Alexander v. Western Union Telegraph Co.

1. Telegraph Company. Negligence. Delay in transmission. Damages. In this case the declaration alleges the following: Plaintiffs were negotiating for the purchase of a lot of land in Chattanooga, Tenn. On December 6, 1886, they delivered to the telegraph company at Starkville, Miss., a message, addressed to the agent of the owner at Chattanooga, in the following words: “Yours of 3d received. Get option till Monday if can, if not close trade and fix papers.” This was in answer to a letter offering the lot at three thousand dollars and asking a response on that day. The price for sending the message was paid, and the operator was informed of the importance of promptness. Through negligence of the company the message was not delivered until late the next day. Meantime the lot was sold to another and was then worth five thousand dollars. Held, on demurrer, that the plaintiffs were entitled to recover the damages sustained by reason of the failure to purchase the lot; and this whether the message is to be construed as an acceptance or not. 2.Same. Authority of agent. Statute of frauds. It being alleged that appellants would have procured a good title to the lot, if the message had been properly transmitted, it is immaterial whether the agent to whom it was sent had written authority from the owner to make a contract for the sale of the land. 3. Same. Acceptance not necessary. Night to recover. It was not essential to plaintiffs’ right to recover damages that the message should have been an acceptance of the offer made. It being alleged that ■ they would have procured a good title to the lot but for the delay in sending the message, this averment is capable of proof, and the damages can be established with reasonable certainty. 4. Same. Measure of recovery. Damages when not speculative. Appellants, under the allegations admitted by the demurrer, are entitled to recover the difference between the price at which the lot was offered to them, and its actual market value at the time when the message should have been delivered at Chattanooga. Such damages are not speculative and contingent, but result directly from the breach of duty. 5. Same. Nominal damages. Pleading. It is error to sustain a demurrer to a declaration that shows a breach of a contract and damages. In any event, nominal damages are recoverable. Aside from other questions, plaintiffs in this case were entitled to the price paid for transmission of the message, if no more. 6. Preadino. Demurrer ovei'ruled where declaration good in part. Where a declaration or either count is good for a recovery, if only in part, a demurrer to the declaration as a whole will be overruled. 7. Tjgreorafh Company. General duly of company. Telegraph companies undertake to serve the public, and are under obligation to perform their contracts without negligence or unreasonable delay.' Rapidity, as well as accuracy, of communication commend them to popular favor, and the law imposes upon them liability in damages for losses that may be traced directly, or with reasonable certainty, to their negligence.

From the circuit court of Oktibbeha county. Hon. Logic E. Houston, Judge. The case is stated in the opinion of the court. 1. It was not necessary that the authorization of Carothers, the agent, should be in writing. See Tenn. statute of frauds, code of Tenn., 1884, § 2423 and note. Under the statute of this state, which was identical with that of Tennessee prior to the code of 1857, it was held that it was not necessary that the authority of an agent to make a valid contract for the sale of land should be in writing. Cwrtis v. Blair, 26 Miss. 309. But it is immaterial whether Carothers had authority to conclude a valid binding contract for the sale of the land or not. The declaration alleges that plaintiff would have secured a good title to the lot if the message had been, promptly sent, .and the demurrer admits this. If plaintiff can show that Kessler owned the lot and stood ready to make the deed, and would have done so if the message had been received on the 6th, what difference does it make if we concede that Carothers was without authority to make the contract? The manifest error in the action of the court below was in applying to this case the same rules that would govern if this were a suit by plaintiffs against the owner of the land for specific performance. In deciding upon the liability of the telegraph company for negligence in sending a message very different rules apply. In the one case it would be necessary to show a valid contract between the parties in order to enforce it; in the other the plaintiff shows the failure to make a contract by reason of the wrongful act of the company, a third person. 2. We contend that the telegram was an acceptance of the offer. It was tantamount to saying : “ Do better if you can, but if not, close the trade.” It is alleged that Carothers had no authority to sell an option, and that Kessler would not have given one. If the message had been delivered, Kessler would have said: “ No, I will sell no option ; fix the papers.” If the lot had gone down in value two thousand dollars, he could have held plaintiffs to the bargain. Plaintiffs were in for the purchase of the lot at three thousand dollars the instant the message was sent. 3. But it is not essential that the message should be construed as being within itself an acceptance of the offer, so as to close a contract with the seller of the lot. Plaintiffs are entitled to recover if by the negligence of the company, they were prevented from making a contract, and thereby from securing a purchase that would have yielded a profit of two thousand dollars cash. Of course.they are not entitled to speculative profits. Here the actual market value of the lot was five thousand dollars, and plaintiffs woiild have secured a title to it for three thousand dollars. No difficulty about proving such allegations as these with all