Davis & Clark vs. Talcott & Canfield, 14 Barb. 611

Taggart, P. J. The questions arising in this case may be reduced to four separate propositions only. First. Do the former judgment and-proceedings between the same parties constitute a bar to this action? Second. Was it competent for the plaintiffs to prove the conversation between the parties which took place after the written contract was made, as to the time within which the contract was to be completely performed, for the purpose of showing, as between the parties, what was regarded as a reasonable time ? Third. Whether the questions put to the witness Westcott, as to difference in value, was competent?

Fourth. Were the decisions of the court, as to the measure of damages, right ? First. In the case of Campbell v. Butts, (3 Comst. 173,) the court say, “ The rule is well established, if not elementary, that a party insisting upon a former recovery must show that the record of the former suit includes the matter alledged to have been determined. This is true in all cases in courts of record, whether the pleadings between the parties in the previous suit are general or special in their character.

It follows that when a declaration, as in the first suit between these parties, states a special matter as the ground of action, and issue is taken by the defendant upon the allegation, parol proof is inadmissible to show that a different subject was' litigated upon the trial. For this would be to contradict the record which shows the issue, and verdict and judgment upon that issue, to the exclusion of all other matter whatsoever.” In the case of Young v. Rummell, (2 Hill, 478,) the court say, “ The judgment is only evidence, by way of bar, when the same matter was directly in question in the former suit.

The record must show that the same matters might have come in question on the former trial, and then the fact that it did come in question, may be shown by proof aliunde.” In the case of Doty v. Brown, (4 Comst. 71,) the plaintiff withdrew part of the claim set up in the declaration. The court, speaking on this subject, in the opinion delivered, say, “ In the action before the justice, brought by Brown v. Doty, Brown declared for and at first claimed to recover for all the goods levied on. This claim of course embraced the goods which are the subject of the present controversy.

But discovering that Doty had done no act amounting to a conversion of the goods now in question, he withdrew his claim to recover for them and proceeded only for the value of the goods which Doty had sold or otherwise converted. The former judgment therefore stands on the same footing as if the goods now in controversy had not been included in the declaration in the first suit.” Parol evidence is admissible to show what was actually in controversy between the parties. (Doty v. Brown, 4 Comst. 75. Wood v. Jackson, 8 Wend. 9. Gardner v.

Buckbee, 3 Cowen, 120.) In this case the record only shows that the same matters in controversy might have been litigated. If I have a correct appreciation of the case, neither the defendants’ answer nor the record of the former action shows that the same matters were litigated. The most that they show is that the same matters might have been litigated. If so, the burden lay upon the defendants, to show the contrary.

This they failed to do;'it was therefore unnecessary for the plaintiffs to prove what they have proved, viz. that the matter in controversy was not litigated, but was withdrawn from the consideration of the referee, and did not pass into judgment. If, however, I am wrong in this view of the case, yet there is nothing in this case which conflicts with the opinion of the court of appeals in the case of Campbell v. Butts. Parol proof was not admitted here to show that a different subject was litigated upon the trial.

It was admitted merely to show that a subject which it appeared by the record might have been litigated was not litigated. Had the plaintiffs shown that a subject matter not contained in these pleadings, was litigated, they would have come in conflict with the case of Campbell v. Butts. This they have not done, and are not in conflict with that opinion, but, the ruling in this case is sustained by the uniform decisions of the supreme court, and especially by the cases above cited. Second.

Was it competent for the plaintiffs to prove by Westcott the conversation between the parties that took place after the written contract was made, as to the time the contract was to be completed, for the purpose of showing as between the parties, what was regarded as a reasonable time? “It is a question for the jury as to what is a reasonable time, and we have seen that parol evidence is admissible to show the circumstances and situation of the parties at the time of making the contract, for the purpose of determining what is a reasonable time.” (Chitty on Cont. 730, note s. Id. 108. Ellis v.

Thompson, 3 M. & W. 445, 446.) Stipulations and agreements subsequent to the execution of the contract are not within the rule by which parol evidence is excluded; hence the time of performance of a simple contract in writing may be extended by a subsequent parol agreement between the parties. (1 Cowen & Hill’s Notes, n. 301, p. 610.) It matters not how soon after the execution of the written contract the parol one was made; if it was in fact subsequent, and is altogether unobjectionable, it may be proved and enforced. (Id. and Brewster v. Countryman, 12 Wend. 446. LaFarge v.

