Smith, Kingsley R.

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Volume 38 Issue 1 Article 13 December 1931 Contracts--Offers and Acceptance--Counter Offers Kingsley R. Smith West Virginia University College of Law Follow this and additional works at: https://researchrepository.wvu.edu/wvlr  Part of the Contracts Commons, and the Jurisdiction Commons Recommended Citation Kingsley R. Smith, Contracts--Offers and Acceptance--Counter Offers, 38 W. Va. L. Rev. (1931). Available at: https://researchrepository.wvu.edu/wvlr/vol38/iss1/13 This Recent Case Comment is brought to you for free and open access by the WVU College of Law at The Research Repository @ WVU. It has been accepted for inclusion in West Virginia Law Review by an authorized editor of The Research Repository @ WVU. For more information, please contact ian.harmon@mail.wvu.edu. RECENT CASE COMMENTSCONTRACTs - OFFER AND ACCEPTANCE - CouNTER O mS. -Plaintiff was a West Virginia corporation engaged in buying andselling coal, with its place of business in Mercer County, West Vir-ginia. Defendant, also a West Virginia corporation, was a coaloperator having its mines in Kentucky. Plaintiff by letter to de-fendant in Kentucky inquired whether defendant would be inter-ested in an order for 40,000 tons of coal (or, in the alternative,15,000 to 20,000 tons ("or a similar tonnage .. .. considered inthe nature of a back log") at $1.30 net ton mines to be delivered"in approximately equal monthly instalments" from date of theletter until November 15th, about a five-months' period. Plain-tiff requested reply by wire. Defendant construed the letter asan offer and telegraphed at once that it would "accept orderone car daily" over the stated period. The total amount of coalto have been shipped under this arrangement would have been6,540 tons. Plaintiff thereupon replied, also by telegram, "Acceptyour offer one car daily mailing order." The coal was not de-livered in accordance with the contract and plaintiff sued in Mer-cer County, West Virginia, for breach of contract, recovering$1,420.83 on a jury verdict. On writ of error, the Supreme Courtof Appeals reversed the judgment, dismissing the case on thetheory that the defendant's plea in abatement attacking the juris-diction of the court should have been sustained. Three StatesCoal Co. v. Superior Elkhorn By-Products Coal Co.'At common law the action for breach of contract wastransitory and the defendant could be sued wherever he could befound.! However, by statute, West Virginia has so limited thetransitory nature of this action that under such facts as these itcould be maintained in this state only if instituted in the county"wherein the cause of action or any part thereof arose."' Con-sequently, the initial problem facing the court in this case wasthat of determining whether the cause of action "or any partthereof" arose in Mercer County.The cases are not in accord as to where the cause of actionaccruing from the breach of a contract arises. Some hold that itarises exclusively at the place where the contract was made,' others1158 S. E. 661 (1931).22 ANDREws, AmERICAN LAw (1908) p. 1439.8W. VA. REV. CODE (1931) c. 56, art. 1, § 2. "An action .... may bebrought in any county wherein the cause of action or any part thereof, arose,although none of the defendants reside therein, in the following instances;(a) When the defendant .... is a corporation."'IMorgan v. Eaton, 59 Fla. 562, 52 So. 305 (1910); Peters v. E. 0. PainterFertilizer Co., 73 Fla. 1001, 75 So. 749 (1917) (cause of action held to1Smith: Contracts--Offers and Acceptance--Counter OffersPublished by The Research Repository @ WVU, 1931WEST VIRGINIA LAW QUARTERLYmaintain that the place of the breach is, where such cause of actionaccrues Still other decisions adopt the theory that the "cause ofaction" is divisible, consisting of (1) the contract and (2) thebreach thereof.' West Virginia has long followed the latter rule,'under which a material part of the cause of action arises bothwhere the contract was made and where it was breached. Sinceboth parties admit that this contract was breached in Kentucky,the only way in which plaintiff could invoke the jurisdiction ofthe Mercer County court was to show that the contract was madein that county..A contract is made where the offer is accepted.8 An offercontemplating telegraphic acceptance is turned into a contractwhen and w7here the offeree's telegram is delivered to a telegraphoffice for transmission,' but an acceptance which varies the termsof the original offer rejects that proposal and sets up a counteraccrue in county in which letter was written accepting offer to sell) ; State v.Reid, 177 Wis. 612, 188 N. W. 67 (1922).5 Penn. L. M. Fire Ins. Co. v. Meyer, 197 U. S. 407, 25 S. Ct. 483 (1905)(policy issued in Pa. on N. Y. property; property burned and upon refulsalto pay insurance it was held the cause of action arose in N. Y., where contractwas breached, even though made in Pa.); N. P. Sloan Co. v. Barhana, 138Ark. 350, 211 S. W. 381 (1919); Moherstadt v. Harry Newman, Inc., MotorCars, 204 Mo. App. 619, 217 S. W. 591 (1920); Lentz v. Evans & HowardFire Brick Co., 11 S. W. (2d) 1070 (Tex. Civ. App. 1929) (suit for breachof contract for sale of clay; held, the cause of action arose at destinationwhere buyer rejected shipment there, precluding circuit court