Court Opinion

ID: 3579935
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:31:11.83139+00
Date Added: 2024-06-11T07:41:21.932690
License: Public Domain

This controversy arises upon a contract in relation to wheat between a merchant and miller; and it is one *Page 435 
of the many cases concerning the same subject matter in which it is somewhat difficult to determine whether the parties intended to make a contract of sale or of bailment.
The distinction between a bailment and a sale is correctly laid down by Bronson, chief judge, in Mallory v. Willis (4Comst. 85), in these words: "When the identical thing delivered, although in an altered form, is to be restored, the contract is one of bailment and the title to the property is not changed; but when there is no obligation to restore the specific article, and the receiver is at liberty to return another thing of equal value, he becomes a debtor to make the return, and the title to the property is changed: it is a sale."
The judges in that case differed with respect to the effect of the distinction upon the case before them, but not in regard to the distinction itself.
We will examine the contract in detail. In October 1844 Brown agreed to deliver to Foster at Rochester 30,000 bushels of wheatto be ground. These words, unless qualified and controlled by some subsequent grant of the agreement, show a bailment for manufacture and not a sale. They show what was to be done with the wheat. If the contract operated as a sale, Foster might lawfully sell it again and immediately. But it was to be ground and not sold; and the words used by the parties control the power of Foster over the wheat and prevent him from selling it as his own property.
The contract proceeds: "Fifteen thousand bushels to be ground in season to be shipped east during the navigation this fall." What was to be shipped east? The only answer to be given to this question consistent with the language of the parties is, that it was the flour to be made of this 15,000 bushels of wheat. And if this part of the contract is obligatory on Foster, he was bound to return that identical flour for the purpose specified.
Why was the time fixed within which it was to be manufactured? If the transaction was a sale the time was immaterial, because Foster might have delivered other flour without having ground the wheat within the time, but if it was a bailment the *Page 436 
time was material, and the parties deemed it material or they would not have fixed it by a stipulation in the contract. They contemplated a bailment therefore and not a sale.
The contract goes on thus: "And fifteen thousand to be ground during the winter." The same observations apply to this clause. Both these provisions are obligatory upon Foster; they bind him to grind the wheat within the specified times; and this was to be done for the benefit of Brown. But Brown could derive no benefit from the manufacture within the time, except to enable Foster to return him the flour to be made from the wheat; and if that was what the parties meant should be done, they intended a bailment and not a sale.
The next provision in the contract is this: "Said Brown to be subject to no charge on account of storage." If the parties had intended a sale, this clause was useless and senseless; because Foster could have no pretence for charging for the storage of his own wheat. But if they intended a bailment this provision was useful, effective and sensible. It secured Brown against a charge which Foster would otherwise have had a right to make. It is a legal maxim that any part of an instrument shall if possible be construed as having some effect. If we apply this maxim to the contract in question, we must regard the transaction as a bailment and not a sale.
There was this further provision in the contract: "The wheat to be received from Gelston  Evans, and the flour to bereturned to them." The import of this sentence is that the wheat received fram Gelsten  Evans should go back to them again in flour. The delivery to them of the flour of the same wheat would be a return of the same thing in a different form. The delivery of the flour of other wheat would not be a return to Gelston  Evans, because it had never been in any form in their hands.
Every sentence in the contract has now been noticed excepting one, and every sentence thus noticed contains evidence that the parties intended a bailment and not a sale.
The part not yet noticed stands in the contract immediately after the clause in relation to storage; it is in these words: *Page 437 
"Said Foster is to deliver to said Brown one barrel of superfine flour for each five bushels of wheat so delivered to be ground."
It is contended that Foster is not bound by this stipulation to return Brown or his agents the flour of the same wheat, but may perform his contract by the delivery of any other superfine flour, and therefore the transaction was a sale and not a bailment.
If the particular clause under consideration were to be considered and construed by itself and without reference to any other part of the contract, we should assent to the plaintiff's proposition; and according to the rule by which a sale is distinguished from a bailment we should regard it as a sale, because Foster is not expressly and in terms bound in this clause to return flour of the same wheat. There are however even in this clause, words which make it doubtful whether the parties did not look to a return of that flour. The purpose for which the wheat was delivered, namely, "to be ground," is distinctly expressed in it; and if we are to understand it was to be ground for Brown
(and that seems to be a natural and necessary interpretation), the parties must have regarded it as Brown's flour in Foster's hands as bailee. But it is a settled rule in the construction of contracts that the interpretation must be upon the entire instrument and not merely on disjointed or particular parts of it. The whole context is to be considered in collecting the intention of the parties, although the immediate object of inquiry be the meaning of an isolated clause (Chitty on Contr. 83, and authorities cited). Here is a contract every sentence of which excepting one shows an intention to create a bailment and not to make a sale. Even that one standing alone is ambiguous. It shows expressly that the wheat was delivered to be ground, and by implication that it was to be ground for Brown. It authorizes performance by a return of the flour made from the wheat received. It is not directly repugnant to the other parts of the contract, because it does not require performance by the delivery of flour made from other wheat. It must therefore be construed in sub-serviency to the intention to create a bailment which is so *Page 438 
plainly manifested in all the other parts of the instrument, and the flour which Foster was bound to return was (although not expressly specified in the particular clause in question) the flour to be manufactured from the wheat received under the contract.
The judgment of the supreme court should be reversed and a new trial ordered.
GARDINER, JEWETT, JOHNSON, WATSON and WELLES, JJ., concurred.
MORSE, J., dissented.
Judgment reversed and new trial ordered.