Court Opinion

ID: 6751305
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:18:00.32253+00
Date Added: 2024-06-11T16:02:16.536436
License: Public Domain

Dtjefey, P. J.,
dissents. The trial court found that the parties contemplated C. A. F. contract. Both counsel agree. It is also agreed that under a C. A. F. contract the buyer procures the transportation (here a truck from Wilson Freight) and loads the merchandise. Upon sealing the load, the title passes to the buyer. From that point on (with exceptions not pertinent here) all risks of transit and delivery fall upon the buyer.
The contract here was originally an oral one made by telephone by the Armour Company, acting through a broker (Busse), and Val Decker. It is stipulated that the terms of the contract are those contained in Armour’s confirmation letter dated December 26, 1956. The portions pertinent to this suit are:
“Terms — C. A. F. Worcester; Thru: Worcester County Trust Co., Worcester, Mass.
' “Shipping date — 11 P. M. 12/26/56.
“Ship, to — Western Pork Packers, Inc. Destination — 288 Franklin St., Worcester, Mass.
“Note: Please show on bill of lading in large size, bright colored print or crayon that Western Pork Packers Inc. desire to unload these hogs not later than 3 P. M. Friday, 12/28 and as much sooner as possible. If delayed, truck driver to please *205call collect, Mr. Ralph Cutillo, Mgr. Armour & Co. 219 Summer St. Worcester, Mass. tele. No. PLEASANT 2-5653.”
It should be noted here that the provision about the time of delivery to Western is on its face, and on the testimony of the witnesses, a statement of instructions for the carrier rather than a term of the contract.
As the above quotation shows, the contract explicitly specified a time of Shipment. Appellee admits that shipment did not take place until 12:25 P. M. on December 27 — some thirteen and one-half hours past the time specified in the contract. While in transit there was a mechanical breakdown. The driver called Armour and was authorized to arrive at Western by 6:00 A. M. on December 29. He did not arrive at that time and, in fact, not until after the 29th (apparently sometime on the 31st.) Armour refused to accept the shipment.
In a C. A. F. contract the promised performance is shipment i. e. delivery on board the carrier. Yal Decker, even in the absence of a specific provision, would be obligated to ship within. a reasonable time. I do not interpret the majority opinion, or the lower court’s, as suggesting that the contemplated performance by Yal Decker was in the alternative i. e. that Yal Decker could ship C. A. F. on the 26th or deliver before 3:00 P. M. December 28.
Appellee states that the basic issue is, “Was the time of shipment from appellee’s plant in Piqua, Ohio of the essence in the contract between appellant and appellee?” Of course, time is always of the “essence,” if the reference is to the obligations of the one not performing on time. Yal Decker obviously breached its contract. But this suit is not concerned with that breach but with the alleged nonperformance of Armour. More accurately, then, the issue here is whether Yal Decker’s delay in shipment was such a material breach of contract as to excuse Armour from performance.
It is undisputed that Armour was not purchasing for itself, but rather its purchase was to fulfil a prior contract with Western. Yal Decker knew that at the time the contract was negotiated. It is, therefore, apparent, and the trial court so found, that delivery to Western on Friday afternoon, December 28, was the essential purpose of the contract. While that was the purpose, it was not the promised performance. The legal *206issue is not whether time of delivery was more important than time of shipment. The question is whether time of shipment was under the circumstances a material term of the contract and, if it was, whether the breach by the delay in performance was a material one. One important factor in determining the materiality of delay in performance is the existence of a contract provision. Appellee has stipulated that. Another factor is the purpose of the contract. This was a contract for resale on a prior commitment and both parties knew this. Time was therefore an important aspect of the transaction — both as to shipment and as to delivery. There could be no delivery without a shipment. There is also the testimony of Carl Decker, Vice President of Yal Decker. He testified to his conversation with Mr. Busse (Armour’s broker).
“Q. Do you recall whether there was a shipping date indicated?
“A. I believe so, I believe there was.
“Q. Do you recall it?
“A. Well, other than the telephone conversation with Mr. Busse, which was on that date and he so indicated that the shipment was to go forth that night.
“Q. That night?
“A. Yes.”
The majority opinion appears to hold that delivery to Western was the important thing and shipping time was unimportant (at least up to the point where timely delivery would be impossible). On the other hand, the opinion relies on shipment as establishing the C. A. P. contract. The result is that Armour is liable even though the shipment was late and even though the actual delivery was not made even remotely within time. I believe that this result fails to give consideration to one highly important aspect of the transaction — the risk of late delivery at destination.
As Judge Bryant has pointed out, all parties knew that the road conditions were not good and normal transit time was twenty-four to thirty hours. The time period between 11:00 P. M., December 26, and desired arrival at 3 :00 P. M., December 28, is forty hours. Each hour’s delay increased the risk to Armour — one might say disproportionately increased the risk. Armour did not want the hogs for its own use. As the time *207margin decreases, even slight mechanical failures or road obstructions would substantially affect the ability to make a timely delivery. Val Decker used a double loading crew and requested two drivers for the truck. This, in addition to the testimony quoted, indicates that Val Decker appreciated the importance and possible effect of the delay.
The actual shipment was made at 12:25 P. M., December 27, leaving' twenty six and one-half hours for transit. At no point between the negotiation of the contract at 5:30 on the 26th and the time of shipment did Val Decker notify Armour that there was a delay. One of the obligations of a buyer under a C. A. F. contract is to procure the transportation.
The question here can be pointed up obliquely. What would Armour’s rights have been if Val Decker had notified Armour of the delay before shipping? To say that Val Decker could insist on the right to ship, and correspondingly, that Armour could not rescind, is to give Val Decker the power to substantially alter the risk to Armour of accomplishing delivery to Western and fulfilling the purpose of the contract. Perhaps Armour would have authorized the late shipment, but perhaps too, it might have found another processor with better chances of making a timely delivery to Western. I think it apparent that Armour would have had the right to seek better arrangements, and to rescind the Val Decker contract without liability.
Surely Val Decker’s failure to inform Armour of the delay does not add to Val Decker’s legal position i. e. its right to ship late without prior approval by Armour. Nor is . it relevant that subsequent actual events prove that even timely shipment would not have reached Western until after the 29th. Armour can be held to assume the risk of transit only if Val Decker substantially performed its side of the contract. Val Decker’s right to ship under the C. A. F. contract must be determined as of the time of shipment.
In my opinion, the delay in performance by Val Decker substantially altered Armour’s position, and there was no right to ship without a confirmation 'by Armour made with knowledge of the delay. ■ In view of that conclusion, the events which occur after the time of shipment are immaterial to the ultimate liability of the parties. The actual shipment would legally be *208a unilateral venture by Val Decker. It was good gamble, but unfortunately it did not succeed. The subsequent phone call to Armour by the driver would, at most, constitute a conditional acceptance of the late shipment. The condition not having been fulfilled, it does not affect liability.
The judgment should be reversed and remanded with instructions to give judgment to the defendant.