Milton v. HC Stone Lumber Co.

• Court: U.S. Court of Appeals — Seventh Circuit
• Writing for the Court: ALSCHULER, EVANS, and PAGE, Circuit
• Citation: Milton v. HC Stone Lumber Co., 36 F.2d 589 (7th Cir. 1930)
• Decision Date: 18 January 1930
• Docket Number: No. 4169.,4169.
• Parties: MILTON et al. v. H. C. STONE LUMBER CO.

36 F.2d 589 (1929)

MILTON et al. v. H. C. STONE LUMBER CO.

No. 4169.

Circuit Court of Appeals, Seventh Circuit.

December 5, 1929.

Rehearing Denied January 18, 1930.

Josiah Whitnel, of East St. Louis, Ill., and David J. Cowan, of Peoria, Ill., for appellants.

Chester F. Barnett, of Peoria, Ill., for appellee.

Before ALSCHULER, EVANS, and PAGE, Circuit Judges.

EVAN A. EVANS, Circuit Judge.

Appellants complain because the court failed to apply the proper measure of damages to determine its loss suffered by reason of appellee's breach of its contract. The action was tried by the court upon a written stipulation waiving the jury. A carefully prepared opinion was filed by the District Court which embodied its views both as to fact and the law. The substance of these views was: That appellee breached its contract to take 100,000 feet of hardwood lumber for which it had agreed to pay a stipulated price; that at the date of the breach, and also at the date fixed in the contract for the delivery of the lumber, there was a well-recognized market price for lumber at the place of delivery of said lumber; that the market value of such lumber exceeded the contract price; that judgment should run to appellants but for nominal damages and costs.

Appellants argue that the proper measure of damage in this case is the difference between the contract price and the cost of cutting and marketing the lumber. Appellee, while insisting that it was justified in refusing to take any more lumber and therefore that it did not breach its contract, contends in the alternative for the rule of damages which the court applied.

A jury having been waived by the parties, appellants are not in a position to present questions of fact over which there is any dispute or conflict. Fleischmann Construction Co. v. United States, 270 U. S. 349, 46 S. Ct. 284, 70 L. Ed. 624; Law v. U. S., 266 U. S. 494, 45 S. Ct. 175, 69 L. Ed. 401. They must accept the general finding of the court in appellee's favor, as conclusive on the existence of a market value and also that the market value exceeded the contract price. The evidence on both these issues was conflicting.

Appellants contend, however, that the application of the proper rule of damages in case of a breach of contract presents a question of law reviewable on appeal. With the soundness of this position generally we are prepared to agree. Maryland Casualty Co. v. Jones, 279 U. S. 792, 49 S. Ct. 484, 73 L. Ed. 960. However, there are instances where the application of the true rule of damages depends upon circumstances and facts which throw light upon the understanding of the parties and the character of the agreement. If such facts and circumstances be controlling and are in dispute, then a finding on this issue by the court is likewise conclusive.

To illustrate, appellants contend that the evidence disclosed a situation which called for the application of what may be called an exception to the general rule of damages. To support their position, they contend that the agreement was one calling for the manufacture of merchandise rather than, as contended by appellee, a contract for the purchase and sale of hardwood lumber. If the determination of this issue is dependent upon the construction of evidence or upon disputed evidence, appellants are precluded from raising the only question upon which they rely for a reversal.

The contract was somewhat informally drawn and is to be found in letters and telegrams that passed between the parties.

Appellee's agent, after some verbal negotiations, wired appellant:

"Accept deal as agreed; write me outlining your understanding."

To this communication, plaintiffs replied:

"The purpose of this letter is in accord with our conversation and contract between J. W. Beck and Milton & Bass for lumber contracted by Milton & Bass to J. W. Beck.

"We understand the following:

"Milton & Bass are to furnish J. W. Beck with 100,000 (One Hundred Thousand) feet of Oak lumber at the following prices: * * *

"Milton & Bass agree to deliver said lumber F. O. B. cars E. S., Missouri.

"This lumber is to be graded at our mill in Washington County, and when there is as much as 20,000 feet or more sawed, J. W. Beck agrees to grade same at our mill in Washington County and to advance fifty per cent of purchase price on same.

"Milton & Bass agree to deliver said lumber to Elair Switch as soon after grading is completed at the mill as J. W. Beck wants it moved and we agree to move same to switch as rapidly as it is possible to move it after J. W. Beck is ready to have same moved.

"Milton & Bass retain the right to move lumber to Elair Switch on or before December 1st, 1920, providing lumber has been sawed at least ninety days before moving."

J. W. Beck wired:

"Your contract is O. K. both as to understanding and wording."

Thereafter the parties both by letters and actions construed, or attempted to construe or make more certain, the agreement. Differences arose...