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 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 judg ment 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 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. 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 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. 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. English, 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. 1 Reggio v. Braggiotti, supra; Armstrong v. Percy (1830), 5 Wend. (N. Y.) 535; Blasdale v. Babcock (1806), 1 Johns. (N. Y.) 517. 2 Reggio v. Braggiotti, supra. 3 Ante. § 1798. 4 See ante, § 1813. 5 Fitzpatrick v. Osborne (1892), 50 knowledge that the disease was other 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 not plead the breach of warranty as a defense, as he might have done, is not a bar to his maintaining a separate suit for the breach of warranty; but a judgment against him where he did plead it would be a bar.2 § 1837. Or though he may have resold the goods.The mere fact, moreover, that the buyer has sold the goods to another does not preclude his recovery of damages for a breach of the warranty of quality. Such a resale, as has been seen, is often contemplated by the parties at the time of the original purchase; and even where it is not, the fact of the resale cannot affect the warrantor's liability except as the price received upon the resale may furnish some evidence of the actual value of the goods. $1838. Or though he may have made a profit on them. So the fact that the goods sold subsequently enhance in price so that the buyer makes a profit on them is held to be imma- . terial. "Any advance in the market was the legitimate fruit of the venture, just as the purchaser would have had to bear the loss of any decline in the market price prevailing at the time of delivery." (1894), 162 Mass. 351, 38 N. E. R. 976, citing many cases. 2 Gilmore v. Williams, supra. 3 Eagle Iron Works v. Des Moines Suburban Ry. Co. (1897), 101 Iowa, 289, 70 N. W. R. 193. A purchaser of merchandise that has been warranted, and proves worthless, may defeat a recovery for any amount, though he sold a part of the merchandise for cash, and the buyer made no claim on account of defects. Western Twine Co. v. Wright (1899), 11 S. Dak. 521, 78 N. W. R. 942, 44 L. R. A. 438. 4 Andrews v. Schreiber (1899), 93 Fed. R. (Ct. Ct. W. D. Mo.) 367. than a cold. After the death of the horse he brought suit on the warranty. Held, that there had been no waiver of the warranty. In Northwestern Cordage Co. v. Rice (1896), 5 N. D. 432, 57 Am. St. R. 563, 67 N. W. R. 298, it is held that where goods are sold under a warranty (implied), the giving of a note by the purchaser for the purchase price, with knowledge that the goods did not conform to the warranty, does not prejudice his rights, where he expressly reserves his right to insist upon damages. 1 Cook v. Moseley (1835), 13 Wend. (N. Y.) 277; Gilmore v. Williams § 1839. Remedies for deceit or fraud.- It is entirely consistent with liability for breach of warranty that the seller acted in the best of faith. There may, of course, be fraudu lent warranties, and remedies for these have already been referred to. There may, however, be many cases into which fraud or deceit will more actively enter, in which the remedy as for breach of warranty will not be the most desirable or adequate, and a brief consideration of the remedies appropriate to the case is necessary. The buyer who has been imposed upon or misled by the fraud of the seller has usually his choice of a variety of remedies. For example: (1) He may rescind the contract, restore what he has received and recover what he has parted with. (2) He may retain the property and bring an action for damages for the deceit. (3) He may retain the property, and in an action by the seller for the price may be allowed damages for the injury caused by the deceit.3 Enough has already been said of the buyer's right to rescind. The third remedy will be considered in later sections, and the action for deceit or fraud will be considered here. § 1840. Elements of fraud.- What the various elements are which must be present to establish fraud in law, and what are the chief forms of fraud upon the buyer, have been already considered in previous sections and need not be repeated. There must, of course, be fraud. The false representation relied upon must have been made with knowledge of its falsity, or, at least, without belief in its truth. The somewhat diverse views upon this question have been already noticed, and it will suffice to refer to that discussion. 1 See ante, § 1239. 2 See ante, § 820. 3 See ante, § 940; Lukens v. Aiken (1896), 174 Pa. St. 152, 34 Atl. R. 575; Wilson v. Cattle Co. (1896), 36 U. S. App. 634, 20 C. C. A. 244, 73 Fed. R. 994; Olcott v. Bolton (1897), 50 Neb. 779, 70 N. W. R. 366. 4 See ante, § 930 et seq. 5 See post, § 1844. 6 See ante, §§ 866-885; Bank of Atchison v. Byers (1897), 139 Mo. 627, 41 S. W. R. 325; Wilman v. Mizer (1895), 60 Ark. 281, 30 S. W. R. 31. 7 See ante, §§ 930-942. 8 See ante, § 875 et seq.; Scholfield Gear & Pulley Co. v. Scholfield (1898), 71 Conn. 1, 40 Atl. R. 1046. |