102 S.E.2d 199

A. B. C. SCHOOL SUPPLY, INC. v. BRUNSWICK-BALKE-COLLENDER COMPANY.

36989.Court of Appeals of Georgia.
DECIDED JANUARY 17, 1958. REHEARING DENIED FEBRUARY 3, 1958.

Conceding, but not deciding, that the original contract was nudum pactum, and where, as here, parties entered into a subsequent agreement based upon mutual promises, such as are set forth in the petition, the plaintiff having set forth in detail how he performed his part of the new contract and how the defendant failed to do so, the court is without legal authority to sustain a general demurrer.

DECIDED JANUARY 17, 1958 — REHEARING DENIED FEBRUARY 3, 1958.

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Action on contract. Fulton Civil Court. Before Judge Camp. October 11, 1957.

A. B. C. School Supply, Inc., brought suit against the Brunswick-Balke-Collender Company alleging injuries and damages by reason of nonperformance of a contract on the part of the defendant.

The petition, as amended, reads as follows: “1. That defendant is a nonresident corporation having an office and place of business located at 1217 Techwood Drive, N.W., Atlanta, Fulton County, Georgia, and subject to the jurisdiction of this court. 2. That defendant has injured and damaged your petitioner in the amount of $1,695.35 by reason of the foregoing facts. [By amendment the figure $1,695.35 was changed to $1,038.51.] 3. That on or about November 1, 1954, plaintiff and defendant entered into a written contract, a copy of which is attached hereto marked Exhibit A and made a part of this petition. 4. That the original of said contract is in possession of defendant and defendant is hereby notified to have and produce at any and all hearings in this case. 5. That plaintiff and defendant continued to operate under said contract attached hereto as Exhibit A from the time of execution of same until February 1, 1956, at which time defendant purportedly terminated the said contract by sending a telegram to plaintiff, a copy of which is attached hereto marked Exhibit B and made a part of this petition.”

By amendment the plaintiff struck paragraphs 6 through 13 and inserted in lieu thereof the following: “6. In the spring of 1955, the exact date not being known to plaintiff, plaintiff’s salesman, W. J. Brooks, acting for and on behalf of plaintiff in the performance of his duties, contacted Mr. Ray Bryant, County School Superintendent of Colquitt County, Georgia, for the purpose of inducing the said Mr. Ray Bryant in his capacity as County School Superintendent of Colquitt County, Georgia, to request the Georgia State School Building Authority, an instrumentality of the State of Georgia, to purchase for the benefit of mentality of the State of Georgia, to purchase for the benefit of the Colquitt County Board of Education, products manufactured by defendant and sold by plaintiff. 7. That at said time, that the said W. J. Brooks, acting in the capacity set forth above, exhibited to the said Mr. Ray Bryant, a cata-lot [catalogue] and samples of school furniture manufactured by defendant and

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sold by plaintiff. 8. That following this initial contact made by plaintiff’s salesman, W. J. Brooks, with the Superintendent of Schools of Colquitt County, Georgia, additional contacts were made during the months of April and May of 1955, said contacts being made for the purpose of inducing the County School Superintendent of Colquitt County, to request the State School Building Authority to purchase for the benefit of the Colquitt County Board of Education, school furniture manufactured by defendant and sold by plaintiff. 9. On at least one of the contacts set forth in paragraph 8 above, the said W. J. Brooks, plaintiff’s salesman, was accompanied by Mr. E. A. Hurdle, District Sales Representative of defendant in the southeastern territory. The purpose of the visits of the said W. J. Brooks, salesman for plaintiff, and E. A. Hurdle, district sales representative of defendant, was to induce the County School Superintendent of Colquitt County, Georgia, to request the State School Building Authority to purchase, for the use of the Board of Education of Colquitt County, Georgia, products manufactured by defendant and sold by plaintiff. 10. That periodic visits were thereafter made to the office of the County School Superintendent of Colquitt County, Georgia, by W. J. Brooks, salesman of plaintiff, C. W. Williams, president of plaintiff corporation, and E. A. Hurdle, district sales representative of defendant, all of said visits being routine sales calls made for the purpose of inducing the County School Superintendent of Colquitt County, Georgia, to request the State School Building Authority to purchase, for the use of the Board of Education of Colquitt County, Georgia, products manufactured by defendant and sold by plaintiff. 11. That the sale which was contemplated by plaintiff to the State School Building Authority for the benefit of the Colquitt County Board of Education, was the sale of school furniture to be installed in new schools erected under and by virtue of the State School Building Authority Act (Code Section 32-1401a et seq.), and the procedure for selling school furniture, pursuant to the provisions of said act, was for the county school superintendent to prepare detailed request forms, giving quantity, size, colors and specifications of furniture design, all to be purchased through the State School Building Authority. 12. That on one of the sales calls set forth in paragraph 10 above, W. J. Brooks, salesman

