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Eaves & Collins vs. The Cherokee Iron Company

Supreme Court of Georgia1885-01-06
73 Ga. 459

Summary

Holding. The judgment is affirmed. The trial court properly instructed the jury that the plaintiffs waived their right to recover for breaches of specific contract terms by acquiescing in departures from those terms, accepting payment based on the modified arrangement, and failing to give clear notice of an intent to enforce the original contract strictly.

Eaves & Collins entered into a written contract with the Cherokee Iron Company for the delivery of iron ore. During performance, both parties deviated from specific contract terms—such as the location of weighing scales and the daily tonnage requirements—and continued making monthly payments and settlements based on these departures. The plaintiffs later sued for breach of contract, but the trial court instructed the jury that by accepting payment and acquiescing to the modified terms without clearly notifying the defendant of an intent to enforce the original contract strictly, the plaintiffs had effectively waived their right to recover for those specific breaches. The trial court also charged that mutual abandonment of the contract would preclude recovery and that notice of the plaintiffs' election to furnish an optional second batch of ore must be given within a reasonable timeframe. The plaintiffs challenged these instructions on appeal.

The court found that the trial instructions properly stated the law. When parties to a written contract depart from its terms during performance and money is exchanged based on those departures, the party seeking to enforce the original contract must give clear and unequivocal notice of that intention before recovery is available. Until such notice is given, the departure constitutes a provisional modification of the agreement. The court approved the trial judge's application of waiver principles and rejected the plaintiffs' arguments that the instructions were erroneous.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

  • Whether conduct of the parties during contract performance constitutes waiver of strict contract terms
  • What constitutes sufficient notice to reinstate enforcement of original contract terms after deviation and acceptance of modified performance
  • Whether mutual abandonment of a contract precludes recovery for breach
  • Whether proper notice is required before exercising an optional election under a contract

Procedural posture

The plaintiffs appealed from a trial court judgment rendered in favor of the defendant Cherokee Iron Company, challenging the jury instructions on waiver and contract abandonment.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion

majority opinion

Jackson, Chief Justice.

On a careful examination of this record, we are unable to see clearly that the ends of justice demand a new trial. The parties are at issue on the facts, and the jury .and presiding judge having determined them in favor of the defendant, the version given the defendant must be .assumed by us as true. That settles the question made in the grounds of the motion in respect to the verdict being contrary to the charge and law and evidence, etc.

The charge sent up in full in the record appears to be a .plain, full and complete presentation of the issues before the jury and the law bearing thereon. The errors assigned on portions of it and the refusals to charge other points, ■read in connection with it, contain no substantial errors ■which demanded á new trial.

Stress is particularly laid by the very able counsel who .argued the case before this court for the plaintiffs in error upon the charge in respect to the waiver of the strict /.terms of the contract by the conduct of plaintiffs in working under it. The contract, for instance, required scales ¡to be furnished at the point where the iron ore was to be delivered on the railway, and the judge charged, if it was weighed, and fairly weighed at another point, and the plaintiffs acquiesced in it by receiving the weights and .the monthly payments which they called for, then, on the principle of waiver, the plaintiffs could not recover, becausé the scales were not furnished at the place agreed on, but -at another place the iron was weighed. Besides, on this matter the court did charge that if damaged by it, plain■tiffs could recover; that is, if the weight was incorrect.

So, too, the contract required a sufficient number of phutes and screens to enable plaintiffsto furnish-fifty tons a day at the road- The judge charged to the effect that if this, was acquiescedin for some months, from time to time, with.monthly settlements, the plaintiffs .were debarred by this conduct from recovery, unless they notified the defendant that thenceforth they would stand literally on the contract. And the same principle was applied to plaintiffs’ conduct in not being prepared each day with that number of tons to be delivered, and the defendant’s not being ready to take them every day, that such a departure from the strict terms of the contract, acted on in this way, would forbid recovery for such failure until notice was given that thenceforth plaintiffs would insist on their contract. The point is specially emphasized that the judge charged in effect that mere indefinite complaint would not be sufficient notice, but it must be distinct and emphatic, impressing on the defendant that thenceforth the contract was required to be enforced strictly.

The view this court takes of it is this: When a contract is in writing, each party has a right to expect the other to do precisely what he promises; but if, in the course of the execution of its terms — the carrying them into practical execution in a continuous business — some of those terms are departed from and money is paid and received on that departure for some time, then before the one can recover from the other for failure to pursue the letter of the agreement, he must notify him with clearness of his purpose thenceforth to stand on the original contract. Until such notice, the departure is a sort of new agreement. 2 Wharton on Contracts, p. 870, n.; 2 Camp. R., 530. The rule laid down in the charge of the court applied to the facts before it strikes us as sound sense, and therefore good law.

It is also insisted that the court erred in charging that .if the parties abandoned the contract, there could be no recovery by the plaintiffs. The suit is for breach of contract ; abandonment by both sides would seem to preclude either from complaining of a breach when both agreed to quit. 54 Am. Dec., 480; 2 Pars. on Cont., 5 ed., 677 to 681.

But it is insisted that there is no evidence to authorize the charge. It may not be clear that the parties intended to abandon it, but there is perhaps enough to base a charge upon it. If not, it hardly hurt the plaintiff.

The plaintiff in error urges also that the court erred touching the right of plaintiff to recover damage for the second lot of twenty thousand tons which, by the contract, he could elect to furnish. The court charged to the effect that notice that plaintiffs had elected must be given pending the time necessary for them to complete the first 20,-000 tons at 50 tons a day, such being a reasonable time.

Certainly, it seems to us, the other side to the contract ought to have some notice of this election, in order to employ others, if these did not elect; or to prepare to receive the iron if they did. And the reasonable time fixed by the court is the very longest that could be allowed the plaintiffs, to-wit, the whole of the time it would take them by the contract to deliver the first 20,000 tons. Certainly the time allowed could not be complained of by the plaintiffs.

The judge below having given this case a thorough examination, and having granted a new trial, unless the defendant would write off a large part of the verdict which the jury gave it as set-off, and thus having shown the thoroughness of his investigation of the facts, and having approved the verdict with that part written off, and having given, we think, a fair charge, and the plaintiffs in error having shown this court no substantial error of law, our duty is to affirm the judgment. It may be well to add, that in the charge the judge applies the same doctrine of waiver to the defendant in its complaint of bad and unskillful work by the plaintiffs and its effort to recover therefor.

Judgment affirmed.