Court Opinion

ID: 9572235
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:39:56.065497+00
Date Added: 2024-06-11T12:32:06.866584
License: Public Domain

Carter, J.
This is an action for damages for breach of contract. A verdict and judgment for $70,000 were obtained by plaintiffs. An appeal was taken to this court where the judgment was reversed and the cause remanded with directions to sustain defendant’s motion for a judgment *217notwithstanding the verdict. Selig v. Wunderlich Contracting Co., 159 Neb. 46, 65 N. W. 2d 233. Plaintiffs filed a motion, for a rehearing. This court allowed a reargument on the motion.
The record shows that Ben L. Selig and Stanley Selig were co-partners doing business under the firm names of Esse Sales Service and Engineering Company, and Esse Radio Company, with their principal place of business in Indianapolis, Indiana. We shall hereafter refer to the partnership as Esse. The defendant Wunderlich Contracting Company is a Nebraska corporation which, for convenience, we shall refer to as Wunderlich.
The defendant purchased a large number of surplus aircraft at Kingman, Arizona, from the government which were required to be dismantled by the purchaser. On January 15,' 1947, Esse submitted an offer to Wunderlich for 17 items which were to be stripped from these planes. The offer was accepted. The contract was entered into at Kingman, Arizona, whereby it was provided that Esse was to make a deposit of $2,000 and pay cash prior to the shipment of the items purchased. Pursuant to the terms of the agreement, Esse gave its check to Wunderlich for $2,000 bearing date of January 15, 1946, but which was actually given on January 15, 1947.
The check was drawn on the American National Bank, Indianapolis, Indiana. It was deposited with the Valley National Bank, Kingman, Arizona, which bank forwarded it for collection in the usual course of business. The Indianapolis bank received it on January 21, 1947, and refused payment. The check was returned to the clearing house in Indianapolis where it was protested and protest notices mailed. On January 22, 1947, Esse made a $5,000 deposit in the Indianapolis bank. The check was returned and paid by the Indianapolis bank on January 23, 1947. Wunderlich received notice on January 27, 1947, from the Kingman bank that the check had been protested and on that date it issued *218instructions to make no shipments on the contract of January 15, 1947. On January 28, 1947, Wunderlich, through its broker, advised Esse that the check had been protested. Esse advised Wunderlich under date of January 28, 1947, that the check had been returned because of bookkeeping troubles which were being straightened out. On the same day Esse wired Wunderlich to send the check through again and that it was “okay.” On February 12, 1947, Wunderlich advised Esse that the bank had been unable to collect the check, and requested a certified check. Ben L. Selig, one of the partners in Esse, arrived in Kingman on February 12, 1947, and was told that Wunderlich was not delivering any of the items purchased because it had not received the $2,000 cash deposit. Wunderlich demanded another check and Ben L. Selig promised to have a certified check sent. Ben L. Selig left Kingman at that time and returned on February 20, 1947. A certified check dated February 13, 1947, for $2,000 was mailed by Esse to Ben L. Selig in care of Wunderlich. Wunderlich offered evidence that Ben L. Selig agreed to deliver cash or a certified check on or before February 18, 1947. This was denied by Selig.
Wunderlich testifies that on February 19, 1947, it received an offer by a third party at a higher purchase price for one of the items contracted to Esse, and wrote Esse that as it had not adjusted the deposit matter by February 18, 1947, as agreed, it was reserving the right to dispose of any or,all of the items contained in the agreement of January 15, 1947. Esse received this letter on February 21, 1947. On March 1, 1947, Wunderlich executed the purchase order agreement with the third party.
On February 20, 1947, Ben L. Selig arrived back in Kingman and tendered the $2,000 certified check to Wunderlich. The check was refused by Wunderlich and Ben L. Selig was advised that the contract had been can-celled. Selig was told that two of the items, APN-4 *219Radar Scopes and I-152-AM Indicators, which we will refer to as radar scopes and indicators, had been sold to another buyer. Wunderlich offered to deliver the remaining items. After much discussion it was agreed that the two items should be deleted, and the change was mutually initialed on the agreement. The $2,000 certified check was tendered and accepted after the deletion of the two items had been made. On March 4, 1947, Wunderlich was advised by Esse that the first $2,000 check was in fact paid by the Indianapolis bank on January 21, 1947. By the same letter Esse demanded the reinstatement of the original contract of January 15, 1947. Wunderlich refused to reinstate the agreement because it had, on March 1, 1947, contracted to sell all radar scopes and indicators at Kingman Field to another buyer.
It seems clear to us that oh February 20, 1947, neither Ben L. Selig nor E. B. Fontaine, the authorized agent of Wunderlich, had any actual knowledge that the $2,000 check bearing the date of January 15, 1946, had been paid by the drawee bank. We do not think that this was a fact upon which either Esse or Wunderlich could rely. The Kingman bank, and each intermediate bank to whom it forwarded the check for collection, was the agent of the depositor Wunderlich. Such being the case, Wunderlich had imputed knowledge that the check was paid on January 23, 1947. Western Smelting & Refining Co. v. First Nat. Bank of Omaha, 150 Neb. 477, 35 N. W. 2d 116; Placek v. Edstrom, 148 Neb. 79, 26 N. W. 2d 489, 174 A. L. R. 856.
The Indianapolis bank is likewise the agent of Esse and the knowledge of that bank is imputed to Esse. Exchange Bank of Wilcox v. Nebraska Underwriters Ins. Co., 84 Neb. 110, 120 N. W. 1010, 133 Am. S. R. 614; Modern Woodmen of America v. Berry, 100 Neb. 820, 161 N. W. 534, Ann. Cas. 1918D 302; Scottsbluff Nat. Bank v. Blue J Feeds, Inc., 156 Neb. 65, 54 N. W. 2d 392. A dual relationship exists between a bank and *220its depositor. A debtor-creditor relationship exists with respect to funds on deposit and a principal-agent relationship exists with respect to the payment by the bank of checks drawn by a depositor. 9 C. J. S., Banks and Banking, § 267, p. 546. Consequently, the knowledge of the drawee bank that it had paid the check on January 23, 1947, is imputable to Esse. It is clear therefore that Wunderlich and Esse had imputed knowledge that the check was paid on January 23, 1947. No- default existed thereafter because of the alleged nonpayment of the $2,000 deposit. It is urged that Esse estopped itself from asserting that the $2,000 check was paid because it had continuously assumed in dealing with Wunderlich that the check had not been paid. But the very facts upon which the estoppel is claimed were known to be untrue by Wunderlich. An estoppel is no more available to Wunderlich than it is to Esse under the circumstances shown.
The record shows that Wunderlich attempted by letter under date of February 19, 1947, to cancel the agreement of January 15,1947. It is shown that this letter was not received by Esse in Indianapolis until February 21, 1947. The postal department being the agent of Wunderlich, the letter would not operate- as a notice of rescission or cancellation of the agreement until the latter date. On February 20, 1947, Ben L. Selig arrived in Kingman and carried on certain negotiations with Wunderlich. It is the effect of these negotiations which must determine the issues here presented.
On February 20, 1947, Ben L. Selig returned to King-man. He immediately contacted Wunderlich through Fontaine. Selig tendered the certified check for $2,000, which Fontaine refused on the ground that the contract had been cancelled. Fontaine told Selig that Wunderlich was willing to cancel the whole contract and forget everything. Selig testifies that he knew something was wrong and that Esse was being deceived, and he told Fontaine so. After an argument in which Fontaine *221stated he would not reinstate the contract under any circumstances without taking the two items off, Selig agreed to do so under protest. They noted the deletion on the margin of the contract and each indicated his assent thereto by initialling the change.
There is no evidence of a breach of the agreement on the part of Esse. The delay in proceeding under the terms of the agreement appears to have been caused by a misunderstanding of facts which were imputed to each by law. The record shows that Wunderlich did negotiate for the sale of the radar scopes and indicators with Air Industries prior to February 20, 1947. The record shows that Air Industries made a firm offer for these items on February 19, 1947, which was conditionally accepted by Wunderlich. It is quite evident that these negotiations were carried on in contemplation of a breach of the agreement made with Esse on. January 15, 1947. These negotiations, which were had with Air Industries in anticipation of a breach of contract by Esse, are important in determining whether or not the agreement was cancelled in good faith. Wunderlich did not enter into a contract of sale with Air Industries until March 1, 1947. Such sale without liability to Esse is dependent upon the right of Wunderlich to rescind the agreement on February 20,1947, without liability for damages.
We conclude from what we have already said that there was no breach of the agreement of January 15, 1947, by Esse. Esse was insisting upon the fulfillment of the agreement on February 20, 1947, when Wunderlich first notified Esse that the agreement was can-celled. There is evidence in the record that Wunderlich had sold 41 of the radar scopes to others before it attempted to rescind, and it had negotiated with another party for the sale of the remainder of the two items involved here. Even if these acts constituted a breach of the agreement, Esse does not rely on it and Wunderlich cannot take advantage of its own wrong to the injury of *222Esse. Esse could waive the breach and properly insist upon compliance with the agreement.
The question immediately presents itself as to whether or not the agreement was modified before or after breach. On February 20, 1947, the date the modification of the original agreement was made, Esse was not in default. Wunderlich advised Ben L. Selig on that day that it had cancelled the contract and that it would not comply therewith unless the two items in question were deleted. This was a breach of the agreement, an unequivocal refusal to comply with the terms of the agreement of January 15, 1947. “Where a party bound by an ex-ecutory contract repudiates his obligation before the time for performance, the promisee has, according to the great weight of authority, an option to treat the contract as ended so far as further performance is concerned, and \o maintain an action at once for the damages occasioned by such anticipatory breach.” 17 C. J. S., Contracts, § 472, p. 973.
It is clear, therefore, that after the breach of the agreement by Wunderlich, the parties modified the first agreement by deleting two items. We find that no consideration existed for the modification. The rule in this state is stated in Swanson v. Madsen, 145 Neb. 815, 18 N. W. 2d 217, as follows: “Defendant contends that a contract required to be in writing by the statute of frauds can be altered or modified by parol agreement and that the consideration for the original agreement is sufficient to sustain the new. We think this is true where there has been no breach of an executory contract, but where, as here, the contract had been breached at the time of the modification, a new consideration must be shown.” See, also, Moore v. Markel, 112 Neb. 743, 201 N. W. 147; Prime v. Squier, 113 Neb. 507, 203 N. W. 582. In the case before us there was a modification of the original agreement after breach. There being no consideration for the modification, it is not effective to defeat the claim of *223Esse. Sallander v. Prairie Life Ins. Co., 112 Neb. 629, 200 N. W. 344.
