Court Opinion

ID: 8781940
Source: CourtListenerOpinion
Date Created: 2022-11-26 13:21:39.55912+00
Date Added: 2024-06-11T17:02:52.647381
License: Public Domain

ROSS, Circuit Judge
(after stating the facts as above). On the trial it having been admitted on behalf of the defendant that $2,059 worth of glucose had been sold to it by the plaintiff, and that, unless *931the defense set up was sufficient, the plaintiff was entitled to a verdict, the sole question for consideration is the sufficiency of that defense. In support of it, the defendant introduced in evidence certain circular letters issued by the plaintiff and received by the defendant, and certain subsequent letters passing between the parties in relation thereto. Evidence was also introduced going to show that the defendant did not buy all the glucose it used during the year 1908 from the plaintiff, but that during that year it bought a considerable portion of it from other parties at less prices than those asked therefor by the plaintiff; the contention of the defendant being, as stated by its counsel in this court;
“That the Corn Company by its offers obligated itself to sell glucose to the Syrup Company during all the year 1908 at a reasonable price if the Syrup Company chose to buy from it; that, as it did not sell at a reasonable price, the Syrup Company was justified in buying elsewhere, and at the same time was entitled to recover from the Corn Company the amount of the rebate for the xmrehases made in 1907 that it would have received if it had purchased exclusively from the Corn Company during all of the year 1908.”
[1] The gist of the defense, therefore, was that the plaintiff in the action had obligated itself to sell glucose to the defendant during the period mentioned at a reasonable price, if the defendant chose to buy it from the plaintiff. In other words, that the plaintiff had hound itself by contract so to do; and further contending that the plaintiff had exacted an unreasonable price, thereby justifying the defendant in purchasing from others.
The first and conclusive answer to the contention is that without some obligation on the part of the defendant there was, and could he, no contract at all. Mutuality is one of the essential elements of a contract. The right of the defendant to buy only in the event it should choose to do so manifestly imposed no obligation on it to do so.
[2] Secondly, the record does not support the contention of counsel for the plaintiff in error that the Corn Company obligated itself to fix a “reasonable price” for the glucose it offered for sale.
The first circular letter addressed to the defendant by the plaintiff is as follows:
“Corn Products Refining Company, 20 Broadway,
“New York, November 28, 1906.
“Long Syrup & Ref. Co., San Francisco, Cal.
“Gentlemen: This company recognizing the fact that its own prosperity,
in a great measure, is interwoven with the goodwill and co-operation of its patrons, lias decided to adopt a liberal plan of profit-sharing with you in case you shall in the future continue to give us your exclusive patronage.
“This company inaugurates such a policy of profit-sharing, by announcing that it will set aside out of profits from the manufacture and sale of glucose and grape sugar for the last six months of 1900, an amount equal to ten cents per hundred pounds on all shipments of glucose and grape sugar (Warner's Auhydro & Bread Sugar Excepted) which shall have been made by this company from July 1st to December 31st, 1906.
“This amount will be paid to you or your successors on December 31st, 1907, on condition that, 1'or the remainder of the year 1908 and the entire year 1007, you or your successors shall have purchased exclusively from this company or its successors all the glucose and grape sugar required for use in your establishment.
*932“With the assurance of the steadfast co-operation of its customers, given in reciprocation for the benefits conferred upon- them, this company confidently anticipates a continuance of such profit-sharing distribution annually to the full extent that its earnings may warrant.
“Yours very truly, Corn Products Refining Company.
“E. B. Walden, General Manager of Sales.”
Similar letters addressed to and received by the defendant are as follows:
“Corn Products Refining Company, 26 Broadway,
“New York, December 23, 1907.
“Sales Department.
“Gentlemen: The plan of profit-sharing adopted by this company in November, 1906, having met with the hearty approval of our customers, we take pleasure in announcing its continuance for the year 1907.
“The amount to be paid yon will be based upon the shipments of glucose and grape sugar (No. 70 Climax and Chicago anhydrous sugar) which shall have been made to you by this company during the year 1907, and will be paid on December 31st, 1908, on condition that you or your successors shall have purchased exclusively from this company or its successors, either for resale or for use in your establishment all the glucose and grape sugar required by you during the year 1008.
“The amount thus to he paid will be announced to you as soon after Jan-nary 1st as the business for the year has been closed and the profits ascertained.
“Yours very truly, Corn Products Refining Co.”