of county whereshipment was made from asserting jurisdiction).0 Graves v. MeCollum & Lewis, 193 S. W. 217 (Tex. Civ. App. 1917);Houston Packing Cotton Co. v. Cuero Cotton Oil & Mfg. Co., 220 S. W. 394(Tex. Civ. App. 1920) (suit for breach of contract for sale of oil heldproperly brought in county where offer was accepted, under statute permit-ting suit in any county in which the cause of action or part thereof arose);Silvers Box Corporation v. Stone & Co., 248 S. W. 1104 (Tex. Civ. App.1923); State Bank of Beckville v. Mailander, 277 S. W. 232 (Tex. Civ. App.1926); Arizona Superior Mining Co. v. Anderson, 262 Pac. 489 (1928).7 Harvey v. Parkersburg Ins. Co., 37 W. Va. 281, 16 S. E. 580 (1892);Clarke v. Ohio River R. Co., 39 W. Va. 737 (1894); Galloway v. StandardFire Ins. Co., 45 W. Va. 237, 31 S. E. 969 (1898) (application for insurancefrom Va. accepted in W. Va. and policy issued thereon in this state; held,W. Va. contract); Hudson v. Iguano Land & Mining Co., 71 W. Va. 409(1912); Danser v. Derr, 72 W. Va. 433 (1913); Findley v. Coal & Coke By.Co., 76 W. Va. 751 (1915). In Jones v. Main Island Creek Coal Co., 84 W.Va. 248, 99 S. E. 462 (1919), Judge Ritz used the following language: "Acause of action may .... be said to consist of an obligation and the breach.... of that obligation .... the statute uses this language in order to con-fer the jurisdiction in any county in which either of these elements arises."8 Hogue-Kellogg Co. v. Webster Canning Co., 22 Fed. (2d) 384 (C. C. A. 4th1927); Galloway v. Standard Fire Ins. Co., supra, n. 7; Nettles v. GulfFertilizer Co., 78 Fla. 490, 83 So. 298 (1919); Bundy v. Commercial CreditCo., 200 N. C. 511, 157 E. S. 860 (1931) (order given in Michigan for ac-ceptance in Alabama became Alabama contract upon acceptance there);2 WHARTON, CoNPLucT OF LAWS (3d ed. 1905) § 422(a); 1 WILLISTON, CO -5 n cTs (1920) § 97.Burton v. U. S., 202 U. S. 344, 26 S. Ct. 688 (1906) ; Watson v. Coast, 35W. Va. 463, 470, 14 S. E. 249 (1891) (option to be accepted "by wire or2West Virginia Law Review, Vol. 38, Iss. 1 [1931], Art. 13https://researchrepository.wvu.edu/wvlr/vol38/iss1/13RECENT CASE COMMENTSoffer which in turn requires acceptance by the original offerorbefore contractual relations arise." In the principal case theSupreme Court of Appeals held that the defendant had made asufficient acceptance. This conclusion was reached on the theorythat plaintiff had set no minimum tonnage and by construing thewords "or a similar tonnage" to include a total which was 8,550tons less than the smallest amount mentioned in the letter. Underthis view the contract was held to have been made in Kentucky andconsequently no part of the cause of action arose in West Virginia.It is submitted that plaintiff's letter quite clearly set both amaximum and a minimum tonnage. This letter offered to pur-chase 40,000 tons, then stated that if defendant was not inclined tohandle that order, "perhaps you would consider the acceptance of15,000 to 20,000 tons .... or a similar tonnage." The minimumis expressly set and defendant's proposal to send less than halfthat minimum (a total of 6,450 tons) can hardly be construed asan unconditional acceptance.The Supreme Court of the United States has held in a leadingcase that an "acceptance" of 1,200 tons of iron rails (the offerhaving been for from 2,000 to 5,000 tons) was such a variation fromthe terms of the offer as to constitute a rejection of that proposaland the substitution of a counter offer.' If an "acceptance"specifying 800 tons less than the minimum stated in an. offer tosell irons rails converts the offeree's reply into a rejection andnew offer, it would quite naturally seem to follow that an "ac-ceptance" of 8,500 tons less than the minimum named in an offerto buy coal would have similar legal effect. By this interpreta-tion the contract was made in Mercer County upon plaintiff'sacceptance of defendant's counter offer there, a material part ofthe cause of action arose at that situs, and the West Virginia courtquite properly assumed jurisdiction of the suit.It is therefore submitted that the reasoning of the trial courtwas sound and that the plea of abatement to the jurisdiction of thecourt should have been denied.-KINGSLEY R. SMITH.otherwise" held turned into a contract upon acceptance by telegram); Bar-num Iron Works v. Construction Co., 86 W. Va. 173, 102 S. E. 860 (1920);C. W. Craig & Co. v. Jones & Co., 200 Ky. 113, 252 S. W. 574 (1923).10Weaver v. Burr, 31 W. Va. 744, 8 S. E. 743 (1888); Barnum Iron Worksv. Construction Co., supra n. 9; Crews v. Sullivan, 133 Va. 478, 113 S. E. 865,867 (1922); Bowers Co. v. Kanawha Valley Products Co., 100 W. Va. 284,130 S. E. 284 (1925); J. Neils Lumber Co. v. Farmers Lumber Co., 293Pac. 288 (1920); Carrollton Acceptance Co. v. Ruggles Motor Truck Co.,253 Mich. 1, 234 N. W. 134 (1931); Morris F. Fox v. Lisman, 237 N. W.267 (1931); 1 WILLISTON, CONTRACTS (1920) §§ 72, 73, 77."Minneapolis & St. Louis Ry. Co. v. Columbus Rolling Mill Co., 119 U. S.149, 7 S. Ct. 168 (1886).3Smith: Contracts--Offers and Acceptance--Counter OffersPublished by The Research Repository @ WVU, 1931

Contracts--Offers and Acceptance--Counter Offers

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Contracts--Offers and Acceptance--Counter Offers

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