Case Name: CHARLES W. MAY, Plaintiff and Appellant, also Respondent, v. JACOB R. SCHUYLER, and others, Defendants and Respondents, also Appellants
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1877-11-07
Citations: 11 Jones & S. 95
Docket Number: 
Parties: CHARLES W. MAY, Plaintiff and Appellant, also Respondent, v. JACOB R. SCHUYLER, and others, Defendants and Respondents, also Appellants.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 43
Pages: 95–117

Head Matter:
CHARLES W. MAY, Plaintiff and Appellant, also Respondent, v. JACOB R. SCHUYLER, and others, Defendants and Respondents, also Appellants.
I. PRINCIPAL AND AQBNT.
1. Agent to sell, with no interest in the subject of sale.
1. MODIFICATION OF TERMS OF EMPLOYMENT.
(a) When it mat be made. At any time before the agent has fully performed the service for which he was employed; or in case the principal has waived or prevented full performance, then at any time before substantial performance.
(b) Effect of modification at such time. The agent may decline to further act, or may make a new agreement with the principal as to the terms of his employment;
But,
if he does neither, and thereafter makes sales, such sales, and his compensation therefor, must be governed by the modified terms.
1. Protest. This although he protests against the modification.
3. Agent or broker to sell on certain specific terms, and
AGENT OR BROKER EMPLOYED GENERALLY TO FIND A PURCHASER.
1. COMPENSATION, WHEN EARNED.
(a) Distinction between.
1st. In the first case he must find a purchaser, ready and willing to complete the purchase on the terms specified.
3d. In the second case it is sufficient if he brings the parties together, and a sale results in consequence thereof.
3. Admissions by principal to third parties, effect of, as
EVIDENCE IN THE AGENT’S BEHALF.
1. A settlement, made by the principal with parties from whom he procured the goods which he had employed the agent to sell at certain prices, (the agent to receive all above such prices for Ms compensation,) on the basis and statement that he, the principal, was entitled to receive only those prices, is not absolute proof that the principal had not lawfully modified the original terms of the agent’s employment so that he was, in fact, entitled to receive much higher prices than those he thus stated to the third party, on the faith and basis of which statement a settlement was made with such third party.
Decided November 7, 1877.
(a) Contrary proved, effect. When the plaintiff has himself proved the fact to bo contrary to such settlement and statement, he cannot rely on the settlement and statement as countervailing his proof.
(5) Wrong on the third party. Although, on such a state of facts, the inference is that the third party was wronged, and is entitled to recover the difference, yet the agent has no right to hold on to that difference.
H. EVIDENCE.—ADMISSIONS.
Vide supra.
Before Sedgwick, Speir, and Freedman, JJ.
In this action, judgment was entered upon the report of a referee, in favor of the plaintiff, against the defendants, for $37,077.56.
Both plaintiff and defendants appealed.
The plaintiff, by his complaint, alleged that on or about September 15, 1870, he procured for the defendants a sale to the French government of arms and military goods, at the aggregate price of $286,937.93. That the same were sold under an arrangement that for his compensation the plaintiff should have the excess over certain prices which had been named to him in a letter of July 9,1870, from the defendants. That such excess amounted to $32,881.95 ; from which certain charges were to be deducted.
For a second cause of action, the plaintiff alleged that on or about October 26, 1870, he procured for the defendants a further sale to the French government of 5,250 Sharp’s carbines and 2,000,000 cartridges, at the aggregate price of $127,008.22. That such sale was procured under the' same arrangement, and that the excess of the price over the sum named in the letter of July 9, 1870, was $38,508.22, from which were to be deducted certain charges.
For a third cause of action, the plaintiff „ alleged that he purchased from the defendants 1,320 Sharp’s rifles, and 660,000 cartridges at the price named in the letter of July 9, 1870, amounting to $33,000. That he sold them to the French government for $38,086.13, which the defendants collected and received to his use, the excess being $5,086.13, from which were to be deducted certain charges.
