Opinion of the Court.

ercise of option in favor of postponing the maturity of the unpaid instalments. He may be justified in supposing that if he had incurred a forfeiture, the creditor had elected not to take any advantage of it, and may be chargeable with knowledge that limitation would be computed accordingly. But if the creditor cannot postpone the maturity of the debt, and hence cannot waive the forfeiture, if such it can be termed, the debtor cannot, of course, be charged with notice that he has done so."

Accepting this decision as giving the rule to be observed in the interpretation of the local statute, it remains to inquire. whether, upon the mere default in payment of interest, or upon such default continuing for ninety days, limitation began to run, without regard to any option upon the part of the payee or the holder of the notes. In determining whether the payee or the holder of the notes was compelled to treat them as due and collectible upon such default, we are to look at the deed of trust, and treat it and the notes as one instrument, or as contemporaneous agreements relating to the same subject matter. The deed refers to the notes, and is itself referred to in each note, and may be examined to ascertain the real intention of the parties. Looking alone at the first clause of the notes, there would be some ground, under the case last cited, for holding, with respect to each note, that it would become due and collectible, without regard to the wishes of the holder, immediately upon default in paying interest. But this could not have been intended, because the deed of trust, referring to the several notes, provides for the whole debt, as well as the interest, becoming due and payable, if at any time the interest shall remain unpaid, after maturity, for as much as ninety days. We think, however, that the words in the deed of trust," at the option of said third party," the payee or holder of the notes, refer not only to a foreclosure, but equally to the clauses in the notes and in the deed of trust relating to the maturity of the principal, in the case of a default in the payment of interest. In other words, the principal, in either of the contingencies named, might become due and payable in advance of the time specifically named in

VOL. CXLI-40

Opinion of the Court.

the respective notes, at the option of the payeee or holder. If this be not the correct interpretation, it would follow that the payee or holder of the notes, notwithstanding the words "at the option of said third party," which words are admitted to have given an option, at least, as to the foreclosure of the deed of trust would be compelled to bring his suit for forclosure within four years from default in the payment of interest at maturity, or at least within four years after the expiration of ninety days from such default. We say this, because it was the law of Texas, when the notes in suit were executed, that if the debt secured by a mortgage or deed of trust was barred, the creditor was without remedy by foreclosure. Ewell v. Daggs, 108 U. S. 143, 147; Eborn v. Cannon's Adm'r, 32 Texas, 231; Blackwell v. Barnett, 52 Texas, 326. Subsequent decisions, it is true, may have modified this doctrine, but only to the extent of holding that, although an action for the debt may be barred by limitation, a court of equity, the debt being unpaid, will not enjoin a trustee from executing a power of sale given in the deed securing the debt, Goldfrank, Frank & Co. v. Young, 64 Texas, 432; and that a sale by the trustee, under such a power, after the debt is barred by limitation, will pass a good title free from the lien of a subsequent purchaser who has notice of the incumbrance. Fievel v. Zuber, 67 Texas, 275, 278. In our judgment, the parties intended to give the holder of the notes an option after default in the payment of interest, not only to declare the principal due, but to foreclose the deed of trust, in advance of the dates of maturity named in the notes and deed. That option not having been exercised when or after the several defaults occurred, limitation began to run on the several notes only from their respective dates of maturity, as specified in them, namely, the first days of November, 1885, 1886 and

1887.

It results that plaintiff was entitled to judgment as claimed in his original petition. In view of this conclusion, it is unnecessary to consider whether the defendants made any acknowl edgment or promise which, under the statute of Texas, as construed by the Supreme Court of that State, (Gathright v.

Statement of the Case.

Wheat, 70 Texas, 740; Krueger v. Krueger, 76 Texas, 178,) would remove the bar of limitation, if we should assume that limitation began to run from default in paying interest, or upon the expiration of ninety days after such default.

The judgment is reversed, and the cause remanded with directions to grant a new trial, and for further proceedings consistent with this opinion.

MR. JUSTICE BREWER concurs in the judgment.

MR. JUSTICE GRAY did not take part in the decision of the

case.

WILLCOX & GIBBS SEWING MACHINE COMPANY v. EWING.

ERROR TO THE CIRCUIT COURT OF THE UNITED STATES FOR THE EASTERN DISTRICT OF PENNSYLVANIA.

No. 64. Argued October 29, 1891.- Decided November 16, 1891.

