Court Opinion

ID: 8829827
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:59:56.528316+00
Date Added: 2024-06-11T17:04:53.627830
License: Public Domain

ROSS, Circuit Judge
(dissenting). It appears from the evidence that the contract was made by the defendant company, through its traveling agent, Powell, with Austin Bros. Levi Austin testified that Powell went over their land with him, and that he went, over with Powell their irrigation problem; that they went into thé details of the old plant, which was not satisfactory, according to the witness, “for even the acreage we had in then, and we wanted to put in more acreage, and we went into details as to the different lifts and the amount of water required, and he (Powell) proposed this 25 horse power outfit connected to an 8-inch pump would be exactly what we would want for this condition and the amount of water.” We told him, said the witness, “our problem there for irrigation, and at this time the outfit we had there was not satisfactory; we could not get enough water, and we told him that we must make a change of some kind, and asked what he would recommend to fit our purpose, and he proposed that we take at least a 25 horse power engine and connect it to this 8-inch pump, and later on, if we cared to put in a larger pump, this 25 horse power outfit would furnish the power.” The witness further testified, in effect, that he told Powell it would be necessary to have-the machinery contracted for delivered about December 1st, to give ample time for its installation, as they wished to commence pumping by the 1st of April, 1920, and that such was the understanding.
Jay Austin, the other member of the firm of Austin Bros., testified that, at the time of entering into the contract, they had 25 acres of. upland and between 15 and 20 of the lower flat in alfalfa, and that with their old plant the usual time of commencing their irrigation was about the 1st of May, for the reason that the well from which the water was then obtained was not deep enough to supply water before that time; that in the early spring of 1920 the ground was in good shape, and that because of the defendant company’s failure to comply with its contract it was May 20, 1920, before they could get any water for the irrigation of their alfalfa; and there was testimony given, over the objections and exceptions of the defendant company, as to the resulting loss of the plaintiff’s alfalfa, and as to the dying out of some of it. I do not, however, find in any of the evidence any fact testified to which, in my opinion, can be fairly said to have informed the plaintiff in error or its agent, Powell, that either party to the contract contemplated that a breach of it on -the part of the company would subject the latter to damages for the loss of crops afterwards to be planted or that were then growing, the extent of which, so far as appears, was unknown to it. If such a liability had been suggested, it cannot be doubted that the plaintiff in error would have refused to have entered into the contract; and certainly its sales agent, Powell, is not, by the record, shown' to have been authorized' to incur on its behalf any such liability. Yet it is the well settled law that in case of a breach of contract “a person can only be held to be responsible for such consequences as may be reasonably supposed to be in the contemplation of the parties at the time of making the contract.” Globe Refining Co. v. Landa Cotton Oil Co., 190 U. S. 540, 544, 23 Sup. Ct. 754, 755 (47 L. Ed. 1171), and cases there cited.