For a fourth cause of action, the plaintiff alleged ’that the defendants sold to the French government, on or about October 3, 1870, 5,000 Spencer carbines and 2,780,000 cartridges, at the price of $206,378.31, and on or about November 1, 1870, 100 revolvers and 14,000 Qartridges at the price of $1,737.72 ; that the sale was procured by the plaintiff, and that for his services, he was entitled to the- usual and customary commission of 5 per cent.
The plaintiff claimed that after deducting all the charges, and certain credits to which the defendants were entitled, there remained due to him $56,954.01, for which, with interest from January 1,1871, he asked judgment.
The defendants compose the well-known firm of Schuyler, Hartley & Graham, dealers in military goods.
The plaintiff, at the time in question, was a merchant doing business in Paris. He had been a partner, and subsequently, was the business correspondent in Paris of the defendants, doing business for them upon a commission of five per cent.
The defendants, by their answer, admitted their letter of July 9, 1870, but they denied that the plaintiff had made any sales under the arrangement therein proposed; they further denied that the plaintiff had rendered any such services as he claimed.
For a further defense, the defendants alleged that on or about July 15, 1870, war was declared between France and Prussia. That in consequence and by reason also of correspondence between the defendants and the plaintiff, all arrangements made prior to the declaration of war had ceased, and that the sales claimed to have been procured by the plaintiff, were really made by one William W. Reynolds, an agent of the defendants, under an agreement to compensate him for services in aiding Reynolds, different to that claimed by the plaintiff.
The defendants claimed that pursuant to the terms of such new agreement, which the answer stated to have been made on September 27, 1870, the amounts which the plaintiff had received fully paid him.
The answer also set up several counter-claims, which were put in issue by plaintiff’s reply. They have been abandoned upon his appeal, and hence it is not necessary to refer to them.
By his report the referee found: That about September 15, 1870, the plaintiff did effect for the defendants the sale alleged in the plaintiff’s first cause of action, ■ and upon the terms there alleged. The net amount to which the plaintiff thereby became entitled being $24,208.11.
That on or about September 15,1870, the defendants made to the plaintiff the sale mentioned in the plaintiff’s third cause of action, and upon the terms there stated. That the goods were subsequently sold by the plaintiff to the French government. That the defendants received the proceeds, and that, after deducting all charges, the defendants thereby became indebted to the plaintiff in the sum of $2,872.15.
That the plaintiff procured for the defendants the sales mentioned in the plaintiff’s fourth cause of action. That he was entitled to a five per cent, commission thereon, and that the same amounted to $10,405.80.
The referee further reported that the plaintiff had received from the defendants on account of their in debtedness, in goods $9,605.90, and a balance of $2,885.50 of cash, consisting in the difference between $7,223.24, received by the plaintiff to the credit of the defendants, and the sum of $4,337.74 paid by him on their account.
Deducting those amounts from the sums reported in plaintiff’s favor left $24,994.66, for which, with inter-est, the referee reported in the plaintiff’s favor.
The defendants excepted and appealed.
The referee disallowed the plaintiff’s second cause of action, being of the opinion that the sale therein alleged to the French government was not procured by the plaintiff upon the terms of payment authorized by the defendants, and that they had not waived any departure from those terms ; and to that part of his decision the plaintiff excepted and appealed.
Man & Parsons, attorneys, and Jno. E. Parsons, of counsel, for plaintiff.
Abbott & Fuller, attorneys, and D. D. Lord, of counsel, for defendants.

Opinion:
By the Court.—Freedman, J.
—By letter, dated July 9, 1870, the defendants, constituting the firm of Schuyler, Hartley & Graham, of the city of New York, employed the plaintiff, a commission merchant, in Paris, France, to sell for them in France certain arms and military goods, and in consideration that he should do so, the defendants in said letter, as is claimed by plaintiff, agreed to pay him as compensation for his services in ' selling the same or any part thereof, the difference between certain prices therein stated for such arms and military goods, and the price which should be obtained upon the sale thereof, and they also offered to sell to the plaintiff at the same prices any of the said goods. All sales were to be paid for in the city of New York.
On July 19, 1870, war was declared between France and Prussia, and on July 29, 1870, the firm of which plaintiff was a member, replied to defendants' letter of July 9, which had been written to plaintiff individually, to the effect that they could do nothing without samples, and that even with samples they hardly knew what could be done, as the war department had written that it was fully supplied.
