estimated by the difference in value of the land with and without the trees as warranted.1 $1829. Purely speculative profits, however, stand upon different ground. There are many cases, indeed, as has been already seen,2 in which a loss of profits is properly to be compensated. There is nothing in profits, as such, which necessarily renders them an unfit basis for compensation: if they are certain and not speculative, they may be taken into account; but it happens in most cases that they are not certain but wholly indefinite, speculative and contingent, and in such cases clearly they furnish no proper foundation for an award of damages. What the buyer might have made if he had done something which he could have done if the seller had done some other thing which he ought to have done but did not do, comes obviously into the region of the uncertain and problematical.3 § 1830. Thus, where the seller of a brick machine warranted it to have the capacity to make a certain number of bricks per day, but the machine failed in this respect, it was held that the proper measure of damages was the difference in value between a machine with the capacity warranted and a machine like the one delivered, and not the profits which the buyer might have made on the larger quantity of bricks he 1 Heilman v. Pruyn (1899), 122 commissions on goods that would Mich. 301, 81 N. W. R. 97. 2 See ante, § 1761. 3 Alpha Checkrower Co. v. Bradley (1898), 105 Iowa, 537, 75 N. W. R. 369. In Noble v. Hand (1895), 163 Mass. 289, 39 N. E. R. 1020, the plaintiff was to sell samples of defendant's goods and solicit orders for samples and for goods to be ordered from said samples, and was to receive a commission on all goods ordered from said samples. if not rejected by defendants. Plaintiff sent in orders for samples which were neither filled nor rejected, and he sought damages for have been ordered if samples ordered had been sent. Held, too indefinite for more than nominal damages. But profits that might have been made on a government dredging contract which contemplated the performance of specified work at a specified price are not too speculative to be recovered from the seller of dredging machinery who fails to deliver according to contract, where the contract is known to the seller. Industrial Works v. Mitchell (1897), 114 Mich. 29, 72 N. W. R. 25. might have made and sold if the machine had had the capacity to make as many bricks as it was warranted to make. In such a case the longer the buyer should continue to operate the defective machinery, even with knowledge of its defects, and the greater the deficiency in the number of bricks which he could thereby produce, the larger would be his damages. § 1831. In the case last referred to,2 the court cited with approval a case in Michigan in which the buyer sought to recover as damages the profits which he alleged he might have made from the operation of a saw-mill to be supplied by the seller. In that case the court, per Cooley, J., said: “The difficulty in measuring damages by profits is that they are commonly uncertain and speculative, and depend upon so many contingencies that their loss cannot be traced with reasonable certainty to the breach of the contract. When that is the case they are said to be too remote; and the damages must be estimated on a consideration of such elements of injury as are more directly and certainly the result of the failure in performance. But in some cases profits are the best possible measure of damages, for the very reason that the loss is indisputable, and the amount can be estimated with almost absolute certainty. The case of a contract for the delivery of grain or any other article which at all times finds a ready sale at a current market price is an instance: if the contract is not performed, the purchaser may recover the advance beyond the purchase price; and this, though not recovered under the name of profits, is really nothing else. It often happens also that one contract, the performance of which will result in certain and definite profits, will be dependent upon the performance of another; and if the second contract is broken, the loss of definite and fixed profits under the other is a necessary and immediate consequence. There is no difficulty in saying in some such cases that profits lost are the proper measure of damages. 1 Moulthrop v. Hyett (1894), 105 Ala. 493, 17 S. R. 32, 53 Am. St. R. 139. 2 Allis v. McLean (1882), 48 Mich. 428, 12 N. W. R. 640, citing McKin But the profits of running a non v. McEwan (1882), 48 Mich. 106, 11 N. W. R. 828, 42 Am. R. 458. 3 Citing Loud v. Campbell, 26 Mich. 239; Booth v. Spuyten Duyvil Rolling saw-mill are proverbially uncertain, indefinite and contingent. They depend on many circumstances, among which are capital, skill, supply of logs, supply and steadiness of labor; and one man may fail while another prospers, and the same man may fail at one time and prosper at another, though the prospective outlook seems equally favorable at both times. Estimates of profits seldom take all the contingencies into the account, and are therefore seldom realized; and if damages for breach of contract were to be determined on estimates of probable profits, no man could know in advance the extent of his responsibility. It is therefore very properly held in cases like the present that the party complaining of a breach of contract must point out elements of damage more certain and more directly traceable to the injury than prospective profits can be."1 § 1832. Losses not contemplated.