Streator v. Paxton , 201 Pa. 135 ( 1902 )

Opinion by

Mr. Justice Brown,

On July 12, 1899, the appellant and other manufacturers, using natural gas in their plants, entered, into the following agreement, for the purpose of protecting themselves against an increased price for the same, which they feared would be charged by a combination of the competing companies that were supplying it to manufacturers in the borough of Washington: “An agreement made and entered into this twelfth day of July, 1899, by and between the following named persons, to wit: Wm. P. Tyler, R. J. Beatty, A. B. Paxton, James E. Duncan, J. W. Paxton, W. H. Griffiths and J. B. R. Streator. In consideration of the conditions hereinafter to be performed, hereby agree to form themselves, into a company for the purpose of leasing lands for oil and gas, and in case sufficient land can be procured of contiguous territory to at once proceed to drill a well thereon. All leases are to be taken in the name of J. B. R. Streator and held by him in trust for the balance of the above named parties. The expense of taking such leases and drilling such well or wells shall be paid equally by the above named parties to the said J. B. R. Streator (who shall contract for the above well) at such times as shall be necessary to keep said work moving. In case gas is found in paying quantities the above named parties hereby agree to have said company incorporated under the laws of the state of Pennsylvania as a natural gas company with sufficient capital to drill additional wells, lay lines, and operate said company. At which time the said J. B. R. Streator hereby agrees to convey all of the leases taken for said above-named parties to the corporation formed under this agreement, and it is also further agreed that each of the parties named aforesaid shall have an equal interest in said company, and that all gas furnished to the establishment operated or controlled by any of the above-named parties shall be furnished to each at an equal and uniform rate.

“ Witness our hands and seals the day and year above written.

“ Wm. P. Tyler, [Seal.]

“R. J. Beatty, [Seal.]

“A. B. Paxton, [Seal.]

“ James E. Duncan, [Seal.]

“ J. W. Paxton, [Seal.]

“ Wm. H. Grieeiths, [Seal.]

“ J. B. R. Streator. [Seal.]

After the execution of this agreement, H. B. Duncan, one of the appellees, became the substitute of James E. Duncan in it, and the suit of the appellant is against him and the other parties to it. The agreement, on its face, is complete and unambiguous ; its terms are couched in no uncertain words. The damages which the appellant claims, resulted from no breach by the appellees of what they therein covenanted; but he asks that they pay him for losses which he alleges he sustained through their failure to perform two certain parol promises or agreements, made contemporaneously with the execution of the written one. The testimony of the appellant and of Ruple, the witness upon whom he relies for corroboration, is, that these two parol agreements were discussed and entered into by the parties just before and at-the very time the written one was executed. They are not agreements made subsequently to the written contract, but, as proven by the appellant, were made contemporaneously with it. As set forth in the statement filed, they are, first: “ In consideration of the plaintiff giving to the other corporators the benefit of his experience in the production and marketing of natural gas, and in the location by him of the territory to be developed, and in his taking of leases of the lands included therein, and overseeing and directing the operations to be conducted thereon, the defendants agreed with the plaintiff, that they would pay all advancements, assessments and charges which the plaintiff would otherwise have been required to pay by reason of the foregoing written agreement and of his ownership of the aforesaid forty shares of the capital stock of said corporation, and to carry the same for said plaintiff until his share of the profits of the corporation would be sufficient to repay the same; ” and, secondly: “ At the date of the aforesaid written contract of date July 12, 1899, there was but one available source of supply of natural gas for fuel at the manufactories with which the parties to this suit were connected, as aforesaid, and the primary inducement to said parties in entering into said contract, was the apprehension that the price of the gas at their respective manufactories might be increased, and to the end that the rights and interests of the several corporators might not be impaired or endangered, by the transfer of the holdings of any one of said corporators in said corporation to any outside party or persons, the plaintiff and the several defendants mutually agreed, each with the other, that no one of them would sell or transfer his holdings in said corporation, to any outside party, without first giving to the remaining corporators the right to purchase said holdings at the same price that could be obtained for the same from any other party.”

In the first parol agreement declared upon, the appellant distinctly recognizes the written one and his liability, as therein set forth, to bear equally with the other parties to it “all advancements, assessments and charges ” which might be incurred in carrying out the purpose of the company, and which necessarily involved the liability to take and pay for the stock of the corporation to be formed. In the face of this written agreement, he not only denies the liability which it imposes, and he assumed under his own seal, but insists that those who entered into it with him must pay him damages for their breach of a contemporaneous parol agreement, expressly contradictory of it, so far as it relates to him. This first alleged parol promise is in plainest contravention of the terms of the written instrument, by which Streator, who now says he was to pay no assessment or charges, agreed that he would pay whatever the others would pay and bear whatever they would bear. There is neither allegation nor proof that, even if this contemporaneous parol agreement was made, it was omitted from the written one by fraud, accident or mistake. The court below, however, admitted the evidence offered in support of it, and the point reserved was, whether there was “ any evidence in this case to support a verdict in favor of the plaintiff which ought to be submitted to the jury.” We are, therefore, not to determine whether the testimony offered in support of the first alleged parol agreement was properly received, but whether the court, having admitted it, subsequently committed error in regarding it as no evidence in support of appellant’s claim. In other words, even though the testimony admitted ought to have been rejected, because there was neither allegation nor proof that it had been omitted from the written one through fraud, accident or mistake, the simple question is, whether the court, having received it, properly regarded it afterwards as no evidence in support of plaintiff’s claim and did not' err in entering judgment in favor of the defendants non obstante veredicto.

