Court Opinion

ID: 7368918
Source: CourtListenerOpinion
Date Created: 2022-07-27 23:54:24.566893+00
Date Added: 2024-06-11T16:20:51.058077
License: Public Domain

McCLELLAN, j.—
(dissenting.) — This was an action for damages for breach of a contract. . The appellee (defendant), and another not now concerned, agreed to buy the entire output of the appellant’s coal mine, during the period from October 1, 1913, to June 30, 1914, at the price of 95 cents per ton f. o. b. mines, subject “to your [appellant’s] coal proving satisfactory,” and “preparations being made,” by appellant, “according to our [defendant’s] specifications,” and stipulating for monthly payments for coal shipped by plaintiff, the bills of .lading to show defendant as shipper, and the plaintiff engaging to “furnish us [defendant] a daily report as per the blank which we have fur*371nished you [plaintiff],” and the plaintiff further agreeing “to stand any reclamations on account of off-grade coal, and to stand ready and willing to prepare the coal in a proper and marketable manner.” The complaint contains three counts. In'all of them the allegation is that plaintiff not only fully performed his part of the contract for approximately four months, the defendant receiving large amounts of coal delivered under the contract, but also that he was ready and willing to perform his part of it for the remainder of the period stipulated by the parties to the agreement. It is further averred in the several counts that the plaintiff spent a large sum of money, approximately specified in the counts, in “equipping himself with the necessary machinery, mules, and other implements for the carrying out of his part of said contract,” and that plaintiff “spent the sum of, to-wit, one thousand dollars ($1,000) in opening up a mine so that he could mine the coal necessary to fulfill his part of said contract.” (Italics supplied.) The breach charged is'that on, to-wit, February 24, 1914, the defendant notified plaintiff he would not longer carry out his part of the contract, and that the contract was canceled. The only damages claimed in the first count is the loss of profits he would have made had defendant not prevented plaintiff’s performance of his part of the contract. But the damages claimed, as upon appropriate averments, in the second and third counts, are not limited to the loss of profits as in the first count. In the second and third counts the damages accruing for expenditures made by plaintiff in preparation for his performance of the contract — including the “opening up of a mine so that he could mine the coal necessary to fulfill his part of said contract” — are expressly averred and claimed. There was judgment for the defendant. The appeal is on the record. There is no bill of exceptions. The only errors assigned, and the only arguments made in the briefs for the parties, relate to rulings of the court on demurrers to pleas 2, 3, and 4, and replications to those pleas. Since the only questions of law raised and made by these rulings on the sufficiency of the mentioned pleadings did not involve inquiry into or doubt of the binding quality of. the contract averred, it is quite probable a bill of exceptions would have been taken to show the situations, purposes, and circumstances surrounding the parties when they made the agreement as well as their subsequent acts under and in interpretation of it, had the plaintiff been at all warned in the trial court *372that there would he any doubt- of mutuality in the contract averred.—Mason v. Ala. Iron Co., 73 Ala. 270, 274. There, it-was said: “In the construction or interpretation of all contracts, oral or written, the object is to ascertain, and, if possible, to effectuate the intention of the parties, so that performance may be enforced according to the sense in which they mutually understood it at the time it was made. It is necessary not only to read and examine the mode in which the contract is expressed, but to consider the situation of the parties, the subject-matter, and the object it is intended to accomplish.”
Doubtless, evidence available to the parties would disclose their intention in stipulating for “preparations being made according to our [defendant’s] specifications,” and that the plaintiff would “furnish us [defendant] a daily report aS per the blank which we [defendants] have furnished you [plaintiff].” It is the judicial duty to ascertain the 'intention, and to give effect to the lawful intention of the contracting parties to the end that the obligations assumed by them may be found and appropriately enforced. Intention is the parent of obligation assumed; and if the parent is known, the offspring is generally readily found. “A promise is a good consideration to support a promise.”—Evans v. C., S. & M. Ry. Co., 78 Ala. 341, 345. “If the party in whose favor such unilateral promise is made, accepts its performance, or does any act in recognition of its implied or intended, though unexpressed consideration, this supplies the element of mutuality, and gives a right of action.”—Pratt Consol. Coal Co. v. Short, 191 Ala. 378, 68 South. 67; Sheffield Fur. Co. v. Hull Coal Co., 101 Ala. 446, 447, 14 South. 672; McIntyre Lumber Co. v. Jackson Lumber Co., 165 Ala. 268, 274, 51 South. 767, 138 Am. St. Rep. 66. In Evans v. C., S. & M. Ry. Co., supra, Stone, C. J., writing to the point of mutuality vel non in the contract there under review, said: “The whole doctrine, however, rests mainly on the absence of consideration to support the promise ; there being no corresponding promise to uphold the promise declared on. Hence, where there is a consideration, the rule (i. e., that both parties must be bound else neither is bound) does, not apply.”
