McEwen v. McKinnon

• Decision Date: 12 April 1882
• Citation: 48 Mich. 106,11 N.W. 828
• Court: Michigan Supreme Court
• Parties: McEWEN v. McKINNON.

11 N.W. 828

48 Mich. 106

McEWEN v. McKINNON.

Supreme Court of Michigan

April 12, 1882

Plaintiff contracted with defendant to furnish the materials and make for defendant two boilers, and have the same completed, and all connected in the mill of the said first party, on or before the fifteenth day of March, 1880. They were not completed until the twenty-eighth day of April. The boilers were to be used in the steam-mill and salt block of the defendant, which was known to plaintiff. Upon suit brought for a balance due upon the contract defendant set up as recoupment the loss of profits from inability to use the salt block between March 18th and April 28th. Held, that the same was properly disallowed.

Error to Bay.

Hatch &amp Cooley, for plaintiff in error.

McDowell & Mann, for defendant in error.

MARSTON, C.J.

The plaintiff below, McKinnon, commenced an action of assumpsit declaring upon the common counts. The defendant pleaded the general issue and gave notice of recoupment. The plaintiff's claim was for a balance due, under a written contract to furnish the materials and make for defendant two boilers, have the same "completed and all connected in the mill of the said first party on or before the fifteenth day of March, 1880." The defendant, in his notice of recoupment, set forth that the boilers were to be used in his steam-mill and salt block for the purpose of running and operating the same; that these were the only boilers he would have to furnish steam; that the capacity of his salt block was 200 barrels per day; that without the boilers he could not manufacture any salt, all of which facts were known to the plaintiff; that the boilers were not made and completed until the twenty-eighth day of April, and that in consequence of the breach by plaintiff the use and profits of his salt block were wholly lost, and the profits he would have made from the fifteenth of March to the twenty-eighth of April he claimed the right to recoup. This claim was not allowed in the court below, and this raises the principal question in the case, viz., the proper measure of damages.

The position taken by counsel for plaintiff in error as set forth in their brief is, that the defendant below could under the facts recover the value of the use of the machinery which lay idle in consequence of the delay, and that beyond this "what he might have made from the use of the machinery etc., the profits which he would have realized from the business carried on with it." There are undoubtedly many cases where upon the breach of a contract the injured party is entitled to recover as damages the profits he would have made, had the contract not been broken. Where a party is to perform labor, from which a profit would arise as the direct result of the work done at the contract price, such profits may be recovered. Burrell v. New York, etc., Salt Co. 14 Mich, 39. Or where a party is to furnish and deliver material under a contract and is prevented, as in Masterton v. Mayor of Brooklyn, 7 Hill. 62. The principles recognized in this class of cases are well established and have been applied in a great variety of cases. So in cases of tort the loss of profits may be allowed. Allison v. Chandler, 11 Mich. 558; White v. Mosely, 8 Pick. 356.

There is however another class of cases, within which this comes where the authorities differ, as to the right of the injured party to recover such profits as are claimed in this case. Perhaps the case most relied on, and upon which the others allowing such a recovery mainly rest, is Hadley v Baxendale, 9 Exch. 341. In that case the court held, the loss of profits while the mill...