the sum of $8,646.55, which was the amount | market price at the time and place of delivery, Pollen v. Leroy, 30 N. Y. 549; 2 Suth. Dam. 359, and cases cited; Masterton v The Mayor*, 7 Hill, 61; 2 Stark. Ev. 7th Am. ed. 1201; Boor man v. Nash, 9 Barn. & C. 145; Story v. N. Y. & H. R. R. Co. 6 N. Y. 85; Maclean v. Dunn, 4 Bing. 722; Leigh v. Paterson, 8 Taunt. 540; Gainsford v. Carroll, 2 Barn. & C. 624. In an action by a vendee against a vendor for a breach in not delivering the article sold, the measure of damages is the market price at the time of the breach. Marsh v. McPherson, 105 U. S. 709 (26:1139); Hopkins v. Lee, 19 U. S. 6 Wheat, 109 (5: 218); Douglass v. M'Allister, 7 U. S. 3 Cranch, 298 (2:445); Shepherd v. Hampton, 16 U. S. 3 Wheat. 200 (4:369); Masterton v. The Mayor, 7 Hill, 74, James H. McKenney, Clerk, Sup. Court, U. 8. and cases cited. The defendant in error was bound, both in law and good morals, to exercise due diligence [264] FRANCIS E. HINCKLEY, Plff. in Err., to protect itself, and thereby inflict the least v. PITTSBURGH BESSEMER STEEL COM- possible damages on the plaintiff in error, even tract. Shannon v. Comstock, 21 Wend. 457; Hecksher v. McCrea, 24 Wend. 309; Hamilton v. McPherson, 28 N. Y. 76. Mr. John N. Jewett, for defendant in er (See S. C. Reporter's ed. 264-278.) 1. In an action to recover damages for the breach 2. This court will not reverse a judgment for al- Argued April 5, 1887. Decided April 18, 1887. ERROR to the Circuit Court of the United nois. Opinion below published, 17 Fed Rep. 584. Affirmed. The history and facts of the case appear in the opinion of the court. Mr. Thomas S. McClelland, for plaintiff in error: The giving of drilling directions, mentioned Palm v. Ohio & M. R. R. Co. 18 Ill. 217; If there is a cause of action against plaintiff Mr. Justice Blatchford delivered the opinion of the court: This is an action at law, brought in the Cir- [265] cuit Court of the United States for the Northern District of Illinois, by the Pittsburgh Bes semer Steel Company (Limited), a Pennsylvania corporation, against Francis E. Hinckley, to recover damages for the breach by Hinckley of a written contract for the purchase by him from the Company of 6,000 tons of steel rails. The contract was as follows: "Memorandum of Sale. "The Pittsburgh Bessemer Steel Company yard, and to be rolled true and smooth to the "Said rails are to be made of the best quality "All second quality rails or excess of shorts gested citations at close of case, Lawyers' edition. [Ed.] [266] [267] and to be piled and shipped separately (paint- | purchaser of steel rails to give directions as to "Deliveries to begin in May, 1882, in which month one thousand tons shall be delivered, and to continue at the rate of twenty-five hundred tons per month after July 1, 1882, until finished-strikes and accidents beyond ordinary control of said Steel Company, and acts of Providence preventing or suspending deliveries, alone excepted, in which case deliveries are to be delayed for a corresponding length of time only. the drilling thereof, and that each railroad com- "4. That, by letters dated April 3, April 20, "Price to be fifty-eight dollars net, per ton *In witness whereof, The said Hinckley has hereto set his hand and seal, and the Pittsburgh Bessemer Steel Company (Limited), by its duly authorized officers, hath signed and affixed its corporate seal, the day and year aforesaid. "It is further agreed that the Pittsburgh Bessemer Steel Company (Limited) are not to be responsible for delays resulting from failure of railroads to furnish cars, proper efforts having been made to procure them, nor for detentions after shipment has been made. "It is understood that the purchaser shall have the right to make one half of the order fifty-six (56) pounds per yard, pattern No. 4 of said Steel Company, notice to be given thirty days before the time for the delivery of the rails. "That, about June 23, plaintiff notified defendant that it was ready to commence rolling the rails for the July deliveries, as well as to cover the thousand tons specified in the contract for delivery in May, of which plaintiff had postponed delivery at defendant's request, and asked for drilling directions from the defendant, but defendant wholly neglected to give such drilling directions. "That, about the 26th of July, defendant, in "Chicago, Ills., Feb. 18, 1882. "F. E. HINCKLEY. "C. H. ODELL, Broker.” 