Rickert, 5 Id. 187.) The defendants cannot object that the parol agreement was cotemporaneous with the written one, because that will contradict the bill of exceptions, which states it to be afterwards. Now if it is competent to prove a subsequent contract varying the place or time of delivery, it must be competent to prove a subsequent parol contract fixing the time of execution or performance of the written contract which merely omitted the time within which it was to be performed. That does not, as in the former case, create a different contract, but merely supplies an omission.

It cannot be objected that this agreement was without consideration, because it is as much for the interest of the defendants as the plaintiffs to have the time of performance definitely fixed. Perhaps a reasonable time might have expired before the 20th of May; the defendants were interested in having it extended to that time. It amounts therefore only to a mutual agreement; the promise on the one part being a consideration for the promise on the other. At all events, the plaintiffs were entitled to the evidence, as an admission of the defendants as to what a reasonable time would be. Third.

Was the question to the witness Westcott proper, viz. “ what in your opinion is the difference in value between the machinery put in by the defendants in this case and the machinery well finished, -in a workmanlike manner, of sufficient strength and size to correspond with the cylinders; machinery heavy and calculated to do heavy work?” •" The defendants object to this question on the ground that the evidence was irrelevant, and also that it did not appear that the witness was an expert or machinist, or sufficiently acquainted with the value of such machinery to make his opinion proper evidence in this cause.

As to the first ground of the objection, a full and conclusive answer will be found in the cases of Cary v. Gruman, (4 Hill, 625,) and Voorhees v. Earl, (2 Id. 288.) The last ground is fully answered by the bill of exceptions itself. By the testimony it appears that the witness was an expert, a machinist, and sufficiently acquainted with the value of such machinery to make his opinion proper evidence. Fourth.

The court decided and instructed the jury that the plaintiffs were entitled to recover, if the jury should find that the machinery was not properly constructed, (1.) Such sum as would be sufficient to put the machinery in such condition as was contemplated by the contract; (2.) Such sum as the mill would have earned during the time it was necessarily delayed in consequence of the breakage or defects in the machinery. That the jury were to take the fair ordinary earnings of the mill, after deducting the expenses of running the same from the gross earnings, thereby arriving at the net profits.

So, in case the contract was not performed in a reasonable time, the jury wer to ascertain what length of time it was unreasonably delayed, and then if they should find the plaintiffs were in a condition to work their mill by having, stock to grind, and were prevented from grinding the same, by such unreasonable delay, the plaintiffs are entitled to damages to the gross amount of the earnings of said mill, after deducting the expenses of running the same. The defendants rely chiefly upon the case of Blanchard v. Ely, (21 Wend. 342,) to sustain them upon this point.

That case was as follows: In September, 1834, a contract was entered into between the parties, by which the plaintiff agreed to build for the defendant a steamboat, intended to ply on the Susquehannah river, between Owego and Wilkesbarre, to be completed by the first of May, 1835, for which the plaintiff was to be paid the sum of $12,500. The boat, although not entirely completed, proceeded down the river about the 7th of May, being accepted on condition that what remained to be done should be done, but which was not done till some time in July.

On her return to Owego she broke her shafts, which were repaired at the expense of the plaintiffs. This delayed her four days, and after she again started for Owego she was delayed sixteen days more by reason of-the lowness of the water. On her second trip she again broke her shafts, and the defendants at their own expense procured a new set from Mew-York, which cost about $700. The defendants, after they took possession of the boat, enlarged her wheels and made other alterations, and proved that the guards were too low, and the expense of altering them would cost $250.

Several witnesses for the defendant proved the iron of the shafts to be bad; in this, however, they were contradicted by the plaintiff’s witnesses. It was proved that a trip between Owego and Wilkesbarre could be performed in four days, at a net profit of $100 per trip, and that the river between these places was navigable only four months in a year.

