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Pakas v. Hollingshead

Appellate Division of the Supreme Court of New York, First Department
Dec 1, 1904
99 App. Div. 472 (N.Y. App. Div. 1904)


December, 1904.

Louis J. Vorhaus, for the appellant.

Edmond E. Wise, for the respondents.

For the reasons given by Mr. Justice GREENBAUM in his opinion at the Trial Term, we think the judgment appealed from should be affirmed, with costs.

VAN BRUNT, P.J., and PATTERSON, J., concurred; HATCH and LAUGHLIN, JJ., dissented.

The following is the opinion of Mr. Justice GREENBAUM, delivered at the New York Trial Term:

The defendants, by written contract dated August 30, 1898, sold to the plaintiff 50,000 pairs of Hercules bicycle pedals at certain stipulated prices, deliveries to begin immediately, 500 pairs weekly until December first, after that 1,000 pairs weekly until expiration of contract. Terms of payment, "sight draft with documents attached." The pleadings and proofs show that the defendants only delivered 2,608 pairs of pedals under the contract; that they refused to make any further deliveries; that thereafter and on or about March 15, 1899, the plaintiff brought an action against the defendants in the City Court of the city of New York to recover damages for the breach of the contract, by reason of defendants' refusal to deliver 19,500 pairs of pedals, the quantity to which the plaintiff was then entitled, and that plaintiff thereafter recovered a judgment in said action for the full amount of damages claimed. The present action was brought in February, 1900, subsequent to the time fixed for the delivery of all of the 50,000 pairs of pedals, and damages are sought to be here recovered for the failure on defendants' part to deliver the quantity of pedals to which the plaintiff would have been entitled after March 1, 1899. The defendants rely upon the judgment in the City Court as a bar to any further recovery. The learned counsel for the plaintiff in his brief describes the action in the City Court as one brought for damages for the breach of the contract here involved, and the complaint, after alleging a breach of the contract on defendants' part in refusing to deliver the 50,000 pairs of pedals, alleges that "thereafter and on or about the 15th day of March, 1899, the plaintiff commenced an action against the defendants in the City Court of the City of New York to recover damages for the breach of the contract for the failure on the part of the defendants to deliver to the plaintiff" the number of pedals which the defendants were then obligated to deliver. Although some evidence was adduced as to a further demand by the plaintiff upon the defendants after March, 1899, for deliveries of the pedals under the contract, it is apparent that not only was such demand unnecessary under the pre-existing facts as established upon the former trial, but that the plaintiff evidently so considered the law, because the complaint is silent as to any such demand. It is, therefore, obvious that not only is this action brought upon the same contract as that involved in the City Court action, but for the identical breach thereof. It is stated by plaintiff's counsel that no adjudication can be found in this State touching the question of a vendee's right to maintain successive actions for a breach of a contract where the deliveries were to be made in installments, but that authority for such procedure will be found in two decisions of sister States. But without attempting to discuss or distinguish either of these cases, it seems to me that there is no difficulty in disposing of the question presented under the well-settled principles established by the decisions in this State. The right of a party to a contract upon such a breach thereof by the other, as amounts to a repudiation, to elect to treat the contract as still in force and pursue his remedies thereunder, or to consider it at an end and sue for damages upon the breach, is well recognized. ( Howard v. Daly, 61 N.Y. 362, 374-377; Nichols v. Scranton Steel Co., 137 id. 471.) Thus, upon the failure of a purchaser to perform a contract for the sale of personal property, the vendor, as a general rule, has the election of remedies as illustrated in Dustan v. McAndrew ( 44 N.Y. 72). In the case of the failure of the vendor to deliver under such a contract of sale, the purchaser being ready to perform, there is obviously nothing else for the latter to do, if he is damnified by the act of the vendor, than to treat the contract as repudiated, and to sue for damages for the breach of the entire contract. In the case of a vendee's breach the vendor is in a practical situation to permit him, if he choose, to treat the contract as in effect and enforce the vendee's liability thereunder, while in the case of a vendee there seems no other remedy open than to treat the contract as repudiated and sue for damages for the breach. ( Elliott v. Miller, 17 N.Y. Supp. 526.) In other words, the effect of a breach of the contract by a vendor is the same as that of a breach by a vendee, the only difference being in the remedies available to the respective parties. It, therefore, follows that the prior action brought by the plaintiff in the City Court must of necessity have been brought as one for damages for breach of the contract. Plaintiff had the unquestioned right when he brought his action in the City Court to recover damages for a breach of the entire contract, notwithstanding that the time for delivering all of the 50,000 pairs of pedals had not then arrived. ( Nichols v. Scranton Steel Co., supra, 488.) It is well settled that "all damages accruing from a single wrong, though at different times, make but one cause of action, and all debts or demands already due by the same contract make one entire cause of action." ( Secor v. Sturgis, 16 N.Y. 557.) There is no doubt that successive recoveries under such a contract of sale as here existed would be permissible where independent causes of action are created by performance, as in the case of the vendor seeking to recover for deliveries made under the contract in suit, but the authorities are easily reconciled that there can be but one recovery where the damages arise out of a single wrong. ( Perry v. Dickerson, 85 N.Y. 345; Seed v. Johnston, 63 App. Div. 340; McCleary v. Malcom Brewing Co., 56 id. 531.) The action of the plaintiff in omitting to avail himself of the right to demand all the damages to which he would have been entitled under the contract, upon a breach by the defendants, gives him no right to bring successive actions for various items of damages. ( Samuel v. Fidelity Casualty Co., 76 Hun, 308; affd. on opinion below, 150 N.Y. 583.) The motion to dismiss the complaint must be granted.

