by Card to the Seagers by telegram, and by letters dated April 20, 21. Seager Brothers replied to the telegram by letters dated April 21, as follows : “We decline as already informed you to recognize any party but yourself in the matter of this steamer’s charter and insist upon performance of contract as per charter party.” And in answer to the letters of Mr. Card dated April 21 and 22, Seager Bros, telegraphed that they would accept the offer of twenty shillings and hold Card liable for difference in freight between the two charters. To this Mr. Card replied “I confirm my letters April 21 and 22. I make your firm offer ‘ Limosa ’ twenty shillings, lay days and other conditions same as in canceled charter party, dated March 20.” Seager Brothers replied: “Tour yesterday’s telegram received. We accept without prejudice to the rights of either party on previous charter party. Vessel ready to sail to-day. Confirm immediately otherwise shall charter ‘Limosa’ for your account.” From the foregoing correspondence it is clear that Mr. Card did not intend to agree to, nor did he in fact agree to, any reservations of the respondents’ rights under the first charter party. The telegram of April 25, did not constitute the contract, for it left essential matters affecting the rights of the parties open for further consideration ; and Card expressly stated in it, while confirming Seager’s telegram, that he would send copies of the charter party that night. Until that charter party was received and its contents known to Seager Bros., and until it was accepted by them, neither Seager Brothers nor Card was bound by what had passed between them (Brown v. N. Y. Central R. R. Co., 44 N. Y. 79 ; Beach v. R. R. Co., 37 Ib. 457; Renard v. Sampson, 12 Ib. 561). The evidence shows that Seager Bros., accepted the new charter party, containing new provisions, (viz : providing for a May shipment), on condition that the first charter party was canceled without any reservation, and that the appellants re-chartered on those terms. This constituted the contract and released not only the appellants, but Card, from all liability under the first charter party (Lattimore v. Harsen, 14 Johns. 329 ; Green v. Green, 9 Cow. 50; Dearborn v. Cross, 7 Ib. 48 ; Holmes v. Doane, 9 Cush. 135 ; Monroe v. Perkins, 9 Pick. 298 ; Blood v. Enos, 12 Vt. 625).
II. The court also erred in excluding the evidence that the appellants needed a ship for an April shipment and as the effect of their not getting one. The rulings of the justice on these points prevented the appellants from showing the obligations they had assumed, which were the foundation of their employment of Card as their broker, and thus a part of the res gestee. In view of the conflict of evidence between Card and Mr. Williams, this worked a serious injury to the appellants.
E. B. Convers, attorney and of counsel for respondents,
on the questions considered in the opinion, argued : —I. It is apparent from the correspondence that the parties were making, as the court below said, “a subsequent agreement which was without prejudice to the rights of either party, and, therefore, only went in diminution of damages.”
II. Ho “valid contract” was necessary to reserve the plaintiffs’ rights under the first charter. The defendants’ absolute refusal to load thereunder relieved the defendants from the duty of making tender of the vessel under the same, and gave rise to a cause of action at once. When, therefore, the agent could obtain no higher rate for the vessel elsewhere, and re-chartered her to the defendants, the plaintiffs’ cause of action under the first • charter had accrued, and the only effect of the second charter was to reduce that cause of action by twenty shillings per ton. So far from requiring a valid contract to reserve their rights, it would be necessary, in order to sustain defendants’ contention, to give evidence of an express waiver of them.

Opinion:
Sedgwick, Ch. J.
The action was by the owners of the steamship "Limosa," against the defendants as charterers, for an alleged breach in not loading as provided by the charter. The charter was not made by the defendants, nor did their names appear as charterers. The plaintiffs' names did not appear as principals on the charter. They were represented by their agents, Seager & Brothers. One Card appeared to be the charterer. It was claimed by the plaintiffs that Card acted as the agent of the defendants. The defendants did business in Charleston, South Carolina. Seager & Brothers did business in Hew York. The charter, as it was construed by the plaintiffs, provided that the "Limosa" should proceed to Charleston with all reasonable dispatch, subject to any delay caused by the perils of the sea. It did not provide for readiness to take an April shipment at Charleston.
