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fendant's interest in any future musical or dramatic play, during the term of the agreement, upon payment of a proportionate part of the actual cost. By the fifteenth subdivision of the agreement the following covenant was made in respect to the remedies available to the plaintiff in the event of the defendant's default:
“Fifteenth. In addition to any remedy which the party of the second part may have by virtue thereof, the parties hereto expressly agree that, should the party of the first part fail to fully perform all the covenants and conditions of this agreement on his part to be performed, then and in that event the danages which said party of the second part may sustain by reason thereof are hereby assessed at the sum of twenty-five thousand dollars ($25,000), which said sum the party of the first part agrees to pay; this not being a penalty, but agreed upon as liquidated damages for the breach of the within contract."
The plaintiff brings this action to recover damages because the defendant, as he alleges, failed to submit six routes to him on or before May 1, 1906. He does not claim that he ever demanded the routes. On June 2, 1906, he gave the defendant the following notice:
"Take notice that, you having failed to carry out many of the conditions of the contract made and entered into by and between us in writing, dated July 28, 1903, and especially having failed to subinit to me and set aside six first-class routes prior to the 1st day of May, 1906, as provided for by the second clause of said contract, and more than 30 days having elapsed since said time, you are hereby notified that the said contract has been terminated by your failure to carry out the same, and I bereby demand of you the payment of the sum of $25,000 forthwith as liquidated damages as provided for by the fifteenth clause of said contract.”
Immediately on the receipt of this notice the defendant wrote the plaintiff as follows:
“June 2, 1906. “My dear Frank: Yours of June 2d to hand and contents noted. I ain really surprised at the contents thereof. I have written you several letters with reference to your routes and have telephoned you over a dozen times, but seem to get no information whatsoever from your office. I simply desire to reiterate, what I have heretofore written you, that your routes have been awaiting your approval for the last four weeks. Coine over and see me with reference to the matter. With kindest regards, I am, "Yours truly,
Leo Schubert." The plaintiff did not reply to this letter, but commenced this acti On behalf of the defendant it was proved that the routes had been made up for the plaintiff's use, and were in the defendant's office, ready to be delivered to him, if he called, before May 1, 1906, and the routes so prepared were marked for identification. There was testimony to the effect that as early as April 10, 1906, the defendant wrote the plaintiff that the routes had already been set apart for him, and asked him to call and go over them. The plaintiff denies that he received this letter. It was shown by the testimony of the defendant's attorney, which, however, the plaintiff contradicted, that in April, 1906, said attorney spoke to the plaintiff over the telephone about the routes, and asked why he did not come over and fix the routes at the office, and that the plaintiff said he would be over very shortly. The jury returned a verdict for the plaintiff for $25,000, and from the judgment entered thereon this appeal is taken.
The briefs of counsel upon both sides have elaborately discussed the
and 140 New York State Reporter question whether the $25,000 provided to be paid by the fifteenth clause of the agreement is to be considered as liquidated damages or as a penalty, and have cited a multitude of cases. All of these cases and many more have been examined by us. From them has been deduced one rule, at least, in which they all agree, and about which there can be no doubt, and that is that in the construction of such provisions the actual intention of the parties, so far as it can reasonably and fairly be ascertained from the language of the contract and from the nature of the surrounding circumstances, is to be considered; in other words, that each case is to be considered in the light of its own facts. Examining this case as made, we find it unnecessary to enter into a discussion of this vexed question or to add to a legal literature where reconcilement of all the cases has been abandoned as impossible, because it seems to us clear that the plaintiff has not made out a breach of the contract upon the defendant's part. There being no breach, it is of no importance whether the sum to be paid upon a breach be liquidated damages or a penalty. The fifteenth clause, quoted supra, preserved all the ordinary remedies, both legal and equitable, which the plaintiff might have under the contract, or any of the provisions thereof, and in addition provided a distinct remedy for a failure by the defendant to perform all the covenants and conditions of this agreement by him to be performed, and fixed the damages therefor at $25,000. It is not claimed that at the time this suit was brought the defendant had failed to perform all the covenants and conditions of the agreement. The utmost that is claimed is that he had failed to perform one of the covenants or conditions. It is claimed that that failure broke the entire contract, and that $25,000 immediately became due, without any proof of damage. . This covenant was that the defendant should submit to and set aside for the plaintiff, prior to the 1st day of May, six good routes.
