Opinion ID: 1625752
Heading Depth: 1
Heading Rank: 3

Heading: The Damage Awards for Breach of Contract.

Text: A. Cook and Webster were granted a judgment against Pundzak for $37,200, representing the difference between the fees actually received by them from Pundzak for advertising spots for Allied Insurance Group and the amount they claimed had been due them under their arrangement. (The parties had operated under a 75/25% split, but in the case of Allied, Cook and Webster received only sixty percent.) Pundzak argues that, regardless of what the prior understanding was as to a 75/25% split, Cook and Webster expressly agreed to a fee for the Allied spots that amounted to only sixty percent. Cook and Webster, therefore, were not entitled to compensation on the basis of a 75/25% split, according to him. Cook and Webster respond that they were not given a copy of Pundzak's agreement with Allied, and Pundzak did not tell them what Allied was paying for the spots or that Cook and Webster were only receiving sixty percent. Accordingly, they did not knowingly consent to a 60/40% split. The parties had previously agreed to a 75/25% split, but this agreement was not put in writing. Nevertheless, we believe this term may become a part of their agency agreement. See Restatement (Second) of Contracts § 220 (1981): (1) An agreement is interpreted in accordance with a relevant usage if each party knew or had reason to know of the usage and neither party knew or had reason to know that the meaning attached by the other was inconsistent with the usage. (2) When the meaning attached by one party accorded with a relevant usage and the other knew or had reason to know of the usage, the other is treated as having known or having reason to know the meaning attached by the first party. Under Restatement (Second) of Contracts section 220, comment c, [a]n agreement or term thereof need not be stated in words if the parties manifest assent to it by other conduct, and such assent is often manifested by conduct in accordance with usage. Where there is an integrated agreement, an agreed but unstated term may be annexed by usage on the same principle which controls consistent additional terms generally. While the agency agreement with Pundzak did not expressly provide for a percentage split, there was substantial evidence that the parties had consistently operated on a 75/25% split, and there was adequate evidence to submit the issue to the jury. B. Pundzak contends that the $37,200 verdict for the Allied account underpayment and a $60,000 verdict for Cook and Webster under their best efforts theory are duplicative. We agree. Cook and Webster's claim to the $60,000 was based on the difference between what they actually received and what they should have received under a 75/25% split if Pundzak had used his best efforts. If the $37,200 had been added to the amount actually received, as the jury found it should have been, the recovery under the best-efforts claim would have been reduced accordingly. While it is true, as Cook and Webster argue, that the $37,200 and the $60,000 were recovered under different theories, the $60,000 verdict still included a second recovery for the same loss. To conclude otherwise would put Cook and Webster in a better position than they would have been if Pundzak had provided his best efforts under the agreement. Accordingly, on remand, Cook and Webster's judgment should be reduced by $37,200. Pundzak raises another issue of overlapping recoveries. Cook and Webster originally sued Allied on the theory that Allied, through Pundzak, had used the protected Willard & Rafert material without their consent. Cook and Webster settled with Allied before trial for $7050 and dismissed Allied as a defendant. The settlement expressly provided that Pundzak was not involved in the settlement. The jury awarded Cook and Webster this $7050, and Pundzak again claims duplication. Cook and Webster respond that the jury was instructed not to award overlapping damages. Furthermore, they claim, the recovery against Pundzak was under a breach-of-contract theory and the settlement with Allied was for infringement of Cook and Webster's protected interests. Despite the fact that the jury was instructed to avoid duplicate recoveries, and despite the fact that Cook and Webster's theories of recovery were different as to each defendant, we agree with Pundzak that the effect of the court's instructions and the jury's verdict was to allow Cook and Webster to recover twice for the same loss: once by settling with Allied for $7050 on the infringement claim and once under their claim against Pundzak for withholding that fee from them. In analogous circumstances in tort cases, the general rule is that: The consideration received by one injured as a consequence of a tort committed by two or more tortfeasors operates to reduce, pro tanto (to the same extent), the amount of damages he is entitled to recover against any other tortfeasor responsible for his injuries. This is true whether the tortfeasors are joint or independent. This result is mandated by the rule that a plaintiff is entitled to only one recovery for a single injury, and a joint tortfeasor is not a collateral source that can be ignored under the collateral source rule. A jury may have the right to find for a defendant if it believes that the plaintiff has been fully compensated for his injuries by a joint tortfeasor, even though the nonsettling defendant is guilty of negligence contributing to the injuries, or a court may reduce a compensatory damage award to zero in such a situation. 22 Am.Jur.2d Damages § 559, at 634 (1988). The present case does not involve a tort claim against Pundzak, but the pro tanto rule would be equally applicable. In tort cases that preceded the adoption of the comparative fault provisions of Iowa Code chapter 668, we discussed the pro tanto rule. In Greiner v. Hicks, 231 Iowa 141, 300 N.W. 727 (1941), for example, we stated: The theory underlying these decisions [on pro tanto credit] is that while a party is entitled to full compensation for his injuries there can only be one satisfaction therefor. This court has repeatedly recognized the universal rule that there can be but one satisfaction for an injury. Id. at 146-47, 300 N.W. at 731. Accord Wadle v. Jones, 312 N.W.2d 510, 513 (Iowa 1981). Cook and Webster are entitled to recover the Allied fee, but they are entitled to recover it only once. The district court on remand is instructed to further reduce Cook and Webster's judgment against Pundzak by $7050. We affirm the judgment on the breach-of-contract claims but remand for reduction of the judgments by $37,200 and $7050, which we find to be duplicative.