difference between the amount for which the oats were first sold and that obtained on resale.

824. Neglect to sell. Where a principal consigns property to his factor with instructions to sell it upon its arrival, the latter is bound to follow the instructions, and sell for the price it will command; and if he do not, he will become liable for the damage his principal may sustain in case of a fall in the market.(") The damages in such a case are the difference between the amount finally realized, and that which would have been realized at once had the principal's instructions been obeyed.() But as in the case of sale at wrong price, the principal cannot recover more than the market price at the time when the goods should have been sold. So where a factor neglected to sell bales of wool consigned to him by the plaintiff, it was held error to charge the jury that the plaintiff could recover the highest price between the time when the order to sell was received and the time of the trial, Miller, J., saying that he could recover the value within a reasonable time after the order was received.(©)

§ 825. Agents to purchase-Neglect to purchase.—* A case in the Supreme Court of the United States' exhibits another species of injury inflicted by an agent on a principal. Cunningham & Co., of Boston, owners of the Halcyon sent her from Havana to the defendants below, Bell, De Yough & Co., with directions to invest of the freight (which was about 4,600 pesos), 2,200 pesos in marble tiles, and the balance in wrapping paper, to be

1 Bell v. Cunningham, 3 Pet. 69.

(*) Evans v. Root, 7 N. Y. 186.

(*) Cothran v. Ellis, 107 Ill. 413; Atkinson v. Burton, 4 Bush 299; Howland v. Davis, 40 Mich. 545; Allen v. McConihe, 12 N. Y. Suppl. 232.

() Whelan v. Lynch, 60 N. Y. 469.

§ 825.

AGENTS TO PURCHASE.

589

shipped by the same vessel to Havana. The defendants disobeyed the directions, and invested the whole in wrapping paper. The tiles would have made a considerable profit; the paper made a heavy loss. Trial and verdict. for the plaintiff; exception and writ of error. The plaintiffs in error (the defendants below) insisted that Cunningham & Co. were entitled to no more than the value of the money at Leghorn, which ought to have been invested in tiles, and not its value in Havana; or, in other words, that the value of 2,200 pesos at Leghorn, with interest, and not the value of the tiles at Havana, ought to be given. But the court overruled this, saying, that it would be tantamount to a declaration that the breach of contract consisted in the non-payment of two thousand two hundred pesos, not in the failure to invest that sum in tiles. Speculative damages dependent on possible successive schemes, ought never to be given; but positive and direct loss, resulting plainly and immediately from the breach of orders, may be taken into the estimate. Thus, in this case, an estimate of possible profit to be derived from investments at Havana of the money arising from the sale of the tiles, taking into view a distinct operation, would have been to transcend the proper limits which a jury ought to respect; but the actual value of the tiles themselves at Havana affords a reasonable standard for the estimate of damages.1

So in Louisiana, an agent failing to ship goods, which he was directed by the principal to do, is liable for the actual value of the goods at the port of destination.' It

1 This case will be found reported at Nisi Prius, 5 Mason 161, where Story. J., told the jury in very general terms, that they were at liberty to compensate the plaintiffs for the actual loss sustained in consequence of the defendant's default, but were not at liberty to give vindictive damages.

'Ryder v. Thayer, 3 La. Ann. 149. In this case exemplary damages were claimed; but the court said: "In case of a breach of contract, by the negligence or fraud of a party no other sum can be allowed as damages than that which fully indemnifies the creditor."

is proper to notice that this allowance of the value which the goods would have had at the place intended for the sale amounts to an allowance of profits, on the principles which we have heretofore had occasion to consider;

**

but when it can be proved with reasonable certainty, as in such cases, what profits would have been earned, and such profits were within the contemplation of the parties when the agent was ordered to buy the goods, the plaintiff is entitled to recover them.(*)

826. Purchase of wrong goods.—In an English case an agent at Hong Kong, instructed to purchase a certain grade of opium and ship it to England, bought and shipped an inferior grade. No opium of the grade ordered could have been purchased in Hong Kong at the time. It was held that the agent was liable for the actual loss of his principal-that is, for the cost of the opium and the expense of importation and sale, less the amount obtained by sale of it; but that he was not liable for the value of the better grade of opium at the port of destination—that is, for expected profits.()

It is to be observed that in this case it was not possible for the agent to buy the opium ordered, and consequently the case differs from Bell v. Cunningham. The court noticed the latter case, but declined to give any opinion of its correctness.