“Corn Products Refining Company, 26 Broadway,
“New York, January 23, .1908.
“Sales Department.
“Profit Sharing for 1907
“Gentlemen: Referring to our letter on this subject of December 23,
1907, and confirming same, we now take pleasure in informing you that we will pay to you ou December 31st, 1908, fifteen cents per hundred lbs. of the total amount of glucose and grape sugar (70, Climax and Chicago anhydrous) which we have shipped to you during the year 1907, upon condition that you or your successors shall purchase exclusively from this company or its successors all of the glucose and grape sugar handled by you during the year 1908, and shall have paid in full all invoices covering the same.
“You will observe that this profit sharing cannot be anticipated by deducting from our invoices, but is only payable by this company's checks after those invoices are settled in full.
“Will you jilease send us at your earliest convenience a full detailed statement showing date of invoice, our order number, number of packages and number of net pounds covering all shipments made to you during 1907. We ask that you give this request your immediate attention, as later you may have difficulty in compiling this data.
“Yours very truly, Corn Products Refining Company.”
Conceding- that, if this were all that passed between the parties in respect to the matter, the plaintiff’s offer might be held to imply the condition that the glucose would be sold by the plaintiff “at a reasonable price,” the subsequent letters which passed between them expressly negative any such implication. Those letters are as follows:
“San Francisco, December 6, 1906.
“The Corn Products Refining Go., New York City, N. Y.
“Dear Sirs: Your letter of November 28th received. We have gone over your letter carefully and note your propositions.
“As we understand them you are to allow us 100 per hundred rebate *933on all glucose bought from you since July 1st, 1906, to December 31st, 1906. This amount to he paid to us on December 31st, 1907, and a further rebate of 100 per hundred on all glucose we buy from your firm or their successors from January 1st, 1907, to December 31st, 1907, providing as you say that we buy all our glucose from your firm or their successors during the time mentioned in this letter.
“In answer, we are willing to do this providing you sell us at as low a figure as any one else and will guarantee to protect us on prices should any firm start up in opposition to your firm or their successors and put the price lower than the price of your firm. You then in this- case, if the price was lower, should either allow us to buy from them or you meet their price and still give us the 10«S per hundred rebate on all that we buy from you during the time stated.
“We also in this case agree to give you the preference providing the prices are the same and under the same conditions. If this meets with your approval please write to us and then we will write yon a further letter confirming contract, or, as you see fit to make it.
“Yours truly, Long Syrup Refining Oo., per J. M. Long.”
“Corn Products Refining Company, 26 Broadway,
“New York, December 22, 1906.
“Sales Department, Room 400.
“Long Syrup & Refining Go., Sail Francisco, Calif.
“Gentlemen: Replying to your favor of December 6th, beg to say that our profit-sharing proposition contemplates purely a voluntary act on the part of a buyer. If we receive the exclusive patronage of that buyer during- the year 1907 he then will he entitled on such deliveries as ho may have received from us from July 1st to December 31st, 1906, ten cents per hundred pounds on glucose and grape sugar. It makes no condition relative to competitive prices or otherwise. It is a question for each buyer to figure whether or not it is to his interest to join in the plan and this, of course, can only be figured, taking into consideration conditions competitively or otherwise which may exist from time to time during the ensuing year. It makes no stipulation, preference or otherwise, nor do we enter into any written contract for the supply of our materials for this, period.
“At the end of 1907 when this dividend of ten cents per hundred pounds is to be paid we will simply ask that you and our other patrons sign a warranty which will show conclusively that you are entitled to it by having given to us an exclusive patronage during that period.
“Respectfully yours, Com Products Refining Company,
“E. B. Walden, General Manager of Sales.”
In the last letter quoted the defendant in error, in answer to the letter of the plaintiff in error of date December 6, 1906, expressly informed the Syrup Company that the Corn Company’s “profit-sharing proposition contemplates purely a voluntary act on the part of the buyer,” and that it (the Corn Company) “makes no condition relative to competitive prices or otherwise. It is a question for each buyer to figure whether or not it is to his interest to join in the plan, and) this, of course, can only be figured, taking into consideration conditions competitively or otherwise which may exist from time to time during the ensuing year. It makes no stipulation, preference, or otherwise, nor do we enter into any written contract for the supply of our materials for this period.”
In view of these letters, we are of the opinion that the Corn Company cannot be properly held to have bound itself in respect to prices at which it would sell glucose to the Syrup Company.
The judgment is affirmed.