such promise, even though plaintiff was not obliged to make or deliver any ties, and hence contract was not lacking in mutuality. 4. Sales 384(1)-On breach by buyer of contract to purchase all ties produced from certain tract, seller was entitled to damages for refusal to accept all ties within specifications of contract. If defendant, who contracted to purchase all ties produced by plaintiff from certain tract of land, which plaintiff purchased by reason of such contract, breached contract and refused to accept ties, plaintiff may recover, not only damages for refusal to accept ties ready for delivery, but damages for refusal to accept all ties within specifications of contract. 5. Contracts 10(1)-Contract, consideration for which was mutual promises, will not be enforced in equity, so far as it is mutually executory. A contract depending for its validity of consideration on mutual promises alone will not, so far as it is mutually executory, be enforced in a court of equity. 6. Sales153-Buyer's letter, refusing further deliveries after certain date, held re nunciation of contract, obviating necessity of further tender by seller. Letter by buyer, contracting to accept all ties produced by seller from certain tract of land, refusing any further deliveries of ties after certain date, constituted renunciation of contract, obviating any further necessity of tender of ties by seller. 7. Sales 374-On buyer's renunciation of contract, seller held entitled to treat contract as repudiated and to sue for damages. Where buyer, agreeing to purchase all ties produced by seller from certain tract of land, renounced contract, seller had right to treat contract as repudiated, and sue for damages sustained by buyer's failure to carry out portion of contract seller had performed, notwithstanding that buyer stated that it would try, but would not agree, to take ties seller loaded before certain date, since seller was under no obligation to accept delivery conditions which were outside of contract. 8. Sales 153-Seller, having ties ready for delivery when buyer repudiated contract, must be regarded as having executed contract as to such ties, notwithstanding no tender of ties was made to buyer. Where buyer agreed to purchase all ties produced by seller from certain tract of land," and, on date when contract was repudiated by buyer, seller had on hand number of ties manufactured from tract which were never taken by buyer, as to such ties seller must be regarded as having executed contract, since tender of ties would have been useless, in view of buyer's repudiation. 9. Sales372-Mutual mistake in contract held not to absolve, buyer from liability for failure to perform part of contract executed by seller before buyer's repudiation. Though contract for sale of ties contained mutual mistake, buyer is liable to seller for failing to perform its part of contract that had been executed by seller before buyer's repudiation of contract. MOORMAN, Circuit Judge. Plaintiff in error, Hollandsworth, filed this suit against defendant in error, William Mead Tie Company, to recover damages for the breach of a contract.1 The tie company denied the breach, and by counterclaim sought a reformation of the contract on the ground of mutual mistake. The mistake alleged was the omission from the contract of a clause providing that if the Chesapeake & Ohio Railway Company reduced the prices that it was paying for cross-ties, the prices that defendant Issue was joined on this equitable defense, would pay should be reduced accordingly. 1 "This contract, made and entered into this Hollandsworth, Huntington, W. Va., party of 8th day of April, 1920, by and between E. L. the first part, and William Mead Tie Company, Ashland, Boyd County, Ky., party of the second part, Witnesseth: "That whereas, the party of the first part has this day bought a certain boundary of timber from the McClure heirs at Gallup, Ky.; and whereas, the party of the first part has sold to the party of the second part all the ties that he manufactures from the above boundary of timber at the following prices: "The party of the second part agrees to pay the party of the first part 5 cents addition for loading and 5 cents additional commission, to be added to the above prices. If the C. & O. R. R. raises the prices, then the party of the second part agrees to raise and pay the same price to the party of the first part that the C. & O. is paying at the time the ties are loaded. "The party of the second part agrees to take all ties from #3-#2 and #1-8′ long at 5 cents less than the price paid for the same kind of ties 8' long. "The party of the second part agrees to pay the party of the first part cash for the ties as soon as they are loaded and inspected by the railroad inspector, who is sent there by the party of the second part to load the ties." 26 F.