Biggs v. Langhammer , 103 Md. 94 ( 1906 )

The plaintiff in this case is a buyer, seller and shipper of grain, trading as Richard J. Biggs Company, and has been engaged in that business in the city of Baltimore for thirty years. The defendants, John F. Langhammer and Ernest Langhammer, trading as E. Langhammer Son, and Robert McClintock, now deceased, were the owners of the schooner Robert McClintock, and this suit was brought against them to recover damages for the breach of an alleged contract to carry for the plaintiff a cargo of corn from Baltimore to Georgetown, South Carolina. After the institution of that suit, Robert McClintock died, and upon suggestion of his death, his executors, Robert N. McClintock and Walter R. Townsend, were made parties defendant. This will be adverted to later on.

The declaration alleges that Wathen Hooper, being ship brokers, and agents for the schooner Robert McClintock and her owners, contracted in behalf of the defendants with the plaintiff to carry on said schooner from Baltimore to Georgetown from 3,000 to 4,000 bushels of corn in consideration of a freight charge of three cents per bushel; said freight to be paid on delivery of the corn at Georgetown; and the schooner, laden with said corn, to sail on or about May 3rd, 1901.

The defendants pleaded separately the general issue, and the verdict and judgment being for the defendants, the plaintiff appealed.

There are three bills of exception in the record, the first and second being to the admission of certain evidence, and the third to the ruling upon the prayers. The plaintiff, to sustain the issues on his part, introduced testimony to prove the facts alleged in the declaration. He testified himself that in the latter part of April, 1901, he went to the office of Wathen Hooper, who were ship brokers, and agents for the schooner Robert McClintock and entered into an agreement with them to carry for him on the said schooner, then in the port of Baltimore, from 3,000 to 4,000 bushels of corn to the port of Georgetown, South Carolina, for three cents per bushel, the schooner to load and sail in a few days, and that the contract was then closed on the terms stated, with said Wathen; that he had an option on a quantity of corn then stored in an elevator in Baltimore, and was ready and able and willing to close said option and to ship 4,000 bushels of corn as agreed upon, but that early in May, 1901, Wathen Hooper notified him that Captain Lewis, master of the schooner Robert McClintock, had thrown up his charter and had gone to the West Indies for fruit; that he endeavored unsuccessfully to secure another vessel to take this corn; that he ascertained the rate on corn by rail to Georgetown, but found it so high as to be prohibitory; that the market price of corn in Baltimore on May 3rd, 1901, was 47 1/2 cents per bushel, at which price he had secured his option on the 4,000 bushels to be so shipped; that it was his business to keep posted as to the corn market generally, including Georgetown, South Carolina, and that on May 10th, 1901, the market price there was 60 3/4 cents per bushel, and that it varied very little there for ten days preceding; that it cost 2 1/2 to 3 cents per bushel to sack and deliver corn on vessel in Baltimore; and that he never did succeed in getting any part of this 4,000 bushels of corn to Georgetown. He further testified that he had chartered a great many vessels in Baltimore, and that the general custom among ship brokers was to close charters without referring them to the master of the vessel for his approval.

On cross-examination he said he had not actually sold the 4,000 bushels of corn on which he had an option, but had written his agent at Georgetown, B.A. Munnerlyn, to sell the same on its arrival, at the then market price.

The plaintiff further proved by Munnerlyn, that he had been in the grain commission business at Georgetown for ten years, that corn sold there during May, 1901, as high as 65 cents per bushel, and that he could have sold all the corn plaintiff could have shipped him between May 5th and 25th, 1901, at 60 3/4 cents per bushel.

He further proved by Robert D. Wathen, a member of the firm of Wathen Hooper, that his firm, about the last of April, 1901, entered into an agreement with the plaintiff to carry corn to Georgetown on the schooner McClintock at three cents per bushel, but that he did not remember the quantity specified; that his firm had trouble with Captain Lewis over his failure to take the corn as agreed on, and the vessel was taken out of their hands and handled by another broker until sometime in 1905, when she was again placed in their hands; and that it usually took the McClintock about one week to make the voyage from Baltimore to Georgetown.