1. That the written agreement set out and described in the declaration was duly executed by the plaintiff and defendant in said cause, as alleged in said declaration. "2. That immediately after the making of said contract and before the time to begin the execution thereof, the plaintiff purchased the requisite amount of material from which to manufacture the six thousand tons of steel rails called for by said contract, and that, after the purchase of said supplies by plaintiff there was a decline in the value thereof, before the time for the delivery of any portion of said rails, and that lower prices for such supplies ruled during the months of May, June, July and August, 1882. "3. That it appears from the parol proof heard on said trial, aside from the provision in said written contract in regard to drilling directions, that it was usual and customary for the "I further find that while plaintiff did not expressly agree with defendant to postpone the time for the delivery of the rails to be made and delivered under said contract, yet plaintiff did in fact delay the rolling and delivery of the rails to be delivered in May, and that, by reason of the repeated statements of defendant that he was not ready to give drilling directions, not ready to use said rails, and not ready to ac cept them, plaintiff did postpone rolling said rails, and in fact never rolled any rails to be delivered on said contract, but that plaintiff was at all times during the months of May, July and August ready and able, in all respects, to fulfill said contract and make said rails, and the same would have been ready for delivery, as called for by said contract, if defendant had fur n'shed drilling directions, and had not stated to plaintiff's agents that he was not ready to fur [268] nish said drilling directions and not ready to ac- | ant is liable in damages for a breach of the con. "I further find that on or about the 15th day of September, 1882, defendant was formally re[269] quested to furnish drilling directions and to accept said rails, and that he replied to such request that he should decline to take any rails under said contract, and that he had made arrangements to purchase rails of others at a good deal lower price. [270] "I therefore find, from the testimony in this case, that defendant, by requesting plaintiff to postpone the delivery of said rails, and by notifying the plaintiff that he was not ready to accept and pay for said rails, excused the plaintiff from the actual manufacture of said rails and a tender thereof to defendant. 64 And I further find that defendant's statement to plaintiff, on the 26th of July, that he could not pay cash for said rails, as called for by the contract, and that he wished to buy them on credit, was in fact a notice that he would not be able to pay for said rails if rolled and tendered to him by plaintiff. "I therefore conclude, and so find, as a matter of fact, from the evidence in the case, that said plaintiff in apt time requested defendant to furnish directions for the drilling of said rails, and that defendant neglected and refused to do so, and that, although plaintiff was ready and able to fully perform said contract and make and deliver said rails to defendant, as required by said contract, defendant refused to accept and pay for said rails. "5. That plaintiff manufactured and sold to other persons 4,000 tons of steel rails, from the materials so purchased with which to perform said contract with defendant, for which said rails plaintiff received $54.60 per ton, delivered at a port on Lake Huron, and that plaintiff made a profit of $1.60 per ton on said 4,000 tons; that by reason of defendant's refusal to accept said rails, the plaintiff had no employment for its mill for a time, and was obliged to stop its mill for about three weeks in the month of August, 1882. "6. That it would have cost plaintiff $50 per ton to have manufactured and delivered the rails called for by said contract to defendant, according to the terms of said contract; so that plaintiff's profits, if it had not been prevented from fulfilling said contract by the conduct of defendant, would have been $8 per ton on each ton of rails called for by said contract. "And, because of said facts, I find that defendant was guilty of a breach of said contract, and that plaintiff hath sustained damage, by reason of such breach, in the sum of $42,400." On these findings, a judgment was entered for the plaintiff for $42,400 damages, and for costs. 17 Fed. Rep. 584. To review that judgment the defendant has brought this writ of error. After the record was filed in this court, it being discovered that there was an error in computation, in entering the judgment for $42,400 instead of $41,600, the circuit court allowed the plaintiff to remit the difference, $800, and an order was entered accordingly, as of the date of the judgment. tract. It is provided in the contract that the rails are "to be drilled as may be directed." The circuit court finds that it appears from the proof, aside from the provision in the written contract in regard to drilling directions, "that it was usual and customary for the purchaser of steel rails to give directions as to the drilling thereof;" that each railroad has its own special rules for drilling; that the drilling of the rails is considered in the trade as a part of the work of manufacture, and a part of the duty of the manufacturer, in order to fully complete the rails for use; that, by four letters written in April, 1882, by the agents of the plaintiff to the defendant, and which letters were duly received by the defendant before May, 1882, he was requested to furnish drilling directions for the 1,000 tons of rails to be delivered in May, under the contract; that he neglected to comply with that request, and also notified the plaintiff