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for plaintiff, prepared for the said Mr. Ray C. Bryant, County School Superintendent of Colquitt County, Georgia, a request for furniture to be installed in a certain school in Colquitt County, known as Reedy Creek School, detailing all sizes and types of furniture, color, etc., to be placed in each room of the said Reedy Creek School. 13. That on or about January 15, 1956, C. W. Williams, president of plaintiff corporation, made a trip from Atlanta, Georgia, to Moultrie, Georgia, at the request of Mr. Ray C. Bryant, County School Superintendent of Colquitt County, Georgia, for the purpose of amending, correcting and assisting the said Mr. Ray C. Bryant, County School Superintendent of Colquitt County, Georgia, in properly submitting his request form for the Reedy Creek School to the State School Building Authority. 14. That on said visit, the said C. W. Williams, president of plaintiff corporation, did go over said request from, check on all details above, and install correct stock numbers for each item of furniture, manufactured by defendant and sold by plaintiff, which was being requested by the Colquitt County Board of Education from the State School Building Authority. 15. That prior to the visits on behalf of the representatives of plaintiff and the district sales representative of defendant, the County School Superintendent of Colquitt County, Georgia, had had no contact whatsoever with any product manufactured by defendant and, as a result of the visits made by the representative of plaintiff, the County School Superintendent of Colquitt County, Georgia, was induced to request the State School Building Authority to purchase for its use products manufactured by defendant. 16. That after the request forms had been submitted by the Board of Education of Colquitt County, Georgia, to the State School Building Authority, the said State School Building Authority required a complete description, including pictures and specifications of all furniture contemplated by this request, which included the preparation of blue prints. 17. On January 19, 1956, Arthur E. Hart, an authorized representative of the State School Building Authority, requested plaintiff to furnish certain information, including detailed specifications and pictures, concerning the requests filed with the State School Building Authority by the Board of Education of Colquitt County, Georgia, a copy of said requirement being attached

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hereto, marked Exhibit D, and made a part hereof. 18. That on February 1, 1956, plaintiff received the telegram referred to in paragraph 5 of plaintiff’s petition, a copy of which is attached to said petition and marked Exhibit B. 19. That on February 3, 1956, plaintiff wrote a letter to defendant, the original of which is in possession of defendant, and defendant is hereby notified to have and produce said original at any and all hearings in connection with this case, a copy of said letter being attached hereto, marked Exhibit E. 20. That while the contract between plaintiff and defendant was in force, defendant furnished plated profit that plaintiff would make out of each order placed by it, profits varying among different orders, according to quantity and pieces involved. It was contemplated by the plaintiff and defendant that had plaintiff been awarded, at his bid price, the contract by the State School Building Authority, on this project, to wit: Reedy Creek School, Colquitt County, Georgia, plaintiff’s profit would have been thirteen percent or $1,038.51, as shown by schedule attached hereto marked Exhibit F, and made a part hereof. 21. That on some date between February 3, 1956, and February 18, 1956, C. W. Williams, president of plaintiff corporation talked to E. A. Hurdle, district sales representative of defendant, concerning the sale of the school furniture for the Reedy Creek School, Colquitt County, Georgia, and the said E. A. Hurdle orally assured plaintiff that it would be allowed to submit its bid to the State School Building Authority, without interference from defendant. 22. That on February 18, 1956, plaintiff wrote defendant a letter, the original of which is in possession of defendant and defendant is hereby notified to have and produce same at any and all hearings in this case, a copy of said letter being attached hereto, marked Exhibit G, and made a part of this petition. 23. That on February 23, 1956, plaintiff received from defendant a letter, a copy of which has been heretofore attached and marked Exhibit C, and made a part of this petition, reference to which is hereby made. 24. That thereafter and in reliance upon the representations made by defendant through its agent, E. A. Hurdle, orally, and in reliance upon the written representation set forth in Exhibit C hereto,