reasonable certainty. We are not required to prove anything to a moral certainty. It is immaterial that the subject of this attempted purchase was land. The .same rule of liability applies so far as the telegraph company is concerned, as if it had been corn or wheat, or cotton or stocks, or any kind of personal property. In the numerous commercial transactions of this country, in respect to either land or personal property, how very few telegrams in themselves, embody complete, technical contracts! Yet will it be said that a telegraph company, though guilty of gross negligence, is never to be held liable in damages in a case like the present, unless the message, if sent, would have consummated such a contract? The wrong consists iu the negligence of the company, the unfaithfulness of the servant, which is the direct cause of the loss of a profitable bargain or purchase. In such a ease the law will not allow the wrongdoer to escape on the ground that something might have happened to prevent the consummation of the contract. The duty of the telegraph company is to promptly send the message, no matter what form it is in, and if this is not done, and injury results, the injured party is entitled to prove what would have been done if the duty of the carrier had been promptly complied with. If we go into the field of conjecture and speculation, it cannot be said that anything is certain. The rule contended for by opposite counsel would preclude recovery in every case where damages are attempted to be shown as the consequence of negligence or an unlawful act. Resort being had to the wires by parties in negotiation, when the telegraph company fails to transmit a message, it has nothing to do with the statute of frauds as between the contracting parties. It is perfectly competent to prove what would have been done if a telegraphic message had been promptly transmitted, as a means for fixing the damages against the company for a failure to deliver. Paries v. Tel. Co., 13 Cal. 422; True v. Tel. Co., 60 Maine 9; Fatman v. Tel. Co., 73 Ga. 288; Daughtry v. Tel. Co., 75 Ala. 168; Tel. Co. v. Hyer, 22 Fla. 637; s. c. 1 Am. St. R. 222, note ■on p. 228. 4. Neither of the four cases relied upon by opposite counsel sus-tains the position for which they contend ; but, on the contrary, in so far as they are applicable at all, these are all authorities for the plaintiffs in this case. This is especially true of Tel. Co. v. Hall, 124 U. S. 444. In the case of Booth v. Rolling Mill Co., 60 N. Y. 487, the suit was directly between contracting parties as to the effect of a contract, and did not involve a telegraph company. The same is true of White v. Miller, 71 N. Y. 133, and of Squires v. Tel. Co., 98 Mass. 232. The following language is used in While v. Miller: “ Gains prevented as well as losses sustained may be recovered as damages for a breach of contract where they can be rendered reasonably certain, and have naturally resulted from the breach.” We ask no better exposition of the law as applicable to this case. In all the cases where merely nominal damages have been allowed, and where consequential damages (such as are claimed here) have been rejected, the messages were in cipher and the company was not admonished of the importance of the business or that such damages would likely result from a failure to transmit. Here the company was distinctly informed of the importance of the message and of the necessity for promptness. Telegraph companies hold themselves out as ready to transmit messages of every character, at rates which they fix without regulation or control. They prescribe their own rates in the conduct of a business which the public must of a necessity transact through them. With increased facilities and greater skill, they are daily becoming better prepared to discharge their duties, and public policy demands that they should be held to a high degree of diligence and a strict liability. 5. In any view of the case, the judgment must be reversed, because the plaintiff was entitled, at least, to nominal damages, the price paid for transmission of the message, and the like. 1. There are two cases, and only two, in which a party can recover damages for a failure to mahe a speculation, occasioned by a breach of contract. These are : (1) Where the breach of the contract has caused him to make a purchase at a greater price or a sale at a less price than if the breach had not occurred ; and (2) where the breach of the contract has ipso facto prevented the closing of a bargain at a stipulated price — and the party, using reasonable diligence, cannot get as favorable terms. In case of a failure to deliver a message directing a purchase, a telegraph company is liable to paj compensatory damages (1) when, by reason of the non-delivery, the sender malees a purchase at a higher price than if the message had been promptly delivered; or (2) when the message, if promptly delivered, would have ipso facto concluded a contract at a certain price, and, owing to the failure to deliver, the bargain is lost. In the former case the measure of damages is the difference between the price paid, and that at which the property could have been had. In the latter case, the measure is the difference between the price at which the purchase would have been made if the message had been promptly delivered, and the price at which it could have been had afterward by the use of reasonable diligence. Tel. Co. v. Hall, 124 U. S. 444. In all other cases, though a profitable speculation might, and probably would, have been made, yet damages cannot be recovered, because they cannot be made “ reasonably certain by the evidence.” Boothe v. Rolling Mills, 60 N. Y. 487 ; White v. Miller, 71 N. Y. 173. “ All remote, speculative, and uncertain results, as well as possible profits and advantages which might have arisen from the fulfillment of the contract, must be excluded as forming no part or legitimate basis on which to determine the extent of the injury actually caused by a breach.” Squires v. Tel. Co., 98 Miss. 238. Here no transaction was, in fact, had, and there being neither a purchase nor a sale, there was no actual loss, and consequently no damages under the rule above stated. If the message of plaintiffs had been promptly delivered, it would not have closed the contract. The offer by Carothers was positive and unconditional to sell, provided there was an acceptance by Dec. 6. To this offer to sell plaintiffs replied : “Get option if you can ; if not, close trade.” The message, on its face, must be an acceptance. Squires v. Tel. Co., 98 Mass. An acceptance must comprehend the whole proposition, and must not qualify its provisions. 