274 F. 774 | 9th Cir. | 1921
(after stating the facts as above). It will hardly be questioned that the decision of the court is tantamount to a general verdict upon the facts, and it will be so treated in our consideration of the controversy.
“The undertakings herein contained on our part are ail conditioned upon your doing your work in an efficient and satisfactory way”
—was operative and binding in Tokyo, as well as in Shanghai. It is insisted by counsel for defendant that the legal effect of the clause is to accord to defendant the right and authority to exercise its independent judgment respecting whether plaintiff’s services were unsatisfactory or inefficient, and that it could discharge him at its pleasure.
“Tlio addition of the phrase, ‘and satisfactory to tile Pacific Sewer Pipe Company,’ implied a complete satisfaction, and authorized the defendant to reject the brick or discharge Tiffany under the terms of the contract, if for any reason of any character the quality or quantity of the product was not satisfactory. We think the contract falls within the rule applicable to cases where the judgment of the promisor is involved, and that his decision that he is not satisfied is conclusive on the other party and upon the court to which the question is presented.”
The court distinguishes some other cases previously decided by it, but cites none that was deemed to settle the specific question.
There seems to be a practical concurrence of opinion that, in contracts involving matters of fancy, taste, or judgment, when one party agrees to perform to the satisfaction of the other, he renders the other party sole judge of such satisfaction, without regard to the justice or reasonableness of his decision, and a court or jury cannot say that the party should have been satisfied where he asserts that he is not. 13 Corpus Juris, 675. See, also, 9 Cyc. 618, 619. Apt illustrations of the subject-matter of the kind of contract within the rule are given in Cyc., as, for instance, a suit of clothes, a bust of defendant’s husband, a set of artificial teeth, and the like.
The case of American Music Stores v. Kussel, 232 Fed. 306, 146 C. C. A. 354, L. R. A. 1916F, 882, cited by counsel, is also illustrative, where the contract was to perform services to the satisfaction of the employer. Many cases are cited, and the contracts involved are practically all specific in the stipulation that the service or the thing to be done is to be to the satisfaction of the employer.
There is another line of authorities which seem to hold that a contract to do work, not involving personal taste or feeling, to the satisfaction of the adversary party, means that the work must be so done that the adversary party, if a reasonable man, would he satisfied therewith. 3 Page on Contracts, § 1390. But, after all, the true meaning of the contract is one for construction, depending upon the nature and character of the thing stipulated to be done, as well as the chief purpose the parties had in mind, to accomplish the end designed.
“Whore,” says the court in Frary v. American Rubber Co., 52 Minn. 264, 53 N. W. 1150, 18 L. R. A. 644, “the chief thing the parties have had in mind was to effect some definite purpose or end, of the performance of which others could judge just as well as the parties could, and which involved no considerations strictly personal, the stipulation that it should be done to the satisfaction of the party has been generally held not to be controlling.”
To a like purpose, see McNeil v. Armstrong, 81 Fed. 943, 27 C. C. A. 16, where the distinction is characterized between the two classes of cases.
Defendant further insists that it was entitled to judgment dismissing the action, upon the' pleaxlings, in pursuance of its motion to that effect.. The motion was interposed after the -plaintiff had put in his evidence. The ruling of the court was reserved until final consideration, but the motion was eventually denied.
Paragraph 10 of the answer alleges that the services rendered by plaintiff “were neither satisfactory nor efficient, as required in the contract, * * * and that the said plaintiff in the performance of his alleged duties was inefficient, negligent and insubordinate to his superiors.” By the provision of section 69, supra, the defendant is entitled to judgment on the pleadings, if the plaintiff fails to reply to new matter in the answer constituting a defense. Upon principle, it is essential that the new. matter be material and constitute a defense to the action set up by the complaint. If the practical issue were already tendered by the complaint and answer, then, of course, it could not be material, because it would be tantamount to a presentation of the same issue twice.
Under the contract, as we have construed it, the defendant had the right to discharge plaintiff for inefficiency, or for having done his work in an unsatisfactory way, and even, it may be, for insubordination. But when plainfjff alleged that he was wrongfully and improperly discharged, without cause or reason, he opened the way for defendant to show to the contrary, to the very extent that plaintiff was inefficient and insurbordinate, and that he did his work in an unsatisfactory manner, so there was no need of further presentation of the issue in the pleadings. Watkinds v. Southern Pac. R. Co. (D. C.) 38
This disposes of the question on a legal assumption most favorable to the defendant; but it is doubtful whether a reply is required at all under the practice prevailing in the China court. The trial court was of the view that it is not so required. We do not have access to the rules. The provisions of section 5 of the act creating a United States Court for China, however, lend color to the view. 34 Stat. 814, 816 (Comp. St. § 7691).
“We, tlie undersigned, agree to the arbitration of our differences by the Honorable Hr. Potter.”
This makes it necessary that we examine the negotiations of the parties looking to the arbitration, to ascertain what their differences were, and what was to be submitted for adjustment.