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plaintiff continued its efforts in negotiating a sale of defendant’s products to the State School Building Authority for use in the Reedy Creek School of Colquitt County, Georgia. 25. That in connection with the above it was necessary for the State School Building Authority to have numerous detailed specifications for the purpose of preparing its requests for bids to be advertised in connection with the aforesaid school building project. 26. That in reliance upon representations made by defendant as set forth above, plaintiff continued to communicate with Mr. Arthur E. Hart, a representative of the State School Building Authority, as aforesaid, concerning details of the specifications to be included in the request for bids for equipment to be furnished concerning the building of the Reedy Creek School, Colquitt County, Georgia. 27. That relying on the assurance that plaintiff would be allowed to submit its bid to the State School Building Authority for the Colquitt County School project described herein, without interference from defendant, plaintiff continued to communicate with the said Arthur E. Hart, concerning the necessary details and specifications of the work to be done in connection with this project. 28. That after the detailed information concerning the property which was to be purchased by the State School Building Authority for the Colquitt County Board of Education, had been completed, the State School Building Authority published requests for bids for materials to be used in connection with the furnishing of equipment for schools in Colquitt County, Georgia, included in which was the request for bids for the furnishing of equipment for the Reedy Creek School heretofore referred to in this petition. 29. That relying upon the representations made by defendant and explained herein, plaintiff submitted a bid for equipment to be used in furnishing the Reedy Creek School referred to herein. 30. That relying upon the representations of defendant as set forth herein, plaintiff purchased a bid bond, purchased a performance bond, and submitted its bid to the State School Building Authority, in compliance with law, in the amount shown on Exhibit F, which amount would allow plaintiff to realize a profit which was in accordance with the schedule furnished by defendant to plaintiff, heretofore referred to. 31. That without the knowledge, consent or approval of plaintiff, defendant submitted a bid to the State School Building Authority, for furniture

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to be used in the Reedy Creek School, Colquitt County, Georgia, in an amount less than the amount bid by plaintiff, and defendant was awarded the contract for the furnishing of equipment for the said school project. 32. That at the time that defendant submitted said bid, it was aware of the fact that plaintiff had submitted a bid at a higher figure, which figure defendant knew did include plaintiff’s profit, which was determined by the schedule which had been previously furnished to plaintiff by defendant, hereinabove referred to. 33. That had defendant not submitted its bid direct to the State School Building Authority for the project referred to herein, plaintiff would have been awarded this contract for the reason that no other competitor could have met the specifications called for in connection with the furnishing of this furniture, which fact was well known to defendant. 34. That had defendant not submitted its bid directly to the State School Building Authority, as set forth herein, plaintiff would have been awarded said contract and would have received as its compensation therefor the sum of $1,038.51, which represents the profit on said project as contemplated by the schedule referred to above, which had previously been furnished to plaintiff by defendant. 35. That plaintiff was prevented from receiving said sum as its compensation for work done in connection with the sale of defendant’s products to the State School Building Authority, solely and entirely by reason of defendant’s making a direct bid to the State School Building Authority, in violation of its agreement with plaintiff. 36. That demand has been made upon defendant for payment of $1,038.51, and payment has been refused.”

The plaintiff prayed for $1,038.51 damages.

The defendant demurred generally to the petition as amended. The court sustained the general demurrers and it is on this judgment that the case is here for review.

Taylor, Edwards Yancey, Louis D. Yancey, Jr., for plaintiff in error.

A. M. Wilkinson, Jr., contra.

GARDNER, Presiding Judge.

It is not necessary to discuss whether or not the contract as originally sued upon was nudum pactum, but the question is whether or not the petition, as amended, set forth a valid enforceable contract. In Hill v Horsley,

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142 Ga. 12 (2) (82 S.E. 225) the Supreme Court said: “(a) A consideration is valid if any benefit accrues to him who makes the promise, or any injury to him who receives the promise. . . (c) The fact that property is placed in the hands of a real-estate broker to sell does not prevent the owner from selling, unless otherwise agreed. In the present case, however, it was agreed otherwise.” Code § 20-302 reads: “A consideration is valid if any benefit accrues to him who makes the promise, or any injury to him who receives the promise.” It may be conceded, but not decided, that the original contract was a mere nudum pactum. It will be noted that this court held in Stevenson v Atlanta Mission Holding Corp., 72 Ga. App. 258, 262
(33 S.E.2d 568) as follows: “A promise, though a mere nudum pactum when made, and consequently unenforceable against the promisor at the time when made, may become binding and enforceable, if the promisee subsequently furnishes the consideration contemplated, by doing what he was expected to do. . . A nudum pactum becomes binding when one party performs his part and the other party gets the benefit of such performance . . . the part performance of the contract and the services rendered in the business by the petitioner . . . supplied the lack of mutuality and rendered the contract enforceable.” See also Turman v. Smarr, 145 Ga. 312
(89 S.E. 214).