*6The recent decision of the Circuit Court of Appeals of the Eighth Circuit—Stebbins v. Selig, 257 Fed. 230, 168 C. C. A. 314—was largely based upon that decision of the Supreme Court. The decision in Stebbins v- Selig was a far stronger case for the plaintiff in error there than is the case of the plaintiffs below in the present action; for there, as appears from the allegations of the complaint upon which the decision was based, the well and pump the defendant to the action agreed to sink and install for the plaintiff was known and understood by both parties to the contract to be for the sole purpose of keeping the plaintiff’s land flooded for the growing of rice thereon; that the regular business in which the defendant was engaged was the sinking of wells and the furnishing of pumps for water for rice fields, and that the defendant well knew that the successful cultivation of that article required that the land upon which it is grown should be kept flooded; that by reason of the failure of the defendant to perform his agreement the plaintiff was obliged to get another company to sink the needed well and install the needed pump at an excess cost of $675, and, that in consequence of the delay in thus obtaining the needed water the plaintiff’s crop of rice was reduced, to his damage in the sum of $3,500, for which he prayed judgment. The Court of Appeals said :
“In considering the question of special damage, we must remember that the contract between the parties was in writing and contained no expression as to what the damages should be in case either party wholly failed to perform it. The general rule is that a person can only be held to. be responsible for 'such consequences as .may be reasonably supposed to be in the contemplation of the parties at the time of making the contract. Under this rule, the-plaintiff in the present case could clearly recover in the proper forum the sum of 8675, whieh he alleges was the excess paid to the Bayne & Bowler Company for doing the same work that the defendant agreed to do. Parties, when they make contracts; contemplate performance, not breach; therefore they do not usually say anything about consequences in case of breach by either party. In this situation the law establishes a rule by whieh it may be determined with reasonable certainty what the parties would have said, had they spoken in their contract. Thus arises the rule, above stated, that parties who break their contracts are to be held responsible for such consequences as may be reasonably supposed to be in the contemplation of the parties at the time of making the contract. The rule being thus established, the next question that arises is: How shall it be determined what the consequences were which the parties to a contract contemplated when they entered into the same? It has been decided that these consequences may “be shown by oral evidence when the contract is in writing. It has also been decided that mere notice to a seller of some interest or probable action of the buyer is not enough necessarily and as matter of law to charge the seller with special damage on that account, if he fails to deliver the goods. As was said by Mr. Justice Willes in British Columbia Sawmill Co. v. Nettleship, L. R. 3 C. P. 499, 508: ‘The knowledge must be brought home to the party sought to be charged, under such circumstances that he must know that the person he contracts with reasonably believes that he accepts the contract with the special condition attached to it.’ In this case the special condition would be that defendant entered into the contract in question, knowing that the plaintiff reasonably believed that, if the defendant wholly failed to perform the contract, he would be liable to the plaintiff for the difference between the value of the rice crop raised upon -the plaintiff’s land and the value of the rice crop raised upon any adjoining land; this difference amotmting in the present case to 83,500. One way of testing whether the defendant contemplated this consequence is to suppose that, had defendant been asked to agree to a clause in the contract that would make him liable in the way specified, would he have *7assented to the same? In our judgment there can he but one answer to this question: He would not.”
Much less, I think, can it be properly held that the plaintiff in error in the present case, by agreeing to sink the well and install the pump here in question, understood or contemplated that by reason of its failure to do so it was subjecting itself to liability for all or any loss to the alfalfa plants themselves. In this connection, it is to be observed that a witness for the plaintiffs testified:
“I live in Yakima, and am an irrigation or electrical engineer. I have been an electrical engineer for 15 years and an irrigation engineer for 11 years. I have lived in Yakima for 11 years. I know the land owned by plaintiffs. I have been over and across these lands at various times. I am familiar with the soil conditions on these lands. They are composed of what we know as Ephrata fine soil, mixed with gravel, with emphasis on the gravel. There is a difference in the amount of water necessary for such as that and land situated in the Yakima valley. Eour times as. much water as is needed in the Yakima valley is needed on the soil of the Austin place. On the pumping plant we figure the Yakima valley twice what we have for gravity and on the Columbia river we double up on that.”
It is not pretended that -the defendant, or its sales agent, Powell, had any information, at the time of or before the making of the contract in question, regarding any excess of water required by the plaintiff’s land over the ordinary, nor, indeed, as has already been mentioned, does it appear that the plaintiff in error, or its agent, Powell, had any specific or definite information regarding .the future planting of alfalfa by the plaintiff's, nor, indeed, any specific information respecting its then existing planting — indeed, nothing, in my opinion, upon which it can be reasonably supposed that the plaintiff in error could have contemplated that, by entering into the contract for the sinking of the well and the installation of the pump, it was rendering itself liable for any special damage,'or-any other damages beyond the ordinary damages that might result from a breach of the contract on its part.
I think the judgment should have been for the plaintiffs for $574 only, with costs.