McCall Co. v. Jennings

McCARTY, J. after stating the facts, delivered the opinion of the court. Counsel for defendants (cross-appellants) contend that plaintiff, under the facts as disclosed by the record, is not entitled to recover the purchase or contract 1 price of the goods, and that its only remedy is by an action for damages for breach of contract. That is, if we understand counsel’s position, which is not clearly defined, the case should be reversed, for the reason that the facte proved make out a different case [464] from the one alleged in the complaint; in other words, that there is a fatal variance between the pleadings and proof. Defendants did not raise this question in the court below. In fact they insisted, in the face' of repeated objections made by plaintiff, on trying the case on the theory that the action is for a breach of contract, and not for the purchase price of goods sold and delivered under the contract. Having taken this position in the trial court, they can not now be permitted to change or shift it, and in this court for the first time be heard to complain that the case made out is different from the one alleged. Lebcher v. Lambert, 23 Utah 1, 63 Pac. 628; Wasatch Mining Co. v. Crescent Mining Co., 148 U. S. 293, 13 Sup. Ct. 600, 37 L. Ed. 454. There are other errors alleged by cross-appellants, but as they are entirely without merit, it is unnecessary to.review or discuss them. The written notices mailed to plaintiff by defendants, forbidding plaintiff to ship any more goods, and the testimony of defendants’ refusal to receive the 2 same, were admitted over plaintiff’s objections. The action of the court in overruling the objections to this kind of evidence is now assigned as error. Defendants were entitled to t¿his evidence, and it was not error to admit it, as it was material for the purpose of showing a rescission of the contract by defendants, which, if established, would prevent a recovery by plaintiff of the purchase price of’all goods shipped after such rescission. The rule is well settled by the weight of authority that a party to an executory contract, such as the one under consideration, may, by his own act, break and terminate it; but by doing so he will be liable to the other party to the contract for all damages resulting from such breach. The measure of damages.in such case is the difference between the price agreed upon and the market value of the goods contracted for. Mr. Bishop, in his work on Contracts (section 837), states the rule as follows: “And the proposition is sound in principle and sufficiently supported by authority, though [465] more or less may be found in the books against it, that one party alone, with no consent from the other, who is in no fault, has, at law, the power — not to be exercised without liability for damages, but still the power — to rescind an executory contract. If this were not so, one might be ruined by an undertaking the carrying out of which a change in circumstances rendered highly inexpedient or practically impossible.” And again the same author says (section 841): “A party who receives from the other a notice of rescission is, while entitled to damages should it proceed from the other’s mere pleasure or necessities, still not justifiable in allowing anything further to be done to bring needless expense. He is even to take affirmative action if the interests growing out of the rescinded contract require.” And, continuing, he declares (section 842): “At law a. party who has broken his agreement will be liable to the other to the extent of what, has been suffered, and no more. ’ ’ Unexcelled Fireworks Co. v. Polites, 130 Pa. 536,18 Atl. 1058, 17 Am. St. Rep. 788; Davis v. Bronson, 2 N. D. 300, 50 N. W. 836, 16 L. R. A. 655, 33 Am. St. Rep. 783, and note; American Bridge & Contract Co. v. Bullen Bridge Co., 29 Or. 549, 46 Pac. 138; Lawrence Canning Co. v. H. D. Lee Merc. Co., 5 Kan. App. 77, 48 Pac. 749. The court instructed the jury as follows; “(4) In an action for breach of an executory contract (that is, a contract where there has been no delivery, 3 or title has not passed) to purchase personal property, in the absence of fraud or stipulation to the contrary, the rule of damages is actual compensation; the injured party may recover his loss sustained. In such case the damage is the difference between the contract price and the market price at the time and place of delivery. (4a) It is the duty of the plaintiff to keep down and not enhance the damages. After notice from the defendants not to ship any more goods, the plaintiff is not entitled to keep on manufacturing the goods, and compel the defendants to pay freight and the costs of [466] manufacture. (4b) If you find that plaintiff offered to deliver the goods and wares in accordance with the written contract order, and that defendants refused to accept the same through no fault of the plaintiff, then plaintiff can recover as damages the difference between the contract price and the market value of such goods at such time, together with interest thereon.” To these instructions the plaintiff duly excepted, and now assigns the giving of them as error. This is an action for debt — the purchase price for goods sold and delivered. Under the pleadings as they are now framed, the plaintiff can only recover the balance due, if any, of the purchase price of the merchandise sold and delivered under the contract. No evidence was introduced to prove damages for breach of contract. In fact, under the pleadings as they now exist, evidence of this character would be inadmissible. Therefore the instructions of the court, while they contain a correct statement of the law in the abstract, are inapplicable when applied to the issues made by the pleadings in this case, and the giving of them was error. The court, over plaintiff’s objections, admitted evidence of certain oral statements and promises made by plaintiff’s agent to defendants just prior to and 4 about the time the contract under consideration was signed, which statements tended to vary the terms of the instrument. The admission of this testimony was error. 1 Greenl., Ev., sec. 275. The ease is reversed, with directions to the trial court to grant a new trial, and permit the parties, if they so desire, to amend their pleadings; the costs of this appeal to be taxed against defendants (cross-appellants).. BASKIN, 0. J., and BARTCH, J., concur.