Mr. Hooper, the other member of the firm of Wathen Hooper, testified that there were negotiotions between his firm and plaintiff for carrying corn to Georgetown by the McClintock, and that plaintiff may have secured the vessel, but he could not be positive, and does not remember that any definite quantity of corn was specified. He also said the usual custom of brokers is to refer the charter to the captains before closing finally.

Plaintiff further proved by Luther H. Gwaltney that he is the manager of the American Lumber Company and has been in the lumber business in Baltimore for over twenty years, and always understood that the custom here was for ship brokers to finally close charters without referring them to the captains for ratification.

Captain Lewis for the defendants, testified that he never gave Wathen Hooper authority to charter for less than 5,000 bushels of corn; that nothing was said about the quantity of corn, "whether there was ten, fifty, one hundred or one thousand bushels, not a word," though in another part of his testimony he had said that Mr. Hooper told him there were 2,000 bushels belonging to Mr. Biggs to be shipped; that "the brokers as a general thing are agents for the vessels, but before they close anything they generally consult the captain; that is the way I have been running the vessel, they never closed the vessel until they saw me."

The defendant, John H. Langhammer, testified that his firm and Robert McClintock were owners of the schooner McClintock, but that he had nothing to do with her chartering; turned that all over to the captain and his brokers; that his firm received from Mr. Biggs the letter dated May 6th, 1901, offered and admitted in evidence over the objection of the plaintiff; also that he met Mr. Biggs sometime in May, 1901, after the breach of the alleged charter on South street, and that Mr. Biggs told him Wathen Hooper had agreed to take 2,000 bushels of corn for him by the McClintock to Georgetown, and at the same time said he had better send him $50 and call it square. This statement was objected to by plaintiff, and was admitted over his objection. Plaintiff testified that when Langhammer said he mentioned 2,000 bushels of corn as the quantity to be carried, he was mistaken and confounded sacks with bushels, 2,000 sacks being equal to 4,000 bushels, and that he, plaintiff, never told him the quantity was 2,000 bushels.

The letter of May 6th, 1901, above-mentioned, will be transcribed in full and is as follows:

"Messrs. E. Langhammer Son, Managing Owners Sch. Robert McClintock, 2112 Aliceanna St., City.

Dear Sirs: — We like to be neighborly about these matters, and yet, when we make sharp losses through no fault of our own, we cannot help feeling greatly disappointed.

The brokers, Messrs. Wathen Hooper, engaged with us for vessel's account, the schooner McClintock to load general cargo for Georgetown, commencing on Friday, May 31st. We obligated ourselves to deliver grain, c., to Georgetown, and to our own surprise the captain tells us he has chartered elsewhere, and hence cancels his Georgetown charter.

If our customers institute proceedings against us, our loss will be several hundred dollars, and may, in fact, be much more than this, but if we can settle the matter amicably and pleasantly with you, we would much prefer doing so to filing claim for damages and charges against the vessel and owners, and therefore, subject to your prompt acceptance and prompt payment, we will accept in lieu of all claims against the vessel as above-mentioned, for the cancelling of its charter, the reduced amount of say, $40 to $50, which offer we make out of respect to you, and in spirit of neighborly courtesy. Please let us hear by two o'clock.

As a merchant, you will understand that the position in which we have been placed ruins a man's business as well as brings pecuniary loss.

Of course if you decline this, and we are forced to consider the matter on a different basis, we would have to ask our full damages.

With much respect,

Very truly yours, Richard J. Biggs Co."

At what wharf is McClintock lying?

The date May 31st, mentioned in the body of this letter as the time to commence loading, was obviously meant for April 31st, from all the testimony in the case, and needs no further explanation

The first exception was to the admission of this letter in evidence, and the second exception was to the admission of Mr. Langhammer's testimony as to the plaintiffs telling him he had better pay $50 and call it square. These exceptions present the same question, and will be considered together.

