Moody v. Leverich

By the Court.^*—C. P. Daly, Ch. J.

This action is founded upon the assumption that if the contract for the hiring of the servant is for a year, at a salary payable in monthly installments, and the master wrongfully dismisses the servant before the expiration of the year, that the servant, after his dismissal, may sue for and recover each installment as it becomes due, if he has held himself during the time ready and willing to render the service contracted for. That there is, in other words, in such a case, a constructive service on the part of the servant.

This idea of a constructive- service is founded upon a decision of Lord Ellenborough (Grandell v. Pontigny, 4 Camp., 375), where a servant having been discharged before the expiration of the quarter for which he had been engaged, Lord Ellehboroug-h said, that as the plaintiff had served a part of the quarter and being willing to serve for the residue, he might, in contemplation of law, be considered to have served the whole.

This was merely a nisi prius decision, and whatever weight it may have derived from the eminence of Lord Ellehborough, it possesses no longer ; for as a rule of law it must now be regarded as repudiated.

In Archard v. Horner, 3 Carr. & P., 349, it was held that if the servant is turned away improperly before the end of the year for which he was engaged, he cannot recover upon a count stating the contract to be one for an entire year, and that if he sues for wages under the contract he can recover only for the period during which he served. In' other words, if he sues upon the contract, for the wages contracted, for, performance is essential to a recovery.

In Smith v. Haward, 7 A. & El., 544, the court approved the decision in Archard v. Horner. The four judges who delivered opinions, expressed their dissatisfaction with Lord Ellenborottgh’s decision in Grandall v. Pontigny. Lord Denman said, that Archard v. Horner was grounded on the better reason. Williams, J., that it had more reason and authority to support it. Patterson, J., declared, that if it were necessary to choose between the two, he should prefer Archard v. Horner ; and Coleridge, J., said that he was not satisfied with the decision in Grandall v. Pontigny.

A few years afterwards the case of Aspdin v. Austin, 5 Ad. & El. N. S. (Q. B.), 671, came up in the same court. It was an action for a breach of covenant in wrongfully dismissing the plaintiff whom the defendant had covenanted to employ for a certain period at a fixed weekly salary. Lord Denman said that the defendant had covenanted to pay weekly sums to the plaintiff for three years, on condition of the plaintiff’s what was on his part a condition precedent; and that the plaintiff would be entitled to recover these sums, whether he performed the condition or not, if he was ready and willing and offered to perform it, but was prevented by the defendant from doing it.

This was sixteen years after the decision of Archard v. Horner, and seven years after Lord Denman and his associates had in Smith v. Haward approved Archard v. Horner. It was a decision upon the pleadings ; and from what followed in the same and other courts after-wards, I presume that Lord Denman did not give much consideration to the point, as judgment Was given for the defendant upon-the pleadings, and the point was therefore not directly involved.

In Fewings v. Tisdal, 1 Exch., 295, the servant was dismissed without a month’s warning, and her wages being paid only up to the time of her dismissal, she brought an action to recover a month’s wages commencing from the day of her dismissal. It was held that the action could not be maintained; all the judges agreeing that Archard v. Horner, which Pollock, C. B., said was recognized by all the courts, was decisive of the case.

In Elderton v. Emmens, 6 Man., Gr. & S., 178, Baron Park said to hold, where the employer determined the relation by a wrongful dismissal, that the servant may entitle himself to wages for the whole term, by being ready to serve, was a doctrine that, if sanctioned, would be of pernicions consequences.

In the note of Mr. Smith to Cutter v. Powell, 2 Smith L. Cas., 30, that learned commentator states three remedies that a servant has, who has been wrongfully dismissed; the second of which he states as follows: “2. He may wait till the termination of the period for which he was hired, and may then perhaps sue for his whole wages in indebitatus assumpsit, relying on the doctrine of constructive service,” for which he cites Lord Ellenboroltgh’s decision in Gandall v. Pontigny.

