O'Malley v. E. J. Griffith & Co.

BRAY, J. Defendant appeals from a judgment in favor of plaintiff in the sum of $11,331.56.1

Question Presented

Does the evidence support the court’s finding that there was no account stated by the letter of October 8, 1952?

Defendant also contends that the court’s findings and judgment were inconsistent in that the court found that the $11,331.56 for which it gave judgment was due both for breach of contract and on an account stated. Inasmuch as defendant does not contend that the evidence does not support both theories (except as to whether said amount was paid) we deem it unnecessary to determine whether or not there was such inconsistency or to further discuss this contention.2

Was There a Second Account Stated?

This action grew out of a written contract entered into about June 1, 1952, wherein Micronesia Metal and Equipment Company, Inc. (plaintiff’s assignor and herein referred to as “Micro”) agreed to sell and E. J. Griffith and Company, Inc. (herein referred to as “ Griffeo”) to buy a shipload of steel and iron scraps. Ninety per cent of the declared value was to be paid upon shipment and the balance to be ascertained [245]in Japan after arrival of the ship there. Concededly the scrap was delivered, the actual cost determined to be $184,-654.67, of which 90 per cent or $171,936 was paid as agreed and a balance of $11,331.56 left. Defendant contends that on October 8, 1952, an account was stated showing that of this latter amount all was paid except $831.10 which defendant offers to pay. The circumstances of this so-called second account stated follow; There had been a statement of account dated August 7, 1952, sent by Micro to Griffeo showing the $11,331.56 balance. November 12,1952, Griffeo’s vice president in Tokyo wrote to Griffeo’s general offices in Portland, Oregon, stating that Griffeo still owed Micro $11,-331.10. In June or July, 1955, Griffeo was purchased by Getz Bros. At the trial no general ledgers or books of account reflecting the scrap transaction were produced. Getz Bros, had endeavored to get defendant’s records from its Tokyo office where they had been kept, but were unsuccessful. However, three annual audits of defendant were produced. The 1952 audit contained a figure of $17,000, itemized under “Scrap Contract Expenses Reserve.” The 1953 audit contained a figure of $11,331.10 as “reserve for scrap contract expenses.” The 1954 audit contained no similar figure. Nor was there any such item on the balance sheet of Griffeo when Getz Bros, purchased the company. Defendant produced a letter dated October 8, 1952, written on a Micro letterhead addressed to Griffeo and signed “Micronesia Metal & Equipment Co., Inc., Jack Gotthold, Manager,”3 stating: “We assume that you know that this Corporation has been purchased by new owners and the undersigned has been appointed Manager of the operations in the Mariana Islands and the Palau Islands. Upon perusal of our files, we find that there is a statement of account with you for the amount of $11,-331.10. On the other hand, Mr. Bruce Aitchison, the General Manager of this Corporation, informed us that we owe you, as a finder’s fee, the amount of $10,500. In consideration of this we ask you to kindly remit to us the balance of $831.10, for which we thank you.” This letter was found in Griffeo’s files. There was no record of its having been answered or acted upon. The Aitchison mentioned in the letter was general manager of Micro from August or September of 1952, and for a while was a minority stockholder therein. By the