(156 La.) No. 24150. VAN NESS v. LOUISIANA FARM "The party of the first part" (meaning the defendant here) "agrees to allow and will allow unto party of the second part" (meaning the plaintiff) "as commission and compensation for his services as herein set forth twenty (20) (Supreme Court of Louisiana. March 24, 1924. per centum of the retail sale price of such Rehearing Denied by Division C May 5, 1924.) (Syllabus by Editorial Staff.) 1. Principal and agent 41-Mandate; allegations insufficient to warrant recovery of profits for tractors not delivered. Where agent ordered from his principal eight tractors which were not shipped, agent did not state cause of action for loss of profits, where he failed to allege that he could have sold at an advanced price, or that they would have been worth the price for his own use. 2. Principal and agent 41-Mandate; petition for commissions and recovery of advances on tractors not shipped held good. tractors sold, as such retail price is fixed and listed at the factory, each party agreeing to abide by and be bound as regards commission, by the retail list price as fixed at the factory, which price is subject to change from time to time, at the discretion of the manufacturers; the compensation or consideration of this contract on the part of the first party being taken out of the balance of said sale price of tractors on terms and as per contract existing between said party and the manufacturers, and not in any way dependent upon the 20 per cent. above mentioned; and "The party of the first part further requires and that, with each and every order so sent in, that all orders be sent to it by second party, a deposit of one hundred (100) douars accomIn a subagent's action against his princi- all such orders received to the manufacturers, pany same, the first party agreeing to forward pal for breach of contract whereby he was to to be filled and shipped out to destination desigsell tractors, petition for commissions and re-nated in due course of business, shipments to be covery of advances on tractors not shipped held to state cause of action. Appeal from First Judicial District Court, Parish of Caddo; John R. Land, Judge. Action by M. B. Van Ness against the Louisiana Farm Machinery Company. Judgment for defendant, and plaintiff appeals. Judgment annulled, and case remanded, Edward Barnett, of Shreveport, McCoy & Moss, of Lake Charles, and Barnette & Roberts, of Shreveport, for appellant. Crain, Jackson & Johnston, of Shreveport, for appellee. sent out with sight draft attached for the bal- Plaintiff avers that the meaning of the paragraph last quoted was that the sending in of an order, with the required deposit, made a binding contract at the price then fixed and listed at the factory, and that defendant was then responsible for the payment of the commission, at 20 per cent, on the price so fixed and listed at the time of the By Division A, composed of O'NIELL, C. receipt of each order with the accompanyJ., and ROGERS and BRUNOT, JJ. O'NIELL, C. J. The plaintiff has appealed from a judgment dismissing his suit on an exception of no cause of action. The suit is founded mainly upon a contract by which the defendant, as sales agent for the Waterloo Boy tractors, appointed plaintiff the exclusive subagent for a limited territory. The term of the contract was one year, commencing on the 10th of July, 1917. It was afterwards extended to the 31st of July, 1919. The principal demands in this suit are: (1) For a commission on the price of eight tractors which plaintiff avers he ordered and which were not shipped, and (2) for the return of $800 which plaintiff avers he deposited with the orders for the tractors. The cause or right of action depends upon plaintiff's contention that, by the terms of the contract, the price of the tractors, on which his commission of 20 per cent. was based, was not subject to change after defendant's acceptance of an order, with the required deposit. The pertinent clauses of the contract are: ing $100 deposit. Whether the sales were to be made at the prices fixed and listed at the time of the receipt of plaintiff's orders and accompanying deposits, or were to be made at such prices as might be fixed and listed at the time of the shipments, is the important question propounded by the exception of no cause of action. Plaintiff alleges in his petition that, if the contract does not plainly express the meaning which he attributes to it, it is ambiguous in that respect, and that he will prove by verbal testimony that his interpretation of the instrument is correct. He avers that both parties have so interpreted the contract, and that the defendant is estopped to deny that such interpretation is in accord with the intention which the parties had when they signed it. And, in that connection, plaintiff annexes to his petition a letter written to him by defendant, dated the 20th of September, 1917, viz.: "Dear Mr. Van Ness: We have advice from the factory that there will be an advance on the Waterloo Boy tractor, the present price of which is $885.00 f. o. b. cars at the factory, (100 So.) at Waterloo, Iowa, on Oct. 1st, of $100.00, [ graph of the petition, and are very vague. making the retail price $985.00 at