Munson S. S. Line v. Grimwood

HOUGH, Circuit Judge (after stating the facts as above). [1] This cause was submitted to the jury under a theory of damages so [724] unsuited to the facts developed by the evidence that a new trial is necessary. Damages are either compensatory or punitive; in this action on contract the latter may be disregarded; so that this plaintiff is necessarily represented by the jury’s action as having been compensated by this verdict for some loss or injury. This is a result imposed by law, which also forbids any verdict for more than nominal damages, when there is no lawfully proven pecuniary loss for which to award compensation. The substance of the argument in support of the judgment below, is that the parties were dealing in a commodity; i. e., tonnage. Grim-wood was entitled to get it from Munson, who unlawfully refused the demand; therefore Grimwood was properly awarded the difference between what he had agreed to pay Munson for it, and what it would have cost to get it elsewhere at the time of demand, irrespective of whether he got it or not, provided only he made the demand in good faith — i. e., apparently with a real intent to ship coal. Tonnage is in a sense a commodity; so are railway and theater tickets, and many other things, which may or may not be directly productive of losses. If one buys tickets or tonnage to sell again, the profit or loss in such dealings is computable as if coal or grain or any other objects commonly bought and sold were the subject of bargain. But ordinarily the right of carriage or admission is an incident or preliminary to gain from that which is transported, or intellectual pleasure from that which may be seen or heard. In this case, if Grimwood had actually sent coal to Mexico at an expense greater than Munson’s price, there would have existed an actual expense, actually incurred, and requiring compensation on a familiar basis, without any regard to the ultimate fate of such Mexican coal venture. But this contract was (if valid at all, and by the very argument on its behalf) to supply the requirements of Grimwood’s established business in respect of getting, for purposes of sale, American coal into Mexico; that is, what tonnage he could demand depended on the requirements, and the reasonable requirements, of an actual business. It did not depend on how much tonnage Grimwood wanted to take a risk on. For all that this record shows, instead of demanding four ships in November, 1915, 40 might have been called for. Still less was' it within the contemplation of the parties that Grim-wood, without any proof of business destroyed by Munson’s refusal, should collect as his damages for not getting coal, any part of the sums .he did not pay for transportation. We assume that there was a real desire to send 20,000 tons of coal in one month to a market and a business that had not absorbed over 12,000 tons in two years; but there was no proof at all that such a procedure was a reasonable requirement for the business, either at the time when demand made, or at the date of contract. The relations between the parties as evidenced by the contract, and regarding that agreement as a “requirement” contract, were such that tonnage was for them not a commodity, like coal, but a service. Damages did not and could not flow directly from a refusal to transport coal, but only from the effect of such re [725] ftisal on the business of selling coal, and Grimwood’s particular business of that nature. It is qiiite possible that, during Mexico’s period of especial anarchy, Grimwood had kept together a business of sorts, equally possible that what he had was ruined, or its rehabilitation prevented, by not getting coal in November and December, 1915; yet it is a.lso not only possible, but on this record apparent, that he has been awarded a very large sum of money, not because he showed any loss, but solely becaiise he was willing to risk some shipments to a region of which the business capabilities in 1915 are not shown at all. He has paid out nothing, and been rewarded for abandoning a risk; this is mere gambling. Loss in the business with reference to which the parties contracted must be shown. How that can or will be done cannot now be laid down. It depends on evidence not yet adduced; but there must be shown a loss in Mexico. The present verdict represents nothing but an absolutely unearned profit for not sending coal to that distracted country. [2] The fundamental question in this case, whether the writing of July, 1912, is a “requirement” contract, or an unenforceable and illegal promise to obey the will or whim of Grimwood, we cannot decide on this record, with fairness to plaintiff below. As stated above, he was prevented from showing dealings with Munson before 1912; we do not know whether by such evidence the quantity of tonnage needed can be reasonably ascertained. It is presumed that “the intention of the parties, was to contract in reference to such quantity.” This quotation is from* our decision in Manhattan, etc., Co. v. Richardson, etc., Co., 113 Fed. 923, 51 C. C. A. 553, a case which as far as it goes still represents our views on this subject; whether it will cover this case, when presented by proper evidence, we cannot tell. We may add, however, that, had no offer to show the extent and nature of Munson’s previous knowledge of Grimwood’s requirements been made, and the trial court had held the contract a “will, wish, or want” agreement, we should have agreed with such ruling on the Manhattan Case, supra, and the judgment of Sanborn, J., in Coldblast, etc., Co. v. Kansas City, etc., Co., 114 Fed. 77, 52 C. C. A. 25, 57 L. R. A. 696, which fully and ably covers the subject, so far as it can be divorced from facts peculiar "to each transaction. In so far as the language of decision in Ramey, etc., Co. v. Schroeder, etc., Co., 237 Fed. 39, 150 C. C. A. 241, seems to assert that an agreement otherwise void, as depending for effect on the will, wish, want, or whim of one party, is validated merely by the promise of such party to abstain from dealing in respect of the subject in hand, with any person other than the second party, we are compelled to think it inadvertently used, and to disagree. Judgment reversed, and new trial awarded.