Court Opinion

ID: 6485733
Source: CourtListenerOpinion
Date Created: 2022-06-26 23:08:54.667877+00
Date Added: 2024-06-11T15:54:16.630996
License: Public Domain

DISSENTING OPINION OF
PERRY, J.
Briefly stated the case is this: Plaintiffs agreed to sell, and the defendants agreed to buy, certain taro. Plaintiffs refused to perform. Thereupon the defendants filed a bill in equity seeking- specific performance of the contract of sale and obtained the issuance of a temporary injunction restraining the vendors from selling or delivering the taro to persons other than the contractual vendees. In order to obtain this injunction the vendees filed a bond in. favor of the vendors to assure them against all costs, charges and damages sustained by them by reason of the issuance of the injunction if it should be thereafter decreed that the injunction had been improperly issued. A demurrer to the bill in equity was sustained, on appeal, by this court on the sole ground that the ven-dees had an adequate remedy at law by an action for damages and that for that reason a court of equity would *552not interfere. (Lum Wai v. Hong Hoon, 24 Haw. 696, 705.) The vendors thereupon instituted the present action, upon the bond, praying for a judgment for a certain sum of money by way of damages consequent upon the improper issuance of the temporary injunction. The trial court having directed a verdict for the defendants the case comes to this court upon exceptions.
It should be noted in limine that there is no exception, before this court presenting any claim or question relating to the possible right of the vendors to recover upon the bond for counsel fees or other costs or expenses paid or incurred in procuring the dissolution of the temporary injunction. The sole ultimate claim is that the vendors, having adduced undisputed evidence tending to show that the market value of the taro while the injunction was in force was higher than the selling price prescribed by the contract of sale and purchase and having delivered the taro to the defendants during the existence of the injunction by reason solely of the compelling force of the injunction, are entitled to recover by way of damages the difference between the contract price and the market value.
There can be no doubt that the decree in the equity suit was a final adjudication that the temporary injunction was improperly issued. My dissent recognizes that that matter is res judicata and that it is not now open to the vendees to “go behind” that decree and to seek or obtain a-ruling which in substance disregards that prior decree. But it remains equally clear that that decree did not adjudicate or purport to adjudicate the merits of the controversy between the vendees and the vendors and was simply based upon the theory that the vendees’ remedy Avas at law and not in equity. It is res judicata that the injunction was improperly issued and that if the vendors have suffered in damages by reason of the issuance or *553the pendency of that injunction they have a canse of action against the vendees npon the bond; bnt it is not res judicata that the vendors suffered any damages or, if they did, what the extent of those damages is. As in every other action at law for recovery of damages the plaintiff has the burden of proving the two main essentials of his case, to wit, (a) that by reason of the negligence, breach of contract or other substantial cause a right of action exists and (b) that the plaintiff has thereby suffered damage.
In the present instance, the case being freed from any complications or claim relating to attorney’s fees, costs or other expenses, the vendors have failed to prove that they suffered any damage. The undisputed evidence shows that they have suffered no damage. They were enjoined from doing that only which they had no right to do. In my opinion they cannot possibly be damaged under those circumstances. Referring to bonds in support of injunctions, 22 Cyc. 1040 says: “Where defendant in the injunction suit was not, or could not possibly have been, injured, he is precluded from recovering damages on the bond.” The vendors solemnly bound themselves by their contract with the vendees to sell the taro in question to the vendees and to no one else. “In the obligation assumed by a party to a contract is found his duty, and his failure to comply with the duty constitutes the breach.” 6 R. C. L., Sec. 377, p. 1016. “As a contract consists of a binding promise or set of promises, a breach of contract is a failure, without legal excuse, to perform any promise which forms the whole or part of a contract.” 3 Williston on Contracts, Sec. 1288. It is ture that the vendees had the power after entering into the contract to break it and to sell and deliver the taro to others; but they did not have the right, either moral or legal, to do so. It seems to me to be an utter perver*554sion of terms to say that a party to a contract has a right to do that which by the contract he has obligated himself not to do. Constitutions, statutes and courts have from time immemorial regarded contracts as solemn obligations the unoffending parties to which are to be always protected in their rights against those committing a breach. To now say judicially that a party has a right to commit a breach of any contract seems to me to be at variance with the' history of contracts and with the solemnity and respect which has been accorded to them in the past. If a party to a contract has a right to break it, why is it that courts of law allow damages to the un-offending1 party for that breach? Surely no one has ever succeeded in recovering in a court of law damages for the doing of that by another which that other had the unqualified legal right to do.