On August 19, 1870, the defendants determined to send their confidential clerk, Mr. Reynolds, to France, with full power to act for them within certain instructions, which will presently be noticed, as their agent in the sale of goods, and on August 20, Reynolds sailed, taking with him some samples. Others were subsequently sent subject to his order. His instructions were to obtain prices, payable in New York, which were considerably higher than those which had been named to the plaintiff. In all other respects he seems to have been intrusted with full discretionary powers. He also bore a letter to plaintiff's firm in which the defendants introduced him as the representative of their firm, and in which they requested plaintiff's firm to co-operate with him.
Reynolds arrived in Paris on September 1, and on the following day he called on the plaintiff and handed him his letter of introduction. During the voyage of Reynolds some communications had passed between plaintiff and defendants, which, however, in the view hereinafter taken, are not of sufficient importance to be referred to with particularity.
On September 2, 1870, the day after the first interview with Reynolds, plaintiff wrote to the defendants that up to that time he had not accomplished any sales, that all was rocking in Paris, but that the financial bottom was all right, though the then government was about ended.
On September 4, there was a revolution in Paris, which resulted, among other things, in the establishment, on September 8 or 9, of a commission of armament with authority to deal with private parties for the purchase of arms.
On September 12, defendants' samples reached Paris, and on the following day May and Reynolds went together to the commission of armament to offer defendants' goods. On their way there May proposed some changes in the prices of, some of the goods, and as these changes did not encroach upon the limits of Reynolds' instructions, the latter assented that they might be made.
In the course of the negotiation which then ensued, the commissioners of armament expressed their willingness to take a large portion of the goods offered, but declined to pay until arrival; and as Reynolds was not authorized to sell, except for cash on shipment, the negotiation was suspended.
On the same evening May ascertained that four-fifths of the price which the commissioners of armament were willing to pay, would cover defendants' interest in the sale, and thereupon he suggested to Reynolds, by way of getting over the difficulty, to propose to the commission that four-fifths be paid in Hew York on shipment, and the balance in France, on. arrival of the goods. May also agreed that in such case he would take his compensation out of the payment to be made in France. Reynolds agreed to the suggéstion. These terms were accordingly offered to, and finally accepted by the commission.
This transaction, together with further efforts made by May subsequently, during the siege of Paris, led to certain sales for "which the defendants received the whole of the proceeds. For the sales stated in the first, third, and fourth causes of action set up in the complaint, the referee found that the plaintiff is entitled to compensation.
Up to this point there is no conflict of evidence, and plaintiff s right to compensation is not seriously questioned. But as to the amount of compensation to which he is entitled upon the sales stated in the first and third cause of action, there is a decided conflict.
Reynolds testified that at his first interview with May he showed May the memorandum of prices below which he was not authorized to sell; that May compared these prices with those of the July letter, and found that they were higher, but that he made no objection to the increase, and no claim to the July prices, and that if he had, he (Reynolds) would not have employed him.
Reynolds further testified that on several other occasions, between the first interview with May and their joint visit to the commission of armament, he distinctly informed May that under all circumstances the goods would have to net in Yew York the increased prices contained on his (Reynolds') memorandum, and that May was satisfied with it.
And he also testified that, after a commission of five per cent, on his memorandum prices had been agreed upon, May, on the way to the commission of armament, proposed to ask in gold such of the memorandum prices as were in the currency of the United States, and that the difference should be allowed to him in addition to the five per cent., to which Reynolds assented.
May, on the other hand, says that at the first interview with Reynolds, as well as afterwards, he claimed the benefit of the July prices, and that he never agreed to take any different rate of compensation.
If the case rested here, and the proof showed that in the face of this claim made by May, Reynolds, without objection, accepted May's services, the assent of Reynolds to May's claim might be inferred, and if he had authority to bind defendants by such assent, and thereupon the case presented simply a conflict of testimony, the fact as found by the referee could not be disturbed.
