William H. Oliver v. Empire Equipment Co.

Decision Date10 February 1983
Docket Number45051,83-LW-3408
PartiesWILLIAM H. OLIVER, APPELLEE, v. EMPIRE EQUIPMENT CO., APPELLANT.
CourtUnited States Court of Appeals (Ohio)

For plaintiff-appellee: Thomas A. Sampliner.

For defendant-appellant: Dwight A. Miller.

JOURNAL ENTRY AND OPINION

MARUS J.

This cause came on to be heard upon the pleading and the transcript of the evidence and record in the Common Pleas Court, and was argued by counsel; on consideration whereof the court certifies that in its opinion substantial justice has not been done the party complaining, as shown by the record of the proceedings and judgment under review, and judgment of said Common Pleas Court is reversed in part and affirmed in part. Each assignment of error was reviewed by the court and upon review the following disposition made:

In this action for breach of a bulldozer sales contract, the trial court entered judgment on the jury's verdicts. Those verdicts found that plaintiff-buyer was entitled to Twenty Thousand Dollars ($20,000) damages plus the delivery of certain additional bulldozer parts, and that defendant-seller was entitled to Five Hundred Dollars ($500) damages on a counterclaim for breach of a separate contract to modify the bulldozer's starter mechanism.

Defendant contends on this appeal that the trial court erred admitting evidence concerning: (1) plaintiff's claimed lost profits, (2) other claimed special damages which were not asserted in plaintiff's complaint, and (3) documents which violated hearsay and relevance standards. Defendant also claims the judgment on his counterclaim was inadequate and against the manifest weight of the evidence.®1¯

Footnote 1 Defendant alleges the following as error:

A. THE TRIAL COURT ERRED IN ADMITTING EVIDENCE OF LOST PROFITS FROM FARMING SINCE THERE WAS NO EVIDENCE FARMING PROFITS WERE IN THE CONTEMPLATION OF BOTH PARTIES.
B. THE COURT ERRED IN ADMITTING APPELLEE'S EXPERT'S TESTIMONY ON THE VALUE OF LOST PROFITS INASMUCH AS SAID OPINIONS WERE BASED ON SPECULATION AND CONJECTURE.
C. THE TRIAL COURT ERRED IN ALLOWING INTO EVIDENCE, OVER APPELLANT'S OBJECTION, TESTIMONY CONCERNING SPECIAL DAMAGES NOT PLEADED IN APPELLEE'S COMPLAINT.
D. THE TRIAL COURT ERRED IN ADMITTING INTO EVIDENCE, OVER APPELLANT'S OBJECTION, EXHIBITS 2, 3, 4 AND 5.
E. THE JUDGMENT OF THE TRIAL COURT ON THE COUNTERCLATM WAS CONTRARY TO THE UNDISPUTED EVIDENCE OF RECORD.

We agree that the disputed evidence should have been excluded but we conclude that the counterclaim judgment is sufficiently supported by the record. Since defendant's evidence contentions all relate to damage issues on plaintiff's claim, we remand for a partial new trial limited to the extent of damages sustained by plaintiff as a result of defendant's breach of their contract. Defendant's liability for breach of that contract was determined by the jury, that finding is supported by the record, and defendant assigns no error here which challenges that liability decision.

I.

Plaintiff testified that he contacted defendant and several other heavy equipment dealers to purchase a used bulldozer. Plaintiff had acquired land in Mississippi in 1966 and decided to obtain a bulldozer in 1978 to clear the land, in order to make it farmable. Plaintiff claims that he stated to some of these dealers that he intended to use the land for farming after it was cleared. However, the record does not show that he advised defendant about his plan to farm the land. Nor does the record show that he had formed any definite plan as to the part of the land which would be farmed, the crops he would cultivate there, the equipment or personnel he would use for farming, or any specific schedule to begin farming. The land had not been previously used for farming during the 12 years plaintiff had owned it.

Plaintiff and defendant's salesman agreed that he purchased a bulldozer from defendant for Twenty-Two Thousand Dollars ($22,000). Both confirmed that the bulldozer had an angle blade on the front and a grouser bar on the back at the time of the purchase, and that defendant agreed to replace the angle blade with a straight blade and furnish grouser bar stock at no additional cost.

