Aultman & Taylor Co. v. Hetherington

Oole, J. There would seem to be some inconsistency, as claimed by tbe plaintiff’s counsel, between that portion of tbe charge wherein tbe jury were told that, if they found there was a breach of warranty, tbe measure of damages would be the difference between tbe actual value of the machine and tbe value it would have possessed if it bad conformed to the warranty, and tbe instruction which was given at tbe request of tbe defendants, to tbe effect that the defendants bad a right to rely upon the warranty, and were entitled to a deduction of tbe difference between the cost price of tbe machine and wbat it was actually worth at tbe time tbe contract was made. Tbe contract price of tbe machine was $750, while all tbe evidence on tbe part of the defendants bearing upon tbe point fixed its value, if a good machine, at $600. It is certainly true that both these rules, when tbe evidence is considered, could not be correct; and tbe inconsistency was well calculated to mislead tbe jury as to tbe proper measure of damages. Tbe rule is now well settled, that a warranty binds a vendor, in case of a breach, to repay tbe difference between the actual value of tbe article sold, and its value as it would bave been bad it been as warranted, tbe price paid being merely evidence of that [624] value. Sedgw. on Dam., 287; Benj. on Sales, § 913, and cases cited in note (d). But, without dwelling upon this inconsistency in the charge in respect to the measure of damages, it is plain the judgment must be reversed under the rule laid down in G. Aultman & Co. v. Jett et al. [ante, p. 488]. That case, like this, was an action upon one of several promissory notes, given by the defendants for a machine. And the court there charged, as the court charged in this case, that if a breach of warranty was established, the defendants might recover from, the plaintiff the difference between the actual value of the machine as it was, and its value had it corresponded to the warranty, and, if this difference exceeded the amount of the note sued on, the defendants were entitled to a judgment for the excess. The radical error in that view of the case was held to be this: that the transaction was treated as though the vendees had paid for the machine, and the defendants recovered damages upon that basis; whereas they had only given their promissory notes for it, which in this state does not operate as payment, unless it is so expressly agreed by the parties at the time. There were two other notes given by the defendants for the machine, which are unpaid, besides the note in suit. We must presume that these notes are still held by the plaintiff, as there is nothing to show that they have ever been transferred. Now, such'being the fact, it would seem unjust to allow the defendants to recover full damages for the breach of warranty, the same as though they had paid for the machine, when those damages largely exceeded the amount of the note sued upon. Under the rule just referred to, the mere giving of the notes did not operate as payment, nor was it attended with the legal consequences of payment. If it appeared that the notes had been negotiated, a different question would be presented; but it does not appear that they have been, and we must assume that they are still held by the plaintiff. The defendants have seen fit to keep the machine, which is not worthless. Now, [625] suppose the machine had been bought on credit, no notes having been given. In an action brought for the purchase money, if the defendants had set up a breach of warranty in diminution of the contract price, it is very evident that they would have been charged with the actual value of the machine. The effect of the charge is to give them the damages for the entire breach, though they have paid nothing. This, it seems to us, is clearly incorrect; and for that reason there must he anew trial. To prevent further litigation it may possibly be in the power of the circuit court to require the plaintiff to surrender the outstanding notes as a condition of recovery in this action. That question is not before us on this record, and we therefore do not decide it; but, for the reasons above given, the judgment must be reversed and a new trial ordered. By the Gourt. — So ordered.