Cole-Mcintyre-Norfleet Co. V Holloway

141 Tenn. 679 (1919)

Facts

Seller solicited and received an order from buyer for 50 barrels of meal to be totally ordered out by a specified date with 5 cents per barrel per month for storage. Two months later buyer told seller to begin shipment of the meal. Seller told buyer that the contract had never been accepted and that there was no contract. The contract provided that the order was not binding until accepted by seller at its office in Memphis. The salesman had no authority to sign and it was further stipulated that the order should not be subject to countermand. Between the day of the order and the alleged rejection, the price of the meal had advanced 50% in value. The circuit court and the court of civil appeals determined that the contract was completed because of seller’s failure to reject it in a timely manner. Buyer was silent upon the acceptance or rejection of the order and its salesman even appeared at buyer’s place of business in the interim to transaction further business but no mention of the order under dispute was made until these events. There was no custom found from the fact that jobbers filled orders unless the purchaser was notified. The circuit court and the court of civil appeals were both of opinion that the contract was completed because of the lapse of time before seller rejected it. The circuit court found as an inference of fact that because the seller had not acted within a reasonable time, its silence would be construed as an acceptance of the contract. Seller appealed.