In construing this instrument it becomes important to determine whether that date was of the essence of the contract. The plaintiff's claim goes to the extent of asserting that if these six routes had been submitted and set aside one day late, on the 2d day of May, still the contract would have been breached, and the $25,000 recoverable. Is such a claim reasonable? Was it within the contemplation of the parties and the fair intendment of the contract? This contract was between theatrical managers. It had to do with theatrical business. By the terms of the contract each of these routes were to be for at least 20 consecutive weeks, three to begin not later than September 15th and three about October 15th. After the submission of the routes on or prior to May 1st, the contract provided that the plaintiff should notify in writing the defendant, on or prior to July 1st, either his acceptance or declination of all or any part of each or all of said routes, and notify the defendant prior to the 1st of September what time he would not require. If the plaintiff did not have six attractions, he should notify the defendant, on or before September 1st, of the number of attractions he desired to produce, so that the time set apart for him might be disposed of by the defendant. It is evident, it seems to us, that under such conditions submission of the routes on the 1st of May was not of the essence of the contract, and that a failure so to submit did not
per se breach the contract. The plaintiff had two months thereafter in which to consider and pass upon the routes, he had two more months in which to notify the defendant of what time he would not require, and the season was not to begin for three of the routes until the 15th of September and for the rest until the 15th of October. There is not one word in this voluminous agreement which supports the proposition that time, namely, May 1st, was of the essence of the contract. The offices of the two parties were in the same city, within three blocks of each other. No demand was ever made by the plaintiff upon the defendant. The defendant never repudiated the contract, but had set aside the routes and had the prepared charts thereof ready in his office for submission to the plaintiff. Upon the very day on which the plaintiff notified him that he had breached the contract, the defendant wrote, denying such breach either in fact or intention, and told defendant that the routes were and had been ready for his inspection, and asked him to call and look them over. At this time, a whole month of the time provided for the plaintiff to examine and notify of his acceptance or rejection still remained. Under such circumstances, to permit a recovery of the large sum of $25,000 as upon a technical breach is to do violence to all sense of fair play, is not required by the law, and will not be sanctioned by the court.
We leave out of consideration the testimony on the defendant's part that prior to May 1st the plaintiff had been notified by letter and telephone that the routes were ready and awaiting his inspection. We hold that, under this contract and upon this proof, time was not of the essence of this contract, and the defendant had not breached it, and that, as he had not failed to perform all the covenants and conditions of the agreement by him to be performed, the plaintiff was not entitled to recover. We think, further, that under this contract the place of delivery of these routes, no place for delivery being therein mentioned, was at the office of the defendant, and that, even if time could be considered as the essence of the contract, the routes having been set aside and ready for submission at said office prior to the 1st of May, there was no breach. This record impresses us as indicating a far greater desire upon the part of the plaintiff to entrap the defendant into the forfeiture of $25,000 than to carry out a fair contract. He evidently prefers a breach to a performance. The defendant did not repudiate the contract. He complied with its terms.
The plaintiff failed to establish a cause of action, and the judgment and order must be reversed, and a new trial ordered, with costs to the appellant to abide the event. All concur.
KINDELBERGER V. KUNOW. (Supreme Court, Appellate Division, Fourth Department. November 13, 1907.) 1. SALES-CONDITIONAL SALES-TENDER OF PRICE-WAIVER.
In a suit by a seller, on condition that title should remain in him until the price was paid, for the chattels for nonpayment of the price, evidence held to authorize a finding that the seller waived a formal tender of the price by refusing to take it unless he was also paid another debt, and by insisting on holding the chattels for both claims, defeating a recovery.
and 140 New York State Reporter 2. TENDER-SUFFICIENCY-Costs.
Where a seller on condition that title should remain in him until the price was paid waived a tender of the price and sued for the chattels, a tender on the trial of the price, without including therein the costs of the action, was sufficient; the seller not being entitled to costs.
[Ed. Note. For cases in point, see Cent. Dig. vol. 45, Tender, $$ 21-28.) Appeal from Trial Term, Yates County.
Action by Louis Kindelberger against Fred D. Kunow. From a judgment for plaintiff, and from an order denying a new trial on the judge's minutes, defendant appeals. Reversed, and new trial granted.
Argued before McLENNAN, P. J., and SPRING, WILLIAMS, KRUSE, and ROBSON, JJ.
