Taller & Cooper v. Illuminating Electric Co. , 172 F.2d 625 ( 1949 )

KERNER, Circuit Ju-dge.

Plaintiff, a New Jersey corporation, filed its -complaint and -bill of particulars against defendant to recover damages for alleged breach of a written contract. Defendant moved that the -complaint be dismissed on the ground that the comp-la-int -did not ■-state a ol-aim u-pon which relief could be -granted. The, court concluded- that the contract was void because -it lacked mutuality, sustained the motion, and entered a judgment if or costs agains-t plaintiff. From that judgment, this appeal is prosecuted.

Plaintiff agreed to -sell - and defendant agreed to buy, in stated installments for a period of one year, 8,500 electric -irons at $5.17 per iron, 250 of the irons to be shipped in August and 750 irons monthly thereafter. Plaintiff shipped 60 -irons in August, 192 in September, -and 426 irons in November, 1946. On November 22, 1946,' -plaintiff increased the price of the -irons to $5.72 per, iron, and o-n December 5, 1946, .-shipped 192 -irons to defendant at the increased price, making a total of 870 -itops -shipped -to defendant. All of the -irons delivered to defendant were paid tf-o-r by defendant. On December 5, 1946, defendant notified plaintiff that it would not accept shipment of -any more irons 'because of plaintiff’s failure to deliver the irons •pursuant to the contract and because -it was not bound to accept irons at whatever ■price plaintiff -might from time to time determine.

The contract in suit was entered into August 20, 1946, with its main provisions stated in the printed form used by plaintiff. In it the 'plaintiff agreed to 'sell and defendant, referred to therein as “the distributor,” agreed ito buy the following listed products at the agreed stated prices (thi-s is typed into the printed form): “8500 #638-Lady Jackson Auto Electric Irons Cost $4.70 Tax. 47 Cost per iron $5.17.”

The -contract is alleged to have been breached by defendant’s -refusal to purchase -and pay for the balance of the 8,500 irons mentioned in the contract. To this, defendant says that d-t -did no-t breach the contract, an-d that the contract i-s void because plaintiff reserved the arbitrary privilege o-f changing the price -o-f the iron-s.

A contract -in its nature -and character and according to the intention of the -parties -should involve a-nd impose a reciprocity of -obligation and duty. And it is horn hook law that to make a valid, executory contract, there must be -at least two parties capable of contracting -and both must he bound thereby. The promises of ea-ch must be concurrent -and obligatory on both at the same time to -render ■the promise -of either'binding. There can be no question that, if -plaintiff -had -such a contract, it w-a-s essential ito its validity that it -should have been mutually obligatory upon both -par-ties. , And the law i-s well -established -that a -contract 'for the ■future -delivery -of personal property cannot be -enforced if the price of the article ■to be delivered .is conditioned -entirely on -the will of one of the parties.

Plaintiff asserts that to constitute a sale the price need -not be definitely' fixed at the -time the sale is effected, if the agreement contains express or' implied provisions by which 'it may be rendered -certain. Counsel for .plaintiff -have written an able brief. They cite, -among -other icase-s, Memphis Furniture Mfg. Co. v. Wemyss Furniture Co., 6 Cir., 2 F.2d 428. They call attention to clause 6 of the -contract which provides that “The distributor -agrees th-at he -and his dealers will merchandise the Company’s -products at full -list- -price and in accordance with -the Fair Trade Act [15 U.S.C.A. § 1],” and insist that the -contract provides a- definite and " ascertainable standard by which the pri.ce. of the irons -oan be determined,. ;

It will not be necessary to 'di-scuss the cases cited. They are either not in point, -or are easily distinguished under the facts in thi-s -case. It i.s -true that in the Memphis -case the .court upheld -the validity -of •a contract '-f-or the sale of furniture at “prices prevailing at the time of shipment.” In t-hat oase there was no absolute agreement that the -seller sold the furniture -at a specific -price. In -our -case, -as we have already observed, the price w-a-s definitely fixed -at the time the contract was entered into.

But the plaintiff makes the point t-hat the -contract, in addition t-o -clause 6 -already noted, in clause 2 provided: “The prices and terms shall be as shown in the -company’s -current price s-heet, -and -as established -from ¡time to time by the -company. * * * Prices and -discounts are subject to-change without notice. * * And plaintiff argues it -had -the right to increase the price -of the -irons. With this contention we -cannot -agree, -f-or the -reason that the price of the iron-s wa-s -absolutely fixed by -the contract. Moreover, if we were to uphold -plaintiff’s contention, the contract would Ibe a -contract f-or the purchase a-nd sale of the irons -at a price to be established by plaintiff alone. A contract -f-or -the future delivery of personal property, is void -for want of mutuality if the price i-s -conditioned -entirely on the will of one of the parties. Cold Blast Transportation Co. v. Kansas City Bolt & Nut Co., 8 Cir., 114 F. 77, 81; Nebraska Aircraft Corp. v. Varney, 8 Cir., 282 F. 608, 610; Weston Paper Mfg. Co. v. Downing Box Co., 7 Cir., 293 F. 725, 727; and Brooks v. Federal Surety Co., 58 App. D.C. 56, 24 F.2d 884. Compare Sun Printing & Publishing Ass’n v. Remington Paper & Power Co., 235 N.Y. 338, 139 N.E. 470; Midland Steel Sales Co. v. Waterloo Gasoline Engine Co., 8 Cir., 9 F.2d 250, 253.

We conclude that plaintiff -has no -reason to complain of the judgment of the District Court and it will therefore be affirmed.