The judge instructed the jury that they should deduct from the amount otherwise due to the plaintiff, such sum as would be equal to the expenses necessarily incurred by the defendant in remedying such defects as existed in the boat or its machinery; but they were not authorized to take into consideration the delay of the boat or loss of trips, or loss of' profits, consequent upon any defect in the boat or machinery in reducing the amount of the plaintiff’s recovery; the damages sustained by the defendant, from those causes, being too remote and consequential to be allowed in that action, and the remedy of the defendants for any injury sustained from these causes being by action against the plaintiff.

The jury found a verdict for the plaintiff for the whole sum except about $100. The judge, in giving thevopinion of the court, discusses the question of damages at considerable length, sustaining substantially the ruling of the judge at circuit, but concludes by granting a new trial, on another ground. The whole case is therefore obiter, and not an adjudication upon the ques- • tion of damages.

The learned judge, in delivering his opinion, says, “ Yet in all the cases mentioned, as in that of insurance, there is no doubt that by an express contract on good consideration, the vendor may stipulate expressly to indemnify in respect to loss of profits arising from the defect against which he contracts.” It may be observed, too, that the judge cites no authority on this particular question, and on that subject says, “ No common law authority was cited at bar one way or the other, having any direct application to the measure of damages in such a case as this; nor am I aware that any exists.” The case of Masterton v.

Mayor of Brooklyn, (7 Hill, 61,) was an action to recover damages against the vendee for refusing to accept marble contracted to be delivered by the plaintiff to the defendant. Chief Justice Nelson, who delivered the opinion of the court, after commenting on the rule that certain gains and anticipated profits are not recoverable as profits, says, “ But profits or advantages which are the direct and immediate fruits of the contract entered into between the parties, stand upon a different footing.

These are part and parcel of the contract itself, entering into and constituting a portion of its very elements; something'stipulated for, the right to the enjoyment of which is just as clear and plain as to the fulfillment of any other stipulation. They are presumed to have been taken into consideration and deliberated upon before the contract was made, and formed perhaps the only inducement to the arrangement.

The parties may indeed have entertained different opinions concerning the advantages of the bargain; each supposing and believing that he had the best of it; but this is mere matter of judgment, going to the formation of the contract, for which each has shown himself willing to take the responsibility, and must therefore abide the hazard. Such being the relative position of the contracting parties, it is difficult to comprehend why in case one party has deprived the other of the gains or profits of the contract by refusing to perform it, this loss should not constitute a proper item in estimating the damages.

To separate it from the general loss would seem to be doing violence to the intention and understanding of the parties, and severing the contract itself. The civil law writers plainly include the loss of profits in cases like the present, within the damages to which the complaining party is entitled. They hold that he is to be indemnified for the loss which the nonperformance of the obligation has occasioned him, and for the gain of which it has deprived him.

And upon looking into the common law authorities bearing upon the question, especially the later ones, they will be found to come nearly if-not quite up to the rule of the civil law.” Mr. Justice Beardsley, in the same case says, “I think the plaintiffs are entitled to recover the amount they would have realized as profits had they been allowed fully to execute this contract.

The defendants are not to gain by their wrongful act, nor is that to deprive the plaintiffs of the advantages they had secured by the contract, and which would have resulted to them from its performance.” Again, “ Remote and contingent damages, depending upon the result of successive schemes or investments are never allowed, for the violation of any contract. But profits to be made and earned by the faithful execution of a fair contract are not of this description.

A right to damages equivalent to such profits results directly and immediately from the act of the party who prevents the contract from being performed.” It is true the above case is not upon the precise question under consideration in this, but it explicitly establishes the doctrine that anticipated gains or profits do constitute a proper element in the allowance of damages. * In the case of Dewint v.

Wiltse, (9 Wend. 325,) the plaintiff lot to the defendant a ferry establishment at a place called.Long Wharf,, for the term of ten years, at the annual rent of $300; the defendant covenanting to keep and maintain such ferry in good order during the term, supplied with steam ferry boats, and other boats sufficient for the accommodation of travelers.

The defendant discontinued the ferry, removing it to another place, by means of which a house belonging to the plaintiff was so much injured and impaired in its ordinary business and custom that the plaintiff was unable to let the house at any rent; whereas he had before been able to rent it for $300. The plaintiff recovered his damages by reason of the loss of such rent. A new trial was asked for, on account of such recovery, and denied by the court, who held that the damages proved were a legitimate claim, and the legal and natural consequences of the breach of the covenant. In the case of Freeman v.

