Postal Tel. Cable Co. v. Schaefer

110 Ky. 907 | Ky. Ct. App. | 1901

Lead Opinion

Opinion of the court by

JUDGE BURNAM

Reversing.

This suit was instituted by the 'appellees, who were plaintiffs- in the court below, against -appellants, who own and operate a telegraph line, to reeoyer dam-agesi for their failure to correctly transmit and deliver - a certain telegram to- N. Bernstein & Co., of Cleveland, Ohio. The facts necessary to a correct understanding of the case are as- follows: On the 23d day of August, 1897, John Schaefer & Sons, wholesale produce and fruit merchants at Louisville, Ky., delivered to the defendant, for transmission to N. Bernstein & Co.,' produce brokers in Cleveland, Ohio, this telegram: “Bulk potatoes one seventy barrel. Can ship two cars nice stock to-day. Wire quick.” The message was written out upon one of defendant’s printed blanks. On the same day they 'received from Bernstein & Go., 'Over the Western Union Telegraph line, "the following response to their message: “Telegram received. Ship two oars, your price.” And in response to this telegram appellees shipped two ears of bulk potatoes, .amounting to 340 barrels, at the same time advising Bernstein & Co. of the shipment by ia telegram which reads ais follows: “Ship ciar® L. & N., 15,231 and 15,483 potatoes via Big 4.” And on the same day they mailed invoice -with bill of lading attached to a draft for $589, or the price of 340 barrels of potatoes at $1.70 per barrel. On the 25th day .of August, appellees received from Bernstein & Co., a telegram which reads, viz.: “Bill received 2 oars potatoes one seventy bbl. Price named in message one seven bbl. Please explain.” In response to this, appellant answered: “Our copy of telegram reads one seventy. Have notified telegraph company.” And on the next day appellee received from the Ohio people the following message: “Your telegram delivered to us says orne seven bbl. We shall insist upon the twro cars at that price. Instruct bank correct draft at rate of one seven bbl. Will give you until 3 o’clock. You will have to look to telegraph company, not to us.” To which appellees replied on the same day: “We do not comply to your declaration of draft. See telegraph company if error.” All these messages passed between the parties before the arrival of the potatoes at Cleveland, which was on the 27th, wThen Bernstein instituted a suit for damages against appellee for the difference between the contract price claimed by him and the value of the potatoes, and attached the potatoes in the hands of the railroad company. In a day or two thereafter, appellees notified appellant of the exact situation, and .asked them whether they should accept $1.07 per barrel for the potatoes from Bernstein & Co. Appellant declined to advise them as to what course to pursue. They thereupon employed an attorney to defend the suit instituted against them by Bernstein & Co., and this litigation was prolonged for some time. The potatoes in the meantime were left in the cars on the track of the railroad company for several weeks, when they were sold for $250 to pay the freight; the over-plus being held to await the result of the siuit of Bernstein & Co. At the conclusion of the litigation with Bernstein & Go., the appellees, Schaefer & Sons, instituted this suit, in which they allege that they had not only lost all of their potatoes, which were worth $570, but in addition thereto, had been compelled to pay out $321.51 in defending the suit instituted against them by Bernstein & Co., making the aggregate of $898.51, which was, however, to be credited with $114.10, the proceeds of the sale, less freight, leaving a balance of $785.41, which they alleged was directly attributable to the negligence and carelessness of the defendant in improperly transmitting their message. They also made a claim for damages arising from the loss of Bernstein’s custom. The circuit judge sustained a general demurrer to all that part of the petition which sought to recover for attorney’s fees, cost of the attachment suit, or any of the items except what he regarded as the direct loss on the potatoes. The defendant, in its .answer, says that it is not liable to the plaintiff for the amount sued for, or for any amount: First. Because plaintiffs were under no legal obligations to deliver the potatoes sued for to Bernstein & Co., at the price of $1.07 per barrel, as the message of .plaintiff and the response of Bernstein & Co., did not constitute a binding and legal contract between them, whereby plaintiffs were bound to ship the potatoes at the price named in 'the telegram. Second. Because the damages sued for are not the natural and proximate consequences of the mistake complained of in the transmission of plaintiffs’ messaage to Bernstein & Co., and were not within the contemplation of the parties to the contract for the transmission of the telegram at the time it was sent. Third. That as the dispatch was not repeated, their liability was, by the terms of the printed blank upon which it was. written, limited to 40 cents, — the cost of the telegram. Fourth. It is insisted that in no event can they be liable for any greater suim than the difference in the price named in the telegram as received by it¿ and the fair market value of the potatoes on tlie Cleveland market when they arrived. Fifth. It is insisted that plaintiffs made no reasonable efforts to render their injury as small as possible, but negligently permitted the potatoes to remain in the cars until many of them were spoiled and destroyed. So much of the answer as pleaded that plaintiffs were1 under no legal obligation Lo deliver the potatoes sued for at the price of the delivered message, and also that part of the answer which denied liability because the dispatch was not repeated, was stricken out. A trial before a jury resulted in a verdict for $656,' the value, of 340 barrels of potatoes at $1.70, with G per cent, interest thereon from the 31st day of August, 1896; and, a motion for a new trial having been overruled, defendants prosecute this appeal.