The Chief Justice, then set forth the language above quoted in Pratt Consol. Coal Co. v. Short, supra. The doctrine of our cases, cited above, is in accord with authority, generally. See 9 Cyc. pp. 333, 334, and notes; 6 R. C. L. §§ 93, 94; Herrick v. *373Wardwell, 58 Ohio St. 294, 50 N. E. 903; 1 Par. on Contr. p. 451; Stahl v. Van Vleck, 53 Ohio St. 136, 148, 41 N. E. 35; Des Moines R. R. v. Graff, 27 Iowa 99, 1 Am. Rep. 256; Burgess Fibre Co. v. Broomfield, 180 Mass. 283, 286, 287, 62 N. E. 367. “The prima facie measure of damages for the breach of a contract is the amount of the loss which' the injured party has sustained. * * * If the breach consists in preventing the performance of the contract, without the fault of the other party, who is willing to perform it, the loss of the latter will consist of two distinct items or grounds of damage, namely: First, what he has already expended towards performance (less the value of materials on hand) ; secondly, the profits that he would realize by performing the whole contract. The second item, profits, cannot be recovered. * * *” If damages by way of lost profits are “not proved, or if they are of such a remote and speculative character that they cannot be legally proved, the party is confined to his loss of actual outlay and expense. This loss, however, he is clearly entitled to recover in all cases, unless the other party, who has voluntarily stopped the performance of the contract, can show the contrary. * * * But failure to prove profits will not prevent the party from recovering his losses for actual outlay and expenditure.”—U. S. v. Behan, 110 U. S. 338, 344, 345, 4 Sup. Ct. 81, 83 (28 L. Ed. 168) ; 1 Suth. on Dam. § 80.
In view of the allegation of, and claim for, damages (set forth in the second and third counts) for expenditures made by the plaintiff in preparation for performance of the contract and employed in the actual performance thereof for a good part of the period provided in the contract, it is an obvious error, contradictory of two counts of the complaint, to accept as a premise for a conclusion practically destructive of the contract (except as fully executed for a part only of the period) that only loss of profits is claimed in the complaint. If there was a binding contract between the parties, then the general rule for the admeas-urement of damages for its breach (if it was breached without fault on plaintiff’s part) has application; and the necessary result must be that a decision predicated of the notion that only ldss of profits is asserted and claimed as an element of damages in the complaint, is manifestly ill-advised and unsound. Aside from other considerations that disclose the complete inapplication to the contract in question of the decision in and doctrine of the case of Pulliam v. Schimpf, 109 Ala. 179, 19 South. 428, and *374any others that accord with its authority, the assertion of a. claim for expenditures made by the plaintiff to perform, and in performance of, the agreement forbids the acceptance of or reliance upon the doctrine of Pulliam v. Schimpf as any measure of authority for a conclusion that the second and third counts state no cause of action for a breach of the contract therein alleged. In Pulliam v. Schimpf the agreement there considered was held to be ineffectual because of its inherent uncertainty; not because of a want of mutuality, and that uncertainty was found, as correctly stated in Christie, et al. v. Patton, 148 Ala. 326, 327, 42 South. 614, in the provision of the agreement stipulating for its duration. The decisions in Erwin v. Erwin, 25 Ala. 236, and in Howard v. Railroad Co., 91 Ala. 268, 8 South. 868, were controlled, as is accurately pointed out in the Christie-Patton Case, 148 Ala. 327, 42 South. 614, by the fact that no definite period of time was provided during which the agreement should continue. The contract here involved is not subject to the infirmity found in the cases ante reported in 109, 91, and 25 Ala. Reports. This contract is absolute in its definite provision for its continuance. Besides the vital differences' in the terms of the contract here involved and those considered by this court in the Christie-Patton Case, in Pulliam v. Schimpf, in Erwin v. Erwin, and in Howard v. Railroad Co., will readily appear to the reader. The conclusion and the decision attained in the Christie-Patton Case is thus expressed on page 329 of 148 Ala., page 616 of 42 South.: “Granting, therefore, that the transaction amounted to a contract, it is wholly indefinite as to its duration, and therefore lacked one of the elements necessary to any estimate of damages.” ,