A contract of agency, which leaves the agent free to terminate his relations with.the principal upon reasonable notice, must be construed to confer the same right upon the principal, unless provisions to the contrary are stipulated.

A provision in a contract, otherwise terminable upon reasonable notice, that a violation of the spirit of the agreement shall be a sufficient cause for its abrogation, does not imply that it can be abrogated only for sufficient

cause.

The plaintiff in error by contract appointed the defendant in error "its exclusive vendor" for its machines in a defined territory; agreed to sell the machines to him at a large discount from its retail New York prices; and not to "knowingly supply its goods at a discount to go within that territory." The defendant in error accepted the appointment; agreed to pay for the machines at the discount rate; not to sell them below the said retail rate; and not to solicit orders within the territory of other agents. Held, that the agreement constituted him agent within the defined territory.

THE Court stated the case as follows:

This writ of error brings up for review a judgment based upon a verdict for $15,000 as the damages which a jury found

Statement of the Case.

were sustained by the defendant in error, Ewing, on account of an alleged breach of a written contract between him and the Willcox and Gibbs Sewing Machine Company, the plaintiff in error, of date October 15, 1874. The case depends upon the construction of that contract.

On the 16th of May, 1867, the parties entered into a written agreement, reciting that the company's "agency" for Philadelphia and vicinity had been conducted by Ewing, and that a settlement of accounts had been made whereby the assets of such agency had been transferred to him. In view of that settlement, and to secure the interests of both parties, it was agreed, for considerations mutually satisfactory, that the company should furnish Ewing such Willcox and Gibbs sewing machines as he might order, at a discount of forty per cent from its list price so long as the list remained unchanged, and three dollars per machine in addition to that forty per cent; that whenever the price was changed due notice was to be given Ewing, and a discount made upon the basis of the then cost of a machine to the company and its then retail price, which should bear the same proportion that the above discount and three dollars per machine bore to such cost and retail price; and that parts of, and attachments to, the machines should be furnished at a discount of forty per cent, and cabinet work, needles and any attachments that cost the company more than sixty per cent of its retail price, at net cost. In consideration of the premises Ewing agreed to continue the business, then established in Philadelphia, of the sale of these sewing machines, and, in good faith, to devote his entire time and energy to its advancement and improvement, and to the increase of the sale of the machines, as fully and energetically as he had done the previous year; and so long as he faithfully did so and in good faith kept at least the sum of $25,000 actively employed therein, the company "agreed to continue, and in equal good faith, carry out all the provisions" of the agreement.

The company agreed to convey to Ewing, by proper writing, the lease of the property in Philadelphia in which the business was then carried on, to be used for the purposes stated in the

Statement of the Case.

contract. In consideration of the premises, and so long as Ewing faithfully performed the agreement on his part, he was to have the exclusive sale of the Willcox and Gibbs sewing machine, its attachments and parts, in certain defined portions of Pennsylvania, New Jersey, West Virginia and Ohio; the company reserving the right to sell their machines and accessories at their retail prices only to go into such territory. It was also provided that "the agency, or, in other words, the interest in the Willcox and Gibbs sewing machine business" conveyed to Ewing was not to be sold or assigned by him without the company's consent, but such consent was to be given if the party was acceptable to it.

48

On the day of the execution of the above agreement the company gave this receipt: "Received from Daniel S. Ewing, of Philadelphia, twenty-five thousand three hundred and ninety-eight dollars, which is the balance due this company from the Philadelphia office to the 15th inst., the payment of which by the said D. S. Ewing transfers to him all our interest in the stock, fixtures, book ac., etc., of said office."

Under the date of October 15, 1874, the parties signed a memorandum, in which it was stipulated that a new agreement should be entered into between them containing certain specified terms, "the making of which it is hereby understood shall nullify all former contracts and agreements made prior" to that date. This writing closed with these words: "Above is substantially our mutual understanding of what the new contract is to be." On the same day the new contract-the one in suit was reduced to writing and signed. It does not vary from the memorandum of the same date in any respect material to the present controversy. As the case depends upon the construction of the last agreement, it is given in full, as follows:

"This agreement, made and entered into this fifteenth day of October, one thousand eight hundred and seventy-four, by and between the Willcox and Gibbs Sewing Machine Company, a corporation duly organized under the laws of the State of New York, of the first part, and Daniel S. Ewing, of the city of Philadelphia, Penn., of the second part, witnesseth: