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Garrett v. Faust

decided: August 1, 1950.


Author: Maris

Before MARIS, GOODRICH and HASTIE, Circuit Judges.

MARIS, Circuit Judge.

John C. Faust and Cora Faust, his wife, two of the defendants in a civil action brought by T. A. Garrett and Elizabeth Garrett, his wife, in the District Court for the Eastern District of Pennsylvania, have appealed from a judgment entered against them upon the verdict of a jury in the amount of $17,000.00. The jury rendered a verdict in favor of a third defendant, Railway Express Agency, Incorporated, by direction of the court and it is not involved in this appeal. Motions by the Fausts for a new trial and for judgment n.o.v. were denied. 9 F.R.D. 482.

Mr. and Mrs. Garrett reside in Richland Springs, Texas and are there engaged in the business of raising turkeys and selling turkey eggs for hatching purposes. Mr. and Mrs. Faust reside in Ephrata, Pennsylvania, where they are engaged in the business of hatching turkey and chicken eggs and selling the poults and chicks to turkey and chicken growers. The business, which is carried on under the name "Ephrata Hatcheries", is owned by Mrs. Faust and managed by Faust.

The season during which turkey eggs are hatched runs from mid-December to about June. During the 1944-1945 season the Ephrata Hatcheries had purchased turkey eggs for hatching from the Garretts. On August 30, 1945 Faust wrote the Garretts a letter offering to purchase all their turkey eggs for the next season commencing December 15, 1945. A schedule of prices was proposed and the letter stated: "There will be no change in the price of eggs unless we are compelled to sell our poults for less than 60›, or any change due to conditions beyond our control." This offer was accepted by Garrett in a letter of September 5, 1945.

On December 4, 1945 Faust wrote Garrett a letter in which he stated that "Due to the drop in turkey market and the demand for poults way below last year" he was compelled to reduce the price which he would pay for eggs to the figures set out in the letter. To this letter the Garretts replied under date of December 14, 1945 stating: "Your letter of Dec. 4 to hand. Will say in reply that we will accept the reduced price in eggs although the feed is higher than last year and turkey market about as good as last season." Following this modification of the contract the Garretts proceeded to ship turkey eggs produced by them to the Ephrata Hatcheries. On January 28, 1946 Faust sent them a letter in which he placed them on a reduced quota of not more than 10 cases of Broad-breast Bronze turkey eggs per week, effective at once. The quota was not to apply to eggs of the White Holland and Narragansett breeds, a small quantity of which the Garretts also produced. The reason given by Faust for this action was that poults were not moving early in the most eastern states due to the shortage of feed and he was, therefore, going to hatch only 50% of capacity for the balance of the season. He also stated that the price would drop 2 cents per egg and that if they could sell elsewhere it would be all right. He advised selling at once all breeders they did not need. To this letter Garrett replied under date of February 3d, the following being pertinent excerpts from his reply:

"Your letter of Feb. 28th came a day or two ago. It is quite a blow to us, but we have run a Hatchery for fifteen years, and we know when you cannot sell chicks or Poults, you cannot keep buying eggs.

"So we are selling 1500 of our Broad brest, which only leaves 500, which should produce about 10 cases per week.

"Now we have 300 Narraganzets, and 100 White Holland, that we would like to keep, if it meets with your approval.

"Now we would like to know Definitely, if you can take the eggs from these, and the 500 Broad breast, if it is possible for you to say, at this time.

"I believe there is going to be about 80% of the Turkeys sold over the country, so eggs may be scarce before the season is over.

"The trucks are comeing for 1000 hens and 125 toms Tuesday, and the rest Thursday, so we would like to hear from you by Wednesday night, so if you can wire me Wed. evening, stateing your wishes, please do so, if I dont hear from you by then, I will call you Wed. evening late.

"We are selling a little over two thirds of our flock, which should easily take care of the surplus, if everyone will do that."

A few days later Garrett telephoned Faust who agreed to take the Broadbreast eggs which he had on hand and to continue to take his Narragansett and White Holland eggs. This was done for a few weeks after which further shipments were discontinued, as a result of a telegram from Faust on February 21st notifying the Garretts that "Due to conditions beyond our control, cancellations by the thousands, I cannot take any more eggs this season.Stop all egg shipments at once." The Garretts acquiesced in this ...

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