In Goodman v. Pocock, 15 Ad. & El. E. S. (15 Q. B., 576) 582, Patterson, J., says that Mr. Smith had very properly expressed himself with hesitation as to this second proposition. Erle, J., referring to it, said: “ I think the servant cannot wait till the expiration of the period for which he was hired, and then sue for his whole wages on the ground of a constructive service after dismissal. I think the true measure of damages is the loss sustained at the time of dismissal.”

In Whittaker v. Sandifer, 1 Duval (Ky.), 261, and in Chambertin v. McAllister, 6 Dana (Ky.), 352, C. J. Robertson, a very eminent judge, held that readiness and willingness to perform, after a wrongful discharge, was not equivalent to full performance, and that all that the employee was entitled to recover was the actual damages he sustained for the disappointment and loss of equally profitable employment.

In Clark v. Marsiglia, 1 Den., 317, the defendant delivered to the plaintiff a number of paintings to be cleaned and repaired at a certain price for each, and after the plaintiff had proceeded to a certain extent in the work, the defendant countermanded it, but the plaintiff went.on, finished the cleaning and repairing of the pictures, and recovered in this court the full contract price. The judgment was reversed upon the ground that all that the plaintiff could recover was a recompense for the labor done and materials used when the countermand was given, and sueh further sum in damages as might upon legal principles be assessed for the breach of the contract; and in Durkee v. Mott, 8 Barb., 423, an analogous case, a like rule was applied. I cite these two cases, though not cases between master and servant, because they come under and serve to illustrate a rule in the law of contracts, which is as applicable to the contract between master and servant as to any other.

I might pursue this examination by citing many cases, both in this country and in England, that are, by analogy, inconsistent with the doctrine of constructive service ; and reasons might be adduced to show that there never was any foundation for it; but I deem it sufficient to rely upon the authority of the cases above cited, to show that it is now wholly repudiated.

In Thompson v. Wood, 1 Hilt., 96, my former colleague, Judge Imbaham, said that a servant wrongfully discharged had his election to sue for his wages, • as they became due from time to time, and to bring an action for damages. That if he recovered damages it estopped him from bringing any other action; but that if his action was for wages due when the action was brought, it did not estop him from bringing another action for wages subsequently payable on an action for damages for the subsequent breach of the agreement. It may be said in respect to this case that the question of constructive service was not necessarily involved; as in the action set up as a bar, the plaintiff recovered only for the wages due at the time of his discharge, which the court held was no bar to the second action •; and it may have been treated as an action for damages for the breach of the contract in discharging the plaintiff before the expiration of the year ; for although‘the claim was to recover two months’ salary, the action is referred to by Judge Ingraham as an action for.damages.

The referee reported in the plaintiff’s favor for the full amount of the salary, and in an action for damages the salary may, in the discretion of the jury, or referee, be taken, in the particular case, as an adequate and proper measure of damages (Smith v. Thompson, 8 Man., Gr. & S., 44). What Judge Ingraham said, therefore, in respect to the right of a servant wrongfully dismissed, to sue thereafter for his salary from. time -to time as it becomes due, may be regarded as dictum, and as no authorities for this proposition are referred to by him, I infer that he stated the law as he supposed it to be upon the authority of Lord Ellenborohgh’s decision in Gandall v. Pontigny, and his attention was not called to the subsequent cases impeaching the soundness of that decision. In Heim v. Wolf, 1 E. D. Smith, 73, my late colleague, Judge Woodehee, stated the law much more in accordance with these subsequent cases. He said, “Where the employer discharges the person from his employ, he may wait until his wage's become due and then recover them; but that rule is to be taken with restrictions. He recovers, not for services rendered, but damages for breaking the contract, by discharging him before the termination of his agreement; that is, for refusing to employ and pay him according to the contract. If it appears that he was idle, and could- not obtain other employment, his damages would be the whole compensation agreed on. But if he obtains employment, then he is entitled only to a partial recovery.”

