Wentworth & Irwin, Inc. v. Sears
| Decision Date | 07 April 1936 |
| Citation | 56 P.2d 324,153 Or. 201 |
| Parties | WENTWORTH & IRWIN, Inc., v. SEARS. |
| Court | Oregon Supreme Court |
In Banc.
Appeal from Circuit Court, Multnomah County; James P. Stapleton Judge.
Action by Wentworth & Irwin, Incorporated, against Guy L. Sears wherein defendant filed a counterclaim. Judgment for the defendant, and the plaintiff appeals.
Reversed and remanded.
Will H Masters, of Portland, for appellant.
Howard P. Arnest, of Portland, for respondent.
The principal question here involved is whether the loss of anticipated profits on employment of two trucks for gravel hauling, of which profits the defendant claims to have been deprived by termination of the employment, is the proper measure of defendant's damages against plaintiff, the vendor of one of such trucks, for breach of implied warranty of quiet possession of the truck.
On July 9, 1930, the plaintiff sold to the defendant one used G. M. C. motor truck on a conditional sale contract for the purchase price of $3,237.40, upon which the defendant at the time of sale paid $1,073.88 in cash. The contract provided that in the event the monthly payments were not made as therein specified the plaintiff might repossess the truck, sell the same, and apply the amount received from such sale on the balance due on the contract, and in case of a deficiency the defendant agreed to pay the amount thereof to the plaintiff.
Default was made in three monthly installments, and the truck was repossessed by the plaintiff and sold for $388.94 less than the amount of the balance due on the purchase price. This action was brought to recover the deficiency, together with $85.67 for material and services furnished by the plaintiff at the instance of the defendant.
As a counterclaim, the defendant, after admitting the purchase of the truck, the making of initial payment thereon, and the execution of a conditional sale contract providing for the balance of the payment in monthly installments, alleged that at the time of executing such contract the plaintiff knew that the defendant was dependent upon his ability "to use and possess said truck in performance to contracts for hauling highway surfacing material in order to perform such contract and in order" to pay to said truck; and that the plaintiff at the time of executing the conditional sale contract warranted to defendant that the truck was then "free from any charges or encumbrances," and that the defendant would have and enjoy the quiet possession of said truck as against any lawful claims then existing.
The defendant further alleged that after taking the truck on the conditional sale contract he "secured a contract from one Milne-Dussault Company *** to furnish two trucks with drivers for hauling crushed rock" on a highway project near Neskowin, Or., for fifteen cents per yard mile, to begin about September 1, 1930; and that defendant entered upon the performance of that work and continued to haul crushed rock for the said company until October 6, 1930. At that time, according to the allegations of the answer, the sheriff of Tillamook county took possession of said truck to foreclose a valid mechanic's lien which had existed against the truck when defendant purchased the same. The defendant further avers that he was thereby deprived of the use of the truck from October 6 to 10, 1930; that due to the seizure of said truck he "was unable to furnish two trucks in accord with his hauling contract and unable to perform his contract with said Milne-Dussault Company, for which reason said contract was terminated by said company and other trucks put on said job"; and that by reason of such termination of his employment the defendant was damaged in the sum of $23,400, "less only such sum, if any, as may be found owing to plaintiff as the balance of the purchase price of said truck after its repossession by the plaintiff and application of its reasonable value thereon."
The plaintiff in its reply put in issue the allegations in defendant's counterclaim and affirmatively alleged that one Campbell had, prior to the sale of the truck to defendant, filed a notice of lien against the truck for $240.10, due as payment for two truck tires, and that pursuant to said notice of lien the sheriff of Tillamook county on October 6, 1930, had taken possession of the truck; that immediately upon receiving notice from the defendant, the plaintiff, on October 8, filed a denial of the lien and gave an undertaking to release said truck; and that the truck was released and returned to the defendant, who retained it until December 8, 1930, when it was repossessed by the plaintiff for failure of defendant to make payments on it as required by his contract.