The first alleged parol agreement was, as already stated, not made subsequently to the written one, but, according do the plaintiff, and the only witness called in support of it, was entered into contemporaneously with the written one, and its effect is not only to vary and change the latter, but to flatly contra- ‘ diet it. What was said by the lower court in Wodock v. Robinson (Thayer, P. J.), 148 Pa. 508, adopted by us then, can well be repeated now: “ The alleged promise is, therefore, in flat contradiction of the terms of the instrument signed and sealed by the parties. ... It is as true now as it ever was, and is a rule too firmly rooted in justice and honesty to be easily eradicated from any system of wise laws, that all negotiations, all conversations, all oral promises, all verbal agreements, are forever merged in, superseded and extinguished by, the sealed instrument which is the final outcome and result of the bargaining of the parties. . . . Manent litterae scriptae is still the rule. The written instrument shall stand as the sole exponent of the minds of the parties. If it were not for this rule, no man would - be able to protect himself by the most solemn forms and attestations against falsehood, misrepresentation and perjury. In this matter the common law and the civil law are fully agreed, for contra scriptum testimonium non scriptum testimonium non fertur, is the language of the code : Cod. b. IV., tit. 20. The cases upon this subject are myriad.” Of these myriad cases we need hardly refer even to the following : Hunter & Springer v. McHose, 100 Pa. 88, Jackson v. Payne, 111 Pa. 67, and Eberle et al. v. Bonafon’s Exrs. et al., 17 W. N. C. 335. As the effect of the alleged parol contract or agreement was to vary and change the written one, the proof in support of it, proper to be received, ought to have been clear, precise and indubitable : Juniata Bldg. Asso. v. Hetzel, 103 Pa. 507; Phillips v. Meily, 106 Pa. 536; Thomas & Sons v. Seaman & Co., 114 Pa. 35 ; Honesdale Glass Co. v. Storms, 125 Pa. 268 ; Ferguson v. Rafferty, 128 Pa. 337. No such proof was submitted. The terms of the alleged parol agreement are neither definite nor explicit, and the proof that any such agreement was made is vague and uncertain. Whether it was made depended entirely upon the testimony of Streator and Ruple, the uncertainty and insufficiency of which the learned judge below has clearly pointed out in his opinion entering judgment for tbe defendants, and we need not here discuss it. It is sufficient for us to say that having reviewed it, it is-not of that clear, precise and indubitable character that alone would justify a chancellor in reforming the written agreement.

What we have said as to the testimony offered in support of the first parol agreement may be properly repeated as to the second; but, as to it, it is clear that even if the proof of it was sufficient, there could be no recovery in this joint action against the alleged parties to it. As set forth in plaintiff’s statement, it is manifestly a several contract, and cannot possibly be construed as a joint undertaking. Each individual, for himself, gave an option to any one of the others to purchase his stock; but he did not undertake to jointly obligato himself with anyone else. This is so plain that no discussion can make it clearer. The language of the alleged agreement is, that Streator and each of the other parties agreed “ each with the other, that no one of them would sell or transfer his holdings in said corporation to any outside party, without first giving to the remaining corporators the right to purchase said holdings at the same price that could be obtained for the same from any other party.” But, even if this second agreement could be tortured into one of joint liability, the plaintiff could not recover. The agreement, if entered into, was nothing more than a contract by the parties to it as to what they ought to do for the accomplishment of the end that they had in view in forming the combination. The purpose of the combination and of the corporation, subsequently formed, was to obtain cheaper fuel for the several industrial establishments' represented by the parties to the agreement; and, if it was agreed that the members of the new corporation should not sell their stock to outside parties until those remaining in the company should have an opportunity to buy at the price offered, the agreement was not made for the purpose of enabling the individual members to make gain or profit in buying the stock, but for the sole purpose that the new combination or corporation should not get into the control of persons who would thwart the manufacturing firms in their purpose to obtain cheaper gas. The manifest and only purpose of the combination was to guard against imposition and an increased price for gas at the hands of the combined competing companies, and, as the individual parties to this alleged second agreement in selling their respective holdings, did so only under an assurance that the very purpose for which they had become associated would be carried out, and that they would not be compelled to pay more than seven cents per thousand cubic feet for gas, no conceivable damage was done to the plaintiff, even if the contract was joint, and nothing was done by the parties to it for which he can recover.

The learned judge below was clearly right in stating that the motion for a compulsory nonsuit should have been allowed, and the judgment ultimately entered in favor of the defendants, non obstante veredicto, after the plaintiff had been fully heard and evidence had been received that ought to have been rejected, is now affirmed.