-Consequences may, moreover, result which are so unusual as not to fall within the first branch of the rule in Hadley v. Baxendale, and which would have been regarded as so improbable that they could not fairly be said to have been within the contemplation of the parties at the time they made the contract as a probable result of its breach. Thus in a recent case in Minnesota, where a wholesale dealer in milk was charged with supplying skimmed milk to a retail dealer who was arrested and fined for selling it, it was held that the latter could not recover of the former damages for the loss and disgrace suffered from the arrest. "It is perfectly plain," said the court, "that [the seller] could not have contemplated, when warranting the quality of the article, that the probable result of a breach of the contract Mill Co., 60 N. Y. 487; Salvo v. Duncan, 49 Wis. 151: Hitchcock v. Galveston, 3 Woods, 287; Fiegel v. Latour, 81 Pa. St. 448; James v. Adams, 8 W. Va. 568; Waters v. Towers, 8 Ex. 401. 1 Citing Fleming v. Beck, 48 Pa. St. 309; Pittsburg Coal Co. v. Foster, 59 Pa. St. 365; Strawn v. Cogswell, 28 Ill. 457; Frazier v. Smith, 60 Ill. 145; Howe Machine Co. v. Bryson, 44 Iowa, 159, 24 Am. R. 735. See also the full discussion in Watson v. Kirby (1895), 112 Ala. 436, 20 S. R. 624, where many other cases are cited. would be plaintiff's arrest and conviction for the statutory offense with which he was charged."1 § 1833. Measure of damages for breach of warranty where goods bought to be resold. So also, within principles already considered,2 if the warranty by the seller was made with reference to a particular market in which the buyer expected to resell the goods, or a particular contract upon which he expected to supply them, then damages based upon their value in that market or under that contract may be recovered.* Even though the buyer had not any particular market in view, yet if the seller knew that the buyer was buying for resale in some market, then the market price in any usual market within a reasonable time may be considered." $1834. Damages paid sub-vendee for breach of same warranty.— Where the goods are thus known to be purchased for the purposes of resale, and they are resold with a similar warranty, the amount paid by the original vendee upon a judgment obtained against him by his sub-vendee for a breach of that warranty is, at least, prima facie evidence of the amount which he can recover from his vendor; and if he gave notice to his vendor of the pendency of the action and an opportunity 1 Sloggy v. Crescent Creamery Co. (1898), 72 Minn. 316, 75 N. W. R. 225. 2 See ante, § 1763. 3 Reese v. Miles (1897), 99 Tenn. 398, 41 S. W. R. 1065 [citing Lewis v. Rountree, 79 N. C. 122, 28 Am. R. 309; Oldham v. Kerchener, 79 N. C. 106]. In Lewis v. Rountree it is said: "There can be no doubt that a vendee, who takes a warranty and gives notice that he buys to sell again in another market, may include in his damages both the losses he actually sustained by reason of the breach and also the profits he would have made upon resale had the article been what it was warranted to be." 4 See Booth v. Spuyten Duyvil Roll ing Mill Co. (1875), 60 N. Y. 487, Me- 6 Reggio v. Braggiotti (1851), 7 Cush. (Mass.) 166; Reese v. Miles (1897), 99 Tenn. 398, 41 S. W. R. 1065; Nashua Iron & Steel Co. v. Brush (1898), 50 U. S. App. 461, 33 C. C. A. 456. 91 Fed. R. 213. In Whitaker v. McCormick (1878),6 Mo. App. 114, the plaintiff purchased from the defendants, who were elevator proprietors, five carloads of "No. 2 white mixed corn," then stored in the elevator. He did not examine it, but at once resold it, and the sub-vendees recovered a judgment against him for breach of the warranty implied in the description. to defend it, then the taxable costs of the action may be recovered in addition.' Counsel fees, however, have been held not recoverable, as "they vary so much with the character and distinction of the counsel that it would be dangerous to permit him to impose such a charge upon an opponent," though as to this, as has been seen, there is some difference of opinion.3 § 1835. Buyer may recover for breach of warranty though he has not paid the price. The mere fact that the buyer has not paid the price does not, in the absence of a stipulation to the contrary, prevent his suing to recover damages for the breach of warranty. Though a part of the contract of sale, the warranty is merely collateral, and the buyer has his action for its breach, leaving the seller to his appropriate remedy, by action or counter-claim, for the price." § 1836. Or though he has paid the price. So the fact that the buyer may have paid the price, or given his note for it, however much it may bear upon the credibility of his complaints, does not debar him from recovering for the breach of warranty. And the fact that when sued for the price he did The court held, following Strong v. Insurance Co., 62 Mo. 289, that this judgment was conclusive against the original vendors, since notice of the suit was given them, together with a copy of the petition filed against said plaintiff by the sub-vendees, with the request that the said vendors assist him in the defense. Liability to pay is sufficient. Randall v. Raper (1858), 1 EL, Bl. & El. 84, 96 Eng. Com. L. 82. 1 Reggio v. Braggiotti, supra; Armstrong v. Percy (1830), 5 Wend. (N. Y.) 535; Blasdale v. Babcock (1806), 1 Johns. (N. Y.) 517. Minn. 261, 52 N. W. R. 861 [citing Frohreich v. Gammon, 28 Minn. 476, 11 N. W. R. 88; Thoreson v. Minneapolis Harvester Works, 29 Minn. 341, 13 N. W. R. 156; Schurmeier v. Eng. lish, 46 Minn. 306, 48 N. W. R. 1112]. To like effect: Cash v. De Long (Ky., 1899), 53 S. W. R. 1037. 6 Elliott v. Puget Sound, etc. Co. (1900), 22 Wash. 220, 60 Pac. R. 410; Boorman v. Jenkins (1834), 12 Wend. (N. Y.) 566, 27 Am. Dec. 158. In Nauman v. Ullman (1899), 102 Wis. 92, 78 N. W. R. 159, plaintiff bought a horse from defendant with the express warranty that it was sound and well, except for a cold. He paid a three-days note given for the balance of the price, but without Fitzpatrick v. Osborne (1892), 50 knowledge that the disease was other 2 Reggio v. Braggiotti, supra. 3 Ante. § 1798. 4 See ante, § 1813. |
