Stephenson v. Cady

This is an action to recover damages for the defendant’s refusal to perform the contracts declared on. The defence is that the plaintiff himself failed to perform his part of the agreements.

The three contracts were made on three different days, for the delivery of given quantities of yarn at a price named to be paid for on delivery. Part deliveries were made from time to time under the first and last contracts, and all these deliveries except *9the last were paid for at the time. By the terms of the second contract the deliveries under it were to commence when the quantity required by the first had all been shipped. And the question whether the plaintiff can recover anything for refusal to deliver under the second contract depends therefore on whether the conduct of the plaintiff justified the defendant’s refusal to perform the first.

All the contracts are executory agreements for the sale of goods to be thereafter manufactured in the defendant’s mill; they contain stipulations which impose upon one party the obligation to deliver, and upon the other the obligation to pay on delivery, and which are to be regarded as concurrent and mutually dependent conditions. Neither can maintain an action for the neglect and refusal of the other, without showing performance or its equivalent on his part. Payment must keep pace with delivery. The natural construction of the contracts, as applied to the subject matter, implies that the goods were to be delivered as they were manufactured from time to time. And this construction is confirmed by the course of dealing, the deliveries and payments, and the settlement between the parties.

The case was tried by the court without a jury, and we are of opinion that the refusal of the plaintiff to pay for a delivery of yarn which had been made under the contract, “unless the defendant would give security for the entire fulfilment of the contracts,” was, under the circumstances disclosed, sufficient to warrant a jury in finding the defendant justified in treating the contract as abandoned by the plaintiff, and as ended in its unfulfilled obligations upon him. It was a refusal to execute a substantial part of the agreement; an attempt, by holding on zo the property without payment, to impose an onerous condition not contemplated by the original contract, and to which the defendant was not required to submit, so long as he was without default. It was something more than a refusal to pay for a single delivery. It was broad enough to be treated as a general refusal to make any further payments. It was prospective in its character, and was made with notice that such refusal would be regarded as releasing the defendant from all obligation to fulfil. Conduct less decisive has been held to justify non-performance by the other party to the contract.

*10In Withers v. Reynolds, 2 B. & Ad. 882, the plaintiff, being obliged by his contract to pay for straw, for each load delivered on his premises, was in arrear for several loads; the defendant called on him for payment for what had been delivered; the plaintiff tendered the price except for the last load, saying that he should always keep one load in hand. Assumpsit was brought for not delivering straw to the plaintiff pursuant to the agreement. Lord Tenterden says: “ I am of opinion that the plaintiff is not entitled to recover. There is, I think, no doubt that by the terms of this agreement the plaintiff was to pay for the loads of straw as they were delivered.” “ Then the only question is, whether upon the plaintiff’s saying ‘ I will not pay for the goods on delivery,’ (for that was the effect of his communication to the defendant,) it was incumbent on the defendant to go on supplying straw; and he clearly was not obliged to do so.”

This is followed in the very recent case of Bloomer v. Bernstein, L. R. 9 C. P. 588, in which it is held that where there is a contract for the sale of goods to be delivered by instalments, the price of each instalment being payable on delivery, and the buyer does not pay for one delivery under such circumstances as to give the seller reasonable ground for believing that he will be unable to pay for the future deliveries, and that he does not intend to go on with the contract, the seller is justified in repudiating it. See also Fletcher v. Cole, 28 Vt. 114; Webb v. Stone, 4 Fost. 282; Winchester v. Newton, 2 Allen, 492; Star Glass Co. v. Morey, 108 Mass. 570, 574.

There is no legal objection to the finding and judgment of the Superior Court. Exceptions overruled.