the factory. It is alleged merely that the defendant is in"You have orders on hand at this time for debted to plaintiff for an item of $54.90 and two carloads. One of the cars has been shipped an item of $422.02, represented by two credit and should reach you within a day or so; the memoranda, which defendant received from other car will move in the near future. the Waterloo Gasoline Engine Company, of Waterloo, Iowa, for claims really due to plaintiff by defendant. "We advise that you protect yourself as soon as possible with further orders against this advance, as you well know the Waterloo is the standard tractor in your section, and the only question on hand will be delivery. "See your prospects as soon as possible, get them to protect themselves with the usual deposit of $100.00, then they are protected. "Very truly yours," etc. Plaintiff avers that, in response to this letter, he remitted to defendant, on the 25th of September, 1917, $400, as a deposit, with an order for four of the "Model R" tractors, at $708 f. o. b. factory; that is, 80 per cent. of $885. He avers that defendant cashed his check and retained the proceeds. He avers that, on the 8th of April, 1918, he placed "another similar order" for four additional Waterloo Boy tractors, Model N, "to be shipped later, at a time to be specified by petitioner"; and that the order was accepted by defendant, by letter dated the 10th of April, 1918, saying: "We beg to acknowledge receipt of your favor of the 8th, with check or four undred dollars, as deposit on four Waterloo Boy tractors, Model N, to be shipped later, at your pleasure." Plaintiff avers that the check for $400, accompanying the order last mentioned, bore the notation, "Dep. on 4 Model N Waterloo Boys at 720 factory." The allegations relating to this demand, for $478.92, based upon the alleged credit memoranda, are not plain enough to state a cause of action. [1] The allegations on which is founded the demand for $2,400, for the alleged loss of profit on eight tractors at $300 each, are lacking in this, that it is not alleged that plaintiff could have sold the tractors at the advanced price, or that they would have been worth the price for his own use. In fact, we doubt that he would have bought the tractors at the advanced price stated. The supposition is, from the allegations of the petition as a whole, that plaintiff had taken orders for the sale of the eight tractors at the retail price listed when he sent in his orders with the required deposits. In that case, his profit would have been limited to the commission of 20 per cent. on the retail price so listed. [2] Our opinion is that the allegations relating to the demand for the commission of 20 per cent., and for the return of the deposit of $800, do set forth a cause of action. We refer to these demands together because both depend upon the meaning of the contract, and because, if plaintiff was mistaken in his understanding of the contract, and of defendant's letter urging him to put up the deposit, and if, therefore, he is not entitled to the commission, he may well be entitled to a refund of the deposit. He avers that defendant, afterwards, in several letters, the dates of which are stated, repudiated the contract and refused to carry it out. He avers that, on the 6th of October, The basis of the exception of no cause 1918, while his orders for the eight tractors of action, with regard to the commission, were "in good standing," he demanded in is the defendant's contention that plaintiff writing the shipment of four of the tractors, had no right to demand shipment of the tracbut that defendant failed and refused to tors at the price listed when he filed his comply with the contract. He avers that, orders and deposits, but was only entitled to on the 13th of October, 1918, he again de- have them shipped at the price prevailing at manded in writing the shipment of four of the tractors that he had ordered, and that de- the time of shipment. The question is put fendant, without legal cause or excuse, ig-clearly and succinctly in the brief of the at nored his demand. He avers that, if the eight tractors had been shipped in response to his demands, the retail price would then have been $1,250 f. o. b. cars, Waterloo, Iowa; whereas, under his contract, he was entitled to them at $950 f. o. b. cars, Waterloo, Iowa. Hence he claims $2,400 as the profit which he avers he would have made $300 on each tractor-if they had been shipped. He claims also $1,520 as the commission of 20 per cent. on the eight tractors at $950 each; and claims the $800 deposited in part payment of the price of the eight tractors. There is also a claim for $478.92, the allegations regarding which are all in one para100 SO.