I't is complained that the court enred in its instruction as to the measure of damage, ,and also that the verdict is flagrantly against the weight of evidence. The instruction complained of is as follows, viz.: “The court instructs the jury that if they shall believe friom the evidence that, by the negligence of the defendant or its agent, the telegram mentioned in the petition, sent by the plaintiffs to N. Bernstein, was changed so as to read $1.07, instead of $1.70, per barrel for the potatoes in controversy, when the said telegram was received by the said Bernstein & Co., and that plaintiffs were thereby damaged, then they should find for the plaintiffs in such a sum as they .believe, from ■the evidence, represented the difference between potatoes at $1.70 per .barrel and the sum for which the plaintiffs oould have sold them at Cleveland, Ohio, after definitely learning of the mistake in the telegram by the exercise of ordinary care and diligence, if there was such mistake. If they find for the plaintiffs, they may, in their discretion, allow interest from the 28d day of August, 1897.” The deposition of Nathan Bernstein was 'taken and read as evidence by the plaintiffs. He testified that ,he recovered a judgment against appellees for $187, and his costs by way of damages against appellee for failure to deliver 340 barrels of potatoes to him at $1.07 per barrel; that these potatoes were worth in Cleveland on the day on wihich they arrived in that city, from $1.65 to $1.80 per barrel, with freight charges, which were about 28 cents a barrel added; that within a few days the price of potatoes began to decline in Cleveland, because of the delivery of home-grown potatoes; and that, at the time the potatoes in contest were sold, they had remained locked up in the cars for several weeks, and that many of them had rotted; and that they only brought $250 for the whole lot.