(2d) 33 and by agreement the cause was transferred to the equity docket for trial. Upon the trial the equity issue was not determined, but judgment was given for defendant, on the ground that plaintiff had not proved that defendant had breached the contract relied upon in the petition. [1, 2] A primary question raised by defend- [3-5] It is further contended by the defend- tion and delivery, but also such damages as Prior to that date defendant had accepted and paid for all ties produced from the McClure tract and delivered to it. On that date it wrote the following letter to plaintiff and its other customers: "We are very sorry to say that we have just received notice that after March 28 that they will not receive any more ties from us. Inasmuch as the C. & O. Railway has taken off their inspectors and have ceased to take any ties, we think that it is best for us to make preparations not to accept any ties after that date. "If you have any ties that you have decided to have loaded on or before that date, and will advise us how many you will have and at what point, we will try our best to load them, but we do not agree to accept them as to all who want their ties taken up by this date, but the writer will do anything possible to take care of all he can. "The price is to be $1.40 and so on down for treatment ties, and $1.55 and so on down for white oak." This letter was a renunciation of the contract, obviating any necessity of further tender of ties by the plaintiff. Roehm v. Horst, 178 U. S. 1, 20 S. Ct. 780, 44 L. Ed. 953; Central Trust Co. v. Chicago Auditorium Ass'n, 240 U. S. 581, 36 S. Ct. 412, 60 L. Ed. 811. Upon its receipt the plaintiff had the [8] It is said for defendant, however, in this 15, 1921. This question and that concerning the reformation of the contract are material only to the measure of damages, for, if it be true that there was a mutual mistake in the contract set up in the petition and that the Chesapeake & Ohio Railway Company did reduce the price of ties in January of 1921, defendant would still be certainly liable for failing to perform its part of the contract that had been executed by the plaintiff, and perhaps, as has been stated, for failing to perform the full extent of its promise that is, liable according to the written contract as reformed. The decree is reversed, and the cause remanded for proceedings consistent with this opinion. BANK. Circuit Court of Appeals, Eighth Circuit. No. 7813. Banks and banking 123-Deposit of drafts pursuant to agreement to wire deposits to depositor created relationship of debtor and creditor as respected liability of bank. tender any that defendant did not inspect H. & B. BEER et al. v. CHICKASHA NAT. and accept. This contention assumes that it was plaintiff's duty, under the contract, to deliver the ties at the railroad. We do not find it necessary to decide that question; but we may assume that such was his duty, and yet it was not his duty to deliver them within any specific time, or subject to defendant's rights to choose whether it would or would not accept them. Defendant purchased all the ties that plaintiff manufactured from a certain tract of land, the McClure tract, and on March 10 plaintiff had on hand a considerable number of ties manufactured from that tract which were never taken by defendant. As to those ties the plaintiff, in our opinion, must be regarded as having executed the contract, for, even if it is to be construed as providing that he would make deliveries at the railroad, he was not obliged to agree to or to perform the wholly new conditions of delivery set out in the letter of March 10-that is, complete the deliveries by a fixed date—or, in view of that letter, to do the useless thing of making a tender of the ties that defendant had said that it would not accept. [9] As this case now stands, it is not for us to determine whether the clause set out in the counterclaim was omitted from the contract by mistake, or, if so, whether defendant had the right to cancel the contract if the Chesapeake & Ohio Railway Company stopped buying ties, or at least, as defendant contends, to suspend its execution until the Chesapeake & Ohio began purchasing them again. We observe in the record that one of the tiemen of the Chesapeake & Ohio testified that that company did not stop buying ties at all, although it did reduce the price on January Deposit of drafts to credit of brokerage partnership in accordance with agreement evidenced by letter of brokerage partnership to bank, requiring telegraph of each deposit over private wire, with confirmation by mail, and positively forbidding wire that money had been deposited until bank had ascertained checks would be paid, held, as respected liability of bank to depositor, to create relationship of debtor and creditor. In Error to the District Court of the United States for the Western District of Oklahoma; John H. Cotteral, Judge. Action by H. & B. Beer, a copartnership composed of Henry Beer and others, against the Chickasha National Bank. Judgment for defendant, and plaintiffs bring error. Reversed, and remanded for a new trial. Charles Rosen, of New Orleans, La., and Frank Wells, of Oklahoma City, Okl. (D. I. Johnston, George G. Barnes, and W. C. Lee, all of Oklahoma City, Okl., and Dufour, Rosen & Kammer, of New Orleans, La., on the brief), for plaintiffs in error. Ben Franklin and C. B. Stuart, both of Oklahoma City, Okl. (Cruce & Franklin, of Oklahoma City, Okl., on the brief), for defendant in error. Before STONE and VAN VALKENBURGH, Circuit Judges, and KENNEDY, District Judge. 