It does not appear from the record upon what principle the Court admitted what the plaintiff claims to have been, and what upon its face appears to be, an offer of compromise, but it may be inferred from the brief of the appellee, that the Court adopted the argument of the appellee that it was not an offer of compromise in good faith, of a claim which the plaintiff believed to be good and valid in law, but an effort to extort money upon a pretended claim, known by the plaintiff to be without foundation.

The construction of this letter was for the Court to determine, and if it be construed as a bona fide offer of compromise, it is clear upon all the authorities, that as it was not accepted, it was not properly admissible in evidence.

The rule is well settled that "offers by a party with a view to compromise, to pay or to accept a sum of money, or to make deductions, and in general to secure a settlement, are inadmissible," and though there are some cases which hold that such offer is admissible, unless stated to be without prejudice, yet the prevailing rule is that the offer will be presumed to have been made without prejudice. Jones on Evidence, sec. 293. This is the rule in Maryland. Reynolds v. Manning,15 Md. 526; Calvert v. Friebus, 48 Md. 46. In the latter, attention is called to the distinction in this respect between such offers, and the admission of particular facts, in which case, unless expressly stated to be without prejudice, it was held there is no rule of law which would exclude the admission of a particular fact as against the party making it.

The reason for the general rule is nowhere better stated than in Mr. Wigmore's recent work on Evidence, sec. 1061, as follows: "The true reason for excluding an offer of compromise is that it does not ordinarily proceed from and imply a belief that theadversary's claim is well founded; but rather a belief that the further prosecution of that claim, whether well founded or not, would in any event cause such annoyance as is preferably avoided by the payment of the sum offered. In short the offer implies merely a desire for peace, not a concession of a wrong done." While this passage, in its verbal form, refers to offers of compromise from a defendant, it is obvious that it relates as well to the claim of a plaintiff as to the defense of a defendant, since in either case the offer to pay a part, or abate a part, of the sum claimed, equally implies a desire for peace, and wrong is done as well by the presentation of a claim known to be unfounded, as by the resistance of a claim known to be just.

There is in this letter no admission of any particular fact, which the defendant, under the exception stated, would be entitled to have received in evidence, and we are therefore brought back to the inquiry whether this is a bona fide offer of compromise, or, as suggested by the appellee, an attempt to extort money upon an unfounded claim. This suggestion seems to be based upon the admission of the plaintiff in his testimony that he had not actually sold the 4,000 bushels of corn upon which he had an option, and the statement in his letter that if his customers instituted proceedings against him, his loss might be several hundred dollars. But we do not think this justifies that conclusion. If the plaintiff, in fact believed that he had a good and valid cause of action, even though the result of litigation might have shown he had not, his offer of compromise would not have been admissible in evidence. That he gave reasons for his offer, which perhaps were not the best that he could have given, cannot in any manner affect the legal principle upon which such offers are excluded. There was evidence tending to prove the alleged contract. The uncontradicted evidence shows he was prepared to ship 4,000 bushels of corn by the McClintock at the time agreed upon, and that there was a net profit to him on such shipment of about seven cents per bushel, or $280, since the proof was clear that this corn, if shipped, would have been sold for 60 3/4 cents per bushel at any time between May 5th and 25th. A recovery was allowed in a very similar case in Dambmann v. Lorentz Rittler, 70 Md. 380. It was immaterial whether the corn was actually sold or not, or whether any customer could institute proceedings against him for any failure to deliver corn. This consideration could not affect a loss actually incurred, irrespective of any such proceedings, by the failure of the defendant to carry this corn, which the proof shows never was carried by any one for the plaintiff.

We can therefore find nothing upon the face of this letter itself, nor in the surrounding circumstances, which would justify us in the conclusion that the plaintiff was attempting to practice a fraud upon the defendant by offering to compromise a claim which he knew had no basis either in law or in morals.

The verbal offer of compromise followed the letter, and is necessarily governed by the same principle, and for the reasons stated, we are of opinion that both were erroneously admitted.

