Case ID: ny-super-ct_44/html/0487-01.html
Source: Caselaw Access Project
Author: {"author": "By the Court.—Curtis, Ch. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

DUNCAN McCOLL, Plaintiff, v. THE WESTERN UNION TELEGRAPH COMPANY, Defendant.
    I. Damages—measure of, for breach of contract.
    1. CONTEMPLATION OF PARTIES TO CONTRACT—RULE AS TO.
    
      (a) Such damages only are recoverable as the parties- either actually contemplated, or may be fairly supposed to have contemplated, as flowing from the breach.
    1. Remoteness as Affecting supposed Contemplation. (a) Where the damage claimed is a loss of that which might have been obtained, depending on the contingency of a certain expected action of a third party in the event of the contract being carried out, it 3s too remote to be regarded as within the contemplation of the party breaking the contract.
    II. Application of rule.—Telegraphic Despatch.
    Despatch as follows: “ Gan close Valley ría and Othere, 22, 20 net, Montreal. Am. immediately.”
    
    HELD,
    that commissions which the sender would have earned as a broker in effecting a charter of two vessels named Valkyria and Othere, if the message had been duly transmitted, were not damages either actually contemplated, or to be fairly supposed to have been contemplated by the defendant, and therefore not recoverable.
    HI. Telegraph Companies.
    1. Damages for non-delivery not contemplated, are not recoverable. See Supra.
    
    Before Curtis, Ch. J., Sedgwick and Freedman, JJ.
    
      Decided March 3, 1879.
    At the trial a verdict for $1,580.30 was directed for the plaintiff, and it was further directed that the exceptions taken by the defendant at the trial, be heard in the first instance at the general term.
    
      The action was brought to recover certain commissions, which the plaintiff claimed he would have earned, had the charters of vessels been concluded, which were lost from the defendant’s failure to deliver in due time a telegraphic message.
    In April, 1872, the plaintiff was a commission and shipping merchant, and broker, at the city of New York. James W. Carmichael & Co., correspondents of his at New Glasgow, Nova Scotia, had advised him that their two vessels, the YalTcyria and Othere, were seeking charters at Montreal to carry cargoes of lumber-thence to Montevideo or Buenos Ayres1. The plaintiff-communicated with his agents at Montreal, and on April 15, 1872, obtained from them offers for the charter of these vessels, which he thought James W. Carmichael & Co. would accept. On that day he dispatched a message to James W. Carmichael & Co., as .follows:
    “ Can close Yalkyria and Othere twenty-two, twenty net Montreal. Ans. immediately.” At the same time , the plaintiff paid defendant the cost of transmission, $2.05.
    The telegram was sent to Boston, on its way to New Glasgow, but was not sent forward beyond Boston. The plaintiff did not hear anything of it until April 25, 1872, when letters referring to it had been sent by the plaintiff to James W. Carmichael & Co., and their replies received by him. The telegram was not delivered at New Glasgow until the last-mentioned day. It was then of no use. One of the ships had been meanwhile chartered, and the charters which it referred to could no longer be obtained, and could not have been obtained after April 19, a date about half-way between the time of dispatching the message and the time of its delivery. Had the telegram gone forward in usual and ordinary course, the charters would have been accepted and concluded, and thereupon the plaintiff would have earned, as his commissions for negotiating the same, the sum for which, with, interest, the verdict hereinafter mentioned was directed.
    
      Thomas D. Hall, attorney, and of counsel for plaintiff, on the questions considered by the court, argued :—
    I. The plaintiff was entitled to recover the damages he had incurred by the failure of the company to forward and deliver his message. These damages, “flowing naturally and directly from the breach of the contract,” were the commissions he would have earned had the message gone forward; and which he lost because it was not sent. The message was sufficiently explicit. To any ordinary intelligence, upon a casual reading, it would convey the idea that it referred to pending negotiations of vessels which could be closed, and the words “twenty-two, twenty net,” and “ answer immediately,” would denote that the subject matter, if not sufficiently disclosed, was important, and that the purpose of the message was urgent. Had the message been obscure, it was the defendant’s duty or business, by inquiry of the sender, to remove the obscurity and inform itself of its purport (Rittenhouse v. Independent Line of Telegraph, 44 N. Y. 263, 265). The rule of damages in cases like the present, is fully stated in the case in 41 N. Y. This rule has been followed in all subsequent cases ; and even in cases like that in 45 N. Y., where .the telegraph company had the benefit of its discriminations, the authority of the case itself has been confirmed and upheld. In summing up the elements or basis of damages in such cases, the court says: “A more precise statement of this rule is, that a party is liable for all the direct damages which both parties to the contract would have contemplated as flowing from its breach, if, at the time they entered into it, they had bestowed proper attention to the subject, and had been fully informed of the facts” (Leonard v. New York Telegraph Co., 41 N. Y. 544, 566, 567; De Rutte v. New York Telegraph Co., 1 Daly, 547).
    
