Wondering why I haven't said anything here in nearly a week? Well, I've hit one of those times of the year where any second not spent with my nose to the grindstone has a significant effect on my course grades. Exactly two weeks of class left in regulation, before I hit the long sweaty finals stretch.
Compounding the situation is this goddamned weather, and my lack of internet connectivity in the back 40.
To compensate, here are my notes on contract divisibility. There are some entertaining moments:
DIVISIBILITY: Gill v. Johnstown Lumber Co.Yes, that is how I take notes. Posted by FLOG at April 5, 2004 1:16 AM | TrackBack
Gill contracted to deliver logs downstream to Johnstown Lumber Co’s lumber boom in Johnstown. He had delivered some of them when that whole flood thing happened. He sued for payment of his partial performance.Trial court held the contract to be “entire,” i.e. requiring full performance as a condition of payment.
On appeal, the contract was found to be “divisible” or “severable.” (We call it “divisibility” now; “severability” is something else.) There were discrete units of payment stipulated -- $1 per 1,000 feet delivered. So Gill was entitled to payment for the units of lumber he had already delivered.
Form & Substance
The divisibility doctrine cuts the whole contract up into little mini-contracts where possible. In form, there’s one big contract that calls for the whole deal—4,000,000 feet of logs. But in substance there are 4,000 mini-contracts, each for 1,000 feet of logs for $1. The form is a triviality. The substance matters.However, the court does not go so far as to find that he is entitled to payment for some logs he had transported halfway at the time of the flood. He didn’t deliver them. So, in divisibility, the contract is broken into smaller contracts, but each of those requires full performance unto itself. Where he failed to fully deliver, that mini-contract was not performed.
How divisible?
How is a contract to be found divisible? It requires a particular statement of the consideration. In this contract, each 1,000 feet of lumber could be matched up in a bargained-for exchange for $1. It was stated on its face that oak logs would be paid $1 per 1,000 feet.Just because the terms of a contract can be divided does not make a contract divisible. In this case, the contract itself provides the division. “Pairs of matched performances.” Whereas, an agreement to drive a person to Portland for $20…that can be divided down to about 20 cents a mile. But you can’t just drive 50 miles, throw a person out of the car, and collect $10. This contract was not for miles, it was for the whole provided by the miles: getting to Portland.
Wait, divisibility will NOT be determined by the expression of consideration. That helps, but it’s really up to the intent of the parties. The question is, does what is bargained for work as a set, or can each unit of it be of value on its own? A ride to Portland is a whole, only valuable if completed. A bunch of logs is a bunch of freakin’ logs. You’ll have logs either way, just less or more of them. By contrast, if you contract to have those logs made into a house, no divisibility. A bunch of freakin' logs in that context is not fuckin' good enough. You wanna da house, you gonna getta da house.