Cutting v. Grand Trunk Railway Co. , 95 Mass. 381 ( 1866 )

Gray, J.

The only question which has been argued upon these exceptions is of the measure of the plaintiffs’ damages for non-delivery of their goods. After full consideration of the able and elaborate arguments of counsel, the court is unanimously of opinion that the instruction requested by the plaintiffs at the trial should have been given, and that the instruction under which a verdict was returned for the defendants was erroneous.

It is the duty of a common carrier, receiving goods for transportation, to deliver them at the place of destination at the time agreed upon, or, in the absence of any agreement, within a reasonable time; and if be fails so to deliver them, without sufficient excuse, he is responsible in damages. The general principle upon which the damages for the breach of a contract to deliver goods are to be assessed is well settled. It is compensa' tian for the injury of not having the very thing, propter rem ipsam non habitant, at the time and place at which it should have been delivered, including the damages resulting naturally, or according to the usual course of things, from the breach of the contract itself, as well as such as may reasonably be supposed to have been in the contemplation of both parties, when they made the contract, as the probable result of a breach of it. 1 Pothier on Obligations, 162,163. 2 Kent Com. (6th ed.) 480, note. Hadley v. Baxendale, 9 Exch. 354.

As a general rule, the appropriate compensation for the breach of a contract to deliver goods is their market value in money at the time and place at which they should have been delivered, with interest thereon; and it is admitted that such is the rule in an action against a carrier if the goods are never delivered. Spring v. Haskell, 4 Allen, 112. It is also settled beyond dispute that when a carrier negligently delays the delivery of goods, knowing that the owner intends to sell them in the market, he is liable for the diminution in their market value during the delay. Smith v. New Haven & Northampton Railroad, 12 Allen, 531. Hamilton v. McPherson, 28 N. Y. 77. King v. Woodbridge, 34 Verm. 565. Under those circumstances, such damages must have been in the contemplation of both parties; and whether, without regard to that fact, they must be considered as naturally resulting from the breach of the contract itself is a question which was left open in the cases just cited, and is now directly presented for adjudication.

In the absence of evidence that the carrier knew or contemplated that the owner intended to sell the goods in the market, it is contended for the defendants that if the goods are not wholly lost, but only delayed, and afterwards delivered to and received by the owner, the measure of damages is interest during the delay on their market value at the time when they should have been delivered, and nothing more. But the objection to this is that it will never give a just compensation unless the goods are of the same value at the time of actual delivery as at the time when they should have been delivered ; for if the goods have increased in value, it is more, if they have diminished, it is less, than the plaintiff’s loss. The thing which the plaintiff does not receive when he is entitled to it is goods of their value at that time. The thing which he afterwards receives is goods of a value at a different time, which is not necessarily the same value. The general price of such goods in the market is the appropriate, if not the only legal, evidence of the value of the goods at any time in question. If the market value of the goods is- less when they are actually delivered than it was when they ought to have been delivered, the fall in the market value is not a cause, but an incident or consequence, of the diminution in the intrinsic or merchantable value of the goods, and evidence of the degree of the injury which the plaintiff has suffered by the wrongful act of the defendant. A diminution in the mar» ket value of goods by the operation of general laws is a real and actual loss of a portion of the real and intrinsic value, as much6 as a change for the worse in the quality of the goods-By Shaw, C. J., in Stone v. Codman, 15 Pick. 301. A fall in the market is no more a cause of the diminished value of the goods than a fall in the thermometer or barometer is the cause of a change in the weather.

The true rule and measure of damages, in our opinion, whenever by reason of inexcusable delay of the earner the goods are not delivered until after they have diminished in market value, is the amount of the diminution. This allows to the person injured the value, as exactly as it can be estimated in money, of that of which he has been finally deprived by the wrongful act of the defendant; and is the most simple and just rule, as well as the easiest to be applied; for it depends on the general market value of the goods, and involves no question of contingent or speculative profits, and no consideration of any other con tracts made or omitted to be made by the plaintiff in view of his contract with the defendant. To refer to such other contracts, or the profits which might have resulted from them, not within the knowledge or contemplation of the defendant, would be to hold him liable for the consequences, or allow him the benefit, not of his own contract with the plaintiff, but of dealings between the latter and third persons, with which the defendant had nothing to do. Fox v. Harding, 7 Cush. 516. Waite v. Gilbert, 10 Cush. 177. Le Peintur v. Southeastern Railway 2 Law Times, (N. S.) 170. Gee v Lancashire & Yorkshire Railway, 6 Hurlst. & Norm. 211.