Our former opinion holds that there was a compromise and settlement of the claims of the parties for a sufficient consideration. On a reconsideration of this point we now conclude that we were in error in so holding. Without discussing the question as to whether or not the defense of compromise and settlement was properly raised, we think the record fails to show any consideration for the settlement. The modification consisted of the deletion of two items and a part of a third item from the contract. Esse protested the deletions but agreed thereto as an inducement to Wunderlich to deliver the other items, which it did. The modification makes no change in the original contract except to provide for a lesser number of items than was contained in the original' obligation. Wunderlich was required, on February 20, 1947, to deliver the radar scopes and indicators in accordance with its contract. It forced Esse to agree to a deletion of two items without consideration in order that Esse could obtain the delivery of items which Wunderlich was already obligated to deliver. This does not constitute a consideration under the present holdings of this court. Esterly Harvesting Machine Co. v. Pringle, 41 Neb. 265, 59 N. W. 804; Sallander v. Prairie Life Ins. Co., supra. We necessarily conclude that the deletions made in the contract of January 15, 1947, constituted a modification of that instrument. The modifications having been made after a breach of the original contract, a legal consideration was essential to its validity as a justifiable excuse for the nonperformance of the original agreement according to its terms. There being no consideration for the deletion of the two items, any claim of compromise and settlement must likewise fail. 11 Am. Jur., Compromise and Settlement, § 18, p. 264; 15 C. J. S., Compromise and Settlement, § 11, p. 732. A summary of the evidence indicates that Wunderlich’s attempted rescission was not *224made in good faith. We point out that Ben L. Selig came into the office of Wunderlich and tendered a $2,000 certified check before a notice of rescission of the contract had been received by Esse. The check was refused. The record indicates that Wunderlich had been negotiating with Air Industries for the sale of the radar scopes and indicators. Wunderlich advised Selig on February 20, 1947, that these items had been sold. The record reveals that Wunderlich had discovered that the radar scopes and indicators were of much more value than they had estimated. It is noteworthy in considering the matter of the good faith of Wunderlich in attempting a rescission of the contract that it was willing to abide by the contract if the two items were deleted, such two items being those which it had discovered could be sold for considerably more money than the price fixed in the Esse contract. It is quite clear that the attempted rescission of the contract by Wunderlich was not in fact based on the alleged failure to make the $2,000 deposit, but because of the opportunity to make a much better sale to Air Industries. Wunderlich relied upon a legal right to rescind without payment of damages to accomplish that purpose. Not having such a right, legal remedies are available to Esse. There is no basis for the application of equitable principles. It is clear therefore that Esse has established a cause of action for damages against Wunderlich.
Defendant Wunderlich asserts that the trial court erred in giving its instruction No. 4. The part of the instruction first objected to states: “As regards the existence of the contract the burden is upon the plaintiffs to establish by a preponderance of the evidence that E. B. Fontaine in signing Exhibit 4 for the defendant agreed to sell plaintiffs the items described therein from the four fields other than the Kingman field, to-wit, Walnut Ridge, Arkansas, Chino, California, Altus, Oklahoma and Clinton, Oklahoma, which question you are to determine; but as a matter of law you are instructed that there is *225no question but that the defendant has agreed to sell the items in question on the Kingman field to the plaintiffs.”
The record shows that the federal government advertised for bids on the surplus aircraft located on the five fields named' in the instruction. The aircraft were offered for sale on the basis that any one bid should cover all the aircraft at any one field but that no bidder could purchase the aircraft at more than one field. Wunderlich submitted a bid in accordance with the above conditions and was the high bidder for the aircraft at King-man, Arizona. The aircraft at the other four fields were sold to Texas Railway Equipment Company, Sharpe & Fellows Contracting Co., Sherman Machine & Iron Works, and Esperado Mining Company. These five companies entered into a joint venture agreement whereby they, under the name of Aircraft Conversion Co., were to disassemble the aircraft and salvage, scrap, smelter, and prepare for market the aluminum scrap from the aircraft on each field within the time and under the conditions of the contract each held with the federal government. There is nothing in this agreement which deprives each of his title to the aircraft it purchased or gives it any interest in the aircraft purchased by the others. Simply stated, it was an agreement providing a joint method of processing scrap for market as a matter of convenience and economy. The joint venture agreement expressly states: “No Joint Venturer shall make any contract, commitment, or expenditure, binding upon or affecting the joint venture or any of the Joint Venturers, without the concurrence or approval of the Joint Venturers; * * * Nothing herein shall in anywise be construed or operate to prevent each Joint Venturer and the Joint Venturers collectively from strictly keeping and performing all provisions of their respective agreements with the Government; and it is specifically provided that each Joint Venturer shall have and retain full power and authority to sell and dispose of the scrap aluminum and other salvage from the planes pur*226chased by him or it, respectively, to such person, persons or concerns, and at such price or prices as he may desire, * * The Aircraft Conversion Co. did not purport to sign any of the agreements here involved. This agreement is no aid to Esse’s claim that all five fields were bound by Wunderlich’s agreement.
