Samuel v. Sota

Opinion by Orlady, J., This action of foreign attachment was instituted by the plaintiff to recover a claim, $776.21. The defendants admitted the correctness of the plaintiff's claim, but in their affidavit of defense they present a set-off or counterclaim, which the court below considered sufficient, and discharged a rule taken at plaintiff’s instance, for want of a sufficient affidavit [635] of defense. The appeal was originally taken to the Supreme Court, and was subsequently remanded to this court for consideration. Counsel have presented with exceptional fairness and ability their respective contentions,, but the disposition of the question involved is to be determined solely by the sufficiency of the facts set out in the affidavit of defense, and which are to be considered as being true. The defendants allege that on September 19, 1906, they sold under a written contract to the plaintiff, 13,000 to 15,000 tons of Chavarri’s Garrucha-iron ore, one of the conditions being, “Shipment of said ore to be made one cargo in October, one in November and one in December, 1906, steamers to be chartered by sellers in accordance with instructions from buyer and at his expense, and any dispute under the contract to be settled by arbitration in London as customary.” The. parties were well known to each other as dealers in iron ore,- and the subject of sale was known at the time the contract was executed to be of a special grade of iron ore, well known in the trade- as mined by one Chavarri at his mines at Garrucha, Spain, and could be secured from no other source. - The affidavit of defense sets out that on June 16, 1906, the defendants had contracted to buy from Chavarri, 30,000 tons of this ore to be lifted in approximately equal monthly' quantities, between July 1, 1906, and February 28, 1907, payment to be made upon delivery of bill of lading. Of this ore defendant sold- to plaintiff by their contract of September 19, 1906, the tonnage that the defendants would be required to lift from the mines in October, November and December, 1906. During these months the defendants were ready in all respects to perform their part of the contract, but as further alleged in the affidavit of defense, plaintiff’s instructions to-defendants to charter vessels were at such low rates, that no vessel could be obtained, and the plaintiff refused and neglected to charter vessels at the prices that were offered to him by the. defendants or to charter others elsewhere. During the named months, the defendants frequently notified the plaintiff that he would be required to [636] lift the ore under his contract before the expiration of the year, or the mine owner would cancel his tonnage. At the-plaintiff’s-request the defendants negotiated with the mine owner to postpone the delivery of the ore until January and February, 1907. The plaintiff having failed and neglected to charter any vessels during said months, and having failed to lift or accept any of said ore, although duly requested to do so in the month of February, 1907, the mine owner canceled 13,000 tons of the order, and thereafter refused to deliver it to the defendants, by which the defendants lost their profit which they would have made on said contract of September 19, 1906, but for the plaintiff’s default. It is further alleged that in March, 1907, the defendants, as required by the contract, promptly requested the plaintiff to name arbitrators in London, to whom to submit the aforesaid disputes as was customary, but plaintiff refused to submit same to arbitration. The facts are specifically set forth as to dates, amounts and calculations, the copy of the contract is attached to the affidavit of defense, in which it is directly asserted that the claim for loss of' profits was a direct, certain and specific amount due to the plaintiff’s breach of contract, to wit, $2,079, as explained in the statement and figures set out at length in the affidavit of defense, and which must be accepted as true. In such a case the rule laid down in 3 Sutherland on Damages (3d ed.), sec. 665, is clearly applicable. The broad general rule in such cases is that the party injured is entitled to recover all his damages, including gains prevented as well as losses sustained, and this rule is subject to but two conditions, the damages must be such as may fairly be supposed to have entered into the contemplation of the parties when they made the contract, that is, must be such as might naturally be expected to follow its violation, and they must be satisfactorily shown by their nature and in respect to the cause from which they proceed. In Wilson v. Wernwag, 217 Pa. 82, after an exhaustive review of the authorities, Judge Mestrezat concludes, “from these authorities it is clear that damages may be recovered for loss of profits caused by breach of contract; and they are never excluded simply because they [637] are profits. If it reasonably appear that profits would have been made had the terms of the contract been observed, and that their loss necessarily followed its breach, they may be recovered as damages, if the evidence is sufficiently satisfactory and definite to warrant the jury in estimating their extent.” An examination of the well-considered cases will show that prospective profits may be recovered for the breach of a contract, whenever they are susceptible to proof. They have been rejected by the court as damages only because of failure to prove them with sufficient certainty and definiteness. There can be no good reason why they should not be recovered, when they are capable of definite estimation. The injured party has the right to demand and receive from the defaulting party full compensation for the loss he has sustained by breach of the contract. Each party knows the terms of the contract, and therefore is presumed to know the, loss each will sustain by its breach. The law is not so blind to justice as not to require the defendant to respond in damages if there is any reasonable basis for their ascertainment. When, therefore, the evidence shows with reasonable certainty the profits which have been lost by the breach of a contract, they shall be considered as damages and shall be recoverable by the injured party from the one in default. As we are only concerned with the sufficiency of the affidavit of defense, it is needless to pursue the inquiry further. The parties were well known to each other. The damages claimed resulted from the violation of the contract of September 19, 1906, and were not speculative but actual. The calculation on which they were estimated is not challenged. A special tribunal had been selected for the settlement of the dispute, and this the plaintiff refused to follow and the counterclaim is set out with the same clearness and particularity as is required in a statement: Sprissler v. McFetridge, 37 Pa. Superior Ct. 607; see also Horst v. Roehm, 84 Fed. Repr. 565; s. c., 178 U. S. 1; Gallagher v. Whitney, 147 Pa. 184; Winslow Bros. Co. v. Du Puy, 208 Pa. 98. The judgment is affirmed.