Bendle v. Ortho Mattress, Inc.

• Decision Date: 02 December 1974
• Docket Number: No. 2,No. 49695,49695,2
• Citation: 133 Ga.App. 575,211 S.E.2d 618
• Parties: Kenneth BENDLE et al. v. ORTHO MATTRESS, INC
• Court: Georgia Court of Appeals

Page 618

211 S.E.2d 618

133 Ga.App. 575

Kenneth BENDLE et al. v. ORTHO MATTRESS, INC.

No. 49695.

Court of Appeals of Georgia, Division No. 2.

Dec. 2, 1974.

Rehearing Denied Dec. 18, 1974.

Syllabus by the Court

1. Where one contracts to furnish equipment and perform services for another at a stated per diem price, and the user of the equipment breaches the contract by refusing the services during the term, the measure of damages is that amount which the plaintiff would have earned for the remainder of the term less the cost to it of providing the services and material, that is, the loss which a fulfillment of the contract would have prevented.

2. In every case of breach of contract, the injured party is entitled to recover at the least nominal damages which will carry the costs of the action. Where the plaintiff proves a contract, a breach, and that he has been financially affected thereby, it is error, at the close of such plaintiff's evidence, to direct a general verdict for the defendant on the ground that insufficient evidence of the cost to the plaintiff of completing the contract has been supplied to enable the jury to arrive at the net loss involved.

B & G Freight Lines, a partnership composed of Bendle and Grames, sued Ortho Mattress, Inc., alleging in substance that under a contract between the parties the plaintiff had handled the defendant's delivery service in California; that during February, 1971, the parties orally agreed that plaintiff would set up a business to provide comparable delivery services in Atlanta, that one of the partners would move to Atlanta (which was done) to oversee the operation; that the business was established in February or March; that on June 28, 1971, the parties entered into a written agreement, which was necessary in order to comply with Georgia Public Service Commission regulations, and that this contract, among other things, specified that services could be terminated at will by either party on 90 days written notice. On September 28, 1971, defendant wrote giving the plaintiff notice of its intention to terminate as of October 8, 1971, which it did, and thereafter refused to use the plaintiff's proffered delivery services. 'As a result of the breach by the defendant of its agreement with the plaintiff, plaintiff has suffered direct damages in the amount of $20,237.25 plus incidental and consequential damages in the further amount of $10,000.'

Upon the trial it was established that the plaintiff sent Grames to Atlanta, that delivery services using two trucks were begun in April, 1971, that the parties understood the necessity from the beginning of obtaining a certificate of convenience and necessity from the Public Service Commission and signing the necessary agreements for that purpose, that the only provision for termination was the stipulation for a 90-day written notice, and the only agreement for reimbursement was that it would be at the rate of $100 per day per truck; that the plaintiff provided two trucks for this purpose and made the deliveries until the first week in October, for which payment was made, and that the defendant then terminated the agreement.

At the close of the plaintiff's evidence the defendant moved for a directed verdict on the ground that no recoverable damages had been proved. The motion was granted and plaintiff appeals.

Stack & O'Brien, David W. Porter, David J. Keeler, Atlanta, for appellants.

Scheer & Elsner, Robert A. Elsner, Atlanta, for appellee.

DEEN, Judge.

1. 'Damages growing out of a breach of contract, in order to from the basis of a recovery, must be such as can be traced solely to the breach, must be capable of exact computation, must have arisen naturally and according to the usual course of things from such breach, and must be such as the parties contemplated as a probable result of the breach.' Sanford-Brown Co. v. Patent Scaffolding Co., Inc., 199 Ga. 41(1), 33 S.E.2d 422. The plaintiff's expenses in preparing for performance of the contract, such as purchasing trucks and moving one of the partners to Atlanta, were not expenses caused by the breach of the contract, but rather in fulfilling if, and are not per se recoverable. Objection was properly sustained to a question as to whether B & G Freight Lines incurred expenses in moving Mr. Grames to Atlanta originally, since this was necessary in order to enter into the contract; it was done and the contract was in effect for some months thereafter. The case is different where, as in Murphey v. Northeastern Construction Co., 31 Ga.App. 715(2), 121 S.E. 848 there is a contract of sale, the purchaser refuses to perform, and the seller is thereby damaged to the extent of loss of net profit plus out of pocket expenses in preparing for the delivery of the article contracted for after a refusal to accept. A similar rule is applied to contracts for the improvement of real estate where the owner refuses to accept performance after the contracting party has incurred expenses, limiting recovery to net loss; that is, the difference between cost and contract price at completion (net profit) plus expenses already incurred. Crankshaw v. Stanley Homes, Inc., 131 Ga.App. 840, 207 S.E.2d 241. In such cases there is one single, total contract price. In a continuing per diem contract such as we have here, the net profits for each day can be ascertained only by subtracting from the contract price for the day's work the expenses of that day's work. The number of days involved becomes the second element in the equation, also to be determined by the contract. In the present instance the contract is terminable at will be either party, subject to the stricture that no termination may legally occur prior to 90 days after written notice. Since the agreement was for two trucks at $100 each per day, a breach of contract on the part of the procurer of these services is to be arrived at by multiplying the days of deprivation (90 days less whatever number after notice were in fact worked) by $200 per working day to...