Before reducing the aircraft to scrap, each purchaser stripped them of all saleable items, including the 17 items listed in the contract of January 15, 1947, between Wunderlich and Esse. One Harry A. Hammill was a broker operating on all five fields in finding buyers and negotiating the sale of items stripped from these aircraft. He was not authorized to sign contracts for the sellers. The evidence shows that Ben L. Selig inspected the aircraft on three of the fields, including Kingman, in the company of Hammill. At the close of the inspection of King-man field, Selig evidenced a desire to purchase certain electronic equipment at all five fields at the asking price. Hammill wrote up the purchase order on his own brokerage form. It recited that the buyer offers to. purchase: “All fields, Indicator 1-152-AM .50.” All items within the offer were designated in a similar manner. The contract being construed is not complete in itself. The fields referred to as “all fields” are not described in the offer to purchase. It is necessary to determine, from sources other than the offer of purchase accepted by Wunderlich, the meaning to be given the term “all fields” and the scope of the liability assumed by Wunderlich when it accepted the offer. Hammill says that 30 copies of the offer to purchase were made out and that four were sent to each field. Hammill and Selig signed all copies before any were submitted to Fontaine. Fontaine accepted the offer for Wunderlich at Kingman field. Other copies were sent to the other fields for signature of the purchaser of the aircraft at the respective fields. Hammill further testifies that the use of the words “all fields” was questioned by Fontaine. Hammill stated: “And the man (Fontaine) was justified *227in that. But, I wanted to get out and I guess so did Ben, and I said, ‘Don’t mess up this deal’. ‘Selig and I have got this all straightened out. The fact is, you know what it is; Selig knows what it is; so- you haven’t got anything to worry about. I’m going to send these to Dahlstrom. It will be taken care of. There’s nobody here to rewrite it. I will admit I made a mistake on it. Go ahead and sign it. We understand we are going to just get what you got out in them warehouses.’ ” Ben L. Selig was present at this discussion. It is true of course that Hammill as a broker for “all fields” was attempting to negotiate a sale of the specified items for all fields, but this does not mean that Fontaine was selling the items on all fields. It is clear that each seller on the various fields bound himself when he accepted the offer to purchase. This is confirmed by Lindsey Youngblood, Wunderlich’s sales manager, who testified that he was present at the signing of the contract along with Hammill, Fontaine, and Selig. Youngblood testified: “Mr. Ham-mill assured us it was intended only for our approval for our field, as he intended to get the approval of the other fields for his proposal.” Selig was present when this was said. That Selig knew that the contract purported only to bind Wunderlich and the aircraft it purchased at Kingman is plain. Selig made a subsequent contract with the Texas Railway Equipment Company on the Walnut Ridge field covering all of the same items except one. In this respect, the contract with the Texas Railway Equipment Company was rewritten on the offer-to-purchase form provided by Hammill. The words “All fields” were changed to “All on the field” and an ink line was drawn through “APN-4 $1.00.” Otherwise the agreement was identical as to content with the offer to purchase accepted by Wunderlich. The agreement with the Texas Railway Equipment Company was signed by Ben L. Selig. If he purchased the items contained in the contract with the Texas Railway Equipment Company by the contract signed with Wunderlich, as *228he now says, the contract with the Texas Railway Equipment Company was wholly unnecessary. It is wholly inconsistent with his contract with Wunderlich under the evidence he now relates. It is plain to us that Selig knew at that time that the agreement with Wunderlich covered only the items at Kingman field. It appears also that Esse subsequently threatened suit against Wunderlich and Texas Railway Equipment Company. Suit was never threatened against the purchasers of aircraft on the other three fields for failure to deliver items contained in the agreement of January 15, 1947. It would appear that Esse was not at that time placing the construction on the scope of the agreement that it now does. We conclude therefore that the contract of January 15, 1947, covering “all fields” meant that the offer covered all five fields but that the owners of the aircraft at the respective fields became bound by it only as each accepted the offer to purchase by attaching its authorized signature thereto. The agreement with Wunderlich, therefore, covered the items at Kingman field, and no other. The trial court should have so instructed. It was prejudicial error to permit the jury to' speculate as to whether or not items other than at Kingman field were involved in the litigation.
