North Am. Pump Corp. v. Clay Equipment Corp.

• Decision Date: 27 July 1972
• Docket Number: No. 8738,8738
• Citation: 199 N.W.2d 888
• Parties: NORTH AMERICAN PUMP CORPORATION, a North Dakota corporation, Plaintiff and Respondent, v. CLAY EQUIPMENT CORPORATION, a foreign corporation, Defendant and Appellant. Civ.
• Court: North Dakota Supreme Court

Page 888

199 N.W.2d 888

NORTH AMERICAN PUMP CORPORATION, a North Dakota corporation Plaintiff and Respondent, v. CLAY EQUIPMENT CORPORATION, a foreign corporation, Defendant and Appellant.

Civ. No. 8738.

Supreme Court of North Dakota.

July 27, 1972.

Syllabus by the Court

1. On appeal from an order denying motion for new trial, the evidence must be considered in the light most favorable to the verdict.

2. Where plaintiff's president testified that the parties had entered into an agreement under the terms of which the plaintiff was given exclusive dealership in selling defendant's products in a certain area, and this testimony is corroborated by a letter from defendant to plaintiff advising that the contract was being terminated because plaintiff was not doing enough business and that defendant was losing out 'in your area,' there was substantial evidence on which the jury could find that the plaintiff had been given an exclusive dealership in such territory.

3. Where no termination date is agreed to in a dealership contract which requires the dealer to use its best efforts to promote the defendant's products, and which further requires the plaintiff to do a certain amount of advertising of such products and attend winter shows for the purpose of displaying and promoting defendant's equipment, and where the parties operated under such agreement for approximately three years, such contract does not lack consideration and mutuality.

4. An oral agreement granting an exclusive distributorship is not within the statute of frauds merely because it has no termination date, where such agreement is terminable by either party at any time.

5. Uncertainty as to the amount of damages does not preclude recovery, and mathematical certainty as to the amount of such recovery is not necessary. If a reasonable basis for computing an approximate amount of damages is provided, that is all the law requires.

6. Where damages obviously have been suffered and there is no definite evidence available for an exact determination of the amount of damages resulting from a breach of contract, the best evidence which the circumstances will permit is all the law requires.

7. The uncertainty which prevents recovery of damages is the uncertainty of the fact of damages, not the uncertainty of the amount. Where it is reasonably certain that substantial damages have resulted, mere uncertainty as to the exact amount will not preclude recovery.

8. Where the claim of the plaintiff in an action for breach of contract is unliquidated and disputed and incapable of being made certain by calculation on a fixed date, interest should not be allowed until the amount of the claim has been determined.

9. The court's refusal to submit special interrogatories to the jury on specific items of damages was not error, in the absence of a showing that refusal was an abuse of discretion on the part of the trial court.

10. While, as a general rule, courts favor giving a wide latitude on cross-examination, the scope of cross-examination must necessarily be left largely to the discretion of the trial court.

11. The refusal of the court to permit the defendant to cross-examine the plaintiff's principal witness on the plaintiff's pleadings, where the defendant actually was given ample opportunity to bring to the jury's attention variances between the allegations of plaintiff's complaint and the testimony of such witness, was not prejudicial error.

12. In an action for breach of an exclusive distributorship contract for sale of heavy equipment, the evidence supported the jury's award for loss of profits sustained by the plaintiff during the term of the contract.

Nelson, Mack & Moosbrugger, Grand Forks, for plaintiff and respondent.

Degnan, McElroy, Lamb & Camrud, Grand Forks, for defendant and appellant.

STRUTZ, Chief Justice.

This action was brought for damages claimed due for breach of contract. The plaintiff, a sales and service corporation engaged in selling farm implements and industrial equipment, asserts that it had an oral contract with the defendant, a manufacturer of such equipment, which contract, the plaintiff alleges, gave to it the exclusive right to sell defendant's products within a specified territory which was, roughly, the northern half of North Dakota and a small area in northwestern Minnesota. The plaintiff's offices are located in the city of Grand Forks, and George Bowman is its president.

The defendant denies that the plaintiff had any exclusive contract to sell its products and even denies that any arrangement it had with the plaintiff amounted to a contract because of lack of mutuality and consideration.