But the case does not rest here; nor does it present simply a conflict of testimony. The plaintiff, by his own testimony, showed that Reynolds never assented, but that, in reply to plaintiff's claim, he always said that the plaintiff had to fight this out with Schuyler, Hartley & Grraham. On giving his version of the conversation had with Reynolds, immediately before their joint visit to the commission of armament, the plaintiff testified as follows:
Q. Did Mr. Reynolds then, or subsequently,—and if later state exactly at what stage of the proceedings —say anything to you, or did anything take place with reference to an effort on his part to increase the prices of the letter of July 9, 1870 ?
A. I have a list of prices in the handwriting of Mr. Reynolds, found among his papers, when I returned to Paris in the Spring of 1871, which, I think, he made that very day—the 13th of September.
Q. State what took place between Mr. Reynolds and yourself, with reference to those prices, and when it was, with reference to the commencement of your negotiations ?
A. He said, "We are going to show these samples now, and here are the prices, from which I will allow your concern a commission of five per cent., and all or any advance that you may obtain over those prices shall be for yourself."
Q. Did he at that time show you a statement, or list of prices ?
A. He did ; and I said that I should not accept anything of that kind, that I worked by the letter of July 9, and he made use of the expression, "You will have to fight that letter with Messrs. Schuyler, Hartley & Grraham; these are the prices that I name."
Other similar admissions are in evidence.
Upon plaintiff's own showing, therefore, it is difficult to perceive how the report of the referee can be sustained as to the first and third causes of action alleged in the complaint.
Assuming plaintiff's construction of the letter of July 9 to be the correct one, the proposition therein contained and plaintiff's acceptance thereof, constituted a special contract, and unless plaintiff actually effected a sale or offered to buy according to the terms of it, he can maintain no action upon it against the defendants. And no time being specified therein, the defendants, it seems to me, were at liberty to vary their terms or to revoke and terminate the contract at any time before any such sale was actually effected or offer made. Whatever authority was conferred, was one not coupled with an interest in the goods themselves. It therefore remained revocable. The interest contemplated by the rule making an agency coupled with an interest irrevocable, must be one in the subject over which the power is to be exercised, and the power of revocation always includes the power to modify.
That Reynolds, even if he did not revoke, did essentially modify the contract originally entered into between the parties, at least so far as the same could be done against plaintiff's protest, and that for that purpose he possessed all the power and authority which the defendants themselves could have exercised if personally present, is not controverted, and there being no pretense on the part of the plaintiff that he subsequently came to an agreement with the defendants themselves concerning the point in dispute, it clearly appears from his own showing, that in point of fact there was a failure to agree upon a new rate of compensation. As to the extent of Reynolds' authority I will add, that in his brief the learned counsel for the plaintiff expressly concedes that there was no limitation of it in defendants' letter accrediting him to the plaintiff.
The real question involved in the present appeal, therefore, is, whether the defendants immediately preceding the joint visit of the plaintiff and Reynolds to the commission of armament, remained at liberty to take back their original proposition and to insist upon an increase of prices. If they had the legal right to make this change, the referee erred in giving to plaintiff the benefit of the July prices, though, as between the plaintiff and Reynolds, he may have been justified in disbelieving Reynolds. And whether they were free to do so, depends upon the further question whether up to that time plaintiff had effected a sale or offered to buy according to the terms of the letter of July 9.
It is quite clear that he had done neither.
Leaving out of view tfie change that occurred by revolution in the French government, as a fact rather weakening than strengthening plaintiff's case, the most that can be said of plaintiff's efforts up to the time now under consideration is, that by them he had put himself into communication with a party desirous of purchasing in a certain contingency. But that was not enough. That the French government might eventually desire to buy some of the goods, was a matter clearly contemplated by the defendants before they wrote the letter of July 9. The existence and address of this possible purchaser was matter equally well known to both parties. To earn the benefit of the special contract upon which plaintiff relies, it was incumbent upon him to complete a bargain according to the terms of it.
Thus, in McGavock v. Woodlief (20 How. U. S. 221), it was held : "As the terms of sale were explicit, the proposal to fulfill should have been equally so. Nothing should have been left to conjecture or speculation. There should have been as much certainty on one side of the contract as upon the other. Certainty in the offer to fulfill is as important to the vendor as certainty in the terms of the sale to the vendee, and equally necessary before the vendqr can be put in fault.
