Independent Brewing Association v. Burt
| Decision Date | 24 December 1909 |
| Docket Number | 16,313 - (96) |
| Citation | 123 N.W. 932,109 Minn. 323 |
| Parties | INDEPENDENT BREWING ASSOCIATION v. CHARLES B. BURT |
| Court | Minnesota Supreme Court |
Action in the district court for St. Louis county to recover a balance of $416.37 for goods delivered under a contract whereby plaintiff agreed to supply defendant such goods at stated prices and defendant agreed to sell them exclusively for the period of one year. Defendant set up a first counterclaim for $671.05 for overpayment to plaintiff, a second for $10,000 for loss of profits by plaintiff's failure to supply marketable goods and a third for $5,000 for damage to defendant's business and reputation. The case was tried before Dibell, J., and a jury which rendered a verdict for $836 in favor of defendant. From an order granting plaintiff's motion for a new trial, defendant appealed. Affirmed.
Reason For Granting New Trial -- Presumption.
Where it does not appear from the order granting a new trial, or from the memorandum of the court, upon what ground the order is based, a new trial cannot be presumed to have been granted upon the ground that the verdict was not justified by the evidence. R.L. 1905, § 4198, subd. 7; Gay v Kelley, supra, page 101.
Damages for Loss of Profits.
Where one party contracts to sell certain specified goods in a certain district within a given time, and the contract is broken by furnishing unmarketable goods, damages may be recovered for the loss of profits caused thereby, provided the loss is made reasonably certain by competent evidence.
Damages for Loss of Profits. -- Pleading.
The second counterclaim construed, and held not to state facts sufficient to constitute a cause of action for damages for loss of profits.
Miller & Clapp, for appellant.
Austin Lathers, for respondent.
On March 16, 1908, respondent entered into a contract with appellant, C. B. Burt, by the terms of which respondent agreed to sell to appellant such quantities of its bottled beer and malt extract, at certain fixed prices per case, as appellant might from time to time require. Several kinds of beer were specified, viz.: Prima, Burg Brau, Prima Bock, and Export. Appellant agreed to sell respondent's goods exclusively, and to buy no other beer, except that manufactured and sold by respondent, while respondent agreed to furnish its regular brands of bottled beer, and that the same should be of marketable quality. Appellant immediately proceeded to carry out the terms of this contract, but claims that he lost his customers on account of defective goods furnished by respondent, and that he was forced to close out the business about June 1. This action was brought to recover the balance claimed to be due on account, and appellant interposed a counterclaim, among other things claiming damages for loss of profits to his business. The case was submitted to a jury, and a verdict was returned for appellant for $836. Respondent moved for a new trial, upon the ground that the evidence was not sufficient to sustain the verdict, and for errors of law. The court granted the motion for a new trial, without specifying any ground.
No memorandum was attached to the order, and we therefore have a case for the application of the rule that when a motion for a new trial is made upon the ground that the evidence does not support the verdict, and for errors of law, and the order granting the new trial does not specify the ground upon which it was based, the presumption is that the court did not grant the motion upon the ground of insufficient evidence. R.L. 1905, § 4198, subd. 7. Hence the only question before us is whether the trial court committed errors of law.
Although in the motion for a new trial many errors were assigned as the basis of the application, consisting of rulings of the court with respect to the reception of evidence and instructions to the jury, both in the brief and at the argument respondent submitted the case upon the following propositions only: (1) Upon the ground that it appears as a matter of law that appellant is not entitled to any relief, for the reason that the contract under which he operated was one for the sale of merchandise. (2) Conceding that profits might be recovered under such a contract, that it conclusively appears from the evidence that the contract was voluntarily abandoned by Burt, or, if not, that the business was not established, and its alleged interruption formed no proper basis for damages for loss of profits. (3) That the second counterclaim, as set forth in the answer, does not state facts sufficient to constitute a counterclaim for loss of profits, and the court erred in overruling respondent's objection to the introduction of evidence in support of it.
1. The broad distinction which respondent makes between contracts of sale and contracts of commission is not sustained by the authorities. Goebel v. Hough, 26 Minn. 252, 2 N.W. 847, was a case involving the sufficiency of the evidence, where it was sought to recover damages for the interruption of a mercantile business. In Emerson v. Pacific Coast & N.P. Co., 96 Minn. 1, 104 N.W. 573, 1 L.R.A. (N.S.) 445, 113 Am. St. 603, the contract was one for the payment of commission; but it does not follow that the profits of an interrupted business may not be estimated, where the merchandise is purchased at a fixed price and sold again by the agent.
In the case before us the evidence tends to show that appellant had the privilege of buying his goods for the period of one year at a certain price, and that he determined the selling price by adding a certain amount per case to cover the expense of conducting the business and a reasonable profit. The profits of the business were no less capable of being estimated, provided the business had become sufficiently established, than in the Emerson case, where the agent was permitted to recover his commission based on the estimated amount of sales that could be made within the time. In Doud, Sons & Co. v. Duluth Milling Co., 55 Minn. 53, 56 N.W. 463, the amount of profits which the plaintiffs might make in the manufacture of barrels for a flour mill to be constructed was considered too remote, and not within the contemplation of the parties when they made the contract. See also Howard v. Stillwell & Bierce Mfg. Co., 139 U.S. 199, 11 S.Ct. 500, 35 L.Ed. 147.
There is no distinction in principle between these cases and the one before us. They all turn on the sufficiency of the evidence. The general rule has been broadly stated to be that, where loss of profit is estimated upon the basis of the loss of business such as...
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