Contracts — Modification — Suspension — Construction of terms — Attending circumstances — Purpose of parties — Construction giving effect to all terms of contract — Interpretation of parties — Restatement, Contracts.
1. In a proceeding in equity for an accounting of the business of defendant, based on a contract between plaintiff and defendant, which, in effect, provided that defendant would pay plaintiff a commission on all its top-icing business in return for plaintiff's aid in soliciting such business and also for his advice; in which it appeared that the parties to the contract each performed for about six months; that at that time a competitor entered into the top-icing business and the price of ice fell sharply to $5 per ton, at which price defendant could not profitably continue to do business if it was required to pay the commission to plaintiff; that, after a conference between the agents of plaintiff and defendant, plaintiff's agent wrote to defendant stating that "because of temporary price war now existing between ice companies" they would "consider our agreements suspended until this temporary condition is overcome, and prices become stabilized," and defendant wrote to plaintiff "agreeing to the temporary suspension of our contracts"; and that thereafter the price of ice remained constant at $5 per ton, and neither party performed under the original contract, and plaintiff made no attempt to enforce his alleged rights for more than two years; it was held that the letters exchanged by the parties constituted a valid agreement, supported by good consideration, to suspend the original contract until the prevailing price of ice should rise above $5 per ton.
2. Where the original contract, for a three year term, contained a provision that it was to be automatically renewed for a similar period unless specified written notice was given before the expiration date, and neither party to the contract gave the required notice, the contract was renewed automatically at the expiration of the original term for an additional term of three years, subject to the agreement of suspension.
3. The parties to a contract may at any time rescind it, either in whole or in part, by mutual consent, and the surrender of their mutual rights is sufficient consideration.
4. Evidence of the conditions and circumstances surrounding the formation of a contract may be considered, if helpful, in interpretating ambiguous words or terms of a contract having a special meaning.
5. Restatement, Contracts, section 235(d), cited.
6. The apparent purpose of the parties in entering into a contract may be considered as an aid to interpretation.
7. Restatement, Contracts, section 236(b), cited.
8. An interpretation which gives a reasonable, lawful and effective meaning to all manifestations of intention is preferred to an interpretation which leaves a part of such manifestations unreasonable, unlawful or of no effect.
9. Restatement, Contracts, section 236(a), cited.
10. The interpretation given by the parties themselves to a contract as shown by the acts or declarations may be referred to as an aid in construing the contract.
11. Ambiguity or indefiniteness may be supplied by the extrinsic circumstances under which a term of a contract was employed.
Equity — Jurisdiction — Determination of whole cause.
12. Where equity acquires jurisdiction, it will proceed to determine the whole cause, although in so doing it may decide questions which, standing alone, would furnish no basis of equitable jurisdiction.
Argued October 3, 1939.
PER CURIAM, November 15, 1939:
A review of the record in this case satisfies us that no error was committed by the court below in dismissing the exceptions filed by the appellant to the findings of fact and conclusions of law and the rulings of President Judge FINLETTER, sitting as Chancellor, and entering the final decree appealed from.
The decree is affirmed, at the costs of the appellant, on the findings of fact, conclusions of law and discussion of the Chancellor.