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Ridara Livestock Co. v. Agricultural Products Co.

Supreme Court of Arizona

July 14, 1944

RIDARA LIVESTOCK COMPANY, a Corporation, Appellant,
v.
AGRICULTURAL PRODUCTS COMPANY, a Corporation, Appellee

APPEAL from a judgment of the Superior Court of the County of Maricopa. Howard C. Speakman, Judge. Judgment reversed and cause remanded for a new trial.

Mr. Mark Wilmer, for Appellant.

Messrs. Woolf & Shute, for Appellee.

OPINION

[61 Ariz. 474] FAIRES, Superior Judge.

This action and appeal grows out of a purchase and sale contract dated the 16th

Page 762

day of October, 1940. The complaint alleges that defendant agreed to sell and plaintiff agreed to buy from defendant 100 tons of cottonseed meal at a price of $23 a ton; that defendant on or about the 15th day of August, 1941, breached its agreement in that it refused to sell or deliver further cottonseed meal to plaintiff without justification or excuse; the complaint further alleges that after notifying defendant of its intention to purchase the balance of said meal on the open market, plaintiff bought the same at prices substantially above the contract price.

In its amended answer the defendant pleaded several defenses, one of which is that the refusal is based upon a claimed mutual cancellation of a portion of the contract. Another defense, that the contract was cancelled by defendant because of plaintiff's refusal to pay a draft on presentation for the amount due and unpaid for products delivered to plaintiff under the contract during the months of July and August, 1941. Other grounds, both affirmative and defensive, set up in the amended answer, we do not need to recite or consider in the determination of the legal principles here involved.

Appellant, Ridara Livestock Company, a corporation, hereinafter called plaintiff, appeals from a judgment based upon a directed verdict rendered against it in the superior court of Maricopa County in favor of appellee, Agricultural Products Company, a corporation, hereinafter called defendant. [61 Ariz. 475]

It is fundamental that the construction of a contract is for the courts when its terms are plain and unambiguous on its face. 13 C.J. 783; 17 C.J.S. Contracts, § 616. However, it s equally well settled that if there are ambiguities in the contract, and it is necessary to take into consideration the surrounding facts and circumstances in determining its meaning, it is for the jury to determine what those facts and circumstances were; when the facts are once established it is for the court to decide the legal meaning thereof. Kreig v. Hammels, 29 Ariz. 280, 240 P. 1031; Carrick v. Sturtevant, 28 Ariz. 5, 234 P. 1080.

A judgment predicated on a directed verdict must be affirmed on appeal if any of several grounds of the motion for such verdict are good, if the result is the only one that could be reached legally. Horan v. Richfield Oil Corp., 56 Ariz. 64, 105 P.2d 514, and authorities cited thereunder.

It is fundamental that in passing upon the propriety of an instructed verdict all evidence favorable to the party against whom the verdict is directed and all reasonable inferences to be drawn therefrom must be taken as true. An examination of the evidence discloses that on April 9, 1941, the defendant corporation wrote Mr. B. A. Randall, one of the owners of the plaintiff corporation, as follows:

"Dear sir:

"Pursuant to our conversation of April 7th, I am advised by Mr. E. W. Hudson that you have 40 tons of cottonseed meal left on your original contract.

"Some few weeks ago when you were in Phoenix and had a talk with Mr. Hudson concerning the undelivered balance of meal on your contract at that time and Mr. Hudson now advises me that your and his agreement then was you would only need 40 tons of meal to complete your needs and Mr. Hudson promptly sold all over that amount that you had left. [61 Ariz. 476] This 40 tons we are reserving for delivery to you according to the terms of your original contract.

"Yours very truly,

"Agricultural Products Company

"By E. M. Cooper."

Mr. Randall testified in this connection as follows:

"Q. I believe you testified before... that you received that letter, Mr. Randall? A. It was a ...


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