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Defendant to plaintiff (telegram):

“Oct. 10. "Offer ten fifty hundred bales like sample lot. Answer.” Plaintiff to defendant (telegrams):

"Oct. 10. “Telegram received. Your limit impracticable for us. We sold to-day same cotton eleven cents; will sell you hundred this price; we can not do better, market firm, if accepted answer at once."

“Oct. 11. “Will ship you one hundred or two hundred ten three-quarters; we are giving you full inch eighth cotton; if you care to shade staple a little can do the business for less; we make this offer to keep business going with you; answer early to-morrow sure, cannot do better." Defendant to plaintiff (telegram):

“Oct. 11. "Offer ten fifty hundred bales full inch eighth. Answer." Plaintiff to defendant (telegrams):

“Oct. 12. “Telegram received all right. Will ship you one to two hundred bales inch eighth, ten half, average. Strict middling, nothing below middling. You have bought some cheap cotton. Confirm."

"Oct. 13. "Do you confirm one or two hundred on sale made you to-day? Either amount satisfactory to us. If you want the two hundred will ship. Answer." Defendant to plaintiff:

"Oct. 13. “We are in receipt of your telegram offering us the 100 to 200 bales full 118 inch cotton 1012 cts. We have wired you as enclosed confirmation that we would take 200 bales. We will be pleased to have you ship 100 bales of this cotton now and if agreeable we would like to have the other 100 bales shipped any time between Nov. 1st and 10th. We understand this cotton is to be full 143 inch staple, same as the staple in the 25 bale sample lot you shipped to us, the grade to be average strict middling, nothing middling. We desire that you be particular in the selection of this cotton as nothing less than full 148 inch, same type as the sample lot, will be suitable to us. Please route via Birmingham, or Atlanta, and S. A. L. R. R. to Clinton, S. C., as this routing will give us a much quicker shipment."

The principal witness examined for the plaintiff in the trial was a man by the name of Fowler, the owner and general manager of the business of the plaintiff, who conducted the correspondence with defendant. Fowler admitted that the 150 bales which defendant declined to accept was of the same grade and the same character of cotton as the 50 bales which had been sent before with bill of lading attached; and he further admitted that none of the 200 bales, composed, as stated, of the 50 bales first sent under the contract of purchase and the 150 bales which were refused, was of as high grade of cotton as the 25 sample bales; and it was also shown, by the undisputed evidence, that the 25 sample bales was not only a better grade of cotton than the 200 bales, but also commanded a higher price in the market.

The prime question, therefore, is what the contract between the plaintiff and the defendant was. The counsel for the plaintiff contends that the question as to whether the plaintiff complied with the terms of the contract or not was for the jury to determine. It is true, as a general proposition, that where the issue is one of fact as to the performance of the terms of a contract, it is the province of the jury to pass upon it. But before the question of compliance or noncompliance arises, there must be a determination of the terms of the contract itself. In case of an oral contract, where the parties disagree as to its terms, or an ambiguous written contract, in which testimony aliunde is offered to explain its meaning, the intervention of a jury is often necessary. But in that of a written contract showing the whole of the agreement, couched in terms such as to render it capable of intelligent interpretation, its construction is for the court, and not for the jury. In our opinion, the contract between the parties to this controversy is of the latter kind. It is all contained in the correspondence above set forth, and we think that the intention of the parties to the contract at the time of the correspondence is readily gathered. To our minds there is no uncertainty or ambiguity about it, and a proper construction of it is that the defendant contracted to buy 200 bales of cotton from the plaintiff of the character, grade, and quality of the 25 bales which had been theretofore sent as a sample. There is no contention that the cotton shipped under the contract fulfilled these requirements.

On the other hand, plaintiff admits that it did not. It is a well-settled rule that courts will ascertain what parties to a contract have agreed to by what they have said and by the meaning of the words used to express their intention. This doctrine is elementary.