26 F.(2d) 36 VAN VALKENBURGH, Circuit Judge. Plaintiffs in error, a copartnership, doing business under the firm name and style of H. & B. Beer, at New Orleans, La., hereinafter, called plaintiffs, brought suit in the District Court of the United States for the Western District of Oklahoma against defendant in error, a national banking corporation, doing business at Chickasha in the state of Oklahoma, hereinafter called defendant, to recover an alleged balance on deposit with defendant. The statement of account incorporated in the petition showed a balance in favor of plaintiffs of $8,396.13, for which recovery was prayed. The attitude of the defendant bank is best disclosed by its answer, to wit: "Defendant denies all and singular the allegations contained in the petition herein filed, and asks for strict proof of same. "For further answer herein, defendant says that during the years 1924, 1925, and 1926 the plaintiff H. & B. Beer was engaged in what is termed the brokerage business, which means, among other things, that the said plaintiff was engaged in the sale of cotton futures and grain futures throughout different parts of the country; that at the same time one C. F. Avery was engaged in the same character of business in Oklahoma City and throughout other portions of the state of Oklahoma, and at the (at the) same time one Paul James was engaged in gambling in cotton and grain futures through said Avery and H. & B. Beer, plaintiff herein; that at and during said time C. F. Avery had a duly appointed and acting agent by the name of C. E. McGugan; that the method of operation adopted by said Avery and said Beer was for said Avery to find a buyer for cotton or grain futures, draw draft through the defendant's bank on said buyer for the amount of money necessary to purchase the futures contracted for, and that said draft or drafts were always drawn by C. F. Avery, per C. E. McGugan, his agent, on the person who had undertaken to purchase said futures or to furnish money to buy said futures; that during the years 1924 and 1925 many drafts of this character were drawn through defendant's bank on different persons; that each time a draft was drawn for the purposes aforesaid, the said McGugan, acting for said Avery, who, defendant alleges, was the agent of the said plaintiff in all these transactions, would and did represent to the defendant that the draft so drawn was good and would be paid promptly when presented to the person and bank on whom and which it was drawn. "Defendant further alleges that on or about September 21, 1925, said Avery aforesaid, by said McGugan, drew a draft on one Paul James for $7,000, which draft was accepted by the defendant as a cash item, and the sum of $7,000 was placed to the credit of said plaintiff herein in the bank of defendant; that on the very next day, or the afternoon of the said day that said $7,000 draft was drawn, defendant learned that the draft was protested and would not be paid, and defendant, through its cashier, Roy Smith, then and there notified McGugan, the agent of Avery as aforesaid, that no more drafts would be honored on Jaul James, the person on whom said $7,000 draft was drawn; that the said McGugan was notified that the said James had been found to be unreliable and unable to pay this draft, and the said McGugan was told not to attempt to put any other drafts through the bank on said James; that on the next day, that is, on the 22d day of September, 1925, another draft was drawn by C. F. Avery, through C. E. McGugan, on Paul James, First National Bank of Alex, Okl., payable to the order of the Chickasha National Bank for $6,000; that without the knowledge of the cashier as aforesaid, who had notified McGugan not to draw any more drafts and that they would not be honored if drawn, said McGugan induced one Foster who was an employee of the bank, to accept said $6,000 draft as a cash item, and said McGugan obtained from said Foster, on behalf of the Chickasha National Bank, a telegram to the plaintiff that said $6,000 had been deposited to the credit of plaintiff. Defendant says that as soon as the bank, through its cashier aforesaid, found out that said telegram had been sent, the defendant bank wired to the plaintiff in New Orleans that the $6,000 deposit as indicated by the wire aforesaid was a mistake, that it was an error, and that there was no deposit of $6,000 in said bank. Defendant says that said $6,000 was never carried upon the books of the bank as a deposit, and never entered on said books as a deposit in favor of the plaintiff herein; that neither the $7,000 draft aforesaid, nor the $6,000 draft aforesaid, was ever paid by said James; that defendant was caused to accept said $7,000 and to wire plaintiff in regard thereto, as above set forth, by the fraudulent misrepresentations of the said McGugan, acting as agent for plaintiff, that said draft was good and would be paid when presented, when the said McGugan well knew that