A letter dated February 18, 1956, from the plaintiff to the defendant reads in part as follows:

“Brunswick-Balke-Collender Company, 623 South Wabash Avenue, Chicago 5, Illinois. Attn: Mr. F. C. Nichols. Dear Mr. Nichols:

“As you know, we have lost our franchise on your line of school furniture — a loss, I might add, that is sorely felt. Considering certain factors, such as 1955 being our first year in the furniture field, the difficulty of presenting such a superior and high-priced line as the Brunswick in such a competitive and price-minded market as Georgia, we feel that we did a very good volume of business for you. We had succeeded in getting practically the entire line on the State School Building Authority’s list and we have just added two road salesmen for Georgia. In other words,

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just as we were getting our ducks in a row, the Brunswick line is taken away.

“Now that the franchise is lost, however, there remain a couple of loose ends that should be tied down. I talked to Mr. McDermott by telephone and was given to understand that a letter would follow; to date, we have not received a letter on the subject from anyone in your organization. Mr. Ed Hurdle promised us protection on two jobs which we had in the fire previous to the telegram notice of our losing the franchise, namely, a job in Colquitt County, Moultrie, Georgia, and the Ft. Valley State College. There is also a possibility of business with the Atlanta Jewish Community Center, although I do not think this one will pan out. Since we have done the ground work, specifications have been drawn and these will soon be in the bid state. I think we should have protection on these jobs in a written statement. . . Please let us hear from you.

“Very truly yours,

A. B. C. School Supply, Inc.

Charles W. Williams, Jr.

President.”

The defendant answered under date of February 23rd as follows:

“A. B. C. School Supply, Inc. 3225 Cains Hill Place, N.W., Atlanta 5, Georgia. Attn: Mr. Charles W. Williams, Jr., President. Dear Mr. Williams:

“We are in receipt of your letter of February 18, 1956. I wish to point out that we will protect you on the Colquitt County, Moultrie, Georgia job and the Fort Valley State College job.

“Regarding the Screven County job — I would like to inform you that we will issue a credit memorandum in the amount of $168.87 in the immediate future.

“Sincerely yours,

Brunswick-Balke-Collender Co.

/s/ R. P. McDermott”

We are of the opinion that the letter showed that the defendant would protect the plaintiff in the sale of the equipment to the school in Colquitt County and that this was true whether the property was sold by the plaintiff or the defendant. The petition

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sets forth a number of things which the plaintiff did and of which the defendant was aware subsequently to the letter of February 23rd. We call attention in this connection to Brown v Floding, 173 Ga. 400, 404 (160 S.E. 604) wherein it is said: “While the contract as originally entered into might not have been enforceable, on the ground that it was without consideration and unilateral, the part performance of the contract and the services rendered in the business by the petitioner . . . supplied the lack of mutuality and rendered the contract enforceable and a breach of it actionable. The defendant could not take advantage of the offer of the petitioner . . . and receive the benefit of his services and then breach the contract, without rendering himself liable.” See also Webb v. Pullman Co., 57 Ga. App. 772 (196 S.E. 477).