The action is brought to recover damages for breach of a contract made between the plaintiff, who was doing business under the name of International Cycle Fittings Company, and the defendants, who are copartners doing business under the firm name of Hollingshead Wirtz. The contract consists of a proposition in writing made by the defendants to the plaintiff under date of August 30, 1898, and accepted by him. It confirms a sale by the defendants to the plaintiff of 25,000 pairs of Hercules bicycle pedals, delivery to begin immediately at the rate of 500 pairs weekly until the first day of December, and after that 1,000 pairs weekly, with the privilege to the plaintiff of increasing the weekly deliveries upon thirty days' notice and with an option to him, to be exercised on or before January 1, 1899, of purchasing 25,000 additional pairs. The terms of sale were "35c. per pair F.O.B. our factory. Terms sight draft with documents attached." Prior to the 1st day of March, 1899, the defendants delivered only 2,608 pairs of pedals under the contract. On the fifteenth day of that month the plaintiff commenced an action in the City Court of the city of New York to recover his damages for their failure to deliver the other 16,892 pairs which, by the terms of the contract, were to be delivered prior to the first day of March. On the 10th day of January, 1900, he recovered a judgment for his damages for that breach of the contract and it has been paid. The plaintiff duly exercised his option within the time limited therefor to take the 25,000 additional pedals. The defendants failed to make or tender any further delivery under the contract and on the 13th day of February, 1900, this action was commenced to recover the damages sustained by the plaintiff by the breaches of the contract subsequent to the 1st day of March, 1899. The defendant pleaded the judgment in the City Court in bar and that is the theory on which the trial court dismissed the complaint. The complaint in the City Court was clearly limited to the damages for the breach of the contract prior to the 1st day of March, 1899, and it is not contended that the plaintiff recovered in that action any of the damages sought to be recovered here. The theory of the learned counsel for defendants is that the contract was entire; that the breach was a breach of the entire contract and that when the plaintiff brought the former action he necessarily elected to rescind the contract. The case contains all of the evidence. We find no evidence in the record of any breach of the contract by the defendants prior to the commencement of the former action, except their failure and refusal to deliver the number of pedals, which by the terms of the contract it was their duty to deliver prior to the 1st day of March, 1899. There is evidence that in conversations between the plaintiff and the defendants subsequent to the institution of that action they manifested an intention to repudiate the entire contract, but as we read the testimony there is no evidence of such repudiation prior to the commencement of the action in the City Court.

It does appear that prior to the action in the City Court there was a dispute between the parties "about the character of the goods to be delivered," and plaintiff testified, upon cross-examination, that when he brought the action in the City Court he knew that defendants "had refused to deliver under the contract" for five months and "had refused to live up to" their contract and that such "refusal occurred" during the months of December, January and February. If a total breach or repudiation of the contract prior to the commencement of the action in the City Court would bar the maintenance of this, the burden of showing such fact would rest upon the defendant. It may be that upon the failure of the defendants to deliver the installments of pedals covered by the action in the City Court the plaintiff could have elected to sue for a breach of the entire contract and recover all his provable damages, but we are of opinion that he was not obliged to do so. He elected that the contract should remain in force, and after commencing the action in the City Court, demanded performance on the part of the defendants concerning the delivery of the pedals, delivery of which fell due under the contract subsequently. If he was at liberty to, and had elected to recover all his damages at that time, it is manifest that he might be embarrassed in making the proof; for the difference between the contract price and the market value of the pedals, if they would be purchasable in the market at the time of the first breach for delivery at the times called for by the contract, or at the times of the successive defaults in the future, would be quite involved in speculation. It might be a great hardship to the plaintiff to hold that he could not recover the damages which he had actually sustained down to a given time, when they had become fixed and were separate and distinct from the damages he might sustain by reason of the failure of the defendant to fulfill the contract in in the future. Mr. Justice WOODWARD, in McCleary v. Malcom Brewing Co. ( 56 App. Div. 531, 533), well stated the injustice of the proposition as follows: "To say that the defendant, by compelling the plaintiff to sue for the recovery of a sum of money due him, may terminate a contract of which the defendant is receiving the benefits, or, what is equivalent, prevent the plaintiff from collecting the money falling due to him under such contract, is to permit the defendant to take advantage of his own wrong under a technical rule which has no application to such a case."

