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boat for oil burners covered by the above 1168), the Urgent Deficiency Act of October order, this office herewith gives formal ap- 6, 1917 (40 Stat. 345), the jury would be proval of the above order at that price, $3,- warranted in finding that the plaintiff's al223 per boat."

leged contract, upon which the action was [2] It is contended that there was no evidence brought, was illegal, null, and void. that Mr. Main, cost inspector, was authorized The question raised by these instructions to approve for the Compensation Board the was decided by this court when the case was price of $3,223. He testified, however, that first before us, and we there held that, in he was authorized, and no evidence was intro- accordance with the opinion of the Attorney duced to disprove this, nor was he cross- General, which was accepted by the Navy examined upon it. That, as cost inspector Department and acted upon by it, the prohe was stationed at the plant at Bethlehem, vision of these statutes applies only to purand it acquiesced in his approval and did chases by the United States or to contracts not question his authority to act for the Com- made by it, and not to subcontracts made by pensation Board, gives added weight to his the party contracting with the United States, testimony, as also does the fact that it is a and there was no error in refusing to give matter of common knowledge that, in the these instructions. emergency which had arisen, the Compensa- [6] It is also assigned as error that the Distion Board could not personally approve the trict Court refused to instruct the jury that prices at which materials should be purchas- there was no evidence to warrant them in ed under the thousands of contracts made by finding that the Compensation Board or the the United States.

Cost Inspection Board ever ascertained the After receipt of this communication, actual cost of the burners mentioned in the Bethlehem, on April 16, 1918, sent the fol- plaintiff's declaration, and that this was a lowing communication to West & Dodge: condition precedent to the approval of any

“We are pleased to advise you that we are cost by the Cost Inspection Board, and that, authorized to make final award of Union the cost not being shown to have been so asPlant's purchase order F-12-11-17, by the certained, plaintiff is not entitled to recover Compensation Board, Navy Department, on the alleged contract declared on. Washington, D. C., and that you may proceed While it is true that, under the conditions with this order at $3,223 per boat."

of the contract between Bethlehem and the There was a like communication upon the United States, the subcontracts which it made same date in regard to the other orders plac- were to be submitted for approval to the ed with West & Dodge.

proper board of the Navy Department, yet, [3] The jury were correctly instructed that as there was evidence from which the jury it was necessary to sustain the defense that could find that this requirement had been the award of $3,223 per boat was obtained waived, and the case was submitted to the by a fraudulent representation, to show that jury for the determination of whether there such representation was relied upon. There had been such waiver or not, this instruction were also full and explicit instructions in re- was correctly refused. It was not applicable gard to what would constitute a fraudulent to the issue which had been raised and which representation.

was submitted to the jury. [4] Whether there was any fraudulent rep- [7] Over the objection of the defendant, an resentation, and, if so, whether it was relied estimate of the cost of these oil burners made upon, were, we think, correctly submitted by the assistant superintendent of West & to the jury, and there was no error in the Dodge for the information of its president in denial of the motion for a directed verdict. making his original proposal was received [5] The second and third assignments of er

in evidence. This statement covered in deror relate to the refusal of the presiding tail material and labor costs in relation to judge to instruct the jury, in substance, that, these oil burners which amounted to $2,735.if the plaintiff knew that the torpedo boat 20. This was admitted by the court only updestroyers were being built by Bethlehem for on the question of good faith of Mr. Dodge the United States under a cost plus profit in making the representation contained in his contract, and the price of $3,223 alleged to letter of March 4, 1918. have been approved, was unfair, unreason- The witness testified that he made these able, and exorbitant and a price in excess of estimates from a set of blueprints which had a reasonable profit above the actual cost of been furnished him, and that his calculations manufacture, contrary to the Naval Appro- and computations were made for the purpose priation Act of March 4, 1917 (39 Stat. of estimating the cost, that his estimate was


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artert. denied 12710 648 20 L Ed.

