Court Opinion

ID: 9444147
Source: CourtListenerOpinion
Date Created: 2023-08-03 19:43:28.914533+00
Date Added: 2024-06-11T17:29:44.369655
License: Public Domain

GARDNER, Chief Judge
(dissenting).
I find myself in disagreement with the majority opinion. This is a criminal case and the evidence to be substantial must be sufficient to prove the guilt of the accused beyond a reasonable doubt. The statute involved is penal and must be strictly construed. Federal Communications Commission v. American Broadcasting Company, 1954, 74 S.Ct. 593.
I agree with the majority opinion that the nature of the contract between the defendants and Swalve is the crucial question in this case. The guilt or innocence of the defendants may be said to depend upon the interpretation or nature of the contract between private individuals. The contract was an oral one. The parties thereto do not entirely agree as to what was said in the conversations out of which the contract grew. The government contends that the egg shipments involved were received by defendants for and on behalf of the prosecuting witness and confessedly they were transported in interstate commerce. It is true that Swalve in his testimony testified that defendants were “to handle these eggs for me.” There is, however, no magic in these words. The contract being oral and the parties thereto being in disagreement as to its proper scqpe and interpretation, the surrounding facts and circumstances under which it was made and the surrounding acts of the parties indicating their understanding of its terms are pertinent facts for consideration. Thomson v. Thomson, 8 Cir., 156 F.2d 581; Terry v. Muller, 8 Cir., 190 F.2d 170; Craig v. Thompson, 8 Cir., 177 F.2d 457.
In this connection attention is called to the testimony of O. N. Harsha, a Marketing Specialist employed by the United States Department of Agricul*421ture in Washington. In the course of his testimony he said:
“In the egg produce trade, the words ‘commission man’ or ‘commission merchant’ have a very definite meaning. This man or merchant receives eggs and he sells the eggs for what he can get for them. He receives the particular shipment of eggs from a consignor. He sells the shipment for as much money as he can if he is a good commission merchant, and he deducts therefrom his fee. It is a cent or two cents, depending upon the locality, and his ability to make quick sales, and if the transportation charges are paid at destination, those charges are paid by the Commission merchant out of his deduction for handling, and the net sum that is left is remitted to the consignor.”
Manifestly, according to the accepted usages in the egg trade, as explained by this expert witness, and his testimony stands without dispute, the defendants were not commission men nor brokers. The witness further testified as follows:
“When eggs are handled by a commission man or broker for a shipper, it is not customary for the shipper to be guaranteed a price. The term ‘dealer’ has a particular meaning in the egg trade. A dealer is a man who buys eggs and then sells those eggs in anticipation of a profit. Sometimes his anticipations are not realized. He may sustain a loss, but they are his eggs to do with as he pleases. He buys the eggs at a set price, and he sells them for what he can get. The price paid to the original shipper who ships the eggs to the dealer does not depend on what the dealer is able to get for them. There is a definite price between the dealer and the shipper. The custom for determining the price is the same in the egg business as every other business. The man buys it at a set price. They agree to the terms. The seller says, T will sell you these eggs at so much a dozen, so much a case.’ ‘All right, I will buy them.’ That is the end of it. ******
“When eggs are handled by a commission man it is not the custom of the trade for the buyer and seller to have a specific price in mind ahead of time.”
It is equally clear from the acts of the parties that the defendants were dealers. They paid a fixed price definitely determined. They paid this on delivery of the eggs and they paid it whether they sold the eggs or retained the eggs, and they paid it whether their ultimate sales were at a profit or at a loss. In other words, their sales were on their own account and not on the account of the prosecuting witness. The contract as actually performed by the parties had none of the usual attributes of an agency existing between a commission man and his principal. Title vested in the defendants and they were free to do as they chose with the product. The prosecuting witness in his testimony with reference to his attempt to break the contract with the defendants, among other things said, “I broke off business with them on March first, the last load I sold to them.” (Italics supplied.) When the eggs were received by the defendants they became primarily liable for a definite purchase price. The local law determines the nature of the contract here involved. In re Hecka-thorn, 3 Cir., 144 F. 499; In re Morris, 3 Cir., 156 F. 597. Under the decisions of the Supreme Court of Iowa the contract as performed by the parties constituted an absolute sale. Norwegian Plow Co. v. Clark, 102 Iowa 31, 70 N.W. 808; Norton v. Fisher, 113 Iowa 595, 85 N.W. 801; Hull-Dobbs Motor Co. v. Associates Discount Corp., 241 Iowa 1365, 44 N.W.2d 403; Alpha Check-Rower Co. v. Bradley, 105 Iowa 537, 75 N.W. 369.
Referring now to the rule often announced by this and other courts that where the contract is oral and there is dispute as to its terms the contemporaneous acts of the parties before any controversy arose with reference to the in*422terpretation of the contract is very significant. In Terry v. Muller, supra [190 F.2d 172], we said:
“It is elementary that the cardinal rule in the construction of contracts is to determine the intent of the parties. Where the contract is in writing this must usually be determined by the words of the contract. Here there was no written contract and it must be determined to a large extent by the surrounding circumstances, the acts of the parties and how the parties themselves construed or interpreted it. There was no claim of fraud or misrepresentation of any kind.
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« * * * t]j6 action of the parties during the time of the performance of this contract indicated what they thought of its scope and meaning and their conduct is of great, if not controlling, influence in ascertaining their understanding of the scope and terms of the contract. It may generally be assumed, in the absence of fraud or misrepresentation, that parties to a contract know best what was meant by its terms and they are the least likely to be mistaken as to its intention, and whatever is done by the parties during the period of performance of the contract is presumed to be done under the terms of the contract as they understood and intended it to be.”
In Craig v. Thompson, supra [177 F.2d 460], we stated the rule as follows:
“It has long been the law that ‘Where the parties proceed in the performance of the contract as though it had a certain meaning and that meaning is not entirely inconsistent with the wording of the contract, it should prevail.’ ”
The statute, I think, was not intended to cover the situation shown in this case and being penal in nature it ought to be strictly construed. There was not substantial evidence sufficient to prove the guilt of the defendants beyond a reasonable doubt. At best, most liberally construed the evidence did not exceed the dignity of a scintilla and hence, the court should have sustained the defendant’s motion for acquittal. Even had the case been a civil action to recover, not the purchase price of the eggs but damages for the alleged breach of contract, the evidence would not have been sufficient to sustain a verdict for plaintiff. The case in fact has some of the earmarks of a criminal proceeding brought to recover a debt rather than for the enforcement of a law enacted for the protection of the public. I would reverse.