Opinion ID: 1672190
Heading Depth: 1
Heading Rank: 6

Heading: Shipments Into Carlock's Territory

Text: The trial court found that on no occasion did Modine or American sell its products within Carlock's territory in violation of the agreement or breach any contractual obligation owing to Carlock. Under our construction of the contract there is documentary evidence of numerous violations of the contract on account of shipments into Carlock's exclusive territory, and the trial court's contrary finding in this respect is clearly erroneous. Since neither the word sale nor the words sell within Distributor's territory are defined in Par. 4 of Exhibit 1 we resort to the customs and usages of the trade to ascertain their true meaning. We learn from expert witness Sharp, whose testimony on this phase of the case we accept, that a shipment into a territory is definitely a sale into that territory in the absence of any specific language in the contract. In this 3-volume transcript of 717 pages more than 280 invoices evidencing sales were in evidence. Carlock claims $13,094.76 due on 97 shipments into his territory. The invoices and documents relating to these shipments, examined one by one, disclose 21 shipments into Carlock's exclusive territory made by American or Modine in violation of the contract (direct non-OEM sales of products destined for points located within Carlock's five counties; sales of which he was not advised and for which he received no credit). [1] There is testimony of record that on most sales during these years Carlock's discount was 38%, which would represent his gross profit. He is entitled only to net profits, Coonis v. Rogers, 429 S.W.2d 709, 714 (Mo.1968), and is restricted to 25% under his concession that 25% of the sales price to the customer would represent profit for him; that 25% profit was usual. The total invoiced price of this group of 21 shipments into Carlock's territory was $25,301.27. At 25% the amount due Carlock on these shipments as of date of judgment amounts to $6,325.31. There is no liability on the other 76 exhibits, which either were OEM sales excepted by Par. 4(b) of Exhibit 1, or involved shipments to points located outside Carlock's territory, or had no significant or established connection therewith. There were also 9 shipments into Carlock's exclusive territory on orders received by American from distributors located in other parts of the country, which were non-OEM sales of products destined for points located within Carlock's exclusive territory, as to which he was not notified, [2] and of which Carlock became aware only by use of the discovery process in the course of litigation. According to the evidence the justification for participation by the local distributor in the commission to be allowed the selling distributor is that the man into whose territory the equipment is shipped is, in most cases, responsible for the satisfactory performance of the equipment, and the service to the equipment. In failing to give Carlock notice and an opportunity to protect himself on these orders American violated its contractual obligations. Nothing more than nominal damages, however, can be assessed with respect to these shipments, for the reason that Carlock failed to sustain the burden of proving (1) that he would have been reasonably certain to reach an agreement with the other distributors for his financial participation in these transactions, [3] and (2) the percentage of the commissions he could reasonably have been expected to receive. Carlock made no showing of either. With respect to division of commissions he gave four instances in which he split his commission with another distributor, but introduced no evidence of the percentage retained and that shared.