& L

10 F.(20) 293
turned over to Mr. Law, who was the super- dence, and evidently made by counsel in the
intendent of West & Dodge, and that it was heat of argument, as, however, it did not
shown by him to Mr. Dodge. It also appear- bear upon any material issues before the
ed that this estimate had been checked up jury, and was promptly retracted, we think
with reference to the actual work which had it so apparent that the defendant was not
been done, and the result of this comparison injured thereby that it cannot be regarded as
communicated to Mr. Dodge before he wrote sufficient ground for reversal.
the letter of March 4, 1918.

The judgment of the District Court is af-
As bearing upon the question of whether firmed, with costs to the defendant in error
his representation in that letter was fraudu- in this court.
lent or not, we think this estimate, prepared
by practical men in the employ of the plain-
tiff, and compared with actual results in man-
ufacturing, was competent evidence to prove 1141,46

Sup C7.483.
that the statement in the letter was made up- C. C. MENGEL' & BRO. Co. v. HANDY
on reasonable grounds for believing it to

CHOCOLATE CO. be true. See Southern Development Co. v.

(Circuit Court of Appeals, First Circuit.
Silva, 125 U. S. 247, 8 S. Ct. 881, 31 L. Ed.

January 26, 1926.)
[8] The other errors assigned relate to the

No. 1909.
comments of counsel for the plaintiff in his

1. Contracts Om 163-Written insertions in
closing argument to the jury in relation to

printed contract prevail over inconsistent
the failure of the government to produce an printed provisions.
audit alleged to have been made by the gov- Written insertions in printed contract pre-
ernment in regard to the cost of the work vail over inconsistent printed provisions.
some time after its completion.

After a

2. Sales Ow176(3)-Buyer's refusal of tender colloquy between the court and counsel in

on specified ground held not to preclude deregard to these comments, the court instructed

fenses on other grounds; "waiver;" "estop-
the jury as follows:

“Mr. Foreman and Gentlemen: In view Buyer, by refusal of seller's tender on speci-
of the continued objection made to the com-

fied ground, was not precluded by theory of
ment to you about the government's failure "waiver" being intentional relinquishment of a

waiver or estoppel from making other defenses;
to introduce the prior audit or to produce it, known right, and “estoppel” requiring that
Mr. Willard agrees that that part of his ar- other party change his position.
gument may be struck out, and that you may [Ed. Note. For other definitions, see Words
be instructed not to pay any attention to and Phrases, First and Second Series, Es-
that part of the argument

and toppel; Waiver.]
that no inference is to be drawn against the

3. Appeal and error Om 1010(1)-Circuit Court defendant because of that."

of Appeals held authorized to determine If the comments of plaintiff's counsel whether there was any substantial evidence were improper, which we do not find it neces- to support finding. sary to decide, we think this instruction of Where seller excepted to court's refusal to the court removed their consideration from rule that on all the evidence judgment must be the jury.

for plaintiff, Circuit Court of Appeals was au

thorized to determine whether, under proper [9] It is also assigned as error that counsel construction of sale contract, there was any for the plaintiff made a statement to the jury substantial evidence to support finding for which was, in substance, that the defendant buyer. relied upon the hope that, by some talk about 4. Sales Om83—Ineffectual tender from vessel war profits and big contracts, the jury would

held not election, precluding subsequent tenbelieve "that West & Dodge got something der from warehouse. that they were not entitled to," and that an Under contract for sale of cocoa for. "shipanswer to this was that no claim had been ment July-Sept. from the Gold Coast or via made and no action brought against plain- 7.," title not to pass until delivery in New

Liverpool or equivalent dely. from Whse. N. tiff to recover back any money that it might York, subject to inspection by buyer's broker, be claimed was paid or received by it im- held, that seller had right to choose, within conproperly.

tract time, delivery from vessel from Gold Upon objection by counsel for the de- Coast or warehouse, and tender from vessel,

properly refused because of quality, was not fendant, counsel retracted this statement. election, precluding subsequent seasonable tenAlthough it was not warranted by the evi- der from warehouse.

5. Customs and usages em 17-Contract held jury, and, without opinion or special findings

plain on face, and evidence of custom limit; of fact, that court entered judgment for the ing "equivalent delivery from warehouse" held inadmissible.

defendant. Contract for sale of cocoa for shipment [1] The controlling facts are undisputed. from Gold Coast, "or equivalent dely. from The contract was in writing, as follows: Whse. N. Y.," held plain on its face, and evidence of custom limiting term "equivalent de

Cocoa Contract to Arrive. livery from warehouse" to about 30 days from last permissible sailing date, was inadmissible,

"New York, July 7, 1920. under rule that written contract cannot be "Sold for Account of C. C. Mengel & Bro. controlled, varied, or contradicted by custom.