Clute, (3 Barb. S. C. Rep. 424,) the defendants agreed to make and put up for the plaintiffs a steam engine of ten horse power, with a suitable boiler, to be ready for use by the first of September thereafter. There was a delay of three months beyond the time stipulated, in putting up the engine and boiler. The engine and boiler "were also defective, and there was another delay of three months in efforts on the part of the defendants to remedy the defects.

In that case the learned justice said, “I cannot agree with the counsel for the plaintiff that the estimated profits upon the manufacture of a specified quantity of flaxseed into linseed oil constitute a legitimate item of damages against the defendants. Such profits áre entirely too speculative and uncertain to make them a measure of damagesi” The learned justice, after a full examination of the case of Blanchard v.

Ely, and many other cases, concludes as follows: "The conclusion at which I have arrived, after a careful examination of the facts in this case and the authorities bearing upon the question involved, and the principles governing the rule of damages in similar cases, is that the plaintiff is entitled to recover in addition to the sum paid by him on account of the machinery} which now amounts with interest to about $700, the further sum of $700 for the expenses incurred and damages sustained by him in consequence of the failure of the defendants to finish the machinery according to their contract.

The amount thus allowed embraces the loss of the use of the plaintiff s mill and other machinery, the fuel consumed, the delay of his workmen employed for the purpose of carrying on his business, and the interest on the amount expended in purchasing stock for the mill.” The case of Freeman v. Clute fully sustains the ruling in this action.

If the plaintiff was entitled to recover in that case for the loss, of the use of the mill and machinery, for the three months’ delay between the time of the performance of the contract and the time it was in fact performed, and for the further three months consumed in efforts on the part of the defendants to remedy the defects, the plaintiffs in this cause are purely entitled to recover the ordinary earnings of the mill during like periods.

In other words, what the mill would have earned in grinding for hire at the ordinary reasonable price per barrel, or what the rent of the mill would have been worth for the same period. The charge does not authorize the recovery of speculative damages, or what the plaintiffs might have made from purchasing wheat and flouring and selling it at an advance. Such profits are not the gains and profits contemplated. The judge in that case decided that the anticipated profits from making flaxseed into oil could not be recovered; that they were entirely too speculative and uncertain to make them a measure of damages.

The plaintiff in that case was permitted to recover for the loss of the use of the mill and machinery. The plaintiffs in this case only recovered for the loss of the use of the mill and machinery. I think, upon that case, as well as on principle, the ruling at the circuit was correct. It Is most unjust to compel the owner of a mill or other machinery to lose the entire use of his mill or machinery during the time defective machinery is undergoing repairs, and be permitted to recover barely the cost of putting it in the condition the contract required it to be put. [Niagara General Term, February 7, 1853.

Taggart, Marvin and Hoyt, Justices.] When a contractor undertakes to perform a contract to erect a building, or put a mill or other machinery in operation, he ought to be holden to indemnify the other party against the loss of the use of the building, mill or other machinery, after the expiration of the time for performance of the contract. And in case it was defectively made, he should indemnify the party for the loss of the use of the, property for the time necessarily required to repair it and put it in order.

If, however, I am wrong in this view of the case as a general rule, yet the peculiar and definite character of this agreement will take it out of that rule. The defendants had their engine in readiness to put in. It was objected to as insufficient, as in fact it was. The defendants, in consideration that the plaintiffs would allow them to put their machinery into the mill, promised and agreed that they would pay to the plaintiffs all' damages, losses, injury and expenses which they should suffer or incur'by reason of the insufficiency of the machinery.

Upon that consideration the plaintiffs did allow the defendants to put in such machinery, and it was put in accordingly. This is, in the language of the learned justice in Blanchard v. Ely, “a contract on good consideration, by which the vendor stipulated expressly to indemnify the vendee in respect to the loss of profits arising from the defect against which he contracts.” A new trial must therefore be denied. Hoyt, J. concurred. Marvin, J. dissented on the question of damages. Hew trial denied.