It is contended by the defendant that the plaintiff is not entitled to recover because the balance of the Colquitt County job was not consummated until more than sixty days after receipt of the letter of February 23rd. It will be noted that nowhere in the letter of February 23rd is there a time limit. In Evans v Henson, 73 Ga. App. 494 (3) (37 S.E.2d 164) this court said: “The terms of a written contract may be modified . . . by a subsequent parol agreement.” Code § 20-116 reads: “Where parties, in the course of the execution of a contract, depart from its terms and pay or receive money under such departure, before either can recover for failure to pursue the letter of the agreement, reasonable notice must be given the other of intention to rely on the exact terms of the agreement. Until such notice, the departure is a quasi new agreement.” In Hollister Bros. v Bluthenthal Bickart, 9 Ga. App. 176 (8) (70 S.E. 970) this court held: “Where performance has been accepted after the expiration of the [time] limit [for performance], the failure to comply with this condition of the contract will be considered as waived.” In Greene County Oil Co. v. McCaw Manufacturing Co., 9 Ga. App. 39 (70 S.E. 201) the same principle was expressed in this language: “Even where time is expressly declared to be of the essence of a contract, it may be waived by the conduct of the party for whose benefit the stipulation was made. In this case the undisputed facts show that the defendant reaffirmed the contract after the expiration of the time limit for its performance by

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the plaintiff. The contract was therefore enforceable, after performance by the plaintiff had been accepted by the defendant, although the performance was after the expiration of the stipulated time limit.” See also Moody v. Griffin, 60 Ga. 459, wherein the Supreme Court said: “Although time is of the essence of the contract, it may be waived; and if, by consent, one party has complied with its terms after the prescribed time, a bill for specific performance will lie against the other.” I McDaniel v. Mallary Bros. Machinery Co., 6 Ga. App. 848 (1) (66 S.E. 146) this court held: “Forfeiture of rights is not favored, and the courts will readily seize upon circumstances arising in the subsequent conduct or transactions of the parties and imply a waiver, in order to prevent a forfeiture because of noncompliance with formal prerequisites.” In Jordan v. Rhodes Doss, 24 Ga. 478, the Supreme Court held: “Notwithstanding time is of the essence of the contract, it may be waived; and a subsequent offer to fulfill the contract, and urging a compliance on the other side, instead of treating the contract as at an end, amounts to a waiver.” This contention is not meritorious.

We come next to consider the question as to whether or not the petition, as amended, set forth the proper measure of damages which the plaintiff might recover. Code § 20-1407 reads: “Damages recoverable for a breach of contract are such as arise naturally and according to the usual course of things from such breach, and such as the parties contemplated, when the contract was made, as the probable result of its breach.” In Rice v. Caudle, 71 Ga. 605 (1), the Supreme Court held: “In a suit for compensation, growing out of the breach of a contract under which the plaintiff claimed the exclusive right to sell certain goods at a given price, in a designated territory, and in violation of which, others were employed to do the work without his consent, when he was ready and willing to carry out his contract, the measure of damages would be the difference between the cost of doing the work and the price to be paid for it; that is, the profits of the enterprise, after deducting the legitimate and actual cost of its execution.” See also Mimms v. Betts Co., 9 Ga. App. 718 (72 S.E. 271); Kerr v. DuPree, 35 Ga. App. 122
(132 S.E. 393); and Georgia Power Light Co. v. Fruit Growers Express Co., 55 Ga. App. 520 (190 S.E. 669).

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Counsel for the defendant contends that the court did not err in sustaining the general demurrer to the petition, as amended, and call our attention to Morrison v. Roberts, 195 Ga. 45, 46 (23 S.E.2d 164). There the court held: “While it is true, as recognized by the Code, § 20-116, that where parties, in the course of the performance of a contract, depart from its terms and pay or receive money under such departure, a modification by way of a quasi new agreement will be implied, still, in order for this rule to have application, it is necessary that the circumstances be such as will in law imply a mutual new agreement, so that the modification, when taken in connection with the original contract, will provide a new and distinct agreement complete in its terms. Bearden Mercantile Co. v Madison Oil Co., 128 Ga. 695 (4), 703 (58 S.E. 200) Southern Feed Stores v. Sanders, 193 Ga. 884 (3), 887 (20 S.E. 413); Kennesaw Guano Co. v. Miles, 132 Ga. 763, 770
(64 S.E. 1087), and cit.; Ball v. Foundation Co., 25 Ga. App. 126
(103 S.E. 422); Jones v. Lawman, 56 Ga. App. 764, 771 (194 S.E. 416).” Counsel for the defendant call our attention also to Jones v. Lawman, 56 Ga. App. 764, 771
(194 S.E. 416). Those cases are not applicable to the facts in the instant case. We think it is easily discernible from the amended petition that the petition goes into the details to show that the agreement was decidedly different from the provisions of the original petition.

The court erred in sustaining the general demurrer to the petition as amended.

Judgment reversed. Townsend and Carlisle, JJ., concur.