The jury was also informed by instruction No. 4 that: “As to any future damages, if any, which may be suffered after this date, such preponderance of the evidence must establish the same with reasonable certainty.” We find no evidence in the record to support the giving of this part of the instruction. The case was submitted to the jury on May 15, 1953. The breach of the contract occurred on February 20, 1947. The damages to which Esse is entitled are those resulting from the breach. Even a loss of good will, if any be shown which resulted from the acts of Wunderlich, could be established only during the period that orders for radar scopes were not being filled. These orders were received in April and May 1947. No basis exists for authorizing the jury to *229return a verdict which would include damages that might occur after the date of the trial.
The trial court also instructed that loss of good will was, if established by a preponderance of the evidence, a proper element of damage. Loss of good will is a special damage which is not recoverable in every action for breach of a contract to deliver goods. 78 C. J. S., Sales, § 550, p. 242. Any loss of good will by Esse arises solely from its inability to make deliveries of radar scopes resulting from orders received through advertisements. The evidence shows that some time after January 15, 1947, the exact time Hot being shown, Esse placed orders for the advertisement of a great many electronic items in Radio News, CQ (The Radio Amateur’s Journal), and Radio Craft, three radio electronics monthly magazines with national circulation. The advertisements appeared in the May 1947 issues and reached the newsstands on or about April 25, 1947. Each ruagazine carried a three-page advertisement of 19 items. Among the items of electronic equipment there listed was the APN-4 radar scope involved in this suit. It was listed for sale at $17.95. The 1-152-AM.indicators were not advertised for sale in these advertisements. The record is not clear as to the exact date on which Esse attempted to eliminate the radar scope from these advertisements. The general manager of CQ Magazine states that Esse first attempted to make a change in that magazine after April 1, 1947, but the closing date for the May issue was March 20, 1947. The advertisement of the radar scope in Radio Craft contained the words “Sold Out” in heavy type and, consequently, it brought in no orders for that item nor contributed to any loss of good will. As to Radio Craft the attempted change came after its closing date for May 1947. This evidence indicates that Esse failed to cancel the advertising of the APN-4 radar scope within a reasonable time after the breach of the contract.
We point out that the contract of January 15, 1947, *230was cancelled by Wunderlich on February 20, 1947. On that date Esse knew that the APN-4 radar scopes would not be delivered. Ben L. Selig not only knew this to be the fact, but he had agreed to the deletion of the items on the original purchase agreement by affixing his initials to such an understanding. It is clear therefore that Esse was required to mitigate the damages arising from the breach from and after that date. An authoritative text states the rule as follows: “Where a party is entitled to the benefit of a contract and can save himself from loss arising from a breach' thereof at a trifling expense or with reasonable exertions, it is his duty, and statutes sometimes so declare, to do so, and he can charge the party in default with such damages only as with reasonable endeavors and • expense he could not prevent. This rule is especially applicable where one of the contracting parties has acquired notice of the breach of contract and makes no reasonable effort to mitigate the damages claimed.” 25 C. J. S., Damages, § 34, p. 502. In Marcell v. Midland Title Guarantee & Abstract Co., 112 Neb. 420, 199 N. W. 731, this court stated the rule as follows: “It is a well-established rule in this state that, where there has been a breach of a contract by one party resulting in loss to the other, it is the duty of such other party to take all reasonable steps to reduce the- amount of his damages.” It is the rule, also, that one who fails to perform such duty may not recover damages which would have been avoided had such duty been performed. Uhlig v. Barnum, 43 Neb. 584, 61 N. W. 749. The foregoing rules have been reiterated by this court in Shamblen v. Great Lakes Pipe Line Co., 158 Neb. 752, 64 N. W. 2d 728.
