Laredo Hides Co. v. H & H Meat Products Co.

513 S.W.2d 210 (Tex. Ct. App. 1974)

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Nature of the Case

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Facts

A written contract was executed whereby P agreed to buy all of D's hide production for the period from March through December of 1972. The terms were cash upon delivery. Prior to the contract in question, D had considerable difficulty in collecting moneys from P. The contract agreement specified cash, but by actual practice, P would give its check to D at the time it picked up the hides. Lozano's Transfer Company acted as agent for P for delivery of the check and for the purpose of picking up the hides from D for delivery to P. On March 18, 1972, the owner of the transfer company, discovered that his truck driver had left to pick up the hides from D and had forgotten the check. They were instructed to put the check in the mail. The check was not received on Monday or on Tuesday morning (March 21, 1972). D was upset and called P. D gave P an ultimatum that unless he had the monies by 4:30 p.m. he would not sell another hide to P. P went immediately to the bank in Laredo, Texas and transferred Nine Thousand Dollars directly to D's account in the Mid-Valley State Bank. Telegrams were sent to D. On March 22nd, the $9,000.00 was paid by federal reserve draft to the Frost National Bank for the account of the Mid-Valley State Bank. The check was received through the mail by D on the morning of Wednesday, March 22nd. D telephoned the Mid-Valley State Bank, inquired about the bank transfer, and was told that such a credit for the account of P had not arrived at the bank. He called the bank again Wednesday afternoon and was again advised that the credit had not arrived. On Thursday morning, March 23rd, the credit arrived. D treated the failure to make payment before 4:30 p.m. on March 21, 1972, as a breach of the agreement which gave D a right to cancel the contract. On March 30, 1972, D unequivocally told P that he was not going to sell him anymore hides, and further advised that it was useless for him to send a truck for the hides. P was forced to purchase hides on the open market. The total additional cost to Laredo Hides of purchasing substitute hides from other suppliers was $142,254.48. The additional costs (transportation and handling charges) to Laredo Hides which resulted because of the purchases from third parties amounted to $3,448.95. P sued D. The trial court filed findings of fact, and conclusions of law were: 1) time was of the essence of the written contract; 2) on March 18, 1972, P breached the contract by failure to make payment upon delivery of the hides; 3) D (after March 18, 1972) orally agreed with P to accept payment if the money was in D's possession by 4:30 p.m. on March 21, 1972, but if P did not make such payment within the time limited therefore, that no further hides would be sold to P under the contract; and, 4) payment was not received until the inter-bank transfer deposit on March 23, 1972. The court gave P a take nothing judgment. P appealed.