Jacqueline's Washington, Inc. v. Mercantile Stores Co.

Neill, J.

Plaintiff appeals from a dismissal of its claim for smoke damage to its stock of women’s high fashion apparel occasioned by a fire in defendants’ adjoining store. The trial court, sitting without a jury, found in favor of plaintiff on the issue of liability but dismissed the action with prejudice, finding that plaintiff had failed to establish the amount of damages with sufficient certainty to permit an award.

Plaintiff’s appeal to the Court of Appeals presented the single issue of whether the evidence before the trial court was sufficient to require an award of substantial damages. The Court of Appeals affirmed. Jacqueline’s Washington, Inc. v. Mercantile Stores Co., 4 Wn. App. 785, 484 P.2d 445 (1971). We granted review. 79 Wn.2d 1008 (1971).

It is clear from the record that plaintiff suffered substantial damage. Defendants’ liability for such loss has been established by unchallenged findings and conclusions of the trial court. Plaintiff seeks to recover only the difference between the net wholesale value of the damaged merchandise immediately before the fire and the net wholesale value of the merchandise immediately thereafter. This measure of damages is not in issue. See generally 3 L. Frumer & M. Friedman, Personal Injury, § 3.05(7) 251 (1965); Mock v. Terry, 251 Ore. 511, 446 P.2d 514 (1968).

Although the fact of substantial damage has been established, the amount is difficult of proof. The value of the merchandise after the damage is almost exclusively a matter of opinion. We have often observed that in such circumstances, where there is no uncertainty as to the existence of substantial damages or as to causation, recovery of substantial damages is not to be denied merely because the extent or amount thereof cannot be ascertained with mathematical precision, provided the evidence is sufficient to afford a reasonable basis for estimating loss. E.g., Reefer Queen Co. v. Marine Constr. & Design Co., 73 Wn.2d 774, 440 P.2d 448 (1968); Sigman v. Stevens-Norton, Inc., 70 Wn.2d 915, 425 P.2d 891 (1967); Brear v. Klinker Sand & Gravel Co., 60 Wn.2d 443, 374 P.2d 370 (1962); Wenzler & Ward Plumbing & Heating Co. v. Sellen, 53 Wn.2d 96, 330 P.2d 1068 (1958); Gilmartin v. Stevens Inv. Co., 43 Wn.2d 289, 261 P.2d 73, 266 P.2d 800 (1953).

The determination of whether evidence is “sufficient to afford reasonable basis for estimating loss” must depend upon the particular circumstances. Important considerations are, first, that courts should be exceedingly reluctant to immunize defendants and dismiss plaintiffs for such reason; and, second, that the purpose of the requirement is to spare the trier of fact the onus of an attempt to assess damages solely by speculation and conjecture and without the benefit of probative evidence on the issue. We have said that the plaintiff must have produced the best evidence available under the circumstances. B. & B. Farms, Inc. v. Matlock’s Fruit Farms, Inc., 73 Wn.2d 146, 437 P.2d 178 (1968); Brear v. Klinker Sand & Gravel Co., supra. Plaintiff’s evidence consisted of the opinion testimony of its store manager at the time of the fire. The manager had 25 years’ experience in women’s apparel merchandising and had been plaintiff’s manager for several years. Defendants suggest that there was better evidence available to plaintiff in that plaintiff could have undertaken to introduce evidence based upon the price received for the damaged apparel at a subsequent “fire sale.” We agree with the Court of Appeals and trial court that such basis gives no reliable indication of actual smoke loss. There is very little relationship between the price received at a retail sale several months later and the wholesale value of the goods immediately following the fire. In the absence of a wholesale sale of the damaged merchandise, much of which is seasonable, near the time of the loss, the best available evidence, pertaining directly to the wholesale value of the merchandise after the damage, was opinion evidence such as that introduced by plaintiff.

Plaintiff’s manager expressed his expert opinion that the wholesale value of the inventory had been reduced 50 per cent by reason of the fire. Subsequently, plaintiff’s bookkeeper testified that the wholesale value of the inventory before the fire was $22,668.30. During cross-examination of this witness, two exhibits contradictory of the cumulative effect of this testimony were introduced by defendants and accepted into evidence by the court. These consisted of an accountant’s written statement of loss and plaintiff’s president’s sworn statement of amount of loss setting the amount of damage at $7,263.85 and $8,964.92, respectively. These exhibits are not in themselves contradictory as one contains items not included in the other.

