Wise v. The Western Union Telegraph Co.

• Decision Date: 05 November 1935
• Court: Delaware Superior Court
• Parties: WILLIAM ARTHUR WISE v. THE WESTERN UNION TELEGRAPH COMPANY, a corporation of the State of New York

181 A. 302

37 Del. 209

WILLIAM ARTHUR WISE v. THE WESTERN UNION TELEGRAPH COMPANY, a corporation of the State of New York

Superior Court of Delaware, New Castle County

November 5, 1935

Superior Court for New Castle County, No. 34, November Term 1932.

Demurrer to amended declaration.

This was an action of tort upon the facts fully set out at a prior argument in Wise v. Western Union Telegraph Co., 6 W. W. Harr. (36 Del.) 155, 172 A. 757. From these facts it appears that the plaintiff was engaged in the business of selling information concerning horse races and had an established clientele to whom he was accustomed to send telegrams; that the agent of the defendant forged a telegram in the name of the plaintiff which was delivered to a client of the plaintiff, one Sasher; the telegram announced that a certain horse, a "ringer," would be entered at a race and required a monetary payment for the name of the entry. This money was paid by the client to the agent of the defendant and was kept by him. The name of the supposed entry was never forwarded nor any answer made to the client, due to the fact that the money was never transmitted to the plaintiff, who was unaware of the issuance of the forged telegram. The declaration then alleged that the client Sasher, exhibited the telegram to many of the plaintiff's customers and informed them of his payment, his failure to receive any answer or the name of the entry, and the declaration claimed damages by the plaintiff to his reputation, good name and business.

At the trial the plaintiff, in attempting to prove damages, produced a witness who was not a client or subscriber to the plaintiff's service but who was alleged to be one of a secondary group who contributed to the payment made by Sasher and who by reason of the premises had refused to continue in the group contributing to Sasher who in turn subscribed to the plaintiff's system. The offered evidence was excluded because not admissable under the declaration.

The plaintiff has amended his declaration in the following particulars:

1. The plaintiff amends so as to make the words "clients," "subscribers" or "paying users" as employed in the declaration include persons having no direct relationship to the plaintiff and making those words include "persons, firms or corporations who * * * use his service for monetary compensation, reward or charge, the whole or any part of which inured to the benefit of the plaintiff and whether said compensation * * * was paid directly * * * to the plaintiff * * * or otherwise or pooled with like monies * * * and transmitted in any manner whatsoever * * * and whether the identity of such * * * persons * * * was * * * known or unknown to the plaintiff."

2. The second amendment alleges the existence of persons who would have become clients and who did not do so by reason of the action of the defendant, and seeks to recover the loss of profits which would have otherwise inured to the plaintiff.

3. Under the third amendment the plaintiff seeks to recover $ 100 allegedly laid out for printing and mailing notices to listed users of the service, and others, warning them "against unauthorized and fraudulent communications supposedly coming from the plaintiff."

4. By the fourth amendment the plaintiff seeks to recover $ 1000 as the expenses of installing telephones as a means of communication with customers in place of telegraphic communication.

The various amendments have been demurred to on the grounds (1) that it does not appear that the respective elements of damage were the proximate results of the grievances complained of and (2) that the respective elements of damages as set out in the amendment are too remote, speculative and contingent to form the basis of recovery.

The demurrers are sustained.

James R. Morford (of Marvel, Morford, Ward and Logan) for plaintiff.

William S. Potter (of Ward and Gray) for defendant.

LAYTON C. J., and RODNEY, J., sitting.

OPINION

RODNEY, J.

By the declaration the plaintiff has alleged a class of customers who subscribed to and used the system or services of the plaintiff. For the loss of these subscribers, due to the alleged action of the defendant, the plaintiff seeks to recover in the original declaration. This class of subscribers we shall, for convenience, call "primary" users.

The first amendment to the declaration brings in another class and seeks to recover for loss arising from the breach of business relations with this latter class. These we may call "secondary" users. No relationship or direct connection is suggested between this "secondary" class and the plaintiff but the sole connection the "secondary" class had was with the "primary" subscribers. We are of the opinion that any mere failure of this secondary class of users to avail themselves of the service or system is too remote to furnish a basis of recovery by the plaintiff. It is not alleged in the amendment that the primary user cancelled his subscription. Certainly it is true that if the secondary user who has been paying the primary user for the benefit of the service stopped using it but the primary user continues to subscribe for the service, then the only loss is upon the primary user and the furnisher of the service or system loses nothing. If the primary user himself ceases to avail himself of the system, then a loss may fall upon the furnisher of the service and, under certain circumstances, he may recover from a third person whose fault created the breach in relations, and this would be true regardless of the action of a secondary user who has no connection with the furnisher of the service.

The second amendment seeks to recover for loss of profits from those persons whom the plaintiff alleges would have become clients but for the action of the defendant. The defendant denies that such profits are recoverable.

We are of the opinion that this matter is not now determinable by this Court but must await the offer or introduction of evidence.

We are not aware of any rule or reason which would exclude profits, eo nomine, as a measure of damage in a tort action if such loss of profit was the natural, probable and proximate consequence of a wrongful act. We are not aware of any distinction in this respect between actions of tort and contract. Selden, J., in Griffin v. Colver, 16 N.Y. 489, at page 491, 69 Am. Dec. 718, says:

"It is a well established rule of the common law that the damages to be recovered for a breach of contract must be shown with certainty, and not left to speculation or conjecture; and it is under this rule that profits are excluded from the estimate of damages in such cases, and not because there is anything in their nature which should per se prevent their allowance. Profits which would certainly have been realized but for the defendant's default are recoverable; those which are speculative or contingent are not."

Many of the cases dealing with the question of damages for tort as affected by the loss of profits are collected in a note in 52 L. R. A., p. 33.

The defendant denying the right to recover anticipatory profits relies upon Eaton v. Wilmington City R. Co., 1 Boyce (24 Del.) 435, 75 A. 369, 372. That was an action for personal injuries and rests upon an entirely different principle from that...