that he was not then prepared to receive the rails which, by the contract, were to be delivered in May; that, in June, the plaintiff again asked for drilling directions from the defendant, in respect both to the 1,000 tons and to the 2,500 tons to be delivered in July, but the defendant neglected to give such drilling directions; an that, in the latter part of July, he notified the plaintiff, in substance, that he would not perform the contract. The circuit court further finds that, by reason of the repeated statements of the defendant that he was not ready to give drilling directions, not ready to use the rails, and not ready to accept them, the plaintiff postponed the rolling of them, and never rolled any rails to be delivered on the contract, but was at all times during May, July and August, 1882, ready and able to fulfill the contract and make the rails, and the same would have been ready for delivery as called for by the contract, if the defendant had furnished drilling directions and had not stated to the agents of the plaintiff that he was not ready to furnish the drilling directions. and not ready to accept the rails; and that, on or about the 15th of September, 1882, he was formally requested to furnish drilling directions, and to accept the rails, and replied to such request that he should decline to take any rails under the contract, and had made arrangements to purchase rails of others at a lower price. The circuit court also finds that the defendant, by requesting the plaintiff to postpone the delivery of the rails, and by notifying the plaintiff that he was not ready to accept and pay for them, excused the plaintiff from actually manufacturing them and tendering them to the defendant. This conclusion is entirely warranted by the facts found; and on those facts the defendant must be held liable in damages. The only other question open on the findings is as to the proper rule of damages. The circuit court finds that it would have cost the plaintiff $50 per ton to have manufactured and delivered the rails called for by the contract, according to its terms; that the profits of the plaintiff, if the conduct of the defendant had not prevented it from fulfilling the contract, would have been $8 per ton on each of On the special findings the only question the 6,000 tons, being $48,000; and that the open for review is whether the facts found are plaintiff manufactured and sold to other persufficient to support the judgment. There can sons 4,000 tons of rails from the materials purbe no question that, on those facts, the defend-chased by it with which to perform the contract [273] [274] with the defendant, and received for such rails | include the direct and actual loss which the The defendant contends that the plaintiff should have manufactured the rails and tendered them to the defendant, and, upon his refusal to accept and pay for them, should have sold them in the market at Chicago, and held the defendant responsible for the difference between what they would have brought on such sale and the contract price. But we think no such rule is applicable to this case. This was a contract for the manufacture of an article, and not for the sale of an existing article. By reason of the facts found as to the conduct and action of the defendant, the plaintiff was excused from actually manufacturing the rails; and the rule of damages applicable to the case of the refusal of a purchaser to take an existing article is not applicable to a case like the present. The proposition that after the defendant had, for his own purposes, induced the plaintiff to delay the execution of the contract until after the 31st of August, 1882, and had thereafter refused to take any rails under the contract, the plaintiff should still have gone on and made the 6,000 tons of rails and sold them in the market for the defendant's account, in order to determine the amount of its recovery against the defendant, can find no countenance from a court of justice. In United States v. Speed, 75 U. S. 8 Wall. 77 [19:449], where the defendant agreed to pack a specified number of hogs for the plaintiff, and made all his preparations to do so, and was ready to do so, but the defendant refused to furnish the hogs to be packed, this court, citing with approval Masterton v. Mayor of Brooklyn, [276] held that the measure of damages was the difference between the cost of doing the work and the price agreed to be paid for it, making reasonable deduction for the less time engaged, and for release from the care, trouble, risk, and responsibility attending a full execution of the contract.' " These views were again approved by this court in United States v. Behan, 110 U. S. 338 [28:168]. It is found by the circuit court that, immedi- was no deduction made in this case for the time The defendant contends that this evidence was inadmissible, in the absence of an opportunity for him to examine the plaintiff's books, with a view to a cross examination of the witness as to the mode of computation adopted by him, the memorandum being, as contended, the result of the conclusions of the witness from the examination