      Porter, Lowrey, /Sorere <6 Stone, attorneys, and George N. Soren, of counsel, for defendant, argued:—
    I. The verdict for plaintiff cannot be sustained, because the damages awarded to him were not within the contemplation of the defendant when it made the contract. The defendant was entitled to be tried on its contract, w’hich was simply a contract to telegraph and deliver the mere /text of the message. (1) The rule respecting contemplation of damages and the limits of recovery within the principle, is well presented in Griffin v. Colver, 16 N. Y. 491; Baldwin v. United States Telegraph Co., 45 N. Y. 744, and cases cited; Landsberger v. Telegraph Co., 32 Barb. 530; British Columbia S. M. Co. v. Nettleship, 3 L. Rep. (C. P.) 499; Horne v. Midland R. Co., 7 L. R. (C. P.) 590; 8 Id. 131; Cory v. Thames Iron Co., 3 L. R. (Q. B.) 190; Hobbs v. London R. Co., 10 Id. 111; 11 Eng. Rep. 181; Elbinger, &c. v. Armstrong, 10 Id. 127; Sumner v. Ford, 1 El. & El. 616; Simpson v. London and Northwestern R. R. Co., 16 Eng. Rep. 330. (2) The English cases above cited, hold strictly that contemplation means actual contemplation founded on knowledge; and they give no sanction to a doctrine of constructive contemplation, which is, of course, no contemplation at all. (3) These cases further hold, with respect to contemplation of damages, that even knowledge or notice, unless worked into his contract, will not suffice to charge a party (see Willes, J., in British Columbia, &c. v. Nettleship, L. R. C. P. 508, 509). (4) The principle of the rule cannot be better presented than in the decisions about messages in cipher (Candee v. Western Union Telegraph Co., 34 Wis. 471 [17 Am. Rep. 452]; Sanders v. Stuart, 17 
      Eng. Rep. 268). The ground of decision in favor of the telegrapher in these cases is, that it is impossible that he should have had knowledge or contemplation of the transactions involved in such messages, or of the consequences or damages that would follow his default in regard to them. (5) The principle obviously holds good and governs when the message, though not in actual cipher, is yet so obscure as to convey no sense, or no definite or fair explanation of the matter involved (see the remark of Allen, J. in Baldwin’s case, 45 N. Y. p. 749, Allen's cases, p. 649, that such a message might as well be in cipher; opinion of Halt, F. J. [dissenting] in Bryant case, 1 Daly). (6) As there was nothing on the face of this message which disclosed the nature of the subject to which it referred, and especially nothing of the roundabout and remote grounds upon which the plaintiff founds his cause of action and deduces these damages, and no information about any of these things given to the defendant, there is no reason whatever which will uphold this recovery. The cases of Shields, Lane, Stevenson, Kinghorne, Landsberger, Baldwin, Oandee, Dorgan, Beaupré, Grildersleeve, Behm, Hord and Barnesville Bank are all adverse to the plaintiff. (7) In the cases collected at the end of the “Abstract of Oases,” where substantial damages have been allowed, it will be seen that in most of them—for example, in the cases of Parks, Hobson, Birney, Bryant, De Butte, Wenger and Leonard—the dispatches had upon their face disclosed the nature and extent of the business involved. (8) But for the very reason that that feature characterized those cases, and is entirely wanting in this, those decisions cannot avail the plaintiff here. (9) As to the cases of True, Graham, Squire and Strasbnrger, if the rule laid down in the largest number of cases is sound—and the difference in facts being taken into account, as just observed, the cases cited under 7 do not qualify their authority—then these cases last referred to deserve no respect. In those cases, as is said by the editor in 9 Am. Rep. 55, there could have been no more knowledge or contemplation of the nature or extent of the transaction than if the message had been written in cipher. (10) In the Sprague case, it must be assumed that the counsel fee was allowed, as being fairly within the scope of the information communicated to the company as to the pendency of the cause and the coming trial of it, and so naturally and directly incidental to those things. (11) The language employed in the case of Leonard v. Telegraph Co., 4 N. Y. 544, is to be read in the light of the facts before it. The message there was, ‘ ‘ Send five thousand sacks of salt immediately.” If, instead of this, the message had been “ Send five immediately,” it may be very safely doubted whether the court would have employed such language as it has used, at the close of the passage last quoted. But the message showing that the transaction related first to salt, then to a specified quantity of it, and then to an immediate shipment of that amount, the imputation of the facts, incidental to these known facts, is not an extravagant application of the well-settled rule, that the parties may be charged with such deductions as they may be fairly supposed to have made, if they had contemplated an actual breach of the contract and its natural consequences.
    II. The rule illustrated by these cases, which requires the damages recoverable to have been within the actual contemplation of the parties, is to be strictly construed in favor of" telegraph companies. (1) It is manifestly unsound, and as unjust, to regard the telegraph company as a party to the contracts or transactions which are the subject of the messages intrusted to it. The telegrapher is, in these cases, only a third person, not party, having to do with the transaction between the sender and receiver only in an external and collateral way. In almost no case can it be fairly presumed to have such knowledge of the subject of a message as is possessed by the principals in the transaction to which it relates; but in most cases, as in this, it has no knowledge, and can have no actual or even presumed contemplation of anything to which the message refers. (2) Further, the telegraph company is not a voluntarily contracting party. By force of its public duty, it is compelled to do the service demanded of it, without interest in, or right to be informed of the nature of the transaction involved. As to its own service, the law sanctions a contracting under certain reasonable regulations, and the exemption of itself by special contract from damages beyond certain limits. Such a contract was made between these parties, on the terms of the blank in this case, and the rights of both parties here are to be ascertained by the terms of that contract, and not by those of plaintiff’s transaction with third persons (Breese v. United States Telegraph Co., 45 Barb. 274; S. C., 48 N. Y. 152; Belger v. Dinsmore, 51 Id. 166.)
    III. The damages awarded in this case cannot be allowed, because they are too remote, and depend on contingencies which might or might not have happened in such way as to have yielded this commission to the plaintiff, if there had been no default by the defendant, (a) If the message had been received by Carmichael & Co., it is not certain, in a legal sense, that they would have accepted the offer. It is true they say, now, that they would have done so, but that has been held insufficient (Kinghorne v. Montreal Telegraph Co., Allen's Cases, 14). (5) If they had sent an acceptance of the offer, that might not have reached the plaintiff in time to secure his parties, (e) If an acceptance had reached the plaintiff, it would not have concluded any contract with the proposed charterers. The evidence is that Carmichael & Co. “would have considered the charters closed on receiving a reply to that effect.” But it does not appear . that those offers would continue till all these transactions were completed, {d) But charters must have been actually closed before the commission could be earned, (e) This opens new contingencies, and leads out to that remoteness which the law will not favor. (/) And especially should it be noticed in this case, that this remoteness and thin-spun contingency lead very far away from that which was communicated to defendant, to wit, the few incoherent words forming the message.
   By the Court.—Curtis, Ch. J.