By plaintiff’s letter to Blake of May 2, 1919, it is specifically stated that the “award must be considered as binding to both parties in the matter of the main issue involved in the case, viz. the amount of compensation to be paid to me at the Tokyo office of the company in full settlement of ail my claims against the company under the two agreements I have 'with the company.” Blake, by his letter of even date in response to plaintiff’s letter, practically conforms to the latter’s proposition, and concludes “that his award should be binding on both parties, and shall be settled in Tokyo.” The controversy submitted thereon was the amount of compensation to be paid plaintiff in full settlement of all his claims against the company under the two agreements between the parties. Each party submitted to the arbitrator a statement of the case, 'the arbitrator by his decision found:
First, “that the matter of the three-year contract should be referred to Mr. Ward in San Francisco for settlementand, second, “that Mr. Blake should pay Mr. Steele in full, until such time as Mr. Steele can secure flrst-class passage hack to San Francisco, less any indebtedness that may be proved that Mr. Steele owes Mr. Blake.”
It is at once obvious that the award decides nothing as to compensation to which Steele was entitled under the original agreement. It leaves wholly unadjusted the differences arising at the Tokyo office, and awards Steele nothing except payment in full up to the time he could secure passage back to San Francisco, less any indebtedness he owed to Blake.
There is nothing definite in either finding; nor is there any adjustment or settlement of the matters referred for arbitration. In other words, the award settles practically nothing of the controversy submitted by the parties for adjustment. The disposition under the award must be sufficiently definite and exact that nothing further remains to fix the rights and obligations of the parties under the submission, and that the party against whom it is made can perform or pay it without further ascertainment of rights or duties; otherwise,
A further question is presented touching the .measure of damages to be applied in a case like this. Scarcely a year of the three-year contractual period had expired when the action was instituted, and it is contended, on 'the one hand, that the measure of recovery should be limited to the period of time intervening between the date of discharge and the date of trial; while, on the other, it is urged that the measure of relief is compensation at the contract rate for the entire unexpired period of the term, with deduction of any amount the plaintiff has otherwise earned in the meantime.
Judicial opinion is not in accord upon whether an action can be presently maintained on a contract of the kind for damages arising on account of the unexpired portion of the term, but the weight of authority undoubtedly sustains the right of action. The action is not one upon the contract to recover wages or salary, but for a breach of the contract/which has for its remedy the damages sustained by a repudiation of the contractual relations (Roehm v. Horst, 178 U. S. 1, 20 Sup. Ct. 780, 44 L. Ed. 953), and the question turns upon the correct measure of damages to which the employee is entitled.
In Pierce v. Tennessee Coal, etc., Railroad Co., 173 U. S. 1, 16, 19 Sup. Ct. 335, 341 (43 L. Ed. 591), in which a contract somewhat similar, though not the counterpart of this, was involved, the court says:
The party suing “would simply recover the value of’the contract to him at the time of the breach, including all the damages, past or future, resulting from the total breach of the contract,” and, further, “in assessing the plaintiff’s damages, deduction should, of course, be made of any sum that the plaintiff might have earned in the past or might earn in the future.”
The court in this case approves the language employed in East Tennessee, etc., Railroad v. Staub, 7 Lea (Tenn.) 397, as follows:
“But the rule of damages in such eases is what would have come to the plaintiff under the contract had it continued, less whatever the plaintiff might earn by the exercise of reasonable and proper diligence on his part; and, of course, in ascertaining this, we must look to a time subsequent to the breach, and in some cases to a time subsequent to the bringing of the suit.”
The court in Roehm v. Horst, supra, quotes an expression of an English court, in Hochster v. De La Tour, 2 El. & Bl. 678, as follows:
“In either case [referring to the time when the right of action accrued], the jury in assessing the damages would be justified in looking to all that had happened, or was likely to happen, to increase or mitigate the loss of the plaintiff down to the day of trial.”
The English case, like that at bar, was one of employment. The action was really begun prior to the commencement of the term of employment; the defendant having declined to avail himself of plaintiff’s services, and having repudiated the contract. The Roehm Case was one for the purchase of hops, and there was a repudiation of the contract prior to the stipulated time for delivery of certain quantities of the hops. The court held that an action would lie at once upon the breach for damages for failure to perform.
The Supreme Court of California declares the rule, as approved by a number of authorities cited, to be as stated in Lally v. Cantwell, 40 Mo. App. 50, namely:
“The measure of damages is the contract price, although the master may recoup the damages by showing that the servant either earned, or by reasonable exertion might have earned, money in other employment during the contract period.” Seymour v. Oelrichs, 156 Cal. 782, 802, 106 Pac. 88, 97 (134 Am. St. Rep. 154).
“I could get many a position as bookkeeper, but not as a chief accountant. Lots of positions as bookkeeper are vacant here.”
He further'asserted that, to accept a position inferior to chief accountant would serve to injure his likelihood of obtaining that for which he was fitted, and therefore that he did not feel justified in embarking upon a subordinate or indifferent calling.
“Wo cannot think that a party, whoso contract has been broken, is obliged, in order to reduce his adversary’s damages, to accept employment which would affect injuriously his own future career.”
Appellee’s motion to dismiss the writ of error is without merit.
Finding no reversible error in the record, the judgment is affirmed.
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