Court Opinion

ID: 5367894
Source: CourtListenerOpinion
Date Created: 2022-01-08 07:56:23.204005+00
Date Added: 2024-06-11T08:29:58.674491
License: Public Domain

Schenck, J.
Claimant contracted for sale of milk over a period of one year to the Creedmoor State Hospital at the price of $.0644 per quart. The contract included the following provision:
“ Proposal and Price
“All bids are to be submitted on the forms furnished and net price per quart F. O. B. point of destination shall be the basis of award.
“ In the event that a price order, pursuant to the provision of Article 21 as amended by Chapter 383 of the Laws of 1937 of the Agriculture and Markets Law, is made effective by the Commissioner of Agriculture and Markets in the market where this milk *427is to be delivered the Division of Standards and Purchase may in its discretion permit an adjustment of the price paid for milk delivered in accordance with such contract, so that such price will not be out of proportion to the terms of the official price regulations.”
The foregoing discretional “ price adjustment ” clause is the source of the contention herein. During the last four months of the contract the Commissioner of Agriculture and Markets of the State of New York promulgated an order fixing the price of milk paid to producers by handlers of milk for resale in New York city at $2.45 per hundredweight plus two cents additional for administration purposes.
Claimant now contends that it could purchase milk at about $1.70 per hundredweight when it entered upon the contract, and that the increase in price pursuant to the aforesaid order would make it sustain a loss if compelled to accept only the original contract price for resale to the State institution. Claimant argues that a price adjustment should be granted to compensate for the price increase which it was compelled to pay to the producer. The action was brought in the Court of Claims which, while asserting jurisdiction in the matter, nevertheless, dismissed the claim upon the merits.
I think the judgment should be affirmed. By its very language the contract clause placed discretion for “ adjustment ” in the Division. of Standards and Purchase. Both parties were aware of the possibility of price increases by order or otherwise. Claimant should have considered this factor in submitting its bid. The contract did not provide for adjustment upon any definite basis nor did it provide for adjustment to the mutual satisfaction of both parties. The contract, to this extent, was, therefore, illusory. It cannot be said that the contract was unenforcible as to the disputed clause because there was no agreement there to enforce. There was a provision permitting adjustment in the discretion of one party. That this provision might not inure to the benefit of the other party was fully as manifest when the contract was entered upon as it is now. The party now claiming contractual benefits where none were provided should should not now complain.
It is elemental that the terms of a contract must be certain and explicit to make it enforcible. (Varney v. Ditmars, 217 N. Y. 223; United Press v. New York Press Co., 164 id. 406.) A contract providing for adjustment in the discretion of one party is certainly not definite and explicit as to the contractual obligations and rights of the two parties.
*428In view of the fact, furthermore, that what transpired here is exactly what claimant might reasonably have expected to happen, there is no question of “ abuse of discretion.” The State, as a party, was simply not bound by the clause. A binding clause making specific bases for adjustment could have been agreed upon. Unfortunately for claimant, no such clause was made a part of the contract.
The question of jurisdiction has been raised by the State, the contention being that this proceeding should have been brought under article 78 of the Civil Practice Act. I do not see why we should pass upon this point, The matter is better disposed of by passing upon the merits now rather than when it might be presented again in other proceedings.
The judgment should be affirmed, with costs.
Crapser and Foster, JJ., concur; Hill, P. J., dissents in an opinion; Heffernan, J., dissents in an opinion.