It is the contention of appellees that appellant was their agent in sending the telegram to Bernstein & Co., and that the delivery of the erroneous message created and gave rise to a valid and enforceable contract on their part to deliver the' potatoes to the sendee at the price named, and this view seems to have been taken by the Ohio magistrate, who presided in the trial of -the suit instituted by Bernstein & Co. against plaintiff; but, in ¡our opinion, this view of the law is an erroneous one, and is in conflict with the great weight of authority both in England and in this country. Cray, in his treatise on Communications by Telegram (page 189), says: “A telegraph company may perhaps be called a ‘special agent,’ since it is employed to do a particular act, namely,, to communicate a certain message. If so, the employer is responsible on the message a¡s delivered only where that message is the one which he authorized the company to communicate, as distinguished from a certain message.” And he refers to Story, Ag. (8th Ed.), sections 126-133. The same author also sayis: “A person who employs a telegraph company authorizes it and holds it out as authorized, only to oommunieate a certain message; and, while he is responsible upon the message if the 'company duly delivers it, he is not responsible upon any other message which the company may deliver in its stead.” This exact question was fully considered in the case of Pepper v. Telegraph Co., decided by the supreme court of Tennessee, and reported in 11 S. W., 783 (4 L. R. A., 661). In that case the court said, viz.: “The inindls of the party who sends a message in certain words, and the party who receives the message in entirely different words, have never met. Neither can, therefore, be bound the one to the uther.” In our opinion, there was no binding or legal obligation resting upon Schaefer & Sons to have delivered the potatoes to Bernstein & Co. at the price erroneously communicated by the message which was delivered to ttuem by the appellant company; and they were entitled to recover from appellants any damages which they sustained which arose naturally (according to the usual course of things) from such negligence; or, as the rule is very pertinently expressed in Hadley v. Baxendale, 9 Exch. 341 (the leading English case upon this question, and one -which has been almost universally followed in this country), viz.: “Where two parties have made a contract, which one of them has broken, the damage which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered either as arising naturally (according to the usual course of things) from such breach of ■contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the lime 'they made the contract, as the probable result of a breach of it.” But the law imposes upon appellees the corresponding duty to make all reasonable efforts to render that injury as small as possible, and does not permit them to recover damages for any increase of loss consequent upon the failure to perform that duty; or, as Mr. Gray expresses it in his work on Communications by Telegram (page 178): “The measure of damages for that negligence, where the message related to marketable matter, is indemnification for the loss that plaintiff sustained, or would have sustained, in placing himself, in a reasonable manner, and within a reasonable time after notification of 'the negligence, in the position which he might reasonably have been expected to occupy if the message had been duly and correctly communicated; and a failure to do so, does not entitle the person injured by the negligence of the telegraph company to recover damages for any increase of loss attributable to that failure.” Appellees knew that potatoes were, from their nature, perishable, and liable to rapidly deteriorate in value when left in bulk in the cars on .which they were shipped, standing on the railroad switch, and it is equally certain that they knew that the tendency of the market for new potatoes at that season of the year was necessarily downward; and ordinary prudence required that they should bavie taken prompt .steps to have had them disposed of to the best advantage. The uncontradicted testimony of Bernstein is to the effect that these potatoes, when 'they arrived in Cleveland, were worth all that appellee had offered to sell them for; and it is apparent that, if they had acted 'with ordinary promptness and judgment, the necessary, loss on them from appellant’s negligence dould not,- under any circumstances, have exceeded the difference between what they asked for the potatoes 'and what Bernstein & Co., were willing to give for them. Appellees could not. abandon their potatoes, and leave them to rot .and decay upon the railroad track for weeks, and be sold for freight charges, and then recover from appellant damages which, were the .result of their own negligence. Ordinary prudence would have suggested that they replevy them and! sell them to the best advantage, or at least to have applied to the Ohio court for an order for their immediate sale, and ask that the proceeds be held to await the final determination of the litigation with Bernstein & Co.

There is no dispute as to the facts in the matter. The-real question to be settled is the measure of damages in. the case. Under the facts of this -case, the court -should have instructed the jury that, if they believed from the-evidence that the defendant or its agent had negligently-committed an error in transmitting the message from ■Schaefer & Sons to Bernstein & Co., they should find for plaintiff the actual damage to plaintiffs directly attributable to such error, and that -the criterion for determining-the amount -of such damage was the difference between potatoes at $1.70 -per barrel and the sum for which they could have been 'sold in Cleveland, Ohio, by the plaintiffs, after definitely learning of the mistake in the telegram by the xemcise of ordinary care .and diligence,- — not exceeding, however, 63 cents 'on the barrel.