In Perry v. Dickerson ( 85 N.Y. 345) the Court of Appeals say: "To sustain the plea of a former judgment in bar of a second action, it must appear that the cause of action in both suits is the same, or that some fact essential to the maintenance of the second action was in issue and determined in the first action adversely to the plaintiff. In order to establish an identity between the causes of action in the two suits, it is not necessary that the claim made in the first action embraced the same items sought to be recovered in the second. It is sufficient to bring the second action within the estoppel of the former judgment that the cause of action in the former suit was the same, and that the damages or right claimed in the second suit were items or parts of the same single cause of action upon which the first action was founded. The law, to prevent vexatious or oppressive litigation, forbids the splitting up of one single or entire cause of action into parts, and the bringing of separate actions for each; and neither in this way nor by withholding proof of particular items on the trial, or by formally withdrawing them from the consideration of the jury, can the effect of the judgment, as a complete adjudication of the entire cause of action, be prevented. There can be but one recovery for an injury from a single wrong, however numerous the items of damage may be, and but one action for a single breach of a contract." This principle of law is well established. It is, however, often difficult to decide whether a demand is single or entire and whether causes of action are identical. An action for wages due under a contract of employment does not necessarily terminate the contract. ( Perry v. Dickerson, supra.) A wrongful discharge from employment under a contract, however, is considered a general breach of the contract and the right of action for subsequent damages is not for salary or wages theoretically rendered, as by willingness and tender, but for damages for the breach, and if the action is brought before the expiration of the contract period of employment the recovery is limited to the wages that would have been earned prior to the commencement of the action. ( Howard v. Daly, 61 N.Y. 362; Wieland v. Willcox, 40 App. Div. 213; Waldron v. Hendrickson, 40 id. 7.) The authorities treat the discharge as an entire breach of the contract from which all the damages flow and doubtless the theory of thus limiting the recovery is, although I do not see it so stated, that since the damages are subject to reduction by the amount that should have been earned in other similar employment, they cannot be ascertained as to the future term of the employment. In other cases where the covenant is a continuing one or the contract is not severable, an action will lie immediately after the breach in which the plaintiff may recover all past and future damages including loss of future profits where they would have been recoverable at all. ( Fish v. Folley, 6 Hill, 54; Taylor v. Bradley, 39 N.Y. 129; Roehm v. Horst, 178 U.S. 10.) Another rule, now quite well settled, is that where a contract provides for the payment of money in installments, the failure to pay an installment when due may not be regarded as a total breach; but the contract to that extent is severable and an action will lie for the installment due and the judgment will not bar a future action for other installments. ( McCready v. Lindenborn, 172 N.Y. 400; Seed v. Johnston, 63 App. Div. 340; Lorillard v. Clyde, 122 N.Y. 41; Walsh v. New York Kentucky Co., 88 App. Div. 477.) Where the contract is severable and the actual breach is only partial, and the party guilty of the breach wholly repudiates the contract and gives notice that he will not perform in advance of the time fixed by the contract for the performance of other covenants by him, I think the tendency of the authorities is, and the equitable and just rule should be, to give the innocent party an election whether to sue for the partial breach of the contract, treating it as continuing in force or for a total breach. ( Wharton Co. v. Winch, 140 N.Y. 287; McCleary v. Malcom Brewing Co., supra; Mersey Steel Iron Co. v. Naylor, Benzon Co., L.R. 9 App. Cas. 434; Johnson Thornton v. Allen Jemison, 78 Ala. 387; Richmond v. Dubuque S.C.R. Co., 40 Iowa 264; Mixer v. Williams, 17 Vt. 457; Frost v. Knight, L.R. 5 Ex. 322; 7 id. 111; Blackburn v. Reilly, 47 N.J. Law, 290. See, also, Zimmerman v. Erhard, 83 N.Y. 74; Nichols v. Scranton Steel Co., 137 id. 471; Ming v. Corbin, 142 id. 334; Cahen v. Platt, 69 id. 348.) If this be so of course it is immatrial whether this was a partial or total breach of the contract prior to the first action.

I am of opinion that the recovery of the damages for the breaches of the contract prior to the first of March was not inconsistent with the continuance of the contract, and it is clear that the plaintiff did not intend thereby to terminate the contract. The plaintiff's damages for the subsequent breaches of the contract may now be determined with accuracy. At the time of the trial of the former action they could only have been determined with difficulty, and approximately at most. The plaintiff demanded performance, but as the defendants were obliged to deliver the pedals free on board some transportation line performing the duties of a common carrier and present the bills of lading, together with drafts, for the purchase price before the plaintiff was called upon to make payment, he was neither obliged to allege nor show a tender of performance.

I am of opinion, therefore, that the judgment should be reversed and a new trial granted, with costs to appellant to abide the event.

HATCH, J., concurred.

Judgment affirmed, with costs.

Summaries of

Pakas v. Hollingshead

Appellate Division of the Supreme Court of New York, First Department
Dec 1, 1904
99 App. Div. 472 (N.Y. App. Div. 1904)
Case details for

Pakas v. Hollingshead

Case Details


Court:Appellate Division of the Supreme Court of New York, First Department

Date published: Dec 1, 1904


99 App. Div. 472 (N.Y. App. Div. 1904)

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