The record before us does not show that Esse made reasonable effort under the circumstances to cancel the advertising of the APN-4 radar scopes. It knew on February 20, 1947, that these radar scopes would not be delivered. The indefiniteness with which this part of the claim was attempted to be proved is such that it *231does not establish any loss of good will which Esse could not have reasonably avoided. If Esse had acted within a reasonable time after February 20, 1947, we think the advertising could have been eliminated, under the evidence as it appears in the record before us. Esse assumes that the obligation to mitigate the damages did not arise until March 18, 1947, or thereafter. The record does not support such an assumption. We are of the opinion that the trial court improperly submitted the loss of good will as an element of damage under the evidence then before it.
It seems to us that Esse has no valid claim for loss of good will unless it is able to show on a retrial that it' made reasonable effort after February 20, 1947, to eliminate the APN-4 radar scope from its advertising and was unable to do so. But this does not mean that the advertising of the radar scopes at $17.95 each and the orders received were not properly admitted as evidence. They tend to establish a demand for the radar scope at the advertised price. They tend also to fix the market value of the radar scope. For these purposes the evidence was properly received in any event.
In the case before us Wunderlich knew that Esse purchased the radar scopes and indicators for resale. The record shows a general demand for these items at the advertised price. In addition thereto, Wunderlich certainly understood that the resale of the items would result in a profit to Esse. In such case the seller is bound to know that Esse would be damaged in the amount of the profits lost if the items were not delivered in accordance with the agreement. The measure of damages in such a case appears to be in dispute, particularly as to the correctness of instruction No. 9. That instruction states: “You are instructed that the plaintiffs Selig are not required to prove the extent of their damages with mathematical precision; that, if you find that it is certain that damages have been caused by the breach of the contract, you may then consider all *232the facts and circumstances of the case having any tendency to show the probable and reasonable amount of the damages.”
The measure of damages for failure to deliver goods purchased is fixed by section 69-467 (2), R. R. S. 1943, as follows: “The measure of damages is the loss directly and naturally resulting, in the ordinary course of events, from the seller’s breach of contract.” Under this section, loss of profits is a proper element of damage. The rule is stated by this court as follows: “We have repeatedly held that gains prevented as well as losses sustained may be recovered as damages upon a breach of contract. But it must appear that the profits were reasonably certain to have been realized by performance; that they are not speculative or contingent; that such damages must have been within the contemplation of the parties, and the loss must appear to have resulted proximately and naturally from the breach.” O’Shea v. North American Hotel Co., 109 Neb. 317, 191 N. W. 321. In James Poultry Co. v. City of Nebraska City, 136 Neb. 456, 286 N. W. 337, we quoted with approval the rule announced in Wittenberg v. Mollyneaux, 60 Neb. 583, 83 N. W. 842, as follows: “That a party may recover for gains prevented as well as for losses sustained when such damages are not only certain, but are the natural and probable result óf the wrong complained of, is a point no longer open to dispute in this state.” From these holdings we gather that damages for breach of contract must be established with reasonable certainty although mathematical precision is not required. Proof of damages is limited to those which naturally and probably result from the wrong. The trial court has a discretion in determining whether or not proffered evidence of damage is within the foregoing rule. We do not say that instruction No. 9 was prejudicially erroneous when considered with other instructions given, but it would have been more strictly in conformity with the rule-, *233under the particular circumstances of this case, to have closed the instruction as follows: “You may then consider all the facts and circumstances of the case tending to show the amount of the damages.”
We conclude that our former opinion was in error in reversing the judgment and directing on remand that defendant’s motion for judgment notwithstanding the verdict be sustained. We withdraw our former opinion.
For the reasons herein stated, the judgment of the district court is reversed and the cause remanded for a new trial in accordance with this opinion.
Reversed and remanded.