The defense relied -oin in the ¡answer which is predicated upon the terms of the -special contract contained in the printed blanks of the company was fully considered and. decided in the case of Telegraph Co. v. Eubanks, 100 Ky., 591 (18 R., 995) (38 S. W., 1068) (36 L. R. A., 711). It was there held that, under the provisions of section 199 of the Kentucky Constitution, telegraph companies were to be treated as-■.common carriers, and were therefore not permitted, under The provisions of. section 196, to contract for relief from ■their common-law liability for negligence. The court is ¡mat disposed to recede from the position taken in that -case, and it is therefore unnecessary for us to review that «question. For the reasons indicated, ithe judgment is reversed, and the cause remanded. for proceedings don-.sis-ten,t with this opinion.

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Dissenting Opinion

Judge Hobson’s

dissenting opinion:

It seems to me that the court in this case loses sight ■entirely of substantial justice, and that a simple illustration will show this: Jones is a common carrier in the city of Louisville, whose business is to deliver parcels for compensation. Smith has a bar of gold, of value in the market of $500. He delivers his bar of gold to Jones, to carry it to a jeweler, with a. written offer to sell it to the .jeweler for $500. Jones loses the writing stipulating the price, and thereupon gets up another, offering to sell the bar of gold for $300, and delivers the bar with this writing to the jeweler, who immediately accepts the proposition, and notifies Smith of his acceptance. Smith at once informs him that there is a mistake, and that the price is .$500. The jeweler insists on bis bargain, and .plain Mr. 'Smith, being ignorant of the .intricacies .of the law, is in great trouble. So he goes to see,Jones, and tells him the situation. He asks Jones what he must do, and wants to know if Jones will pay the $200 if he lets t'he jeweler keep the bar of gold at $300. But Jones knows something -of the uncertainty of the law, and says •to Smith: “It ds true, I have been negligent and I have ■gotten you into trouble, but you must get out the best way you can. I can not tell you what to do. My business is to carry for people, not to help my customers out of trouble when I get them into it.” Smith then reason» thus with himself: “If I let the jeweler have my bar of gold for $300, Jones will say I ought to have taken legal counsel.” So he goes to a lawyer. The lawyer tells .him. thiait the jeweler got no title to the bar of gold by reason of the false offer delivered by Jones, and that he must take the matter to the courts. Smith realizes that .if he-takes legal counsel, and then does not follow his lawyer’s, advice, Jones may have better reasons for escaping liability than if he had not consulted the lawyer at all. So-he talks to his counsel, and finds that the w'eight of authority supports the advice given him. -He conclude» then to litigate the matter with the jeweler, but the court to whom the case is submitted takes a different view of the matter from his lawyer, and, following the minority of the authorities, decides against Smith and in favor of the jeweler. The result of the litigation is that Smith, loses his bar of gold, and is out $320 in costs besides. He-then sues Jones for damages. Jones says: “You paid ■me forty cents to carry that package to the jeweler, 'amid: that is the limit of my liability; or, at the most, I am only-liable fior $200, which would have been the loss if you had accepted the jeweler’» proposition to pay you the $300.” But says Smith: “I asked you to agree to that before I went to law with the jeweler, and you refused to do so,, and prepared yourself tio escape liability altogether if I accepted the jeweler’s offer; for, if I had done -that, you would have said that the jeweler knew a $500 bar of gold could not be bought for $300 and that the inadequacy of the price was sufficient to put him on notice that there was a mistake. And you would have also said that I had joined hands with the jeweler to rob you. Now, I did. no;t know wbait bo do, but bo get a lawyer and make tibe best fight I could, and this I have done. My property is lost. Your negligence is the cause of it, and you should bear the loss.” This is substantially the case that we have. The oinou.it oourt instructed the jury that they ¡should find for appellees the market value of the property they had lost by reason of appellant’s neglect, less so 'much of the loss as appellees might have prevented by the exercise of isuch care and diligence as might reasonably be expected of an ordinarily prudent person under the circumstances. This was more favorable to appellant than the law warranted, for it took awiay from the .jury all power to compensate 'appellees for the expenses they incurred in the litigation which appellant forced them to undertake. The fundamental principle of dam- ■ agesiscompensation for the injury sustained, as the direct result of the negligence complained of. It is a well settled rule in this State that, where there is any evidence, the question is for 'the jury; and I am at a loss to understand the principle of law uplon which appellees’ recovery is . limited rto the amount which ithey would have lost if they had submitted without resistance to the unconscionable demand of Bernstein. For potatoes are a staple. They were selling in the market for $1.75, and Bernstein as a ■dealer, could uio.t but know that the telegram offering to ■.iseil them for $1.07 was a mistake.

