The Federal Reporter with Key-Number Annotations, Volume 250: Cases Argued and Determined in the Circuit Courts of Appeals and District Courts of the United States, August-October, 1918. Page: 65
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GEORGE V. OSCAR SMITH & SONS CO.
of the amount borrowed, there can be no recovery by the promisee;
and if anything has been paid upon the contract, the promisor can
When the negotiations were begun between Crawford and the Smith
Company which resulted in the loan by the latter of $25,000 to the for-
mer, Crawford was already indebted to the Smith Company in the
amount of about $11,000. There was also subsisting between them at
the time two contracts, one to the effect that Crawford would do the
bleaching for the Smith Company of the linters required by the latter
for filling the contract with the Dupont Company at 31/s cents per
pound, and a contract by which Crawford would furnish to the Smith
Company linters to carry out a contract of the Smith Company with
the Anglo-American Cotton Products Company at 118/4 cents per
pound. There was also a controversy between them as to responsi-
bility for damages to a shipment of linters. It appears also that there
had been delays in the filling of the Dupont contract, for which Craw-
ford was responsible. When he began the negotiations for the loan
of money, he suggested that he would reduce the price of the linters to
be used in filling the Dupont contract one-fourth cent per pound, and
that he would discharge the claim for the damaged linters, amounting
to about $225. The price concession, according to a letter from Craw-
ford, was "in appreciation of your good offices." He further wrote:
"I am offering, in the nature of a personal appreciation of your services,
and to further compensate for the famous delay in Dupont production, to
make a reduction of 1/ c. Ier pound."
Crawford was then applying for a loan of $10,000. Subsequently,
when he undertook to increase the amount of the loan, he proposed to
make a deduction of one-fourth cent per pound on the linters required
to fill the American Products Company contract as a part of the com-
pensation to the Smith Company for the money. The Smith Company,
in agreeing to make the loan, suggested that, in so far as the Dupont
contract was concerned, the concession ought to extend to linters
bleached in December, the difference in the price amounting to some-
thing in excess of $500. As a part of the negotiations the parties cor-
responded with reference to the discharge of the debt then existing,
and it was first proposed by Crawford that it be discharged by making
deduction of $200 from each draft attached to bills of lading for lin-
ters shipped to the Smith Company. The amount of this was subse-
quently reduced to $100 for each shipment.
Counsel for the Smith Company insists that the deductions made
from the drafts attached to the bills of lading were the same as the
concessions made in the price of linters to be furnished upon the Du-
pont and American Products Company contracts, and they insist that
these concessions upon the price were applied to the discharge of the
previous indebtedness and were not inducements to the new loan. But
this court is, of course, compelled to determine cases upon the records;
and it would be entirely impossible for any one to study the record and
conclude that the deductions made from the drafts attached to the bills
of lading and the concessions made with regard to the price are the
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The Federal Reporter with Key-Number Annotations, Volume 250: Cases Argued and Determined in the Circuit Courts of Appeals and District Courts of the United States, August-October, 1918., legislative document, 1918; Saint Paul, Minnesota. (digital.library.unt.edu/ark:/67531/metadc38821/m1/80/: accessed October 21, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.