Ridgeway Dynamo & Engine Co. v. Pennsylvania Cement Co. ( 1908 )

Opinion by

Mr. Justice Potter,

The Ridgeway Dynamo and Engine Company entered into a written contract to furnish to the Pennsylvania Cement Company, two automatic center crank engines to be delivered for the net sum of 83,000. The contract provided for certain special features as to the main bearings and a particular form of cross head, and for certain other special parts as applied to the type of engine which was ordered ; the result of the requirements being apparently the production of an engine not in general demand and not readily salable. After the engines had been partly constructed the cement company countermanded the order, whereupon the engine company stopped the construction» work and made use of the material for other purposes. The engine company then brought this suit to recover damages for breach of the contract. The trial resulted in a verdict for the plaintiff, upon which judgment was entered, and defendant has appealed.

The first question raised by the assignments of error is as to the measure of damages. The trial judge charged the jury that if they were satisfied from the evidence that the engines were manufactured from special designs for a special purpose and had no fixed market value, the plaintiff would be entitled .to recover the difference between the actual cost of manufacturing and delivering the engines, and the contract price. The learned trial judge correctly stated the rule applicable to such a state of facts as this, where from the nature of the article there is no market in which it can readily be sold. In such case the great weight of authority is to the effect that the measure of damages is the difference between what it would cost to make and deliver the article and the price which the purchaser has agreed to pay for it. The principle is thus stated in 2 Sedgwick on Damages (8th' ed.), sec. 618, p. 269 : “Where one engaged in the performance of a contract is wrongfully prevented by the employer from completing it, the measure of damages is the difference between the price agreed to be paid for the work and what it would have cost the plaintiff to complete it. Differently stated, the rule in such case is, recompense to the plaintiff for the part performance and indemnity for his loss in respect to the part unexecuted. The plaintiff is to be placed in the same condition he would have been in if he had been allowed to proceed without interference.” This rule gives to the party which has complied with the agreement the value of his bargain. In the present instance, the amount which was lost to the plaintiff by reason of the breach of the contract was capable of being ascertained with reasonable certainty, and was, therefore, properly adopted as the measure of the damages to be recovered by it as the injured party, from the one in default.

The second question raised by this appeal appears in the fourth assignment of error. Defendant offered to show that simultaneously with the execution of the contract there was an oral understanding between the parties which was the inducement for the making of the written contract, that the construction of the engines was not to begin until notice was given by the defendant company, and certain drawings furnished showing the foundation plans, etc. Upon objection by the plaintiff, the offer was excluded, and properly so, we think. While a contemporaneous oral agreement, entered into as an inducement to the execution of a written agreement, and not inconsistent with it, may be shown in defense to a suit upon a written contract, Keller v. Cohen, 217 Pa. 522; yet in the present case the agreement which it was attempted to set up is clearly inconsistent with the written contract. Furthermore, the written agreement contained an express stipulation that “ all previous communications between said parties, either verbal or written, contrary to the provisions hereof, are hereby withdrawn and annulled; and that no modification of this agreement shall be binding upon the parties hereto, or either of them, unless such modification shall be in writing.” Under this stipulation, inserted evidently for the very purpose of preventing the introduction of any such claim as that presented by the defendant, there was no room for the admission of evidence as to any other terms than those expressed in the written contract. The trial judge was clearly right in refusing to admit proof of the alleged parol contemporaneous agreement.

The judgment is affirmed.