In the case of New England Box Company v. Prentiss, 76 N. H. 313, 317, the court does indeed hold flatly, under circumstances parallel to those of the case at bar, that the vendors had the right to sell to others and that they had the right “to such price as they could obtain” from others. Possibly there are other cases to the same effect. Their reasoning does not appeal to me as being-sound and with all respect I must decline to follow them. Other cases hold to the contrary:
“As long as the lien exists defendant could not lawfully sell more than the equity of redemption in the property which was subject to it. Hence it is not seen that he could have been damaged by being restrained from doing that which he had no right to do.” Parks v. O’Connor, 8 S. W. (Tex.) 104, 107.
“Either party to a contract, however solemn its character or binding its form, has the power to violate ’ if and courts of law give no redress to him who is injured except compensatory damages; but it is not accurate, in law or in morals, to say that a party has a right to break *555his contract. It would be to assert that it is legally right to do what is legally wrong. A person bound by a contract to do or not to do a thing may find it to his advantage not to keep his engagement, for the obligation may be more onerous than the damages likely to be imposed for its breach, but the violation of the contract cannot be regarded as a contractual right.” Rowland Lumber Co. v. Ross, 40 S. E. (Va.) 922, 924, 925.
“It is clear that there must be- an unjust restriction of a right to make one liable in damages for suing out a writ of injunction, and one who has obtained a judgment by fraud on a debt that has been paid cannot recover damages on the injunction bond even though the injunction be dismissed and the writ quashed. We do not hold, nor do we intend to hold, in this case, that where an injunction is dissolved, and that ends the matter, a person may not recover his damages for a wrongful issuance of such injunction, nor that one may set up as a defense to an action on the bond in such case that as a matter of fact the injunction was not wrongfully issued. But where, as in this case, it was determined by an action in court that the judgment, which said injunction was sought to restrain the collection of, was obtained through conspiracy and fraud, such an adjudication may be interposed as a defense to the action on the bond for damages.” Guthrie v. Biethan, 139 Pac. (Ida.) 718, 719.
“To recover on the.bond it must be shown that it” (the plaintiff) “was damaged to some extent by the issuance of the writ * ⅜ * or that some lawful or substantial right was interfered with by the writ.” Ry. Co. v. Whitney, 152 Ia. 520, 523.
It seems to me to be immaterial in what the illegality or absence of right consisted of. Illustrating again the difference between power and right,—“The defendant, if plaintiff’s contention be correct, had no right to tenni-nate the contract; but notwithstanding it did not have the right it had the power to do so, which it illegally exercised, and for which the law steps in and compensates the plaintiff in damages. The general rule is that, while *556a contract is executory, a party has the power to stop performance on the other side by an explicit direction to that effect, subjecting-himself to such damages as will compensate the other party for being stopped in performance on his part at that stage in the execution of the contract.” Dunham v. Hastings Pavement Co., 88 N. Y. S. 835, 837, 838. See also Sumner v. Crawford, 41 S. W. (Tex.) 825.
In this view, that the plaintiffs were enjoined from doing that only which they had no right to do and that therefore they' have neither suffered nor proved any damages, no question of pleading concerning recoupment or set-off can arise.
The further contention of the plaintiffs that because of the existence of the clause in the contract of sale and purchase relating to flOOO the plaintiffs are entitled to recover at least the difference between the sum of $1000 and the excess of the market value over the contract price cannot be sustained. That clause does not in any wise attempt to limit the amount of the damages of either party for a breach of the contract to the sum of $1000.
In my opinion the exceptions should be overruled.