The trial court accepted the testimony of plaintiff’s witness as to the wholesale value of the inventory before the fire. However, it chose to disbelieve plaintiff’s manager as to the extent of damage suffered. The court concluded that there was not sufficient evidence from which it could determine the amount of damage compensable to plaintiff. In reaching this conclusion, the court refused to consider the defense exhibits stating lower amounts of damage, except for purposes of impeachment.

It is true that, as a general rule, impeaching evidence affects only the credibility of the witness and is incompetent to prove the substantive facts encompassed therein. E.g., Hurst v. Washington Canners Co-op, 50 Wn.2d 729, 314 P.2d 651 (1957). Hurst involved a fact situation in which the impeaching matter was a prior inconsistent statement of the witness, which statement was not placed in evidence. We there stated at page 733:

[Ajppellant [during cross-examination of plaintiff] did not make Mrs. Hurst [plaintiff] its witness; that it [appellant] did not introduce the deposition in evidence, but only used it for impeachment purposes, and not to prove the substantive facts contained therein.

We think the type of evidence submitted in the case at bench calls for an exception to the general rule.

The exhibits introduced by defendants were not in the nature of prior inconsistent statements of plaintiff’s witnesses. Nor do these exhibits tend to indicate partiality, incapacity or other lack of testimonial qualities in the witnesses. As an impeachment tool, the sole value of these exhibits is that they contradict the substantive testimony of plaintiff’s witnesses on a fact in issue, viz., the extent of damage. In a sense these exhibits are merely items of rebuttal in impeachment form. Such items are within the category of impeachment by contradiction. See generally 3A J. H. Chadboum, Wigmore on Evidence, ch. 35 (1970); 5 R. Meisenholder, Evidence Law and Practice, Wash. Prac. § 304 (1965).

Unlike impeachment by prior inconsistent statement (see Meisenholder, supra, §§ 291, 296), impeachment by mere contradiction is not within any exception to the hearsay rule. Anderson v. Dobro, 63 Wn.2d 923, 389 P.2d 885 (1964). Plaintiff has raised no objection to defendants’ exhibits; defendants, by introducing the exhibits, have waived any objection; so there is no hearsay issue before us. See, e.g., Carraway v. Johnson, 63 Wn.2d 212, 386 P.2d 420 (1963); W. W. Conner Co. v. McCollister & Campbell, Inc., 9 Wn.2d 407, 115 P.2d 370 (1941). To be admissible, such extrinsic evidence must be independently competent and must be admissible for a purpose other than that of attacking the credibility of the witness. E.g., State v. Oswalt, 62 Wn.2d 118, 381 P.2d 617 (1963); see Meisenholder, supra, § 304 at 283 and cases there cited. The substantive facts contained in those exhibits (variant statements as to amount of damage sustained) have direct and independent relevance to a material fact in issue. For this reason the evidence was properly before the court in the form of impeachment by contradiction.

The very characteristics which rendered the defendants’ exhibits admissible at trial, i.e., their nature as independently competent, material and reliable, militate against applying the general rule of limited use (Hurst v. Washington Canners Co-op, supra) to those exhibits. Having established these characteristics as a prerequisite to letting the evidence in, it would be incongruous to require that the probative value of the evidence be ignored. We hold, therefore, that evidence properly admitted to impeach by mere contradiction constitutes an exception to the general rule and is competent to prove the substantive facts' encompassed in such evidence.

In light of this determination, the record before us contains sufficient evidence, of the best sort available under the circumstances, to afford a reasonable basis for estimating the loss. See W. W. Conner Co. v. McCollister & Campbell, Inc., supra; Meisenholder, supra, § 386. At the very least, this evidence would support a judgment in the lowest amount computable from the evidence. Plaintiff is not to be denied a substantial recovery merely because the precise amount of damage is incapable of exact ascertainment. E.g., Brear v. Klinker Sand & Gravel Co., supra. A more stringent requirement would be contrary to the basic principle which is operative in these cases, as quoted in Wenzler & Ward Plumbing & Heating Co. v. Sellen, 53 Wn.2d 96, 99, 330 P.2d 1068 (1958):

“The most elementary conceptions of justice 'and public policy require that the wrongdoer shall bear the risk of the uncertainty which his own wrong has created.

“ ‘The constant tendency of the courts is to find some way in which damages can be awarded where a wrong has been done. Difficulty of ascertainment is no longer confused with right of recovery’ for a proven invasion of the plaintiff’s rights.....” [Bigelow v. RKO Radio Pictures, Inc., 327 U.S. 251, 90 L. Ed. 652, 66 S. Ct. 574 (1946).]

Accordingly, the judgment of the trial court is reversed and the cause remanded for a new trial on the issue of damages.

Hamilton, C.J., Finley, Hale, Stafford, and Wright, JJ., concur.