Co. to the W. H. Miner Chocolate Co. 6. Customs and usages em 19(3)–Evidence Springfield, Mass.

held not to warrant finding of custom limiting term "equivalent delivery from warehouse,”

"Quantity: Fifty (50) tons (5% more to certain period after last permissible sail.

or less). ing date.

"Description: Usual good fair fermented Evidence held not to warrant finding of cus- Accra cocoa beans. tom of cocoa trade limiting term "equivalent

"Shipment: July-Sept. from the Gold delivery from warehouse" as alternative to delivery from vessel arriving to about 30 days Coast or via Liverpool or equivalent dely. after last permissible sailing date from point of from Whse. N. Y. shipment.

"Price: 1338c. cents per pound. Terms: 7. Sales 181(9)-Evidence that another ves- Net cash. 10 days from weighing and de

sel arrived 3 weeks later than vessel carrying livery. seller's goods held inadmissible, as immaterial.

“To be taken promptly by buyers on arWhere seller tendered cocoa from warehouse promptly on buyer's rejection of cocoa

rival ex dock at the port of New York and arriving on vessel from Gold Coast, as permit- N. Y. weights to govern, usual tare. ted by contract, court properly excluded sell- "Each shipment to be considered a seper's evidence that another vessel, taking ship- arate contract. Should any import duty, inment under same sailing date, arrived 3 weeks ternal revenue, or any other form of tax be later.

levied by the U. S. government on the cocoa 8. Sales m 150(3)-Seller's tender of delivery

from warehouse the same day buyer properly embraced in this contract, it shall be assumed refused delivery from vessel held not too and paid for by the buyers. late,

"In case of loss, destruction, or seizure of Under contract calling for shipment during cocoa or any part thereof, or abandonment July-September or equivalent delivery from thereof or any part thereof to underwriters, warehouse seller's tender of cocoa from warehouse the same day buyer properly refused after shipment, this contract for such portender from vessel held not too late.

tion to be void and the amount sold reduced

accordingly; in case the cocoa or any part In Error to the District Court of the thereof be transshipped within a reasonable United States for the District of Massachu- time and arrive by any other vessel or vessetts; James Arnold Lowell, Judge.

sels, this contract for such portion to hold Action by the C. C. Mengel & Bro. Com- good. pany against the Handy Chocolate Company. "Sellers not liable for contingencies beJudgment for defendant, and plaintiff brings yond their control. Reversed and remanded.

"Quality to be inspected and passed upon Addison C. Burnham, of Boston, Mass. by the undersigned. (Blodgett, Jones, Burnham & Bingham, of

"Snyder & Wheeler, Brokers. Boston, Mass., on the brief), for plaintiff in “Brokerage 1 % of sale. This also ap

plies to any portion lost or damaged at sea." Philip N. Jones, of Boston, Mass. (Hurl- The italicized portions are written inserburt, Jones & Hall, of Boston, Mass., on the tions in a printed form. On familiar prinbrief), for defendant in error.

ciples such insertions are to prevail over any Before BINGHAM, JOHNSON, and inconsistent provisions in the printed form. ANDERSON, Circuit Judges.

Hagan v. Ins. Co., 186 U. S. 423, 428, 22 S.