-4 torneys for defendant, viz.: "The question for determination, therefore, is: Could the plaintiff legally demand shipment at the old price quoted by the factory at the time the deposit was made, if there had been an advance in the price at the time shipment was demanded?" The attorneys for defendant argue that the language of the contract leaves no doubt that the price at which the tractors were to be shipped was the price listed at the time of shipment—not the price listed at the time of the receipt of an order and deposit. And, for greater certainty, counsel cite the extension agreement, and say: "Should there be any doubt in the mind of With regard to the four tractors alleged any one as to the meaning of the original con- to have been ordered on the 25th of Septract in this respect, that doubt was certainly tember, 1917, we understand the allegation set at rest by the language used in the renewal to be that the shipment was expected at once, executed fourteen days after the expiration of the original contract. In the renewal, it is or without unnecessary delay. That, howprovided that all prices saall prevail as quot- ever, is a matter of no importance in view of ed by the factory at the time orders and speci- the fact that, as to the four tractors ordered fications are received at the factory.'" on the 8th of April, 1918, defendant accepted the order "to be shipped later," at plaintiff's pleasure. If plaintiff had sought to take advantage of defendant's liberality in that respect, the case would have been very different from the one we have. The expression quoted from the extension agreement seems to be in accord with plaintiff's interpretation of the original contract. The expression "at the time orders and specifications are received at the factory" does not mean "at the time shipments are made." It is said in defendant's brief that plaintiff does not allege that he sent specifications, either with his orders or afterwards. Plaintiff does allege that he described the tractors by reference to the models which we assume had reference to the manufacturer's catalogue. We have no reason to presume that such reference was not a sufficient specification, until the defendant has answered the allegation and denied that it was sufficient. Defendant's attorneys put great stress up on the statement in the contract, "which price is subject to change from time to time." That does not necessarily mean that the price was subject to change after the receipt and acceptance of an order and the required deposit. A reasonable interpretation of the expression is that the price was to be subject to change after the signing of the contract; in other words, that the commission to be paid to plaintiff was not fixed upon the price prevailing at the time the contract was entered into. It would have been unsafe-if not impracticable-for the plaintiff to take orders from his customers at prices listed in the manufacturer's catalogue, if the prices were subject to change after acceptance of the orders by the manufacturer. For keeping the $800 deposit, defendant relies upon the clause in the contract: "The $100 advance deposit required shall apply on the purchase price and is not to be returned, to second party." It is argued in defendant's brief that plaintiff has not lost his $800, because he may yet, at any time, have credit for the $800 on the purchase price of eight tractors-at the price fixed and listed when he sees fit to order them. That interpretation of the contract is not in accord with defendant's letter dated` the 20th of September, 1917, persuading plaintiff to put up the deposit. The statement in the contract that the $100 deposit was "not to be returned to the second party” did not add anything to the preceding statement; that the $100 deposit should be applied to the purchase price of a tractor. The meaning intended to be stressed was that plaintiff should not get back the $100 if he should fail or neglect to take the tractor. But, if it be true, as plaintiff alleges, that defendant breached the contract, it may well be that the $800 deposit should be returned. It is suggested finally, in defendant's brief, that defendant's only obligation under the contract was to forward plaintiff's orders to the factory for shipment. The argument is Aside from the language of the original hardly consistent with the contention that contract and of the extension agreement, it plaintiff was not entitled to have the tractors is incumbent upon the defendant, by way of shipped at the prices listed when his orders answer to this suit, to explain the letter writ- were received. Be that as it may, the questen to plaintiff on the 20th of September, tion of defendant's responsibility for the al1917, advising him to protect himself against leged nonshipment, so far as the 20 per cent. an advance in price, by sending in orders as commission and the $800 deposit go, is a matsoon as possible, and urging him to see hister of defense which would better be pleaded prospective customers as soon as possible and in answer to the suit. "get them to protect themselves with the usual deposit"; and saying, "then they are protected." Our opinion is that the petition makes a sufficient showing to allow plaintiff a hearing on the merits of his case. When the defendant shall have answered the suit, the district judge will have to de ment sued on is yet ambiguous-whether verbal testimony should then be heard in explanation of it. We do not understand the plaintiff to claim that he had the right, after closing a bargain by sending in an order with the re-termine whether the language of the instruquired deposit, to wait as long as he might see fit to wait for a shipment at the price prevailing when the