Black v. Love & Amos Coal Co.

• Decision Date: 26 April 1947
• Citation: 206 S.W.2d 432,30 Tenn.App. 377
• Parties: BLACK v. LOVE & AMOS COAL CO.
• Court: Tennessee Court of Appeals

206 S.W.2d 432

30 Tenn.App. 377

BLACK v. LOVE & AMOS COAL CO.

Court of Appeals of Tennessee, Middle Section.

April 26, 1947

Rehearing Denied June 28, 1947.

Certiorari Denied by Supreme Court Dec. 12, 1947.

Appeal from Chancery Court, Davidson County; William J. Wade Chancellor.

Suit by Beulah Black, doing business as the Black Coal Company against the Love & Amos Coal Company, to recover for breach of three contracts to sell and deliver coal. From a decree for complainant for $2,013 and costs, both parties appeal.

Affirmed.

On Petition for Rehearing.

Norman Farrell and Jack Keefe, both of Nashville, for complainant.

Albert Williams, Joe Brown Cummings, and Kenneth Harwell, all of Nashville, for defendant.

FELTS Judge.

Mrs Black, doing business as Black Coal Company, brought this suit to recover for breach of three contracts by which Love & Amos Coal Company agreed to sell and deliver to the Black Coal Company a total of 143 cars of coal, a stated number of cars to be delivered each month from August 1942 to March 1943, the price to be the 'market price when shipped.' Her bill averred that defendant failed to deliver 122 cars of the coal, that in the course of her retail business she could have sold this coal for a profit of $9,150, and that she was entitled to that amount as damages.

Answer was filed and proof taken by depositions. The Chancellor heard the cause, found defendant had breached the contracts, and ordered a reference to the Master to report the amount of complainant's damages. Further proof by depositions was adduced, and the Master reported that defendant failed to deliver 122 cars of the coal, about 6,100 tons; that complainant could have sold this 6,100 tons for a profit of $0.33 per ton, or $2,013; and that she was entitled to that amount of damages.

Both parties excepted to the Master's report, complainant insisting he should have fixed her damages at $9,882, or at a profit of $1.62 per ton on the 6,100 tons; defendant insisting he should have reported only nominal damages. The Chancellor overruled all the exceptions, confirmed the Master's report, and decreed complainant a recovery of $2,013 and costs.

Both parties appealed and have assigned errors. Complainant contends that the concurrent finding by the Master and the Chancellor of the amount of her damages is not binding on us and that we should find such amount to be $9,882.00--lost profits of $1.62 a ton on the 6,100 tons not delivered. Defendant insists this concurrence is binding but, if not, the proof justifies no more than nominal damages.

A concurrence of the Master and the Chancellor is conclusive on appeal (Code, sec. 10620) except (1) where it is upon an issue not proper to be referred (State ex rel. v. Bolt, 130 Tenn. 212, 169 S.W. 761); (2) where it is based on an error of law (Hord v. Holston River Railroad, 122 Tenn. 399, 123 S.W. 637, 19 Ann.Cas. 331, 135 Am.St.Rep. 878); (3) where it is upon a question of law or mixed fact and law (Dale v. Hartman, 157 Tenn. 60, 6 S.W.2d 319); or (4) where it is not supported by any material evidence (Code, sec. 10620).

Such a concurrence is conclusive not only as to the credibility of the witnesses and the basic evidentiary facts but also as to the reasonable inferences drawn from such facts. It has the same force and effect as a verdict of a jury approved by the trial judge. Conaway v. New York Life Ins. Co., 171 Tenn. 290, 293-295, 102 S.W.2d 66, 67, 68;

Gibson's Suits in Chancery, 4th Ed., section 620, and cases there cited.

For complainant it is urged that this concurrence is not conclusive because it was not proper to refer to the Master the question of the amount of her damages. The argument is that defendant admitted its breach of the contracts; that the primary and the only issue was the amount of her damages; and that under State ex rel. v. Bolt, supra, this issue should have been determined by the Chancellor without a reference.

In that case the only issue made by the answer was whether the execution had come into the sheriff's hands. It was held that this issue should not have been referred to the Master. The Court approved the statement of Gibson to the effect that the line between what may, and what may not, be referred is not well defined; but that generally the main issues must be determined by the Chancellor, while collateral, subordinate, and incidental issues and the ascertainment of facts ancillary to the main issues may be referred to the Master. Gibons's Suits in Chancery, section 596.