M. A. Leary, for appellant.
KRUSE, J. This controversy is over 20 sheep. The plaintiff made a conditional bill of sale of the sheep to the defendant, retaining the title until the purchase price of $172.25 was paid. On the day that the purchase price became due the plaintiff demanded the possession of the sheep; the purchase price not having been paid in full. There is no question that the plaintiff was entitled to the possession of the sheep, and had the right to sell them, under the provisions of the statute relating to conditional sales, if the defendant was in default in paying for them. It is contended on behalf of the defendant, however, that an absolute and unconditional offer was made on behalf of the defendant to pay for the sheep; but the plaintiff insisted upon taking them, notwithstanding such offer, unless another debt was paid by the defendant, which the plaintiff claimed was owing to him. A verdict was directed for the plaintiff.
We think a question of fact was presented upon the evidence, which should have been submitted to the jury. It appears that each of the parties made claims against the other--the defendant for certain matters for which he had presented an itemized statement to the plaintiff, and the plaintiff for hay, besides the purchase price of the sheep. The plaintiff claimed that the defendant refused to deliver the sheep without deducting from the purchase price the defendant's claim, and the defendant claimed that the plaintiff refused to take pay for the sheep unless the defendant also paid for the hay, and insisted upon holding the sheep for both claims. It is contended, however, on the part of the defendant, that eventually the defendant's wife (who seems to have represented him) stated that she would pay for the sheep, but not for the hay, and that the defendant refused to take pay for the sheep unless he was paid for the hay also, and insisted upon holding the sheep for both claims; and the evidence tends to support the defendant's contention in that regard. Whether true, or not, was a question of fact for the jury in the first instance. If true, it was sufficient, in connection with the other facts and circumstances, to have warranted a finding that the plaintiff waived a formal tender of the amount unpaid upon the purchase price of the sheep. Murr v. Western Assurance Co., 50 App. Div. 4, 11, 64 N. Y. Supp. 12; Allen v. Corby, 59 App. Div. 1, 69 N. Y. Supp. 7.
Upon the trial the defendant again offered to pay the balance due for the sheep. The plaintiff's counsel stated that the plaintiff would accept the offer, if the defendant paid the costs of the action, which the defendant refused. If there was a waiver of the tender, as has been stated, owing to the plaintiff's refusal to accept the unconditional offer of the defendant to pay for the sheep, and the plaintiff insisted upon taking and holding the sheep for his claim for the hay, in addition to that for the purchase price of the sheep, then the plaintiff was clearly in the wrong, and not justified in bringing an action to replevy the sheep, and so was not entitled to the costs of the action.
The judgment and order appealed from should be reversed, and a new trial granted, with costs to the appellant to abide the event. All concur.
CONSOLIDATED RUBBER TIRE CO. v. VEHICLE EQUIPMENT CO. (Supreme Court, Appellate Division, First Department. November 15, 1907.) 1. BANKRUPTOY-COMPOSITION-PLEADING.
A composition in bankruptcy may be pleaded in bar of an action upon a debt discharged, and in order to be available as a defense it must be so
pleaded. 2. PLEADINGMOTION-JUDGMENT ON FRIVOLOUS PLEADING.
If it requires argument to show that a pleading is frivolous, it may not be overruled on that ground.
[Ed. Note.--For cases in point, see Cent. Dig. vol. 39, Pleading, 8 1062.] 3. BANKRUPTCY-OPERATION AND EFFECT OF COMPOSITION.
Plaintifr, on certain conditions, secured the permission of the United States District Court in bankruptcy to institute and prosecute to judgment an action against the bankrupt defendant, a corporation, and to enforce the judgment against its stockholders, and began such action on May 22, 1907. On May 13, 1907, the court confirmed a composition offered by defendant after plaintiff had received its permission to sue. Defendant pleads the confirmation of the composition in bankruptcy in bar of the action. Bankr. Act July 1, 1898, c. 541, 8 14, subd. "C" 30 Stat. 550 (U. S. Comp. St. 1901, p. 3427], provides that "the confirmation of a composition shall discharge the bankrupt from his debts other than those agreed to be paid by the terms of the composition and those not affected by a discharge." Held, that the answer may not be overruled as frivolous, in view of the federal court's permission to prosecute the action to judgment, since it is not perfectly clear that the indebtedness has not been discharged by the composition. Appeal from Special Term.
Action by the Consolidated Rubber Tire Company against the Vehicle Equipment Company. From an order overruling its answer as frivolous, and from a judgment for plaintiff, defendant appeals. Reversed, and new trial ordered. Appeal from the order dismissed.
Argued before PATTERSON, P. J., and INGRAHAM, LAUGHLIN, CLARKE, and HOUGHTON, JJ.
Martin Conboy (Frank A. Clary, on the brief), for appellant.
LAUGHLIN, J. On the 6th day of April, 1906, the defendant was duly adjudged a bankrupt by the District Court of the United States