Ct. 862, 46 L. Ed. 1229. ANDERSON, Circuit Judge. This is an Cocoa intended by the seller for the action for breach of contract. The plaintiff buyer was shipped from the Gold Coast prior was the seller and the defendant the buyer to September 30 by the steamship Tuckaof 50 tons of cocoa beans. The case was nuck. This shipment arrived in New York submitted to the District Court without a on December 15, and was properly rejected



10 F.(20) 293 on December 18 by the buyer, because not of fermented Accra Cocoa sold by us through of the specified quality. On the same day, you to the W. H. Miner Chocolate Company, the seller tendered the buyer the required Springfield, Mass., for July/September shipquantity of cocoa from warehouse in New ment from the Gold Coast is now afloat on York. This tender was rejected by the buyer the Steamship Tuckanuck. on December 20, in a letter, the pertinent “We have in our possession bills of ladpart of which is as follows:

ing dated Seccondee, West Coast Africa, "We regret to advise that we are unable to August 31, 1920, and Accra, West Coast accept a tender of 800 bags from store Africa, September 3, 1920, and the cocoa sold against this contract, you having previously to the W. H. Miner Chocolate Company will notified the buyer that this cocoa was coming be delivered from the lots covered by either forward on the S. S. Tuckanuck afloat to of the above-mentioned bills of lading. New York. This cocoa duly arrived, was “We have been in touch with the steamsampled and quality rejected by the buyers ship company, who inform us that the Steamas not being up to contract requirements. In ship Tuckanuck will probably not arrive at consequence of your having declared a spe- the port of New York before November 15, cific lot, and this being duly tendered and re- 1920, and possibly will not arrive until after jected, does not give you the privilege of December 1, 1920.” submitting or declaring another parcel.

As late as the latter part of October, the "We submitted to you, by telephone, on plaintiff was told by the broker (acting for Saturday proposition covering the 800 bags the defendant) "that as this contract called as tendered per S. S. Tuckanuck lately ar- for either a shipment or equivalent, that his rived. If you are not prepared to accept time to perform against his equivalent was this, it will be necessary to cancel the con pretty near to the finish, and that he would tract."

have to show something; we cautioned him”; It thus appeares that the seller's second that after “the Tuckanuck had been declared tender (from the warehouse) preceded any

I explained

that the claim of the buyer of a right to cancel. De delay of this boat was a hardship on the buyfendant treated the contract as valid and out- er, and that, as they had cocoa in store, why standing until plaintiff rejected its offer of didn't they let the buyer have some of that a reduced price for the cocoa on the Tucka- cocoa? He said, 'No, the Miner Chocolate nuck. The seller insisted on its rights to Company's cocoa is coming on the Tuckamake the warehouse tender, and brought nuck, and they will have to wait for the this suit.

Tuckanuck; we can't give them any store On October, and perhaps in September, cocoa; they will have to wait until the Tucka1920, the buyer had made repeated requests nuck comes in.' That comment as made at for speedy delivery of the cocoa from the least, I will go under oath, six different warehouse. As a result of these requests the times." seller wrote, on October 19, a letter, the ma- The gist of the plaintiff's contention, terial parts of which are as follows:

saved by appropriate requests for rulings "Referring to 50 tons of usual good fair which the court below denied, obviously was fermented Accra cocoa beans sold to you that the contract permitted the plaintiff to for shipment from the Gold Coast July/Sep- perform by tendering the cocoa either from tember or equivalent delivery from ware- a July-September shipment from the Gold house New York, through Messrs. Snyder & Coast, or by a warehouse delivery, substanWheeler, under contract dated July 7th, 1920, tially within the same time limit. we beg to advise you that this cocoa is now The defendant, on the other hand, conafloat on the steamship Tuckanuck and will tended that the plaintiff, by its letter of Ocbe delivered to you ex dock New York upon tober 19, had finally elected the alternative of its arrival.

performing from the Tuckanuck, and that But after receipt of this letter the buyer no other alternative was thereafter open to continued requests for delivery suggesting it. warehouse delivery. The seller declined to A secondary contention of the defendant comply with these requests, but reiterated its was that, if the alternative of delivery from intention to make delivery per shipment the warehouse was after its letter of October from the Tuckanuck. On October 28, 1920, 19, 1920, open to the plaintiff, the tender of the seller again wrote:

warehouse delivery on December 18 was not "As requested by you in your letter of seasonable under the terms of the contract. October 27th, we beg to say that the 50 tons In support of this defense, the defendant offered, and the court admitted subject to contention. But, on principle and the overthe plaintiff's exception, evidence of an al- whelming weight of authority, a party does leged custom limiting the term "equivalent not lose a substantial right merely by failure delivery from warehouse” to a period, vari- to mention it. To ground an estoppel, it ously stated by the defendant's witnesses, must appear that the other party, relying on but roughly ending about 30 days from the that failure, changed its position. See 2 Willast permissible date of sailing from the liston on Sales, 495; Galle v. Hamburg, Gold Coast, so that, if such custom was etc., Co., 233 F. 424, 425, 147 C. C. A. 360. proved and applicable, the tender of ware- We find nothing in the cases cited and rehouse delivery after the arrival of the Tuck- lied upon by the plaintiff which, on this recanuck on December 15 would be too late. ord, constrain us to a different conclusion.