In this case it appears from the record that defendant's motion for verdict or nonsuit was made at the conclusion of plaintiff's testimony, and that upon the refusal of the court to grant the motion the defendant introduced a witness by the name of Bailey, who testified as follows:

"Mr. Sirrine: Q. State to the jury plainly what you and Mr. Dougherty said that day. A. Mr. Dougherty came into my office the day of the arrival, and I sent over to the warehouse where we had this cotton, this 50 bales of cotton, and had him to go through it, and he came back to my office, and I carried him into my private office with Mr. Smart, and we asked him what he considered the cotton, and he said that he called it 148". We brought out the samples of the 25 bales and laid them beside the desk in which we had the cotton that we had received, and we said to him: 'Do you consider this cotton the same as the 25 bales?' He said: 'I do not.' And he said: 'Well, I would like to make some settlement of this matter.' And we told him we were very anxious to settle it, that we were needing cotton, and were in a straight right now. We asked him what he wished to do, and he said he did not know. I said: 'Well, Mr. Dougherty, we will state our position in this matter, and we will tell you what we will do. If you will have your people to authorize the bank to release the drafts so the railroad people can deliver this cotton to us, you can have our warehouse at your disposal, and you can draw the samples from this cotton, and you can arbitrate according to the Carolina Mill Rules, and if that is not satisfactory you can send them to New York and have them classified, and if, after the cotton has returned, you lose in the case, we will charge you not a cent for the storage of this cotton in our hands.'

"Q. What did he say to that? A. He said he would not do it.

"Q. Did he say anything about his authority to do or not to do that? A. Well, the impression was that he had the full authority.

"Q. You spoke of the Carolina Mill Rules, are these the rules, July 15, 1904 (handing witness book entitled 'Rules Known as the Carolina Mill Rules and Governing Sale of Cotton to Domestic Mills')? * A. Yes, sir.”

The defendant did not renew the motion at the conclusion of all the testimony. Plaintiff's counsel have made no point, either in the brief or in the oral argument, because of the omission of defendant's counsel to renew the motion for nonsuit at the close of all the testimony. Under these circumstances we think the court may well assume that plaintiff's counsel waived objection, if such there might be, to this failure, and did not intend to take advantage of the omission of defendant's counsel in this respect. We are led, however, to consider this point because of the fact that in the conference of the judges and upon an examination of the record it is called to our attention, and the question has arisen, as to whether or not by this omission the defendant has not forfeited its right to be heard.

In Accident Insurance Company v. Crandal, 120 U. S. 527, 7 Sup. Ct. 685, 30 L. Ed. 740, the Supreme Court lays down the rule that the refusal of the court to instruct the jury at the close of plaintiff's evidence that she was not entitled to recover cannot be assigned for error, because the defendant, at the time of requesting such instructions, had not rested its case, but afterwards went on and introduced evidence in its own behalf. In support of this decision, the Supreme Court cites Grand Trunk Railway Company v. Cummings, 106 U. S. 700, 1 Sup. Ct. 493, 27 L. Ed. 266, in which it was held that the refusal to direct a verdict on motion of defendant at the close of plaintiff's testimony could not be reversed, if the defendant, after such refusal, offers testimony which does not appear in the record. The reason for the principle laid down in the case last cited is readily apparent: That although the testimony offered by plaintiff may not, in itself, have been sufficient to warrant a verdict, yet the court was entitled to see what effect the testimony of defendant, subsequently offered, may have had upon the issues involved, for it frequently occurs in the trial of causes that the testimony of the defendant, upon cross-examination of witnesses or disclosures otherwise made, has the tendency to strengthen rather than weaken plaintiff's case. It was therefore important that the defendant's testimony should be set out in the record, that the court might see and determine, upon all of the testimony, as to whether or not the case should have gone to the jury. This view seems to be strengthened by the opinion in Northern Pacific Railroad Company v. Mares, 123 U. S. 710, 8 Sup. Ct. 321, 31 L. Ed. 296. When all of the evidence had been submitted, the defendant demurred to the evidence and moved the court to dismiss the action, which the court refused to do. Thereupon the defendant requested the court to direct a verdict, which was also refused and exception taken. The Supreme Court, in the opinion, says that:

“The question raised by the ruling and the exceptions thereto is whether there was sufficient evidence to justify the court in submitting the case to the jury.”

Then the court proceeds to state the fact which the evidence tends to establish and decides that there was enough to go to the jury on the question involved in the case, viz.:

"That the defendant, by the negligence of an engineer in its employment, caused the injury to the plaintiff.”

