Gasoline Products Co. v. Champlin Refining Co.
| Decision Date | 21 May 1930 |
| Docket Number | 2416.,No. 2415,2415 |
| Citation | 39 F.2d 521 |
| Parties | GASOLINE PRODUCTS CO., Inc., v. CHAMPLIN REFINING CO. CHAMPLIN REFINING CO. v. GASOLINE PRODUCTS CO., Inc. |
| Court | U.S. Court of Appeals — First Circuit |
Robert Hale, of Portland, Me., and John B. Marsh, of New York City (Verrill, Hale, Booth & Ives, of Portland, Me., and Taylor, Blanc, Capron & Marsh, of New York City, on the brief), for Gasoline Products Co., Inc.
Harry O. Glasser and Horace G. McKeever, both of Enid, Okl. (William S. Linnell, Carl C. Jones, and Bradley, Linnell & Jones, all of Portland, Me., McKeever, Elam & Stewart, of Enid, Okl., and Emery O. Beane and Beane & Beane, all of Augusta, Me., on the brief), for Champlin Refining Co.
Before BINGHAM, ANDERSON, and WILSON, Circuit Judges.
On a new trial held pursuant to the decision of this court in 29 F.(2d) 331, the amount due the plaintiff for royalties was stipulated, with interest reckoned to April 30, 1929, as $61,530.56. There never was controversy concerning the royalties. The case was tried at length under the defendant's amended counterclaim, in which damages were alleged amounting to $302,316.55. On the issues set up in this counterclaim, the jury found for the defendant, that a contract for the treating towers was made and broken, and assessed the damages for plaintiff's breach at $40,980.59, resulting in a net verdict of $20,549.97 for the plaintiff. Both parties appealed on questions arising under the counterclaim.
The plaintiff's first assignment is to the court's refusal to direct a verdict for the plaintiff, on the defendant's claim in set-off, on the ground that there was no evidence, for the jury, to support such contract. This may be briefly disposed of. The facts as to the dealings between the parties are stated in substantial length in the former opinion of this court, and need not here be repeated. It is enough now to note that we find in this record no new evidence controlling the fair inferences from the evidence in the former record, substantially repeated at the second trial. In fact, there is more evidence supporting the existence of such a contract as defendant asserts. So far as there is conflict, the question was, of course, for the jury. The questions of the existence and breach of the contract alleged in the counterclaim were plainly for the jury.
In outline, the jury's verdict settled that the transaction, although involving separate contracts for the cracking plant and the treating towers (purifying plant), was an integral, single transaction; that the defendant acquired from the plaintiff the necessary rights to have both the Cross cracking plant and the Cross vapor phase system. Clearly, also, the jury must have rejected the plaintiff's view of the valuelessness of the treating tower for the contemplated purpose (purifying the cracked gasoline) involved in the following excerpt from the court's charge:
"Well, now, if it was no good and he" (i. e., the defendant) "did not have it, he could not have suffered any loss for not having the use of it."
It is plain, from the whole course of the dealings between the parties, that the plaintiff's undertaking was to furnish means for the defendant to make an increased part of its crude oil marketable in order that it might thereby derive profits. The defendant's claim for damages falls, therefore, within those cases which hold that, if profits were in the contemplation of the parties, and there is shown some rational basis for determining such profits, they may be recovered as damages. Central Coal & Coke Co. v. Hartman (C. C. A.) 111 F. 96; Bishop-Babcock-Becker Co. v. Estes Drug Co., 63 Okl. 117, 163 P. 276; Stearnes Co. v. Robins, 114 Okl. 156, 245 P. 63; Gagnon v. Sperry & Hutchinson Co., 206 Mass. 547, 92 N. E. 761; Armstrong v. Bangor Mill Supply Corp., 127 Me. 194, 142 A. 734; Id., 128 Me. 75, 145 A. 741; Waukeag Ferry Assoc. v. Arey, 128 Me. 108, 146 A. 10; Eastman Kodak Co. v. Southern Photo Materials Co., 273 U. S. 359, 47 S. Ct. 400, 405, 71 L. Ed. 684.
It follows that the plaintiff's assignments 2 to 6 are without merit; the case was for the jury in all its aspects. The judgment must be affirmed, unless there was reversible error on some point of law affecting the jury's verdict on damages.
Defendant's main contention was that the plaintiff was obligated to furnish it an adequate purifying system contemporaneously with the cracking system. The cracking system was completed about September 20, 1926, and put in immediate and successful operation. Plaintiff furnished no purifying system. Consequently, the defendant was required to supply itself with a substitute therefor. It contends that it did that, with proper promptness and efficiency, and got its substitute ready to use about February 20, 1927.
Its main claims for damages, then, are the excess cost of its substitute system, about $32,000, plus the profits it reckons it would have made in the period from September 20 to February 20. These profits are figured in detail by defendant's auditor in Exhibit 61 at $179,459.14.
Plaintiff challenged the defendant's evidence on damages at practically every point. It stoutly claimed that the defendant did not seasonably and efficiently take steps to minimize the damage done by the breach of contract relied upon. Plainly, there was evidence warranting the view that in August, 1926, the defendant ought to have known that the plaintiff intended to deny any obligation to furnish the Cross purifying system, and that defendant must take proper steps for a substitute. Yet it did nothing effective as to supplying a substitute system until late September or October, and still later changed its plans. It had, as already noted, no substitute system ready for operation until February 20, 1927. The plaintiff also offered evidence that other methods or processes than the one actually adopted by defendant were available for purifying, and might have been installed much earlier than February, 1927. The jury were fully warranted in cutting down the time, during which the defendant was entitled to claim lost profits as damages, to much less than the five-month period used by defendant's auditor in the elaborate computation, Exhibit 61. Plaintiff also attacked other aspects of defendant's computation of lost profits.
We observe, generally, that the amount of defendant's damage was peculiarly a question of...
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