order was given. His contention is that an advance in the price after he had sent in his order with the required deposit did not justify a refusal to ship at the price listed when the order was given, or justify a withholding of his com The judgment appealed from is annulled; the exception of no cause or right of action is overruled; and it is ordered that this case be remanded to the district court for further proceedings consistent with the fore (100 So.) costs of this appeal; the liability for other upon an agreed commission of $5,000; that court costs is to depend upon the final judgment. Rehearing refused by Division C, composed of OVERTON, ST. PAUL, and THOMPSON, JJ. (156 La.) No. 24407. GRACE REALTY CO. v. NOEL. (Syllabus by Editorial Staff.) I. Brokers 84(1)-Burden on principal to establish termination of agency by limitation. Where principal admitted contract to pay broker named commission, burden was on principal to establish expiration of such agreement by limitation before consummation of sale by himself. 2. Brokers 57(2)—Brokers held entitled to full commissions on sale consummated by principal. Where broker procured purchaser who bought property for agreed purchase price directly from principal, who, to consummate sale, reduced cash payment, held, that broker was entitled to agreed compensation. said firm on January 14, 1920, secured Dr. Isaac D. Benson as purchaser of said plantation at said price; and that the act of sale from defendant to Benson of this property, for a consideration of $135,000, was passed before a notary public January 17, 1920. Plaintiff company avers that, notwithstanding the fact that its members procured a purchaser, for this property, after diligent effort on their part and the expenditure of both time and money, defendant has tendered them only the sum of $2,500 as a commission, instead of the sum of $5,000 the commission stipulated between the parties. Defendant admits in his answer that, while on or about November 25, 1919, he entered into a verbal agreement with Albert Grace, a member of plaintiff company, to sell this property for the price of $135,000, payable one-half cash and balance on time, upon a commission basis of $5,000, yet defendant alleges that this agreement was limited to a period of 2 weeks, the defendant reserving to himself the right to sell the property in the meantime. Defendant avers that said agreement expired by limitation, without any sale having been effected by Grace, and that he then notified Grace that the property was no longer in his hands for sale, and that the same was withdrawn. Defendant alleges that the payment of the cash portion of the purchase price was a vital and important factor in the proposition, and that he was Appeal from Twenty-Seventh Judicial District Court, Parish of Ascension; Philip unwilling to dispose of his property, unless H. Gilbert, Judge. Action by the Grace Realty Company against Robert E. Noel. From judgment for plaintiff for an insufficient amount, plaintiff appeals. Reversed and rendered. at least $60,000 cash was paid to him. Defendant admits in his answer that some time later, on or about January 14, 1920, he agreed that Grace might bring a prospective purchaser to see the property; but alleges that at the time there was in existence be John Marks and Ansil N. Simmons, both tween defendant and Grace no agreement of any kind relative to any commission. of Napoleonville, for appellant. Walter Lemann, of Donaldsonville, for ap- that the plantation was sold by him to Dr. It is admitted by defendant in his answer pellee. Benson, the prospective purchaser brought to defendant, for the sum of $135,000; $40,000 being paid in cash, and the balance of the By Division B, composed of Justices DAWKINS, LAND, and LECHE. LECHE, J., of this division, being absent on account of ill-purchase price being secured by mortgage ness, Justice ROGERS, of Division A, heard the argument and took part in the decision in this case. LAND, J. Plaintiff company, a commercial and real estate partnership, composed of Charles E. Grace and Albert L. Grace, seeks to recover in this suit a commission of $5,000 from the defendant, Robert E. Noel, for the sale of the McManor plantation, owned by said defendant, and situated in the parish of Ascension. notes. Defendant avers, however, that before closing the deal with Dr. Benson he called up Grace at Plaquemine over the longdistance telephone, and took up the matter of compensation with him, and that Grace expressly agreed to take the sum of $2,500 as a commission for the sale. Defendant has tendered this sum in open court. It appears, therefore, from the admissions of the defendant himself that there was a verbal agreement between him and Grace to sell this plantation for the sum of $135,000, and that Grace produced the prospective purchaser, Dr, Benson, who purchased the property for said price. It is alleged that on or about November 25, 1919, said plantation was placed by defendant in the hands of said partnership, the members of which are real estate agents and brokers, for sale at a price of $135,000, and For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes The only question, therefore, remaining for us to decide, is whether the