Hampton Stave Co. v. Gardner

• Decision Date: 18 June 1907
• Docket Number: 2,487.
• Parties: HAMPTON STAVE CO. v. GARDNER.
• Court: U.S. Court of Appeals — Eighth Circuit

154 F. 805

HAMPTON STAVE CO. v. GARDNER.

No. 2,487.

United States Court of Appeals, Eighth Circuit.

June 18, 1907

(Syllabus by the Court.)

Upon all questions of jurisdiction, the sum demanded, not the amount recovered, recoverable or admitted, is the amount in dispute, unless the record proves to a legal certainty either that the sum demanded cannot be as a matter of law the amount in dispute, or that it is, as a matter of fact, a colorable and fictitious amount inserted in bad faith to invoke jurisdiction.

Jurisdiction of Circuit Courts is determined by the amount in controversy see notes to Auer v. Lombard, 19 C.C.A. 75; Tennent-Stribling Shoe Co. v. Rope, 36 C.C.A. 459.)

Upon a breach by a vendor of a covenant to furnish an abstract of title in a contract which grants a time option to purchase land, the measure of damages is the difference between the contract price and the value of the land, and the issue whether or not the vendee would have bought the land if the vendor had furnished the abstract is speculative and immaterial.

The basis of waiver is estoppel, and where there is no estoppel there is no waiver.

George B. Pugh and R. E. Wiley, for plaintiff in error.

N. T White and Ben J. Altheimer, for defendant in error.

Before SANBORN, HOOK, and ADAMS, Circuit Judges.

SANBORN Circuit Judge.

The first complaint in this case is that the court below refused to sustain a demurrer to the petition, and, at the close of the evidence, to dismiss the action on the grounds that the amount involved was less than $2,000, and that there was no averment or proof that the plaintiff below would have taken the lands if a complete abstract of title to them had been furnished. The plaintiff, Russell E. Gardner, alleged in his complaint, and the evidence proved these facts: On October 30, 1905, the Hampton Stave Company, a corporation, made a written contract with Gardner upon which he paid it $1,000 whereby the Hampton Company agreed to sell and convey, and Gardner undertook to buy, within 60 days, 5,000 acres of land for the sum of $20,000, the Hampton Company agreed to furnish him within a reasonable time proper abstracts of title to the lands, and they mutually agreed that if the titles proved defective the $1,000 should be refunded; if they proved good, and Gardner purchased the lands, the $1,000 should be credited upon the price; and if the titles proved good, and Gardner failed to take and pay for the lands, the $1,000 should be forfeited to the Hampton Company. The Hampton Company furnished an incomplete abstract of title to the lands, and though often requested failed to furnish any other within the 60 days. The land was worth $30,000, and Gardner alleged that he had sustained, and asked to recover, damages to the amount of $11,000.

Upon all questions of jurisdiction, the sum demanded, not the sum recovered, recoverable, or admitted, is the amount in dispute, unless the record proves to a legal certainty either that the sum demanded cannot be, as a matter of law, the amount in dispute (Vance v. Vandercook Co., 170 U.S. 468, 472, 18 Sup.Ct. 674, 42 L.Ed. 1100; Bank of Arapahoe v. Bradley & Co., 19 C.C.A. 206, 72 F. 867), or that it is as a matter of fact a colorable and fictitious sum inserted in bad faith to invoke jurisdiction (Hilton v. Dickinson, 108 U.S. 165, 174, 2 Sup.Ct. 424, 27 L.Ed. 688; Wilson v. Daniel, 3 Dall. (Pa.) 401, 404, 1 L.Ed. 655; Smith v. Greenhow, 109 U.S. 669, 671, 3 Sup.Ct. 421, 27 L.Ed. 1080; Schunk v. Moline, Milburn & Stoddart Co., 147 U.S. 500, 504, 13 Sup.Ct. 416, 37 L.Ed. 255; Peeler v. Lathrop, 1 C.C.A. 93, 98, 48 F. 780, 786. The vendee claimed damages for the breach by the vendor of a contract of sale of real estate. The legal measure of such damages is the difference between the contract price and the value of the property, and this was $10,000. The record fails to convince that this claim was made in bad faith to impose upon the court below and to fraudulently invoke its jurisdiction, and the amount in dispute was sufficient to sustain the action.

The next objection is that there was no averment or proof that the vendee would have taken and paid for the land pursuant to the contract if a correct abstract had been furnished, and that the court refused to admit evidence offered by the vendor to the effect that he would not have done so. But that evidence was immaterial. What the parties would have done if the vendor had not violated its agreement was a speculative and irrelevant issue. It had committed the first breach of the contract, and had thereby given to the vendee the right to recover the legal damages which resulted from its wrong and the only issues in the case were the breach and the amount of damages. It is said that the damages for the breach should be limited to the cost of a correct abstract, and that in any event evidence that the vendee would not have taken the property was material in determining the amount of damages. But the vendee's right to purchase was limited by the contract to 60 days. He had paid $1,000 for this option, and it was a valuable one. The vendor had covenanted to deliver to him a correct abstract within a reasonable time, and the vendee had the right to rely upon the performance of this covenant by the vendor and to stake his option upon it. He was not required to presume that the vendor would violate his agreement and to act and to procure...