The rule which we adopt in this case is the same which was affirmed in 1861 by independent judgments of the English courts of common bench and exchequer. Wilson v. Lancashire & Yorkshire Railway, 9 C. B. (N. S.) 632. Collard v. Southeastern Railway, 7 Hurlst. & Norm. 79. The distinction between loss of profits and diminution in the market value of the goods was well stated in the first of these cases by Mr. Justice Byles, who said, “ Profits include the increased value arising from the purpose to which the plaintiff intended to apply the goods 5 whereas diminution in exchangeable value is only something subtracted from the inherent value of the articles themselves.” “ It is admitted that deterioration in quality is to be taken into account in estimating the damage the plaintiff has sustained; it is admitted also that loss or diminution in the quantity is to be taken into account; and I do not see why a loss in the exchangeable value of the goods should not also be taken into account.” 9 C. B. (N. S.) 646.

The doctrine of these cases was recognized in Great Western Railway v. Redmayne, Law Rep. 1 C. P. 330, and the damages there refused were the profits which the plaintiff might have made if the goods had arrived in time. See also Lord v. Midland Railway, Law Rep. 2 C. P. 345, 346. In Woodger v. Great Western Railway, Ib. 318, expenses incurred by the plaintiff in waiting for the goods were disallowed, as they were by this court in Ingledew v. Northern Railroad, 7 Gray, 91. In Smeed v. Ford, 1 El. & El. 602, which was an action for not delivering a threshing machine at the time agreed in a contract of sale, the market price, evidence of which was excluded, was not the market price of the machine, the subject matter of the contract between the parties, but the market price of the wheat which the plaintiff threshed with that machine. The earlier case of Black v. Baxendale, 1 Exch. 410, was decided before the English courts had accurately defined the rule of damages in cases of this nature, but it contains nothing inconsistent with the later adjudi cations.

The defendants’ counsel referred, by way of analogy, to the rule of damages in actions of trover, as inconsistent with the rule contended for by the plaintiffs in this case. But we can perceive no such inconsistency. The general rule is well settled in this commonwealth, that in an action of trover the measure of damages is the market value of the goods at the time of the conversion, and interest thereon, even if the defendant has since sold the goods at a higher price. Kennedy v. Whitwell, 4 Pick. 466. Tf the goods have by any means been restored to the owner, it goes in mitigation of damages ; but only to the extent of their market value at the time of the restoration, and less all reasonable intervening charges; in short, so much only is deducted by way of mitigation from the damages, as the plaintiff has already in fact received. Pierce v. Benjamin, 14 Pick. 361. Greenfield Bank v. Leavitt, 17 Pick. 1. Lucas v. Trumbull, 15 Gray, 306. If the plaintiffs had demanded their goods on the day when they should have been delivered, and the defendants had refused or inexcusably neglected to deliver them, and had been sued in trover, the measure of damages would have been the same as we hold it to be in this case. The plaintiffs do not ask to charge the defendants with any higher value of the goods than that which they had at the time when they should have been delivered.

The case of Denny v. New York Central Railroad, 13 Gray, 481, in which the proprietors of a railroad, who, after negligently delaying the transportation of goods, transported them safely to the place of destination and there used due care in depositing them in a warehouse, were held not to be responsible for injuries to the goods while in their warehouse from a sudden flood is quite distinguishable from the present; for in that case the goods were uninjured in quality and undiminished in market value when the liability of the defendants as carriers ceased; and the flood was a special and extraordinary disaster acting upon the goods in question, not a consequence which according to the usual course of things arose from the delay, or could have been anticipated by the parties. More in point, ana not distinguishable in principle from the present case, is the decision that carriers are liable for diminution in the market value of goods from an ordinary change in the weather during a negligent delay in transportation. Ingledew v. Northern Railroad, 7 Gray, 86.

In New York, the question now before us has not been authoritatively determined by the court of appeals, and the number of judgments in the local courts and of opinions of individual judges upon each side of the question would seem, from the cases cited at the argument, to have been about equal. Wibert v. New York & Erie Railroad, 2 Kernan, 252, 258; S. C. 19 Barb. 36. Scovill v. Griffith, 2 Kernan, 513, 517, 518. Kent v. Hudson River Railroad, 22 Barb. 278. Medbury v. New York & Erie Railroad, 26 Barb. 564. Jones v. New York & Erie Railroad, 29 Barb. 633. Conger v. Hudson River Railroad, 6 Duer R. 375. A recent decision of the supreme court of Michigan accords with our conclusion in the present case. Sisson v. Cleveland & Toledo Railroad, 14 Mich. 489.

Exceptions sustained