In Huntington v. Ogdensburgh, &c. R. R. Co., 33 How. Pr., 416, the plaintiff was employed for a fixed period at a monthly salary payable on the first of every month. Before the expiration of the period agreed upon, and on June 6,.he was dismissed by the defendants, against which he protested and offered to continue his services. The plaintiff brought an action to recover his salary for the month of June, and it appearing that he had obtained other employment during that month, Potter, J., said, “ The plaintiff’s right in this action, as I understand the law, is not for services actually rendered, but as for services offered to be performed, which the defendants refused to receive, and that thereby the plaintiff is entitled to recover the amount of wages he was to receive by virtue of his contract. ... If he seeks and finds employment, as seems to be his legal and moral duty, then the damages he would otherwise be entitled to recover by reason of the breach, are to be diminished or regulated by his actual loss, depending upon the actual value to him of the benefits obtained, or to be obtained from such new employment.” Although the law, as stated in the outset of these remarks, is not in accordance with the authorities that have been cited, the conclusion is correct that the month’s wages may be the proper measure of damages, less the value of the employment obtained by the plaintiff during the month ; treating the action as one for the recovery of damages for the breach of the contract in wrongfully dismissing the plaintiff and not for the recovery of a month’s wages upon the contract, the plaintiff having been dismissed before the wages for the month had been earned.

In Van Alstyne v. President, &c. of the Indiana, &c. R. R. Co., 34 Barb., 28, the plaintiff was employed for a year at a monthly salary. During the year the plaintiff was discharged at his own request, the agreement was vacated by mutual, consent, and the plaintiff was paid up in full on the day when he left. He after-wards sued the defendants for two months’ salary accruing' after Jie left, and obtained judgment by default. He then brought another action to recover his salary for the two months ensuing, and the court held that the defendants, by suffering the previous judgment to go by default, were not preclued from setting up in the second action that the agreement for the year’s service had been vacated by mutual consent. The plaintiff in the case now before us, relies strongly upon the case ; but I do not see that it has any material bearing upon the question under consideration.

Regarding it as settled upon the authority of the cases which I have cited, that there can be no recovery of the wages stipulated for by the contract, except where the services contracted for have been rendered, it follows that the" remedy which the servant has for any loss or injury he may sustain by his wrongful dismissal, before the expiration of the period for which he was engaged, is a general action for damages. If at the time of his discharge any amount is due by the terms of the contract, he may of course sue upon the contract and recover it (Archard v. Horner, supra; Peck v. Burr, 10 N. Y. [6 Seld.], 294).

If, by the contract, his wages are payable by the month, or by the quarter, and by being dismissed before the period arrives, he is unable to render the service, which, by the terms of the contract, entitles him to the monthly or quarterly stipend; he may, if he thinks proper, treat the contract as rescinded, and sue to recover for the value of the services actually rendered ; or he may bring an action to recover damages for the breach of the contract, and in that action any installment that may have become due to him by the terms of the contract, or the value of the services rendered up to the time of his discharge, where he is discharged before the expiration of the month, or quarter, will be taken into account, and allowed him in adjusting the measure of his damages; or if he was fully paid up to the time of his discharge, then the sole measure of his damages will be the loss or injury occasioned by the breach of the contract (Clossman v. Lacoste, 28 Eng. Law & Eq., 130 ; Goodman v. Pocock, 15 Ad. & El., 15 Q. B., 576 ; Hochster v. De Latour, 2 E. & Bl., 678, 691 ; French v. Brooks, 6 Bing., 354 ; Smith v. Thompson, 6 Man., Gr. & Scott, 44 ; Emmens v. Elderton, 4 H. of L. Cas., 624, on appeal, and in 4 Man., Gr. & Scott, 479, and 6 Id., 160 ; Smith L. of Master and Servant, 94, note, 9, 99, 100 ; Mayne on Damages, 107, 108, 109).