The witnesses also said that a subsequent agreement was reached by them, under which defendant would replace the bulldozer's "pony motor" starting system with an electric starting system for an additional cost. Plaintiff testified this agreed cost would be One Thousand Two Hundred Dollars ($1,200) while defendant contended the price orally agreed upon was somewhere between One Thousand Two Hundred Dollars ($1,200) and One Thousand Five Hundred Dollars ($1,500). Plaintiff testified that defendant agreed to credit Seven Hundred Dollars ($700) against that One Thousand Two Hundred Dollars ($1,200) cost, because defendant advised that he had a buyer for the old starting system. Defendant did replace the starter system before the bulldozer was delivered to plaintiff. At the time of trial, defendant had not sold the old starter system.

Plaintiff testified that defendant had removed the angle blade at the front and the grouser bar at the back, without installing the replacement straight blade at the front, when the bulldozer was delivered. Plaintiff said he took delivery of the bulldozer on May 3, 1979, without the blade and grouser bar, but with assurance that they would be forthcoming. Defendant stated that he did not deliver the blade or grouser bar because plaintiff owed him for the services rendered to the starting system. Plaintiff testified and documents confirmed that plaintiff attempted to buy another blade in Mississippi when it appeared that defendant would not perform. Plaintiff's testimony also implied that defendant was attempting to pressure plaintiff into returning the bulldozer because defendant had another buyer willing to pay a much higher price for the bulldozer. Defendant's salesman denied that defendant had another prospective purchaser.

Plaintiff was allowed over objection to call an expert in the field of agricultural science. The expert witness testified regarding cost and profit factors involved in planting and harvesting a soybean crop for 1979, 1980, and 1981. To accomplish his calculations he relied almost entirely on average data supplied to him by an unidentified person from the agricultural service at the University of Mississippi. That general cost and profit data was never offered or received in evidence. The witness testified to the cost and profit for the average Mississippi farmer without any information or assumption about the plaintiff's abilities or the nature or location of plaintiff's farm.

Additionally, plaintiff was allowed to present testimony over objection from an attorney who represented the lender bank that financed the bulldozer purchase. The attorney testified that she was retained to collect that loan when plaintiff defaulted on his payments. An employee of the bank testified over objection about that loan, applicable interest and add on charges, and court costs incurred in the collection.

Defendant's sole witness was his salesman who contracted with plaintiff on behalf of defendant. That witness testified that defendant was willing and ready to delivery a blade and bar for this bulldozer shortly after plaintiff took possession of the bulldozer. However, the salesman testified that defendant retained the blade and grouser bar, after negotiations with plaintiff failed to settle their dispute about the collateral agreement for modifying the starting system.

Plaintiff's complaint prayed for damages due to lost farming profits, additional lost job opportunities using bulldozers of this kind, interest, attorney's fees, and court coste. The trial court dismissed plaintiff's claim for damages from additional lost opportunities at the close of plaintiff's case, for lack of supportive evidence. At the conclusion of plaintiff's case and at the conclusion of all the evidence, defendant also asked the court to dismiss plaintiff's claims for lost profits and expenses incident to the bulldozer's financing. Those requests were denied.

The trial court instructed the jury at the end of the case that lost profits could be recovered if "the parties had entered into the contract contemplating losses of this nature at the inception of the contract," (Tr. 243) and that "[d]amages are only recoverable as may be said to be the natural and probable result of the wrong committed and cannot be remote or speculative." (Tr. 243) He also instructed the jury (Tr. 244):

"Damages which are purely speculative cannot be recovered, but it is the uncertainty to the fact of damages and not as to the amount of damages that is to be considered. Where it is certain that damages resulted, mere uncertainty as to the amount does not justify the Jury in refusing recovery. A mere difficulty in assessment of damages is not sufficient reason for refusing them where the right to damages has been established."
II.

Defendant asserts in his first two assignments of error®2¯ that the trial court erred in admitting evidence of speculative lost profits, where no evidence was presented that the contracting parties contemplated these consequential damages when the contract was made. In the classic English case on contract damages, it was established that damages are recoverable only for those injuries that the defendant had reason to foresee as a probable result of his breach when the contract was made. Hadley v. Baxendale (1854), 9 Exch. 341. See also, Cincinnati v. Evans (1855), 5 Ohio St. 594; Adams v. Young (1886), 44 Ohio St. 80; Queen Incubator Co. v. Merrel Company (1926), 21 Ohio App. 482.

Footnote 2 Defendant's second assignment of error also...

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