This statement of conclusion accords with the court’s plainly stated purpose (see page 327 of 148 Ala., page 614 of 42 South.) to follow and apply the doctrine of Pulliam v. Schimpf, Erwin v. Erwin, and Howard v. Railroad Co. The case of Elmore v. Parrish, 170 Ala. 499, 54 South. 203, is likewise without application to the contract here involved, for, apart from obvious differences in the nature and terms of the contract there under consideration (set forth in counts 2 and 4) and that here involved, the decision was that the contract' was void for uncertainty in respect of the price and of the weight of the bales of cotton. Here the price of the coal was fixed by the express agreement of the parties; and the subject-matter of the contract *375was the entire output of the mine, of a stipulated character of coal, for and during a specified period. The contract alleged in the counts before this court cannot be soundly pronounced void for want of mutuality on authorities that deal with and decide only that contracts, different from this one, were void for uncertainty in respect of the subject-matter, or of the period of their continuance, or of the failure to fix a price for the thing to be bought and sold. Uncertainty and mutuality are distinct conceits in the law of contracts, and they should not be confused, if sound, logical conclusions are to be attained. The contract set forth in the several counts of this complaint is certain in every element essential to make a valid, binding contract.
Where a contract is reduced to writing and its terms are unequivocal, unambiguous, nothing can be implied that is not expressed, nor can implication serve to extend the obligations thereof; the presumption being that the parties have expressed all the conditions by which they intend to be-bound.—Blackman v. Dowling, 63 Ala. 304; Electric Co. v. Elder, 115 Ala. 138, 148, 149, 21 South. 983. But where the contract, though written, is susceptible of two constructions, one of which will sustain and the other invalidate it, that which will sustain the contract will be adopted. —Lively v. Robbins, 39 Ala. 461, among others. The essential element of mutuality in a contract need not be expressly provided. If the parties intend to make mutual promises and employ terms — in the light of the circumstances surrounding the parties and the purposes entertained by them— that import a meaning to become mutually bound, then-the contract is not void for the want of mutuality.—9 Cyc. 333; Minneapolis Mill Co. v. Goodnow, 40 Minn. 497, 42 N. W. 356, 4 L. R. A. 202. There are at least two provisions in the letter, setting forth the terms of'the agreement, which deserve to be considered in determining the mutuality vel non of the contract the moment it was made by the parties. These provisions show unmistakably that the plaintiff bound himself, promised the defendant to make “preparations” to mine the coal in plaintiff’s mine “according to” the defendant’s “specifications,” and also bound himself “to furnish” defendant with “a daily report, as per the blanks which” defendant should furnish the plaintiff. If the latter provision contemplated, as in the absence of all evidence it is fair to assume was the purpose in so stipulating, a daily report of the operation of the mine, to the end that the *376buyer (defendant) might promptly know the tonnage to be expected, it is quite clear that, necessarily, the plaintiff obliged himself, promised the defendant, to steadily operate his mine during the period stipulated, else he could not make the daily report he engaged to furnish to the defendant; and the correctness of this conclusion finds further confirmation in the other provision, not explained to this court by evidence of any character, that required the plaintiff to observe “specifications” made by the buyer, the defendant. Since we have no bill of exceptions showing what these “specifications” contained or what particular matter the daily report concerned, it should not be inferred against the validity of the agreement that these provisions, which might be fully explained by appropriate evidence, placed no obligation whatever on the plaintiff to operate his mine that an “output” might be secured by the buyer (defendant) consistent with the manifest purpose of the parties.