The testimony of the witnesses offered by the defendant in the case now under consideration in no way affects that offered by the plaintiff. It corroborates, substantially, the testimony of the agent of plaintiff, to the effect that the 15 bales of cotton which the defendant refused to accept was not of the same character or grade as the 25 bales which were sent to the defendant by the plaintiff as a sample. This is all the testimony of defendant's witness which we deem material; the remainder of it pertaining to negotiations between the parties after the refusal to accept the 150 bales looking to an amicable adjustment of the controversy. We do not think that the rule of practice laid down in Grand Trunk Railway Company v. Cummings and in Insurance Company v. Crandal, above cited, applies in the case before us. The principle in our case is that there was no issue of fact for the jury at all, upon any of the evidence or upon all of the evidence. The question was one solely for the court—the construction of a written contract, plain in its terms. There was no contradiction as to the telegrams and letters which contain the terms of the contract; these being capable of intelligent construction, setting out the agreement of the parties in unmistakable terms that plaintiff agreed to deliver to the defendant a certain grade of cotton like a sample lot of 25 bales shipped by the plaintiff to the defendant in the outset. The plaintiff admitted that the cotton in controversy was not of that grade, but contended that the contract did not call for it. The defendant's witness simply corroborated the fact that the cotton shipped was not of the quality and grade of the sample lot. The construction of the contract, as set forth above in this opinion, being for the court, there was no issue of fact for the jury. In all of the cases we have examined on the point we are now discussing, there was some evidence relating to the fact at issue, and the rule was laid down that if a defendant failed, after introducing testimony, to renew the motion to direct a verdict made at the close of plaintiff's case, the refusal of the trial court to grant the motion could not be assigned as error.

We regard Insurance Company v. Crandal and Railroad Company v. Mares, supra, as the leading authorities upon the point in question, and it will be observed that in both of these cases, the motion was that the court instruct the jury to return a verdict for the defendant. A motion of this characier invoked the power of the court, after considering the testimony and all of it in its various aspects, and giving to it and every part of it its due weight, with all legal and reasonable inferences to be drawn therefrom, to determine whether or not it was sufficient to warrant a verdict for the plaintiff. But such is not the situation in the case here. The motion of defendant's counsel was not to direct a verdict, but nonsuit the plaintiff on the ground that the contract required of it the delivery of a certain grade of cotton, according to a sample which had theretofore been furnished, and, if such were the contract, plaintiff admitted the nonperformance, and therefore could not maintain its action against the defendant for an alleged breach. The motion of defendant was based solely upon a proposition of law, and no issue or question of fact was involved. We do not think therefore that any question in regard to the rule of practice referred to arises. We construe the contract as we have before stated in this opinion, and, such being our construction, with plaintiff's admission of nonperformance, there was not even a scintilla of evidence to go to the jury to support a finding for the plaintiff. We think the learned judge on the trial court should have entered a nonsuit, as requested by defendant, and the refusal to do so was error.

There is error, for which the judgment of the Circuit Court is reversed.


MCDOWELL, District Judge, dissents.

(154 Fed. 353.)


(Circuit Court of Appeals, Third Circuit. April 19, 1907.)

No. 9.



A bank is not chargeable with notice of fraud in the inception of a note which it discounted merely because its president had knowledge of the facts, which was gained by him in his capacity as an officer of another corporation, where he had nothing to do with the discounting of the note, and had no knowledge of it at the time.! In Error to the Circuit Court of the United States for the District of New Jersey.

E. R. Walker, for plaintiff in error.
John S. Applegate, for defendant in error.

Before GRAY and BUFFINGTON, Circuit Judges, and LANNING, District Judge.

BUFFINGTON, Circuit Judge. In this case John E. Lanning, receiver of the Monmouth Trust & Safe Deposit Company, brought suit against Robert McCalmont on a negotiable promissory note for $5,000, dated January 28, 1903, payable to his own order in four months, and by him indorsed. The court below gave binding instructions for plaintiff, which action is here assigned for error.

After examining the proofs, we are of opinion there was, under the proofs, no question to submit to the jury. Assuming, for present purposes, that fraud was practiced on the defendant in securing from him the note for the stock of the Fraser Mountain Copper Company, and that Twining, the president of that company, had knowledge of that fact, still the mere fact that such officer was also president of the plaintiff company does not visit the latter with notice. There is nothing in the record tending to show that the trust company did not discount

1 See note at end of case.

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