"The broker must complete the sale; that is, he must find a purchaser in a situation and ready and willing to complete the purchase on the terms agreed on, before he is entitled to his commissions.
" Then he will be entitled -to them, though the vendor refuse to go on and perfect the sale."
In short, when the right to compensation depends upon a special contract, plaintiff must perform the undertaking assumed by him, and no matter what the terms and conditions may be, upon which the right to compensation depends, they must be performed as a condition precedent to a right of action for the recovery of the specific compensation (Fraser v. Wyckoff, 63 N. Y. 445; Jacobs v. Kolff, 2 Hilt. 133; Gregory v. Mack, 3 Hill, 380).
It is only in cases where the broker is employed generally to find a purchaser, that it is sufficient to entitle him to compensation, that a sale is effected through his agency as its procuring cause. In such a case, his agency may consist, simply, in bringing the parties together, and leaving them to make their own bargain. Yet, if a sale actually results in consequence thereof, he is entitled to recover, and it then matters little whether the compensation for the service actually rendered has been fixed by agreement, or is left to depend upon a custom.
But the case at bar does not fall within that class of cases. It is a case of special contract which plaintiff had not performed, when defendants refused to be bound by it any longer. It was, therefore, competent for them to prescribe new conditions, upon which they would continue bound, and upon such new conditions being made known to plaintiff, he - had his option to assent or to withdraw. Not having withdrawn, whatever services were subsequently rendered by him must be deemed to hane been rendered as if no agreement for compensation, except such as the law implies, had been made. As the case stands, his protest is unavailing in the absence of proof that it was heeded by the defendants, and that it led to a hew promise or agreement on their part, to pay the compensation originally named. It is not enough that he has rendered valuable services to the defendants. For these he may be entitled to a reasonable reward. But before he can recover the specific compensation sued for, it must appear, that before the change in the prices was communicated to him, he had done the very thing for which the reward that he demands was promised. True, strict performance could not be insisted upon, if it appeared that plaintiff, at the time in question, had substantially performed, and that the defendants had waived or prevented full performance. But the question of excuse for non-performance does not arise in this case. «
The referee therefore erred in computing plaintiff's compensation claimed under the first and third causes of action alleged in the complaint upon the basis of defendants' proposition contained in the letter of July 9, and in adjusting the accounts between the parties upon such erroneous computation ; and as such error necessitates a reversal of the whole judgment and the granting of a new trial, the point presented by plaintiffs' appeal in consequence of the refusal of the referee to allow anything on account of the second cause of action alleged in the complaint does not require further consideration at present. Plaintiff's claim in that respect will have to be examined again upon the new trial, upon the evidence which may then be produced, and determined according to the rules of law called for by the facts as they may then be made to appear.
In conclusion it may be well to say a few words yet concerning the settlement made between the defendants and the Remingtons.- This, it is true, contained an admission by the defendants that the prices which they were entitled to receive, were only those contained in the letter of July 9. But such admission was not absolute proof of the fact, and the plaintiff himself has proved the contrary, as hereinbefore stated. On this state of facts the inference is that the Remingtons were wronged, and that they are entitled to recover the difference according to the proof in this case. But the plaintiff has no right to hold on to that difference.
The judgment should be reversed, the order of reference vacated, and a new trial ordered, with costs to defendants to abide the event.
Sedgwick, J., concurred.
The dissenting opinion contains nothing adverse to the propositions in the head-notes. The difference of opinion between the learned judges arises from the conclusions of facts which they arrive at from the evidence.
The prevailing opinion proceeds on the ground that defendants had modified the terms of the letter of July 7, and had, through Mr. Reynolds, their duly authorized agent, notified the plaintiff of such modification before he had effected any sales under that letter.
The dissenting opinion proceeds on the ground that defendants had not, at any time before sales effected under the letter of July 9, changed, or communicated to plaintiff, or to Mr. Reynolds, any change in, the prices fixed by that letter, o