If, however, it should be assumed that the plaintiff, at the time they contracted, made no promise to the defendant to operate the “Baker’s Creek mine,” during the period stipulated, and thereby-leaving the promise of the defendant to buy the' “output” without the supporting consideration of a correlative promise on the plaintiff’s part to operate the mine and thus produce an “output,” the doctrine reproduced above from our cases of Evans v. Railroad, Sheffield Fur. Co. v. Hull Coal Co., Pratt Consol. Coal Co. v. Short, and McIntyre Lumber Co. v. Jackson Lumber Co., ante, must be accorded application and effect to sustain the contract by affording a consideration for defendant’s promise to buy the “output,” because, as appears from all the counts, the plaintiff expended his funds in preparation to mine the coal and in mining the coal to meet the condition to the defendant’s promise to buy the “output,” at a specified price per ton, if the coal met the legal standard fixed by the parties for the quality thereof. The defendant having given the promise to buy and the seller having made an outlay to afford the subject- of the defendant’s promise to buy, “this,” to again quote the Evans Case, “supplies (supplied) the element of mutuality.” The applicable doctrine of the cases mentioned is further illustrated in our case of Mott v. Jackson, 172 Ala. 448, 55 South. 528, though not more aptly so at this time than in Pratt Co. v. Short, where Short had not promised to mine any coal in the described area; but, having entered upon the work just as if he had originally, expressly *377engaged to mine .the coal,, it was ruled, according, to the authority , of the cases cited, that this afforded a consideration for tlie prom7 ise he asserted the coal company made to allow him to mine the', coal, and that the contract was not void for the want of mutuality.
The second plea asserted. that the “qúality or condition of the coal mined from defendant’s [meaning plaintiff’s] said mines did not prove satisfactory to them.” The contract declared on submitted the quality of the coal which defendant obliged himself to take, for a definite period at a stipulated price, to the entire satisfaction of the defendant, “preparations being made according to our [defendant’s] specifications,” and that the plaintiff should “stand ready and willing to prepare coal in a proper and marketable manner.” It is manifest from the contract that the satisfaction to which the parties subjected the coal, defendant obliged himself to take concerned only the quality of the coal, and that the plaintiff should be accorded adequate opportunity to make the condition of the coal conform to marketable shape. The pleader in the second plea, asserted as the basis for defendant’s dissatisfaction with the coal, mined from plaintiff’s mines, that its quality or condition was not satisfactory to defendant. Under this contract the character of the satisfaction to which the parties subjected the quality of the coal defendant agreed to take is well defined in Electric Co. v. Elder, 115 Ala. 138, 153, 21 South. 983. According to that established authority defendant could not be legally dissatisfied with the quality of the coal tendered by the plaintiff, and thus avoid his obligation to take the coal, unless his dissatisfaction was not capricious, was founded in good faith, was not the result of design to be dissatisfied, but was an honest conclusion consequent upon a reason with respect to- the quality of the coal. “If defendant had no reason to be dissatisfied, * * * he was bound to be satisfied.”—Electric Co. v. Elder, 115 Ala. 154, 21 South. 983. In such pleas “the facts which cause the dissatisfaction” must be stated.—Electric Co. v. Elder, 115 Ala. 154, 155, 21 South. 983. The thirteenth ground of demurrer takes the objection that the plea did not set forth “with sufficient definiteness wherein or how the said coal was unsatisfactory to defendants.” The ninth, eleventh, twelvth, and fourteenth grounds of the demurrer raised objections of the same general nature. Aside from the possible faults introduced by the general, indefinite averment in the alternative of the condition of the coal as the basis for defendant’s *378dissatisfaction and by the omission to characterize the defendant’s dissatisfaction as bona fide, plea 2 was faulty in its failure to aver the facts that induced the defendant’s dissatisfaction with the quality of the coal, rather than, as the plea should have shown, that the quality of the coal was so deficient as to reasonably induce the defendant’s dissatisfaction. It seems to me that error affected the action of the court in overruling the demurrer to plea 2.
Pleas 3 and 4 proceed upon a materially different status of contract from that set forth in plea 2, when read in connection with the counts of the complaint. They might have been better framed if they had characterized defendant’s dissatisfaction as bona fide; but this objection to these pleas was not taken by the demurrer. I see no error in overruling the demurrers to these pleas (3 and 4.)
I would reverse the judgment. It appears from special charges given to the jury that the court submitted the issues to the jury, thus rendering impossible the application of rule 45 (175 Ala. xxi, 61 South, ix).