48 Ind. App. 503 | Ind. Ct. App. | 1911
Appellee, who was defendant below, purchased a threshing outfit from appellant, the terms being evidenced by a written contract. The only part of the contract involved in this appeal is the following stipulation:
“In consideration of the expense incurred by the company in soliciting, investigating and taking this order, the purchaser promises and agrees to pay all freight charges on said machinery from the factory, and fifteen per cent of the price above stipulated in cash, in case he cancels this order or declines to accept said machinery. ’ ’
The purchase price of the machinery was $2,475. Appellant shipped and offered to deliver the machinery to appellee, who declined to receive it, and this action was brought to recover the sum of $371.25, being fifteen per cent of the purchase price, and the further sum of $21.60, the amount of freight paid upon the shipment. All proof of freight charges paid by appellant was withdrawn from the jury at the close of the evidence. The court then gave to the jury a peremptory instruction, directing a verdict for appellee, and entered judgment on the verdict that appellant take nothing by its action, and that appellee recover his costs. Appellant filed its motion for a new trial, the over
The only question presented to this court and argued by counsel, is whether the agreement heretofore set out constitutes a claim for liquidated damages, or whether it provides for the payment of fifteen per cent of the purchase price as a penalty. Appellant contends that if the stipulated damages are to be held as liquidated damages, and not as a penalty, then the court invaded the province of the jury in giving the peremptory instruction. Appellee admits that this is strictly true, but says that the construction to be given the stipulation for damages is one of law for the determination of the court, and as the court properly interpreted the law, no error resulted from giving the peremptory instruction.
In 1 Sutherland, Damages (3d ed.) p. 721, it is said: “The trend of judicial thought and action on the subject is well and frankly expressed by Justice Marshall of the Wisconsin court: ‘The law is too well settled to permit any reasonable controversy in regard to it at this time, that where parties stipulate in their contract for damages in the event of a breach of it, using appropriate language to indicate that the damages are agreed upon in advance, and such damages are unreasonable considered as liquidated damages, the stipulated amount will be considered to be a mere forfeiture or penalty and the recoverable damages be limited to those actually sustained. While courts adhere to the doctrine that the intention of parties must govern in regard to whether damages mentioned in their contract are liquidated, they uniformly take such liberties in regard to the matter, based on arbitrary rules of construction, so called, as may be necessary to effect judicial notions of equity between parties, guided of course by precedents that are considered to have the force of law, sometimes calling that a penalty which the parties called stipulated damages-, where otherwise an unconscionable advantage would be obtained by one person over another.’ ” See, also, Seeman v. Biemann (1900), 108 Wis. 365, 84 N. W. 490.
In this State, many cases are reported on the subject of liquidated damages. In the case of Jaqua v. Heddington (1888), 114 Ind. 309, it is announced as a general rule, that “where the sum named is declared to be fixed as liquidated damages, is not greatly disproportionate to the loss that may result from a breach, and the damages are not measure-
Upon the trial, appellant directed all its proof to showing full performance of the contract by it, and a breach
The judgment is affirmed.