Although there is conflicting testimony as to just when such contract was consummated, it appears that sometime during the latter part of 1964 the parties did negotiate with a view of having the plaintiff sell the defendant's products. Mr. Bowman, president of the plaintiff corporation, and Gordon Thompson, an authorized agent of the defendant, met and discussed the possibility of the plaintiff's becoming a dealer for the purpose of handling defendant's products. A credit arrangement was approved, after which it was orally agreed that the plaintiff could obtain the defendant's equipment on credit, and the plaintiff was supplied with a Clay Equipment Corporation catalog of equipment and parts. Although this is denied by the defendant, the plaintiff further claims that the agreement allegedly entered into by the parties included a provision that the plaintiff was to be the exclusive Clay Equipment Corporation dealer in a specified area covering the northern half of the State of North Dakota and a small section of northwestern Minnesota which embraced the city of Crookston.

According to Mr. Bowman, in consideration of his right to purchase Clay products from the defendant on credit, the plaintiff agreed with the defendant to do a certain amount of radio and newspaper advertising, to attend winter farm shows for the purpose of displaying and promoting Clay equipment, to attend Clay dealership schools, to follow up prospective customer leads and inquiries furnished by the defendant, and to put forth its 'best efforts' to promote and sell the defendant's products.

Shortly after such agreement was entered into, the plaintiff hired one Morris Jensen as salesman, and Jensen spent much of his time and effort while employed by plaintiff in promoting and selling Clay equipment. Jensen continued working in the plaintiff's employ until July 1967, when he left North American Pump Corporation in order to work for A & J Supply Company of Grand Forks, of which he was a part owner.

Shortly after Jensen had left the plaintiff's employ, Bowman became aware that A & J Supply was advertising Clay products. However, it was not until five or six months thereafter that the plaintiff was finally notified by letter from Thompson that the defendant was terminating its agreement with the plaintiff and was designating Mr. Jensen's company as its Grand Forks dealer. The plaintiff thereupon brought this action for breach of contract.

The case was tried to a jury, which returned a verdict for the plaintiff of $3,000. After entry of judgment, the defendant moved for judgment notwithstanding the verdict or, in the alternative, for a new trial, which motion was denied. The defendant then brought this appeal from the judgment and from the order denying motion for judgment notwithstanding the verdict or for a new trial.

This court recently considered an appeal from an order denying motion for judgment notwithstanding the verdict. In an opinion by the Honorable Obert C. Teigen, we stated that if there was an issue of fact for the jury to determine and the jury returned its verdict thereon, the motion for judgment notwithstanding the verdict should be denied. We also pointed out that in considering the evidence, we must view it in the light most favorable to the verdict. Farmers Union Grain Terminal Ass'n v. Briese, 192 N.W.2d 170 (N.D.1971).

The only grounds to be considered on an appeal from an order denying a motion for judgment notwithstanding a verdict are those which were assigned on a motion previously made for directed verdict. Farmers Union Grain Terminal Ass'n v. Briese, Supra; Hanson v. Fledderman, 111 N.W.2d 401 (N.D.1961); Leach v. Kelsch, 106 N.W.2d 358 (N.D.1960).

After a careful and exhaustive review of the record and the evidence in this case, we conclude that the defendant, Clay Equipment Corporation, was not entitled to a directed verdict when such motion was made at the close of the plaintiff's case and renewed at the close of all the evidence. Therefore, we hold that the trial court did not commit error in denying the defendant's motion for judgment notwithstanding the verdict.

We now turn our attention to the numerous specifications of error assigned by the defendant and appellant. These specifications set forth errors of law which the trial court is claimed to have committed in the trial of the action. The appellant further specifies in what respects the evidence is insufficient to sustain the verdict returned by the jury. Considering all of these specifications, we find that three general issues are presented by the appellant on this appeal:

1. That the evidence adduced at the trial fails, as a matter of law, to prove the existence of an exclusive sales contract from the defendant to the plaintiff; and that the evidence does show, as a matter of law, a complete failure of consideration and lack of mutuality between the parties, and that the alleged agreement which the plaintiff asserts the parties entered into was void and unenforceable;

2. That, as a matter of law, the evidence produced by the plaintiff to prove damages was incompetent and inadmissible, and that damages were speculative, uncertain, and incapable of being ascertained; and

3. That errors committed by the trial court in the trial of this action were so...