same was not good and would not be paid. Defendant says that the telegram sent the plaintiff as aforesaid, that $6,000 was on deposit, was an error, a mistake, and that said mistake was brought about through the false representation of said McGugan as aforesaid, who had been advised by the cashier of the bank as aforesaid that said $6,000 draft would not be accepted as a cash deposit, and that said McGugan concealed this matter and this direction from the cashier of the bank, from said Foster, who sent the telegram as aforesaid that $6,000 had been deposited to the credit of the plaintiff. Defendant says that it received no consideration whatever for the business of the plaintiff during these transactions, and that it acted purely as a matter of accommodation to the plaintiff herein; that it, at all times as indicated aforesaid, when said drafts were drawn by Avery through McGugan, accepted McGugan's statements that the drafts were absolutely good and would be paid, and defendant would never have passed any of the drafts so drawn by Avery through McGugan to the credit of the plaintiff as a cash item if it had not believed and relied upon the representation by said McGugan that the same would be paid when presented to the drawee; that during all these transactions the said Avery and his agent, McGugan, were acting for the said plaintiff; that they were negotiating the sales on futures for said plaintiff, and were, in every sense, the agent of the plaintiff in finding purchasers and in securing, through drafts aforesaid, the money from said purchasers for said plaintiff. Defendant furthermore alleges that the plaintiff herein knew and was advised each time by said Avery or McGugan as to the person who was making the purchase of futures, that to the amount of money said purchaser was to furnish, and that plaintiff knew and understood that the money obtained by said Avery and McGugan from the purchaser was to be placed in the defendant bank for the purpose of securing the plaintiff against any loss which it might suffer by reason of the purchase by plaintiff of futures for the particular person against whom said drafts aforesaid were drawn. "Defendant further says that the said Avery and the said McGugan knew the very day the $7,000 draft aforesaid was drawn on James that the same had been dishonored, and knew that the $6,000 draft drawn the next day on said James would be dishonored, and yet, notwithstanding this fact, said Avery and McGugan advised their principal, the plaintiff herein, that said drafts had been paid and that the money was actually on deposit for the plaintiff, thereby practicing a fraud upon this defendant. Therefore de fendant says that it is not, or it ought not, to be held liable to pay plaintiff herein said draft of $7,000, or any portion thereof, and said draft of $6,000, or any portion thereof; that said sums of money never reached the defendant's bank. Defendant denies that it is indebted to plaintiff in the sum of $8,396.13, or any other sum, but says that, by reason of the matters above set forth in this answer, said plaintiff has an overdraft at this defendant's bank in the sum of $4,605.47, and, by reason of the premises, is indebted to this defendant in said sum of $4,605.47." The reply of plaintiffs put in issue all the allegations of the amended answer which in any way tended to controvert the allegations of the petition. To shorten the case, it was stipulated that the only substantial matters involved were as to the credit claimed of $7,000 on September 21st and that of $6,000 on September 22d. It was agreed that, if plaintiffs were entitled to those credits, they were likewise entitled to judgment as prayed, and, if not so entitled to either of those credits, the defendant might have judgment as prayed in its answer. The statement of account incorporated in the petition was otherwise conceded to be correct. At the trial, plaintiffs introduced their letter to defendant of September 3, 1924, as the basis upon which the business between plaintiffs and defendant was conducted, and as establishing the nature of the deposits made, to recover the balance of which the action was brought. That letter is in the words and figures following: "September 3, 1924. "Chickasha National Bank, Chickasha, Okla.-Dear Sir: As per request of Mr. C. F. Avery, Chickasha, Okla., we herewith enclose copy of our private office code, in which please telegraph us promptly, over the private wire, as each deposit is made for our credit; and make no disbursements on telegrams over our signature not in this code. Please note that is for use only in connection with business between Mr. Avery, his clients and ourselves. If any one else should present a telegraphic order in these ciphers, please do not pay until you have wired us and received confirmation over the public wire.. "Kindly confirm by mail, and in plain language always, each deposit and each disbursement, avoiding the use of ciphers in letters, so not to subtract from the privacy in which we beg you, in your own interest and ours, to preserve this code. "We also wish to call your attention to |