Court Opinion

ID: 8789608
Source: CourtListenerOpinion
Date Created: 2022-11-26 13:46:25.935005+00
Date Added: 2024-06-11T17:03:16.611813
License: Public Domain

EACOMBE, Circuit Judge.
It is unnecessary to rehearse the general statement of facts, they are yery fully set forth in the master’s opinion.
Apparently, under the opinion of the Court of Appeals when these claims were consideréd by it, the question whether or not there should be nominal damages awarded is no longer open here. Upon the whole record, however, as it now stands this court is to inquire whether there is sufficient proof to warrant a finding of any particular sum as fairly representing substantial damages sustained by claimant.
[1,2] In the case of the City Company, this court fully concurs in the master’s conclusions that the subject-matter of this claim is not covered by the assumption clause (3) of its lease and that under the habendum clause its obligation to afford facilities for the transaction of the express business of claimant or its assignee continued only until the termination of the lease. The master erred, however, in awarding $192.31 damages against the City Railway Company, being the proportion of what he found to be the whole damages for the week from September 24 to October 1, 1907. For the purposes of this case it *755makes no difference whether the date of termination of the lease is taken to he September 24, 1907, or October 1, 1907, or January 12, 1908, when the Third avenue and its leased and controlled roads were cut out of the system, or February 28, 1908, when receivers notified claimant that they would discontinue the operation of express cars, or March 15, 1908, the date fixed, by them for such discontinuance. The service stipulated for in claimant’s contract was, in fact, fully performed and all it bargained for it received until the last-named date. It may be correct as a legal theory to say that when receivers decline to assume an existing contract, the declination dates back to the day of their own appointment. But it is a very different thing to hold that the other party to the contract sustained actual substantial damage from its breach during the intermediate time when, during that whole time its provisions were being complied with and such party was receiving all that had been promised to it.
The special master’s conclusions of law should be modified by substituting for the fourth the following:
“That the claimant Is entitled to no more than nominal damages against the New York City Railway Company for the breach of its agreement with the Metropolitan Street Railway Company of March 4, 1901.”
In order that no more may be decided on this hearing than is necessary to dispose of this particular claim the last words of the first conclusion of law should be changed from “on October 1, 1907,” to "some time prior to February 28, 1908.”
The findings of fact need not be modified unless the disposition to be made of the claim against the Metropolitan Company makes it necessary to avoid any discrepancy between the findings in the two cases. The exceptions of claimant to the findings and conclusions are overruled.
[3] In the latter case of the Metropolitan road the Court of Appeals has held that the claimant is entitled to nominal damages, and in addition to such substantial damages as might be shown by satisfactory proof. The special master has found the damages to be-$129,704.32, but the testimony does not seem to me to warrant that conclusion. The contract which is the basis of the claim was entered into March 4, 1901, by the Metropolitan Express Company and Metropolitan Railway Company, the latter agreeing' for 20 years to furnish cars and give express facilities over its main lines, purchased lines, and controlled lines, and also all lines it might thereafter purchase or acquire control of. Claimant operated under this contract for three years at a loss, and on July 15, 1904, assigned this contract and several others to the American Express Company for a lump sum of $10,000 a year. Testimony was introduced tending to show that for some time before receivership the latter company made a profit out of its operation of about $30,000 a year. There is some criticism as to the sufficiency of this testimony — being in part averages and estimates — but courts are usually liberal when absolute accuracy in such matters is inherently impossible. Upon this evidence the special master has held that the contract was actually worth $10,00() a year for the^ unexpired term of nearly thirteen years. The difficulty with the calculation lies in its assumption that the $10,000 a year which the American Company agreed to pay was wholly for this contract of. *756March 4, 1901. That consideration, however, was for the assignment not only of this but also of many other contracts and leases. As to some of these the master has found that they were of no substantial value; but there are others which were undoubtedly of substantial value. As we have seen, the contract of March 4, 1901, covered not only lines owned by the Metropolitan Railway Company, but all “controlled” lines. Among such lines controlled through stock ownership were the Union Railway, Forty-Second Street, Manhat'tanville & St.' Nicholas Avenue Railway, Yonkers Railroad, Southern Boulevard Railroad, Westchester Electric Railroad, and Tarry town, White Plains & Mamaroneck Railway. The contract of March 4, 1901, contained no covenant that this control of these railroads should continue in the Metropolitan. It may be that while such control still existed the Metropolitan might have been compelled to secure from each of the companies thus controlled a concession to the express company similar to the one it had itself given; but if it parted with the control of either of them it would be powerless to obtain such concession for the express company. To that extent the value of the original contract would shrink and, there being no covenant for a continuance of control, the express company could maintain no claim for damages for such shrinkage. Whether or not the American Company would have agreed to pay $10,000 or $10 a year for the original contract does not appear. Before it took its assignments the weak point.in that con-» tract was covered; the controlled companies enumerated above had each of them made an independent contract with the Metropolitan Express Company similar in its terms to the contract of 1901. Thereafter the holder of all these contracts was secured in the use for express purposes for the period named, of all the lines which the Metropolitan owned or controlled when the first contract was made. All these later contracts were included with the original one in the assignment to the American Company. The master has not found that these were “of no substantial value”; that they were, some of them at least, of substantial value must be apparent to any one who is familiar with the intricacies of the street railway system in Manhattan and the Bronx. There was no apportionment of the $10,000 among the several parcels covered by the assignment and there is nothing in proof by which such apportionment could possibly be made. It seems to me, therefore, impossible to determine what sum of money would fairly represent the damages resulting from the breach of this contract which stipulated for no continuance of control. For the breaches of their several contracts the roads formerly controlled by the Metropolitan may or may-not be responsible, but the finding of substantial damages against the last-named road is not confirmed.
These conclusions call for a disaffirmance of findings of fact numbered 7, 8, 9, and 14 and of the conclusion of law.
The eleventh finding goes too far in holding that the contracts referred to therein “ceased to have any substantial value” upon the breach of the contract with the Metropolitan. The most that can be said is that their value was substantially impaired. The finding should be modified accordingly. In order that all the points raised on-the, hearing may be disposed of all other exceptions to the report are pro forma overruled.