We can perceive no ground upon which it can be contended that the plaintiff was not injured by this erroneous admission of evidence. As was said in Smith v. Satterlee, 130 N.Y. 677. "It is not seen how this Court can determine what effect it had on the mind of the referee who admitted it as evidence and then refused to strike it from the record. Presumably it was considered in connection with the other evidence which induced a finding favorable (in that case) to the plaintiff. The judgment should be reversed."

A very similar case is Barker v. Bushnell, 75 Ill. 222, in which the Circuit Court admitted propositions made by the plaintiff to settle the matter for much less than the value of the corn in controversy, which was the subject of an action of replevin, in which the Supreme Court said, "such evidence was clearly inadmissible," and that "the case ought therefore to be submitted to another jury without the objectionable evidence which may have misled them."

Coming now to the third exception, we think there was error in rejecting the plaintiff's second prayer.

Being a rejected prayer, however, it was not necessary in order to secure its consideration in this Court, that a special exception should have been filed on the ground that there was no evidence legally sufficient to sustain the prayer. Albert v.State, 66 Md. 334; Gunther v. Dranbauer, 86 Md. 1.

There was distinct conflict of testimony as to the existence of a usage authorizing ship brokers to close a charter without reference to the master of a vessel, but this conflict, if the evidence was otherwise sufficient to establish the usage, was for the jury to determine. The evidence upon the part of the plaintiff was of a general uniform usage. That on the part of the defendant, was confined to the experience of the master of the McClintock. The plaintiff supported the usage in all cases by the testimony of himself, Mr. Wathen, a ship broker, and Mr. Gwaltney, a large shipper of lumber. The defendants denial of the usage rested solely upon the testimony of Captain Lewis as to his individual mode of dealing,

If the evidence as offered, lacked any of the elements requisite to establish a usage, its admission should have been then excepted to, but being in, without objection, it must be considered by the jury under proper instructions from the Court. This is not a case where it can be said no legally sufficient evidence has been offered. If such a usage did exist, it is settled that "one who deals in a particular market must be taken to deal according to the custom of that market, and he who directs another to make a contract at a particular place must be taken as intending that the contract may be made according to the usage at that place." Kraft v. Fancher, 44 Md. 216.

The plaintiffs first prayer required the jury to find actual affirmative authority to close the charter, while the second prayer dispensed with actual authority, and relied upon the usage as constructive authority. It is manifest therefore that the latter is not a mere substitute for the former prayer, and that it gives the plaintiff a standing with the jury not given by the first prayer.

The measure of damages in event of a verdict for the plaintiff we think was correctly laid down in plaintiff's third prayer.

The record does not show, that the defendants' first prayer was granted in connection with the plaintiffs' first prayer as is stated in appellees' brief, and without being so connected we think it was calculated to mislead the jury, leaving them in doubt whether the quantity of corn stated in the plaintiff's first prayer "from 3,000 to 4,000 bushels" was, or was not "adefinite quantity." If it had been granted distinctly in connection with plaintiff's first prayer, we should feel, under the authority of Garey v. Sangston, 64 Md. 38, that it should not mislead a jury of ordinary intelligence.

At common law, in case of a joint contract, if one of the joint contractors died, an action at law could not be brought against his executor or administrator, but against the surviving contractors only; and if the contract was several or joint and several, the executor or administrator of one could be sued separately, but not jointly, with the survivors; the reason being that the same judgment cannot be rendered against the survivor and the personal representative, because one is to be charged debonis propriis and the other de bonis testatoris. 18 Cyc., 960. Death in such case severs the cause of action. Poe'sPleading, sec. 401; State, use of Ranstead, v. Banks,48 Md. 520. There is no statute in Maryland altering the common law doctrine as applicable to joint and several contracts, though our statute does provide that where two or more are jointly bound, and one of them shall die, his executors or heirs shall be bound as if the contract had been several as well as joint. The joinder of McClintock's executors therefore as parties defendants with J.F. and Ernest Langhammer, was an irregularity which should be corrected in any future proceedings.

Judgment reversed with costs to the appellants above andbelow, and a new trial awarded.

(Decided February 13th, 1906.)