Pittsburg Steel Foundry v. Pittsburg Steel Co.

Citations

• 223 Pa. 430
• 72 A. 813
• 1909 Pa. LEXIS 553

Syllabus

<p>Contract — Sale—Rescission of contract — Damages.</p> <p>In an action of assumpsit on a contract, it appeared that plaintiff, a corporation, manufactured steel ingots, and that the defendant, also a corporation, rolled ingots into billets. Under the contract in suit, the plaintiff was to erect furnaces to make steel ingots for defendant, and estimated to cost $25,000. Ingots were to be delivered to the defendant from time to time in sufficient quantities to enable it to operate a twenty-inch mill. The quantity was not to exceed 100 tons per day. It was agreed that the plaintiffs should be paid for the ingots fifteen per cent profit on the actual cost of materials, labor and repairs in making the steel, and the defendant guaranteed that the amount of profits which should accrue to the plaintiff should not be less than $50,000 for the period of two years during which the contract was to run. It was further provided that the defendant should make payments on the twentieth of each month for all steel delivered during the preceding month. The defendant further reserved the right to cancel the contract at any time upon paying to the plaintiff such a sum as with the profits then accruing, to plaintiff, would equal the sum of $25,000, being the estimated cost of the investment, plus a bonus of $25,000 for the privilege of cancellation. Plaintiff erected its mill and for three months delivered all the ingots which the defendant required for its use. Plaintiff purchased raw materials at the instance and request of defendant in advance of the immediate need for manufacturing purposes. Towards the end of the second month the defendant made a demand for ingots in quantities greater than it could use. To this the plaintiff replied that, “although you do not need the ingots which you have seen fit to order in pretended compliance with your contract, we hold ourselves in readiness to continue deliveries until notified by you to stop, and will also look to you for full performanc