Lawton Refining Co. v. Hollister

This action was commenced in the district court of Jefferson county by the Lawton Refining Company against S.L. Hollister to recover the sum of $301.49, a balance due for a car of gasoline sold by the plaintiff to the defendant. The defendant answered, admitting purchasing the gasoline and having paid the sum of $850 thereon, and pleaded that the gasoline was purchased according to a sample that had been placed in defendant's car and represented as being a high grade gasoline, and the defendant had paid plaintiff more than the value of the gasoline, and the same was not a high grade gasoline. For cross-petition defendant pleaded being in the mercantile business at Addington, Okla., and engaged in selling gasoline at retail, and that the gasoline purchased from plaintiff was of such an inferior grade that it could not be used in automobiles, and defendant's customers refused to use said gasoline on account of being of such inferior grade, and the customers quit trading with defendant and defendant was obliged to sell said gasoline at a reduced price, and defendant had been damaged in the sum of $1,000.

To this answer and classification the plaintiff replied, first, by general denial; second, admitted the allegations of the answer which admitted the allegations of the petition; third, specifically denied the selling of the gasoline by sample, and alleged that the defendant knew the gasoline was of an inferior grade; fourth, that plaintiff had furnished a higher grade of gasoline than that contracted for. Defendant, to support her cross-petition and counterclaim and as a denial that there was anything due, produced evidence to support the allegations of the answer and cross-petition that the gasoline was of a very inferior grade and almost impossible to be used in running automobiles, and that her customers would not purchase the same, and she was unable to sell the same for a long time, and it was necessary to sell the same at a greatly reduced price. Several customers testified that they had been customers of the defendant, but the gasoline was of such inferior grade that they were unable to use it, and refused to purchase gas from the defendant and they purchased gas from other places.

The plaintiff introduced evidence regarding the grade of gasoline. With the issues thus framed the jury returned, a verdict in favor of the defendant, cancelling the $301.49 due plaintiff and authorizing judgment in favor of the defendant in the sum of $200. From said judgment, the plaintiff has appealed.

For reversal, plaintiff argues numerous assignments of error regarding the admission of testimony and the giving of instructions and the refusal to give certain instructions requested by the plaintiff. The court, after advising the jury, regarding the burden of proof in relation to whether there was a warranty in the fifth instruction, advised the jury in substance if the jury found the defendant had sustained damages by reason of the inferiority of said gasoline, her measure of damages would be the difference in the profits she would have received from the sale of the car of gasoline if the same had been of the grade and quality represented at the time of the sale and the profits she received from the car of gasoline by reason of its inferior quality, together with the amount, if any, by virtue of inferior quality defendant was forced to sell said gasoline below the purchase price. There is evidence in the record sufficient to support the finding that the gasoline was of an inferior quality. The evidence disclosed that it was contemplated by the parties that the defendant should resell the gasoline, and it was purchased for retail trade, and the only market was to users of automobiles. There was evidence to prove that parties who had purchased this gasoline refused to purchase more gasoline because of its inferior quality, and the defendant was required to sell same at a reduced price.

Plaintiff relies upon the general rule as to the measure of damages announced in the case of Spaulding v. Howard,51 Okla. 502, 152 P. 106 to wit: Damages for breach of warranty are:

"The difference between the actual value of the article at the time of the purchase and what its value would have been if it had been as represented"

— and the further proposition that profits cannot be recovered. The plaintiff simply announces the general rule. There is, however, an exception to the general rule, and we think this case comes within that exception. This rule is announced in 24 R. C. L., paragraph 538, as follows:

"Profits or gains prevented, as well as losses sustained, may be recovered as damages for a breach of contract, where they can be rendered reasonably certain by evidence, and have naturally resulted from the breach, and this rule is applied as to damages for breach of a warranty."

To the same effect is the holding of this court in the case of Muskogee Co. v. Yahola Sand Co., 60 Okla. 196, 159 P. 898. Defendant produced sufficient evidence to show the damages sustained were not speculative nor uncertain.

Defendant admits receiving the gas and placing the same in tanks for the purpose of sale, and urges that after customers had used a portion of the same they complained to defendant regarding the same being of such inferior quality that they could not use the same. Defendant states this fact was called to the attention of the plaintiff, while the plaintiff denies this. Defendant produced evidence that after trying to sell the gasoline and being unable to do so, it was necessary to reduce the price. Defendant produced one customer who purchased a great deal of gasoline each month, and the profits on that gasoline were three cents per gallon, and this customer quit purchasing for the reason this gas was of such an inferior quality that he could not use it. No demurrer was filed to the cross-petition, but simply an answer thereto. We think under the pleadings there was no prejudicial error in the instruction, and there was sufficient evidence to support the verdict of the jury.

A determination of this question makes the other assignment of error, regarding the introduction of evidence and regarding the other instruction, immaterial.

For the reasons stated, the judgment of the court is affirmed.

PITCHPORD, V. C. J., and KANE, JOHNSON, ELTING, and NICHOLSON, JJ., concur.

On Rehearing.