In this action ample, full and final satisfaction is obtained, and the jury, therefore, in assessing the damages are justified, in the language of Lord Campbell, “in looking at all that had happened or was likely to happen, to increase or mitigate the loss of the plaintiff down to the day of trial” (Hochster v. De Latour, supra). In this action he recovers all the damages he suffers by the breach of the contract, or that may ensue to him in consequence of it, and any amount that may be due to him by the terms of the contract, and the value of any unrequited service he may have rendered up to the day of his discharge.

This is, therefore, the appropriate remedy. He cannot ptirsue both; that is, he cannot sue upon a quantum meruit for the services actually rendered, and also have an action for damages ; because by bringing the first action he treats the contract as rescinded, and because he can have but one action, where the claims have all accrued and all grown out of the same contract (Colburn v. Woodworth, 31 Barb., 382 ; Bendernagle v. Cocks, 19 Wend., 207 ; Guernsey v. Carver, 8 Id., 492 ; Goodman v. Pocock, 15 Ad. & El. N. S., 15 Q. B., 576 ; Clossman v. Lacoste, 28 Eng. Law & Eq., 141.)

The good sense, justice and propriety of the latter rule, that there ought in such a case, to be but one action, is to my mind very apparent, and is sustained by the authority of the cases, above cited; but it must be regarded in this State at least as somewhat unsettled, since the opinions expressed by Justice Strong in Secor v. Sturgis, 16 N. Y., 548, and by Justice Wells in McIntosh v. Lown, 49 Barb., 550.

The general view of the'law which I have expressed, and which has been arrived at after an examination of the various authorities brought to our attention, by the learned professor who argued this case with so much ability on the part of the defendant, is in my judgment the only one that can be reconciled with the rule before stated, that there can be no recovery of the wages stipulated for in the contract, unless the services contracted for were performed, and another rule equally well settled in this State and in England, that it is obligatory upon the servant when wrongfully discharged to use diligence to find other employment (Emmons v. Elderton, 4 H. of L. Cas., 624, 646 ; Costigan v. Mohawk R. R. Co., 2 Den., 609 ; Dillon v. Anderson, 43 N. Y., 231 ; Hamilton v. McPherson, 28 Id., 76). A rule which is certainly not consistent with the servant’s remaining ready and willing, after his discharge, to fulfill the contract on his part. These rules, however, can be fully carried out and harmonized, where the servant wrongfully dismissed, is restricted, either to an action to recover for the services actually-rendered, or to a general action- for damages for the breach of the contract, in which he may recover any amount due for services rendered, for the non-payment of it is a breach of the contract, and also compensation for the damages sustained by the further breach of the contract in wrongfully dismissing him.

The first action which the plaintiff brought must be regarded as an action of this description; for he alleged that from March 23, to August 1, 1870, he continued to render his services and to devote his time and skill as he had agreed to do, at the monthly salary of two hundred "and fifty dollars, and that after August 1, 1870, the defendants, without cause or provocation, hindered and prevented him from rendering any further service. . Upon these allegations he claimed to recover two hundred and fifty dollars as due by the terms of •the contract, for services rendered from June 23, to July 23, and the same sum for the ensuing month ending on August 23. He recovered four hundred seventy-three dollars arid two cents, and as he rendered no service after August 1, two hundred and twenty-three dollars and two cents of this amount must have been recovered as damages, to compensate him for the eight days’ service from July 23, to August 1, and for the breach of the contract thereafter in wrongfully dismissing him.

A judgment in favor of the plaintiff for this two hundred and twenty-three dollars and two cents, could by the law have been given upon no other ground. It was a recovery of damages for the breach of the contract, and was a bar to any further action upon the contract. .

The judgment of the marine court therefore should be reversed.

* Present, C. P. Daly, Ch. J., Robinson and Loew, JJ.