Jonas v. Noel

• Decision Date: 23 March 1897
• Citation: 39 S.W. 724,98 Tenn. 440
• Parties: JONAS v. NOEL.
• Court: Tennessee Supreme Court

39 S.W. 724

98 Tenn. 440

JONAS v. NOEL.

Supreme Court of Tennessee.

March 23, 1897

Appeal from chancery court, Davidson county; Thomas H. Malone Chancellor.

Bill by L. Jonas against E. T. Noel. The decree was affirmed by the court of chancery appeals, and complainant appeals. Bill dismissed.

John Ruhm & Son, for appellant.

Vertrees & Vertrees, for appellee.

BEARD J.

In November, 1892, the complainant and defendant entered into a written contract, by which the latter agreed to erect in Nashville, upon a lot owned by him, a business house of unusual size for the occupancy of the former, and let him into possession, for a fixed term, at an annual rental of $8,500. Subsequently, without legal excuse, Noel breached this contract, and thereupon the bill in this cause was filed, among other things, to recover damages for the breach. At the hearing the chancellor adjudged that the defendant had violated the contract, and that complainant was entitled to recover from him as damages the difference between the rent contracted to be paid for this leasehold interest and its market value. The cause was referred to the clerk and master to take proof, and report the amount of this difference, if any. The court of chancery appeals affirmed this action of the chancellor, and the complainant has assigned error upon this action of that court.

The insistence of complainant is that the chancellor, in his order of reference, by the use of the term "market" ("market value") placed an unwarranted limitation upon his right of recovery; that the real measure of damages in such a case, and the one which should have been embodied in the order of reference, is the difference between the contract price and the actual or rental value of the term. Where the lessor wrongfully refuses to give possession to the lessee of the leased premises, the authorities agree that the measure of damages is the same as in a case where the vendor without excuse, declines to convey to his vendee. In favor of the lessee thus improperly dealt with Mr. Sedgwick says "The courts are more nearly agreed in adopting the principle of complete compensation for the loss of the bargain. The ordinary rule is to allow the difference between the rental value of the premises for the term and the rent reserved." 3 Sedg. Dam. § 1022. There is no case reported in this state involving a controversy between a lessee and a lessor for a breach of the latter's undertaking to let the former into possession, but we have a number in each of which the disappointed vendee had brought his action against his vendor for violating his contract to convey, and in all these cases this court has said that the measure of damages is the difference between the contract price and the value of the property in question. It is true, no doubt, as Mr. Sedgwick says in section 243 of his work already referred to, that "wherever the measure of damages involves the question of value, however much the market may be resorted to to determine what the value is this resort is had, not as a conclusive test, but to aid in getting at that real value to which the plaintiff is entitled." But the purpose of the law is to give the party complaining as near complete compensation for the loss of his bargain as possible; that is, to place him in as good a position as he would have been in if he had...