The Saint Paul globe. (St. Paul, Minn.) 1896-1905, 1896-11-10

casual expressions and loose recitals cannot
be permitted to establish such q contract.
Nothing short OF plain stipulation to that
effect ought to be permitted to prove It, in
view of the fact that the determination of
actual values was not necessary to the COM
pieuon OF the pending negotiations. There
is no such express stipulation in the con-
tract. The finding of the actual market value
OF these securities was not the object which
the parties sought to accomplish by, or the
intention 81 with which they fixed the values
tend or attempt to fix the values of the Sc
curities of the Merritts in cash. but their
values in the stock of the consolidated mines
at 90 per cent Of it's par value They did
not intend or attempt to fix the values of the
securities of the defendant in money, but their
value in ten year bonds of the consolidated
mines at go per cent Of their face. In view
or the situation of the parties to this contract
when 1t made, their surrounding CIR
eumstances, the object which they were seek
| ing to attain and the terms Of the letter
and OF the agreement, 1t is plain to us that
| this was the extent of their contract as to
the values of the stocks which they described
| In 1T. The evidence convinces US that their
minds never considered or met upon the ques-
| ton OF the actual market value Of any of
these securities. and that they never intended
to, and never did make any binding agree
ment upon that subject. The defendant,
| therefore, did not contract that the market
value of the plaintiffs stocks was 1,4S3, S16 in
| cash or in anything but the stock of the
consolidated mines at so per cent of it's value.
| was he estopped from proving its actual
market value? He was not estopped by any
| agreement as to the value because, as we
nave seen he had made no such agreement.
An estoppel in pals arises when one who is
ignorant Of the material facts which condi-
ton subject is Intentionally or recklessly
induced by the false representations or action
| OF another to change his relation, so that he
Will be injured, If he who made the false
representations is permitted to prove the
| truth If vendor represents to a purchaser
that tract of land contains ten acres more
than 1t actually measures, and thereby in
| tr nv ND for he 70
OF $50 per acre. he is estopped from show
| ing that the land of less value be-
cause the purchaser has actually paid and lost
$50 per acre upon the ten acres that did
not exist. If the plaintiff had induced
the defendant to purchase some of his prop
erty for cash by false representations, he
would have been estopped from denying that
| such property was worth what the defendant
had actually paid for it, because that would
have been his actual loss. The plaintiff was
| not misled or induced to make the contract
by any Misrepresentation of the defendant
on the subject. The defendant made no rep
RESERVATIONS as to the value of the PLAINTIFF
| original stocks and he and his associates
| fixed their own estimates of these values and
| they were embodied in the contract. The
evidence relative to these values presents none
OF the essential elements of an stopped in pals.
WHAT THE DIFFICULTY WAS.
The difficulty with the rule applied by the
court to measure the damages in this case
! seems to be its failure to note the difference
| UetWeeH the actual value OF the pIalnLln S
| stocks and the value at which they were
| estimated in the contract for the exchange
! OF securities. In simple transaction this
| difference seems clear and radical. If A,
| by the false representation of good title to a
| lot that is actually worth $1,000, induces B
to give him lot of the same value in eX-
change, BIS damages must be the actual
| value of the lot which he conveys. If in
| their contract of exchange of the lots and
in their deeds, they estimate and recite the
value of each lot at five times its actual value,
that fact cannot multiply or increase the
damages of B. He loses no more than the
| thousand dollars, the actual value of the lot
he parts with. AS long as he accepted AS
| lot in payment for his, he may be per-
| of $4,000 which he incurred to for the lat
| ter's lot, because that was the contract But
the moment he brings his suit for damages
| and thereby undertakes to collect the value
! of his lot any part of it in money, in
stead of in land, he is limited to it's actual
market value and to his actual loss. The
extent of the defendants agreement to
! the value of the plaintiffs stocks that
| they were worth 81, 4S3,S16 in the stocks of
| the Consolidated mines at 80 per cent of
| their par value, in consideration that the
J plaintiff agreed that the defendants securities
! were worth 81, 299, 900 in first mortgage bonds
| OF that corporation at certain percentages Of
| their par value. AS long the plaintiff was
! content to pay the defendant for his secur-
| tiles in these bonds and to accept the stocks
of the new corporation for his original
stocks, these estimated values stood But
| when in this suit for damages he undertakes
| to convert a part of The payment for his
| original stocks from stock of the Consolidated
mines into money, he must be limited in
! his recovery to the actual market value Of
| his original stocks in cash and thus to the
| actual loss he has sustained. In an action
| for damages for material Misrepresentation
| which induce an exchange of property, the
difference between the actual market value
! of the property which is parted with and the
| actual market value of that which is re-
| celYed under the contract, and not the differ
! ence between the price of the property parted
| with fixed in the agreement of exchange and
the actual value of that received, is the true
! measure of the damages. Reynolds vs. Frank
I lin, A Mimi. 80, 80; Fixal VS.. Blake, At
Mimi. $40, 542; High VS.. Berret % Att. Rep.
| PENN 1904.
| The disregard Of this rule resulted in a
| recovery which violated the fundamental
principles by which damages are measured
/ in actions of this character. One of these
| is that such damages must be merely COM
pensatory and must not be speculative. The
defendant was bound to make good to the
| plaintiff the actual loss which the latter
| had sustained by reason of his misrepresenta-
| tons, but he was not required to pay him
his estimated or expected prices for his
| stocks, If these prices were higher than the
| actual value of his property. The injury was
that the Consolidated mines was caused to is
sue it's first mortgage bonds for 81, 619, S51 for
worthless property and thereby the value of
the stock of the plaintiff in this corporation
| was deprecated in value and in this way he
| was damaged. Obviously the Consolidated
mines must have been damaged before the
plaintiff could suffer from this cause and
he could suffer greater damage than such
| a part of that which the corporation suffered
as his stock was of the entire amount of the
stock issued by that corporation Suppose
| that the defendants securities in the Penokee
| corporation and the Spanish company were
| worthless and that the Consolidated mines
issued its bonds for them to the amount of
| $1,619, 651 what loss did it sustain? What
| would fully compensate it for this loss? If
| the corporation had actually paid 81 ,619 S51
| for these worthless securities, it is clear
| that the repayment of that amount would
completely compensate it for its loss 1t
could not suffer any greater loss by promis-
ing to pay this amount and never paying
it. The plaintiff had less than one-seventh
| of its stock and his share of full compen-
| sation for this injury could not possibly have
! been more than seventh of 81 GIG, S51 and
| interest, or 1921, 407.28 and interest. But he
recovered verdict for $4,000 and this re-
covery imports a damage to the corpora
ton of at least Sc $50 900 for issuing bonds for
ST. GIG, S51. In our opinion, these damages far
exceeded the just measure of full compen-
sation for this injury. They could not have
been limited to the actual loss, but must
| have consisted in large part Of the difference
between the sanguine estimates of the values
of mining and railway stocks made by their
| owners for the purposes of exchange and the
actual values of those stocks. They must
have been composed more largely Of bright
anticipations of prices which the owners of
the stock hoped to realize from them than
of the difference between: the actual values
| of the stocks which were exchanged. In
other words, they were speculative rather
than compensatory damages.
| COURTS RULINGS FATAL
Another universal rule for the ascertain
| ment of damages in casses of this character
is that they must be the natural and prox-
innate consequence Of the injury. They may
not be so remote that the wrong-doer might
not have reasonably expected them under
the circumstances of The particular case lex
NJ I CI1fh or1 and