The case was tried to the court and a jury, and from judgment entered upon a verdict in favor of the defendant for $1,000, the plaintiff has appealed.
The defendant testified that early in July, 1930, he went to the plaintiff's place of business in Portland to ascertain whether any of plaintiff's employes would furnish a truck and his services and join defendant in hauling road materials on a construction job on the Bend-Burns highway, under a contractor named Young. Defendant then owned one truck and wanted some one to join him because the offer of work was for two trucks and drivers. No one connected with the plaintiff's business cared to join in the work. The defendant, however, was persuaded by plaintiff to buy a second truck and hire a driver, and as a result he bought from plaintiff the truck here involved.
Both trucks were used by defendant on the Bend-Burns highway job for approximately one month. He then took a hauling job under one Marston, on the Mt. Hood Loop highway, and after that was employed hauling sand and gravel in county work in and about Portland.
About September 1 defendant was given work by the Milne-Dussault Company, the contractor in charge, for his two trucks, hauling road materials on the Otis-Neskowin section of the Oregon Coast highway. The company had five trucks of its own and three others on the job that were given preference in this hauling. There was no definite contract between the defendant and the company as to the length of time the defendant's trucks would be used, but it appeared that there would be work for those two trucks for approximately two months. The contractor did not agree to use them for that length of time, or any other definite period, nor did defendant agree to furnish the trucks for any stated time.
The defendant began hauling materials on this job about September 5, and on October 6 the following occurred, according to defendant's witness Kissinger, who was in charge of construction for the Milne-Dussault Company and who thus testified:
The other truck owned by the defendant, which had not been sold to him by the plaintiff, worked on October 9 and 10, and on the latter date the truck bought from plaintiff was released by the sheriff of Tillamook county upon plaintiff's filing an answer to the foreclosure proceedings and giving a bond for the release of the truck.
The evidence is undisputed that this truck, prior to the sale to the defendant, had been sold to and used by another purchaser, who while he had possession of it bought two tires for it and did not pay for them, with the result that notice of lien had been filed against the truck. There was no dispute as to the validity of the lien.
In order to prove damages alleged to have been suffered by him through the seizure of the truck by the sheriff, the defendant contended that such seizure resulted in the termination by Milne-Dussault Company of his employment to use two trucks in hauling road material, and that by such termination of employment he suffered a loss to the extent of his anticipated profits on said road work. Testimony was presented on defendant's behalf showing what his profits had been on the work of both trucks from the time he took such employment on September 5 to the seizure of the truck by the sheriff on October 6. The jury was instructed by the court to ascertain, based on that evidence, the amount of damages which the defendant suffered by being prevented from continuing the highway work until completion of the hauling in which he was engaged.
When the plaintiff sold to the defendant the G. M. C. truck there was an implied warranty that the defendant should have and enjoy the quiet possession of such truck against any lawful claim existing at the time of the sale, and the additional implied warranty that the truck was "free at the time of the sale from any charge or encumbrance in favor of any third person, not declared or known" to the defendant "before or at the time when the contract or sale" was made. Section 64-313, Oregon Code 1930.
Where there is a breach of warranty by the seller, a buyer has at his election one of four remedies: (1) To accept or keep the goods and set up against the seller the breach of warranty by way of recoupment, in diminution or extinction of the purchase price; (2) to accept or keep the goods and maintain an action against the seller for damages for breach of warranty; (3) to refuse to accept the goods, if the property therein has not passed, and maintain an action against the seller for damages for breach of warranty; or (4) to rescind the contract to sell or the sale and refuse to receive the goods, or, if the goods have already...
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Seymour v. W. S. Boyd Sales Co., 18
...that they were within the contemplation of the parties at the time of the execution of the contract of sale. Wenthworth & Irwin, Inc. v. Seals, 153 Or. 201, 56 P.2d 324 (Or.1936). See also Price v. Goodman, 226 N.C. 223, 37 S.E.2d As to the cause of action for wrongful conversion, the compl......