The defendant urges, that the verdict for the plaintiff cannot be sustained, because the damages awarded to him were not within the contemplation of the defendant when it made the contract, and that this case is governed by what was held in Baldwin v. United States Telegraph Co. (45 N. Y. 744). In the present case, the text of the message which the defendant failed to transmit until after a delay of several days, indicates upon its face no occasion for special care or the involving of the chartering of two vessels. There was no notice or information of any fact given to the defendant or contained in the message itself, indicating its importance or that special damages would result from any neglect. However strongly the plaintiff may have felt assured, acting as a broker in the matter, that the offer telegraphed to his principals would be accepted, ahd that he would get his five per cent, commission, yet there is nothing in the case that places these contingencies, in themselves uncertain and remote, within the contemplation of the defendant. It is true, the plaintiff’s principals might have accepted the offer, and paid the plaintiff the commissions, and their evidence is, that they would have accepted it, if it had not been delayed by the neglect of the defendant, in failing to forward it immediately.

The claim of the plaintiff is for a special and contingent loss, and not for such a loss as was the natural and necessary consequence of the defendant’s neglect, or, such as from the surrounding circumstances, could even be inferred by the defendant.

The decision in Baldwin v. United States Telegraph Co. (45 N. Y. 744), that, where a special purpose is intended by one party and is unknown to the other, and does not appear by the message itself, in the assessment of damages, such special purpose cannot be taken into consideration, but that the damages must be limited to those resulting from the ordinary and obvious purpose of the contract, governs the case under consideration.

There should be a new trial, unless the plaintiff reduces his verdict to $2.05, the sum paid defendant to transmit the message, with interest from April 15,1872.

Sedgwick and Freedman, JJ„