Nelson v. Goddard & Co.

BARNES, J. Four questions are involved on this appeal: (1) Was there a sale to Amundson? (2) Did plaintiff voluntarily surrender the possession of the premises? (3) Did the court properly instruct the jury as to the rule of damages that should be applied? and' (4) Are the damages recovered excessive? In form the contract between Amundson and the defendant is a lease, containing an option under which the lessee may purchase the premises at a specified price within a prescribed period of time. If the option was taken advantage of, the sum paid for rent was to apply as a payment on the purchase price. It is not seriously contended that this written instrument was a contract of sale, and we are satisfied that it was not. The appellant does earnestly contend, however, that this instrument does not express the true intent and meaning of the parties and that it might and did show by parol the facts and circumstances surrounding the transaction and what actually transpired between the parties before and after the document was signed, and that the real question in the case is, Was there in fact a sale? The respondent claims that the parol evidence offered was incompetent,' and that if properly admitted it tended to show that the written agreement embodied the intention of the parties. The weight of authority seems to be to the effect that, where a controversy arises between a party to a contract and a third person, neither is concluded by the contract, but may show what the actual transaction was. In the view we take of the case the matter of the admissibility of the parol testimony ys not important, and hence we do not pass upon the question. As we read the testimony of Gaynor, the attorney who drew the lease, and of Amundson, the lessee, the writing expressed the intention finally arrived at by the parties, and, if so, there was abundant evidence to support the answer of the jury to the first question in the special verdict. There is no doubt that Amundson desired to buy and that de [70] fendant desired to sell. The price was also agreed upon at $10,000. But Amundson could pay down only $500, and defendant was unwilling to make a binding contract of sale on so small a payment, evidently desiring to avoid the loss and expense of foreclosure in case of default. So a lease with an option to purchase was decided upon. By this arrangement Amundson might buy if he could raise the necessary money, and, if he could not, his rights in the premises would terminate at the expiration of the lease and defendant would not be obliged to foreclose. There was also evidence from which the jury might have found that defendant represented to plaintiff that it had sold the property when in fact it had not, and that it notified plaintiff of such alleged sale and requested him to deliver possession to the purchaser, and that plaintiff, relying on the representation that there was a sale, did surrender possession to the alleged purchaser. The plaintiff was obligated by his lease to surrender possession in case of a sale, and he had a right to rely on defendant’s representations that a sale had been made. The court charged the jury in substance that plaintiff was entitled to recover .as. damages the profits which he would have realized from the use of the premises during the term of the lease. Defendant urges that such damages are remote and speculative, and that the true measure was the difference between the reasonable rental of the premises and the sum which plaintiff agreed to pay. Profits are often an elusive phantom. They are easy to anticipate and hard to realize. Nevertheless in many cases profits can be arrived at with a reasonable degree of certainty, and it frequently happens that they furnish the only fair and adequate basis of compensation for the breach of a contract. The plaintiff and defendant here were apparently satisfied that profits could be ascertained to a reasonable certainty and that they furnished a fair basis of compensa [71] tion in case plaintiff was required to vacate during his term. The lease expressly provided that if plaintiff was called upon to vacate after July 15, 1913, he should be paid as compensation for his loss a sum equal to the net profits that would have accrued if he had been allowed to complete his term. The plaintiff, we think, was entitled to recover such sum as would compensate him for loss arising according to the usual course of things from the wrong done, or such as may reasonably be supposed to have been in the contemplation of both parties at the time the contract was made, as the probable result of the breach. Cockburn v. Ashland L. Co. 54 Wis. 619, 12 N. W. 49; Foss v. Heineman, 144 Wis. 146, 128 N. W. 881; Guetzkow Bros. Co. v. A. H. Andrews & Co. 92 Wis. 214, 66 N. W. 119. It must be said here that the plaintiff’s loss could be fairly and adequately measured by ascertaining net profits, if such profits could be arrived at to a reasonable certainty, and that the parties contemplated that damages for a breach would be so measured. The profits would largely depend on the amount of production, the labor and other cost of production, and the market value of the crop. The testimony quite satisfactorily established these items, and we conclude that the rule submitted was correct. Salvo v. Duncan, 49 Wis. 151, 4 N. W. 1074; Nilson v. Morse, 52 Wis. 240, 9 N. W. 1; Nash v. Hoxie, 59 Wis. 384, 18 N. W. 408; Poposkey v. Munkwitz, 68 Wis. 322, 32 N. W. 35; Corbett v. Anderson, 85 Wis. 218, 54 N. W. 727; Allen v. Murray, 87 Wis. 41, 57 N. W. 979; Stumm v. Western Union Tel. Co. 140 Wis. 528, 531, 122 N. W. 1032; Treat v. Hiles, 81 Wis. 280, 50 N. W. 896; Raynor v. Valentin Blatz B. Co. 100 Wis. 414, 76 N. W. 343. Some -cases are called to our attention where a different rule of damages was applied in the cases of breaches of covenants contained in leases. See Shaft v. Carey, 115 Wis. [72] 155, 90 N. W. 427; Kellogg v. Malick, 125 Wis. 239, 103 N. W. 1116; and Pewaukee M. Co. v. Howitt, 86 Wis. 270, 56 N. W. 784. In the last two of these cases profits were not allowed because it was held that the profits claimed were too remote and it was not contemplated by the parties that they would measure the lessee’s damages in the event of a breach. In the first case the damages allowed furnished adequate compensation and there was no way in which profits could be ascertained with any degree of certainty. These cases were decided on the facts before the court. They do not assume to lay down any hard-and-fast rule applicable to all cases involving breaches of covenants contained in leases. The jury awarded $1,362 damages. The court reduced the award to $1,000, giving plaintiff the option to remit $362 or take a new trial. In its opinion the court stated: “The damages in this case are much more than the jury should have allowed. If every contingency had been successfully met and every possible obstacle overcome, the plaintiff could possibly have realized the full amount of the damages awarded him by the jury. If I were awarding the damages, I would not have put them over five or six hundred dollars. “The answer to the question is, however, all an estimate, and necessarily unsatisfactory in its results, no matter what sum is fixed upon. Reading over my notes of the testimony leads me to think that certain allowances should certainly be made which would reduce more or less the plaintiff’s figures.” The court was justified in concluding that the damages assessed were excessive. Judgment should have been permitted for only such a sum as in any reasonable probability a fair jury properly iustructed would return. Baxter v. C. & N. W. R. Co. 104 Wis. 307, 80 N. W. 644; Rueping v. C. & N. W. R. Co. 116 Wis. 625, 641, 93 N. W. 843; Willette v. Rhinelander P. Co. 145 Wis. 537, 558, 130 N. W. 853. It is apparent that the court overlooked this rule. It is not to' be supposed that a fair jury properly instructed [73] would not place the damages as low as the court would have placed them had it been trying the cáse without.a jury. Much less is it to be supposed that a fair jury would award nearly twice as much damages as the court deemed to be fairly compensatory. Eor this reason the judgment must be reversed. By the Gourt. — Judgment reversed, and 'cause remanded for new trial unless the plaintiff elects within thirty days after filing the remittitur in the trial court to take judgment for $600 and costs, which he may do if he so elects, on motion therefor and on due notice in said court.