Whether appellees used ordinary care in not executing .a bond in the Ohio court, and thus .regaining possession of the potatoes, or in failing to have the property sold at ■once, or in any other step taken or omitted in that action, was a question-for the jury. This was all clearly submitted to the jury by the court below, and they found ¡against ¡appellant on the issue. In determining what was ordinary care on the part of appellees we should bear in mind that the litigation was not in Kentucky, but in a. distant city, and that appellees had, of necessity, to rely to a great extent on the legal advice they there received. Wihait the liability would be upon a bond, the difficulty of executing it, 'the necessity of its execution, the probable-delay of the action if the bond was not given, the 'security appellees bad for a wrongful attachment under the Ohio laws, and whether or not it was best, in view of all the■cirteumistances, to trust to this, or to take other steps, were questions that the men on the ground, -of necessity,, had to decide. It has been well said that when the negligence of the defendant is admitted, and it is also admitted that this .negligence bad placed the complainant in a position where loss -may ensue, the court will not be astute to hunt for errors in his conduct, in 'endeavoring to-relieve himself of the disastrous consequences of the defendant’s negligence. The appellees here were interested in getting out of the dilemma in Cleveland at as little loss as possible; for it was certain that they had to pay the piper; and trust to the uncertainties of the future to get their money back. They exercised the same care for1 the protection of appellant that they exercised for themselves, and that other persons in similar controversies in the courts daily exercise. The steps they took were such as are taken in the majority of cases. Appellant bad no. right to demand of them extraordinary diligence, or the assumpton of extraordinary risks. Appellant knew the-situation, and could have taken steps f,or its protection, if it deemed extraordinary steps necessary. I am therefore of opinion that the question of care was properly submitted to the jury, and that the verdict of the jury is right. But if you charge appellees with the entire loss. by reason of the deterioration in the potatoes or the delay in selling •them, and subtract this from their total loss, it would still leave them out of pocket an lamioumt practically as large as found by the jury. It seems to me that this is going as fiar as the ends of justice permit, even on the basis assumed by the court. The cost of tihe litigation as to the claim of Bernstein ensued naturally from the 'defendant’s negligence, and was tihe proximate result of it. Such cost is as legitimate an element of damage as 'the cost in defending a title conveyed with warranty, or in attempting to save a cargo from a wrecked vessel. Appellees could not give up their property to Bernstein without contesting his right and look to appellant at all. The cost of this contest which they were forced to make, as their property was seized, is as necessary a part of their legitimate loss as the value of the property itself. No more forceful illustration than the result of this controversy can be given of the illusiveness of legal remedies. But for tihe illusion of an adequate remedy against •the telegraph company, appellees might have charged off to 'tihe loss account the $283 claimed by Bernstein, and sustain no further loss. In their effort to save themselves, they wound up with practically a loss of $900. This they might have charged to their loss account, and been no wloirse off. But wihen they have finished with this case on the basis of recovery laid dowm by the court, and have paid all expenses, they will be still sadder and wiser men. When such a result is worked out as the end of the law, small wonder is it that so many people prefer to trust verdicts of juries for substantial justice. I therefore dissent from the opinion of the court.

Petition for rehearing overruled.