This work states that it is proper to refer to the Master 'the assessment of damages in any case where properly allowable' (sec. 595, (14))--'what amount of damages is properly allowable in a given case' (sec. 598, (6)); and such has long been the practice.

In the case before us defendant's answer denied it had breached the contracts, and the main issues upon the pleadings were as to defendant's breach and complainant's right to recover. Both parties took a large amount of proof on these issues. While it is said defendant admitted its breach in its proof, we do not find such admission. Its witness Amos admitted it had not delivered 122 cars of the coal but did not admit this constituted a breach of the contracts. Complainant claimed it did, and undertook to prove her past profits in her coal business as the basis for recovery of prospective profits on the coal not delivered. This necessarily involved an accounting as to the whole of her coal business for the years 1942 and 1943.

The Chancellor determined the main issues of defendant's breach and complainant's right to recover damages, and referred to the Master the subordinate question of the amount of them. That was a pure question of fact--the amount of actual loss in dollars and cents caused complainant by defendant's breach. That amount, she claimed, was her expected profits as shown by her past profits. To establish such profits and thereby the amount of her damages required a complicated and extended accounting, and a reference to the Master was not only proper but mandatory. Provident Life & Accident Ins. Co. v. Globe Ind. Co., 156 Tenn. 571, 3 S.W.2d 1057.

Complainant further contends this concurrence is not conclusive of the amount of her damages because it is based on an error of law (citing Hord v. Holston River Railroad, supra) and is not supported by any material evidence; that the uncontradicted proof shows she would have made a profit of $1.62 a ton on the 6,100 tons not delivered, or $9,882; and that her damages should be fixed at that amount. As stated, defendant's insistence is that, if the question is now open, the proof is insufficient to support complainant's claim to recover lost profits, or to warrant recovery of any but nominal damages.

The law of damages aims at compensation for the actual loss sustained, but within these limits: In tort liability arises in invitum, by force of law; and the extent of liability is fixed by law independently of the wrongdoer's consent. The law holds him not for all the harm that follows his wrong, not for all its consequences, but only for its proximate consequences. In contract liability arises from one's own voluntary undertaking, and the extent of his liability is measured by the contract--'the parties themselves, expressly or by implication, fix the rule by which the damages are to be measured.' Holmes, in Globe Refining Co. v. Landa Cotton Oil Co., 190 U.S. 540, 543, 23 S.Ct. 754, 47 L.Ed. 1171, 1173; cf: Czarnikow-Rionda Co. v. Federal Sugar Ref. Co., 255 N.Y. 33, 173 N.E. 913, 88 A.L.R. 1426, 1432; 5 Williston on Contracts (Rev.Ed.), sec. 1357.

Ordinarily, the only loss the buyer sustains from the seller's non-delivery of the goods is the difference between the contract price and the market price of the goods, because he can replace them by buying in the market. "The proper measure of damages in general is the difference between the contract price and the market price of such goods at the time when, and place where, the contract is broken, because the purchaser having the money in his hands may go into the market and buy." 5 Williston on Contracts, Rev.Ed., sec. 1383; Tennessee Fertilizer Co. v. International Agricultural Corporation, 146 Tenn. 451, 463, 464, 243 S.W. 81.

In cases, however, where there is no available market or where there are other special circumstances enhancing his loss, the buyer may recover such damages as naturally arise, according to the usual course of things, from the seller's breach, or such as may reasonably be supposed to have been contemplated by the parties, at the time of making the contract, as the probable result of its breach. Code, section 7260; Chisholm & Moore Mfg. Co. v. United States Canopy Co., 111 Tenn. 202, 77 S.W. 1062; Hagan v. Nashville Trust Co., 124 Tenn. 93, 136 S.W. 993.

The question whether expected profits are recoverable as damages for breach of contract has been a controversial one in the law. The earlier tendency was generally to regard such profits as remote or as speculative or as not a part of the contract. Hagan v. Nashville Trust Co., 124 Tenn. 93, 98-100, 136 S.W. 993. But the modern view is that such profits may be recovered where they were part of the contract--where an engagement to pay them can be found in the terms of the contract or implied from the circumstances in the light of which it was made--and where they are not in fact remote or speculative but are proved to a reasonable certainty. Hagan v. Nashville Trust Co., supra; Chisholm & Moore Mfg. Co. v. United States Canopy Co., supra; 5 Williston on Contracts, Rev.Ed., secs. 1345-1346A; Rest., Contracts, sec. 331; Notes, 17 Minn.L.Rev. 194, 46 Harv.L.Rev. 696.

Each of these contracts was made July 28, 1942, and each...