of a large number of entries in the books of the plaintiff. It is a sufficient answer to this objection that the cost of the rails was not taken by the court at the sum of $48.25, the sum fixed by Smith; but the bill of exceptions shows that the cost was taken at $50 a ton, from the testimony of Richard C. Hannah, another witness; so that, even if the testimony was erroneously admitted (which it is not necessary to decide), the defendant suffered no prejudice from its admis sion. There is a bill of exceptions in the case, on | book-keeper, who wrote them down; that he (the which two questions are raised by the defend- witness) knew the items to be correctly stated; ant as to the admission of testimony. The con- and that the information as to the items was tract between the parties was negotiated by C. made up from records running through a series H. Odell, who signed it as broker, between of four or five months, and representing an whom and the defendant the correspondence average as to the cost per ton. thereafter, down to and including the first of May, 1882, was carried on, Odell acting for the plaintiff. He made the contract under special instructions, his authority being limited to that of a sales agent. On his examination as a witness [277] at the trial he testified that all of his communications with the plaintiff in regard to the business with the defendant were in writing or by telegram. He also testified, without objection, that he kept the plaintiff fully advised of his correspondence with the defendant concerning the rails. H. P. Smith, the business manager of the plaintiff, was then called as a witness for the plaintiff, and was asked if the plaintiff was advised of the correspondence between Odell and the defendant, which had been read in evidence, and if Odell's actions were approved by the witness as manager of the plaintiff. To this the defendant objected, on the ground that the communications between Odell and the plaintiff consisted of letters and telegrams, which were the only competent evidence of the contents thereof. The court overruled the objection, and the witness stated that the Company was advised of the correspondence and actions of Odell, and fully approved and ratified the same. The defendant excepted to the decision admitting the evidence. We see no objection to the admission of this evidence, independently of the fact that Odell had, with out objection testified to substantially the same thing. The defendant, in his correspondence with Odell, all of which is set forth in the bill of exceptions, treated Odell as representing the plaintiff, and cannot now be heard to question his authority to do so, or to demand further evidence of such an authority, or of the adoption by the plaintiff of what Odell was doing, saying and asking on behalf of the plaintiff. The question asked of Smith, as to whether he, as manager of the plaintiff, approved of Odell's actions, and the answer he made, were, therefore, unnecessary, and could not affect the merits of the case. Smith was further asked to state in detail the elements of the cost of rolling the rails in question. He produced a memorandum showing items taken from the plaintiff's books, which, added together, exhibited the cost, in August, 1882, of manufacturing one ton of such rails as those described in the contract; and, on being asked by the plaintiff's attorney to testify to those items, the court, under the defendant's objection, allowed him to read the items from [278] the memorandum. He further testified, under an objection and exception by the defendant, that the actual cost to the plaintiff of making and delivering the rails in Chicago would have been $48.25; that be stated the elements of such cost from a memorandum prepared by himself, the elements being taken from the books of the plaintiff; that he knew the purchase price of all material which went into the manufacture, because he purchased all of it himself; that the statement was prepared by him from his personal knowledge of the cost; that he called off the items from a pencil memorandum to the The judgment of the Circuit Court is affirmed. James H. McKenney, Clerk, Sup. Court, U. 8. HENRY C. HUISKAMP ET AL., Partners as v. MOLINE WAGON COMPANY. (See 8. C. Reporter's ed. 810-324.) Attachment, proceedings-fraud—interplea, under Missouri Statute, by preferred creditors— chattel mortgages-evidence-record of trial on plea in abatement as partnership payment of individual debt with partnership propertyerroneous instructions. 1. Where a debtor in failing circumstances has the right to prefer a creditor, If such creditor has a of securing it, and not with the purpose of aiding bona fide debt, and takes a mortgage with the intent the debtor to hinder and delay other creditors, the mortgage is valid, even though the mortgages tention is to hinder and delay other creditors. knows that the debtor is insolvent and that his in 2. Upon the trial in attachment proceedings of has acquired no lien, has received no notice of its 5. A bona fide transter of partnership property to Argued April 6, 1887. Decided April 18, 1887. [310] |