commission of $5,000, originally agreed upon, should be | ary 13, 1920, he received a telephone message paid to Grace, or the commission of $2,500, tendered to him by defendant, should be accepted by Grace as his compensation for bringing about the said sale. We are not impressed by the statement made by defendant in his answer that the payment of $60,000 cash was a vital and important factor, and that he was unwilling to sell his place unless at least $60,000 cash was paid to him. As a matter of fact, defendant sold his property to Dr. Benson within 60 days after the agreement, of date November 25, 1919, for $40,000 cash. This is clear proof that defendant had not been able to dispose of his place for one-half cash, and that the vitality of this factor in the transaction had ebbed to the extent of $20,000 cash, when the act of sale was passed, January 17, 1920. Such a defense, therefore, necessarily loses its force as a reason for tendering the sum of $2,500, or one-half of the original commission agreed upon, or as a circumstance tending to corroborate the testimony of defendant as to any new and independent agreement as to the commission to be paid by him. If defendant had been really unwilling to sell at less than one-half cash, he would, unquestionably, have refused to sign a deed for a less sum. Defendant admits that, when Albert Grace came to see him November 24, 1919, they entered into an agreement by which the place was to be sold for $135,000, and $5,000 commission was to be paid. Although defendant testifies that this agreement expired after two weeks, which is denied by Albert Grace, defendant admits that Albert Grace rang him up on January 14, 1920, and asked him if it would be all right to bring down a buyer. To this defendant assented. Defendant testifies that nothing was said at the time by either party as to terms, conditions, or commissions. Ed. Grace, a member of plaintiff company, accompanied Dr. Benson, and H. M. Hawthorne, who was co-operating on this particular occasion with said company, called on defendant at his home, introduced Dr. Benson to the defendant as the prospective purchaser, and he agreed to pay $135,000 for the property. Defendant testifies that, while Dr. Benson with Hawthorne were in the field and looking at the property, he rang up Albert Grace and told him that the buyer was there, and that he could sell him, provided the cash payment was reduced, and, if the price was reduced, he "could not pay him more than $2,500." from Hawthorne at Baton Rouge, La., inquiring if the McManor plantation was still on the market on the same terms and conditions that it had been offered to him, and that witness rang up defendant and asked him if the property was still for sale upon the same terms and conditions, stating that he had a buyer for the place, and that defendant replied that it was, and requested that the purchaser he brought down to the plantation. This was the day before the sale to Dr. Benson. Hawthorne testifies positively that Ed. Grace, who drove him and Dr. Benson to the place in his automobile, introduced Dr. Benson to the defendant, stating to him: "I have some other business to attend to, and I am going to leave Mr. Hawthorne here to go over the place with Dr. Benson, and it's up to you to make the bargain with him. I told him what the bargain was." There was no offering or bargaining whatever on this occasion as to the price of the place, $135,000. Defendant stated that he would not take less than $50,000 cash, and Dr. Benson rejoined that he would not pay said that he would reduce the cash payment more than $40,000 cash. Defendant then to $45,000, and Dr. Benson replied: "No, I don't want to look at the place, unless you accept $40,000 cash, and five notes payable annually and the privilege of on or be fore." Mr. Noel (defendant) ordered the horses, and Dr. Benson says its no use to go out there until you are willing to accept those terms, and he (defendant) said, "Get the horses." The testimony of Ed. Grace shows clearly that he notified defendant of the terms offered by him to Dr. Benson. The defendant had closed the sale before he even rang up Albert Grace over the telephone. The terms that defendant insisted upon, $50,000 cash and the balance in five notes, were the same terms at which the property had been originally listed with plaintiff company. There was no new or independent contract made. The defendant received $135,000 for his place through the efforts of the plaintiffs, and owes them a commission of $5,000, as agreed upon. After closing the deal, defendant arbitrarily fixed the commission at $2,500, when he had obtained the full price for his property. [1] Although defendant consented to reduce the cash price 20 per cent., he has cut the commission of plaintiffs' 50 per cent., Defendant would have it appear also from without their consent. If Albert Grace conhis testimony in the case that there was of sented over the telephone to accept $2,500 as fering and bargaining about the purchase a commission, it is inexplicable that he deprice at the house before it was agreed upon, nies such acceptance, that he wrote a letter and before Dr. Benson inspected the prop- on January 16, 1920, before the deed from |