827. Purchase at excessive price.-An agent to buy paid too high a price, in fraud of his principal. It was held that the principal could recover only the difference between the price paid by the agent and the market. price of the goods at the time of purchase. (©)

(*) Farwell v. Price, 30 Mo. 587; Heinemann v. Heard, 50 N. Y. 27. (*) Cassaboglou v. Gibb, 9 Q. B. D. 220; 11 Q. B. Div. 797.

() McMillan v. Arthur, 98 N. Y. 167.

$ 828.

AGENTS TO DEAL IN STOCKS.

591

§ 828. Agents to deal in stocks.-Where a stock-broker, in the course of his dealing for his principal, fails to use skill and good judgment in buying or selling, he is liable for the actual loss. When the transaction is on a "margin," it may be the broker's duty to close it at a favorable time; and in that case if he negligently closes it without waiting a reasonable time, he is liable for the difference. between the amount realized and what would have been obtained by waiting till a proper time. In Harris v. Tumbridge, (*) the defendant, a stock-broker, bought for the plaintiff a "straddle," that is, an option to buy or sell a certain stock at a certain price within the time limited. Instead of waiting for a proper time to exercise the option, the defendant sold the stock "short" for the plaintiff next day. The court said: "She is entitled to recover what she has lost by his neglect; and the price of the stock from day to day during the remainder of the option having been shown, it was for the jury to determine the amount." This does not mean that the measure of damages is in the hands of the jury. They are to determine the time when the defendant should have closed the transaction, and the variations in the price of stock is evidence from which they may determine when the option should have been exercised; that determined, the damages, as a matter of law, are measured by the price of stock at that time.

If the broker neglects to buy or sell, or buys or sells too soon, the damages in New York are, as we have seen, measured by the value of the stock within a reasonable time after notice of that fact has been received by the customer.() In White v. Smith,(^) the defendant, a

(*) 83 N. Y. 92, 99.

() Baker v. Drake, 53 N. Y. 211; Colt v. Owens, 90 N. Y. 368. See § 524. (©) 54 N. Y. 522.

broker, sold for the plaintiff 100 shares "short" at 186. He afterwards bought 100 shares to cover the sale without notifying the plaintiff and without the plaintiff's authority. Subsequently the plaintiff sent an order to buy when the stock was at 180. The plaintiff was allowed to recover the difference between the price at which the stock was sold short and the market price upon the day when the order was received to purchase, with interest, deducting, however, commissions. If a broker illegally transfers the stock to his own name, the principal has a right to demand the price of the stock on that day, or to disaffirm the broker's act and recover for any rise in the market within a reasonable time. (*)

§ 829. Agents to care for real estate.-In Tuers v. Tuers, () the defendant was an agent to collect the rents from the plaintiff's real estate, and to pay out of the rents the taxes and water-rents. He collected the rents, and retained enough to pay the taxes, but did not pay them. The plaintiff was required to pay an increased rate of interest on the overdue taxes, and a mortgagee commenced foreclosure proceedings on account of the non-payment of taxes. It was held that the plaintiff was entitled to recover something on account of these facts; but just what amount could be recovered, not being before the court, could not be decided. In Blood v. Wilkins (©) the court said:

"Where one person furnishes money to another to discharge an incumbrance from the land of the person furnishing the money, and the person undertaking to discharge the incumbrance neglects to do it, and the land is lost to the owner by reason of the incumbrance, the measure of damages may be the money furnished with interest, or the value of the land lost, according

(^) Parsons v. Martin, 11 Gray 111; Taussig v. Hart, 49 N. Y. 301. () 100 N. Y. 196.

(C) 43 Ia. 565, 567.