Davis v. New England Cotton Yarn Co.

Young, J.

As the case is understood, the plaintiff agreed from time to time with the defendants to hold the lumber, but each of these various agreements was made in consideration of the defendants’ promise to accept it at the contract price at the expiration of a more or less definite time If that is what the case means, the rights and liabilities of the parties are the same as they would have been if none of those agreements had been made; that is, the plaintiff is entitled to recover damages for the loss he sustained because of the defendants’ refusal to accept the lumber in the fall of 1907.

By "damages,” as that term is used in the law of contracts, is intended compensation for a breach, measured in the terms of the contract. The only losses that can be said fairly to come within the terms of a contract are such as the parties must have had in mind when the contract was made, or such as they either knew or ought to have known would probably result from a failure to comply with its terms. Therefore, the test to determine whether the plaintiff 4s entitled to recover any of his various claims for damages is to inquire whether the defendants either knew or ought to have known when they made the contract that he might sustain such a loss if they failed to comply with its terms.

The plaintiff is therefore entitled to recover not only all the items the court allowed him, but also three years’ interest on the money he should have received for the lumber and the taxes assessed on the lumber for the years 1908, 1909, and 1910. The court has found that the defendants ought to have known that it might be necessary to resurvey the lumber, and that the expense of teaming it might increase; and all fair-minded men will agree that they ought to have known (1) that the weather would damage the lumber, (2) that the plaintiff would lose the use of his money, and (3) that he would be compelled to pay taxes on the lumber, not only while he was holding it for the defendants, but also while he was finding another customer.

Defendants’ exception overruled: plaintiff’s exception sustained.

All concurred.