Source: https://arizona.lexroll.com/a-r-a-manufacturing-company-v-pierce-86-ariz-136-1959/
Timestamp: 2019-04-21 16:13:04+00:00

Document:
A.R.A. MANUFACTURING COMPANY, a corporation, Appellant, v. Dewey L. PIERCE and Rosamond S. Pierce, husband and wife, and Arctic Automotive Air Conditioning Company, Inc., a corporation, Appellees.
No. 6428.Supreme Court of Arizona.
Appeal from the Superior Court of Pima County, Renz L. Jennings, J.
Conner Jones, and A.O. Johnson, Tucson, for appellant.
May, Lesher Dees, and Robert O. Lesher, Tucson, for appellees.
This is an action to recover damages for breach of a contract of exclusive distributorship. It arose by way of a counterclaim by appellees to a claim for moneys owing asserted by appellant (the validity of which was admitted at the trial), and comes to us on appeal from a judgment upon a jury verdict for appellees on their counterclaim.
Appellant, a manufacturer of automobile air conditioning units, conceded that, by written contract, it had granted to appellee Arctic an exclusive distributorship for the sale of appellant’s product in the State of Arizona, effective from March 16 to December 14, 1955; and that on or about July 25, 1955, it mailed to dealers in Arizona, customers or prospective customers of Arctic, an “announcement” that “With the increasing demand brought on by competitive advertising of low prices for less effective units to the public, A.R.A. has decided to place its dealers in a strictly competitive position with such units pricewise,” enclosing “revised prices” to dealers which, in fact, were the prices at which sales were made to Arctic. Appellant assigns as error: (1) the ruling of the trial court that it had breached the contract as a matter of law, relying on proof or offer of proof that the mailing to Arizona dealers was a mistake, that it never sold (and, by implication, that it never meant to offer to sell) to Arizona dealers, but only to Texas and Oklahoma dealers, and that it corrected its mistake by a “Bulletin” dated August 2, 1955, stating that the new prices “were mailed to yo in error and are not effective in the territory of Arizona”; (2) instructions concerning the computation of damages; (3) miscellaneous rulings related to the foregoing; and (4) failure to grant a new trial because of newly discovered evidence. We find none of the assignments meritorious.
Thereafter, Bowyer did no business with Arctic “Until he [Pierce] got the price right,” reducing the price per unit from about $535 to $465. In the circumstances, we do not think it was error to rule that the apparent tendency of appellant’s conduct “to defeat the essential purpose of the parties” made it a material breach as a matter of law. See Helgar Corp. v. Warner’s Features, Inc., 222 N.Y. 449, 453-454, 119 N.E. 113, 114; F.A.D. Andrea, Inc. v. Dodge, 3 Cir., 15 F.2d 1003, 1005; Crane v. Colonial Holding Corporation, Tex.Civ.App., 57 S.W.2d 316, 319.
stand up under evidence,” was elicited by appellant itself on cross-examination, pressing for “any evidence either direct or indirect” on the subject, and adds little, if any, appeal to appellant’s contention in that regard.
We turn now to appellant’s assignments concerning damages.
Second, appellant argues that the jury was erroneously instructed to award duplicate recovery. The court’s basic instruction with respect to damages was that, if appellees suffered actual damage as a direct and proximate result of the breach of contract, a verdict should be returned “in an amount which will compensate them fairly for such damages as they have suffered as a direct result of the breach of contract and which should have reasonably [have] been foreseen by the parties.” No other guidance was given the jury as to what elements might be considered in computing damages, except that it was told not to consider expenses incurred prior to March 16, 1955, salesmen’s salaries or commissions and advertising or other promotional expenses except to the extent that such expenses benefitted appellant. Appellant complains that the trial judge refused to instruct that the jury should not consider any loss of profits, any loss of inventory value, or, in effect, any promotional expense.
recover for “gains prevented,” appellees were entitled to have the jury consider any loss of profits shown, or, alternatively, any loss in inventory value. Jacob v. Miner, 67 Ariz. 109, 191 P.2d 734; McNutt Oil Refining Co. v. D’Ascoli, 79 Ariz. 28, 281 P.2d 966. To recover for an additional “loss” inflicted, appellees were entitled to have the jury consider any promotional expenditures which, as a result of appellant’s breach, were wasted. See L. Albert Son v. Armstrong Rubber Co., 2 Cir., 178 F.2d 182; A.L.I., Restatement of Contracts § 333; 5 Corbin on Contracts § 1031; 5 Williston, Contracts § 1363A (Rev.Ed.). While the subject is not free from difficulty, see Standard Machinery Co. v. Duncan Shaw Corp., 1 Cir., 208 F.2d 61, 63-64, such additional recovery, when justified, may be understood as similar to damages for destruction of good will. Cf. L. Albert Son v. Armstrong Rubber Co., supra; Allen v. Elliott Reynolds Motor Co., 33 Tenn. App. 179, 230 S.W.2d 418. Moreover, in cautioning that, “as to those [promotional] expenses, if any, * * * which inure to the benefit of both parties, you should make a fair apportionment,” the trial court may have adopted yet another acceptable point of view — that appellees were entitled to restitution for any benefit conferred on appellant. From whatever point of view, it was not error to refuse appellant’s requested instructions, which, it may be noted, would have prevented any recovery by any practical means of measurement; and the jury was not misled to award double recovery.
262 P. 609; Murphy v. Thompson, 70 Ariz. 250, 219 P.2d 334.
All other assignments of error have been considered and are disposed of by what is said hereinabove.
PHELPS, C.J., and STRUCKMEYER, UDALL and JOHNSON, JJ., concur.

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 § 333
 § 1031
 § 1363
 v. 
 v. 
 v. 
 v.