To meet this evidence, the plaintiff of- Nor do we find any evidence of an estoppel. fered, and the court below excluded, subject We treat this defence of unseasonable tender to plaintiff's exception testimony that the as open to the defendant, notwithstanding steamship Schoodic left the Gold Coast with its letter of December 20. a cocoa shipment prior to September 30, and [3] The plaintiff excepted to the court's reyet did not arrive in New York until some

fusal to rule that on all the evidence judgthree weeks after the arrival of the Tucka- ment must be for the plaintiff. The main nuck.

question, therefore, before this court, is It is difficult to determine upon what whether, under a proper construction of the theory the court below went in admitting the contract, there was any substantial evidence evidence of custom in order to limit the time to support the finding for the defendant. within which seasonable warehouse delivery We do not overlook the limitations upon this might be made; for, at the plaintiff's re

court arising under rules laid down in such quest and subject to the defendant's excep

cases as Law v. United States, 266 U. S. tion, the court ruled that the defendant—by 494, 45 S. Ct. 175, 69 L. Ed. 401; Wear v. its letter of December 20, 1920, refusing the Imperial Glass Co., 224 F. 60, 139 C. C. A. plaintiff's offer of warehouse delivery on the 622; Dangberg Land Co. v. Day, 247 F. 477, specified ground that the plaintiff had by its 159 C. C. A. 531; White v. German Alliletter of October 19, 1920, made a final elec

ance Ins. Co., 103 F. 260, 43 C. C. A. 216; tion of delivery from the Tuckanuck--had Gilbane v. Fidelity Co., 163 F. 673, 674, 90 waived all other defenses. As the cocoa on

C. C. A. 265; Ins. Co. v. Folsom, 18 Wall. the Tuckanuck was concededly not of the 237, 21 L. Ed. 827; Cooper v. Omohundro, quality required by the contract, if this was

19 Wall. 65, 69, 22 L. Ed. 47. the only tender that under the contract the It is manifest that the finding below for plaintiff was entitled to make, it would seem

the defendant must have been based on one immaterial whether the warehouse delivery of two theories: subsequently tendered was or was not sea

(1) That the plaintiff had conclusively sonable.

elected to perform its contract by allocating [2] But we think the court erred in ruling the cocoa on the Tuckanuck, and that the dethat the defendant, by its letter of Decem- fendant was not thereafter bound to accept ber 20, 1920, waived all claims of defense cocoa from the 'warehouse. other than that the plaintiff, by notifying the (2) That the tender of warehouse de purchaser that the goods were coming on the livery on December 18, 1920, was too late, Tuckanuck, and by tendering goods from the even if otherwise permissible under the conTuckanuck, was precluded from making any

tract. further tender. The defense that the tender We think neither defense was, under a of December 18 was too late was duly proper construction of the contract, suspleaded, and there was, on this record, nei- tained by any substantial evidence. ther estoppel nor waiver. “Waiver is an [4] (1) There was no election. Plaintiff intentional relinquishment of a known right.” had, under the contract, a right to choose, Suburban Land Co. v. Brown, 237 Mass. within the contract time limit, either method 166, 168, 129 N. E. 291, 292. There is no of performance. Its stated intention of per

. evidence of such intentional relinquishment. formance by allocation from the Tuckanuck Doubtless in some of the cases are found in- (bad because of the quality of the cocoa) adequately guarded expressions as to waiver, did not exhaust either the plaintiff's right which, considered apart from the facts be- or its obligation to make warehouse delivery. fore the court, might be thought to sustain The case does not fall within the principle the ruling below and the plaintiff's present illustrated in the leading case of Norrington

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