On the trial the plaintiffs took the position that Card was authorized to make the charter as it was. Card testified that he was thus authorized. The defendants took the position that, in the conversation which Card testified to as the authority, the partner acting for them had referred to obtaining a vessel for an April shipment, and no other. They also claimed that the arrangement was that they were to take a vessel from Card, and not that Card should bind them to third parties, of whom Card, acting as broker, for defendants, should charter the vessel. The acting partner testified as a witness that he had spoken only of a vessel for an April shipment. When the case went to the jury, the single question of fact left to them was the nature of the conversation between Card and the acting partner, as to which they were in conflict. When the acting partner was on the stand, the counsel for defendant asked him questions appropriate to elicit testimony that at the time of the conversation the defendants had, in the course of their business, made a contract, or contracts, for the shipment of phosphate rock, in bulk, in the month of April. The cargo of the vessel to be chartered was to be phosphate rock. The court, on objection, excluded these questions.
In the conflict of witnesses, a relevant subject of inquiry by the jury was the motive of the defendants— the reason for their action. In determining the probabilities of the testimony, and the credibility of the witnesses, it was a sound argument that the declarations of the acting partner conformed to the object he had in view, and this would be shown by the kind of need the defendants had for facilities to ship goods; that is, whether it was for their interest to ship the goods in April, or whether they could wait indefinitely. As the jury might have been materially affected by the proof of the facts, judgment upon the verdict should be set aside.
Other questions made at the trial call for further consideration, for the purposes of the new trial that must be had.
In the month of April, the " Limosa " arrived at Hew York, so seriously damaged from a disaster at sea, that it was judged by Card and the defendants, to whom report was made of her condition, that the making of the necessary repairs would keep her at Hew York so long, that she could not be at Charleston in time to take a cargo in the month of April. There was testimony for the defendants, that until after this action was begun they never knew the terms of the charter. They, thinking it provided for taking a cargo in April, upon hearing of the disaster, told Card that they would not take the vessel. Card wrote to Seager & Brothers, that his principals canceled the policy, and bargaining began about a new charter to be made for the same kind of cargo for shipment in May. Card insisted that the making of the new charter should be upon condition of the cancellation of the one in suit here. Seager & Brothers insisted that the making of the new charter should leave unaffected the rights of the parties under the old charter. Before the matter was closed, Card sent to Seager Brothers four copies of the proposed new charter of the "Limosa" signed by himself, with an accompanying letter in which he stated at the close, "I now beg to confirm charter made to-day, the former being canceled, and send you herewith four copies of charter." The proposed charter contained a provision for a May shipment. Seager Brothers by telegram insisted on erasing this provision, and said that the last sentence of his letter inclosing the copies was contrary to the agreement—the former charter not being canceled. The matter at that point was open, neither party being bound. On April 27, Card wrote, after referring to the last communication from Seager Brothers, ' ' As I don't exactly understand what you mean by this telegram, I am wiring you this evening by night message as follows, in order to ascertain what you are going to do in the matter, ' Limosa ' charter dated March 20, was canceled or I would not have signed another. Do you confirm charter dated April 25, as per copies sent you, or not." This conditioned Card being bound by the charter he sent, upon the other party agreeing to cancel the charter in this action. The next day Seager Brothers telegraphed "We accept 1 Limosa ' charter as per copies sent to us," and in a letter of 28th acknowledged the receipt of Card's telegram and confirmed the copies of the charter sent by Card. This was an acceptance of the condition referred to and canceled, as they called it, the first charter. The legal effect was that the plaintiffs, through their agents, Seager Brothers, for a consideration, dis charged whoever was liable on the charter from its obligation to them.
It further appears that there was a question of fact, as to whether the plaintiff had not elected finally to hold Card upon the charter, and not to look to defendants as undisclosed principals.
Judgment reversed, new trial ordered, with costs to abide event.