1 Pars. Con. 476. A conditional acceptance is not sufficient, and the unimportance of a modification does not change the principle. Ib. 477. Plaintiffs’ minds never absolutely consented to a purchase ; they wanted an option, and put that idea foremost in the message. Why do they not sue for the failure to get an option f An option is not a sale, and it is not an incident to a sale. . The question is not what Carothers would have probably done, but what Kessler would have been compelled to do if the message had been promptly delivered. The condition stands in the way of an absolute acceptance, “ Get an option if you can, and if not, clqse the trade.” Touchstone says, “Your if is the great peacemaker.” The law says it is an everlasting contract-breaker. Plaintiffs certainly did not inform the company that an option could not be obtained, for that was unknown to them. The damages to be recovered for the failure to transmit a message “ must be such as might properly be deemed to have been in contemplation of the parties when the contract was entered into.” Squires v. Tel. Co., 98 Mass. 238. The object of the law in making these corporations liable in damages is not to punish them ; it is simply to make those whom they have injured whole. The courts have inexorably refused to allow themselves to be made the arena of speculation. Chateaux en JEspagne are delightful possessions, but are neither listed for taxation, nor can they form the basis of any claim in a court of law. 2. The third and fourth counts show that Carothers 'was not the agent, of Kessler but was the agent of the Southern Land and Loan Co., and as there was only the one transaction, the whole declaration is defective. A careful examination of Curtis v. Blair, 26 Miss., show's that it was not there held that the authorization of an agent to sell land need not be in writing. And, so far from deciding that the appointment of a sub-agent need not be written, it decides exactly the reverse. “ Postesta delególa, non potest delegari.” The Tenn. statute of frauds is substantially like our own on this point, and under it the authority of the agent must be in writing. In view, however, of the allegation of the amended declaration that Carothers was “duly and legally authorized,” it was not necessary to aver that his authority was written. In the fourth count plaintiffs aver that Carothers was their agent to buy the land — possibly the agent of both parties to the transaction. But under whatsoever circumstances, and to whomsoever addressed, we claim that this message does not on its face purport to accept an offer or close a trade. We respectfully ask an affirmance. Regardless of the various ways in which the case is stated in the several counts, the telegram threads its w'ay through each, and is the foundation of the suit. The court is familiar with the rule that the damages must be such as may be fairly supposed to have entered into the contemplation of the parties when they made the contract, that is, such damages as might be naturally expected to follow its violation. Hadley v. Baxendale, 9 Exch. 341; Law of Telegraphs, § 406. 1. Is the message an acceptance ? This is the main question in the case. To constitute an acceptance there must be a clear and definite proposition on the one side, and an acceptance on the other, equally clear and distinct. The acceptance must not introduce any new feature, but there must be a coming together of the minds on every point. Chitty on Con. 9, 10, 11 ; Bruce v. Pearson, 3 Johns. 534; Tuttle v. Love, 7 Johns. 470 ; Eleason v. Henshaw, 4 Wheat. 225. If the alleged acceptance is not to the exact thing offered, and new terms are introduced, they constitute an offer on the other sidé and leave the question open. Bishop on Con., §§ 322, 324; Pommel v. Wingate, 103 Mass. 327 ; Brumer v. Wheaton, 46 Md. 363; Derrick v. Monette, 73 Ala. 75; Baker v. IIolp, 56 Wis. 100 ; Stagg v. Gompton, 81 Ind. 171. Alexander was authorized to use the wire. From the moment the message was handed to the operator, if it be an acceptance, the contract was complete. Bishop on Con., § 328. This being true, then suppose a bill is filed against Kessler for specific performance. Unquestionably the answer would be that the telegram contained new terms, and was not an acceptance of the offer. This determines the question sharply. 2. Is the telegram an absolute request or order to buy f It is immaterial whether appellants knew that an' option could or could not be obtained. Appellee is only bound for a violation of its contract. If damages result by reason of anything aliunde, or that was unknown, it is not responsible. There is no question about cipher message, but about very plain English. If the message had been delivered, it would have devolved upon Carothers to get an option; failing in that, to get the fee. If he had secured an option, his duty would have been discharged. Then this was not an order to buy the fee. If buying the option was the primary thing, why not sue for the damage consequent upon the failure to get that ? The theory of the fourth count is that it was impossible to get an option, and that there was no intention of obtaining one, yet the option is made the “ crown jewel ” in the telegram. It is, however, rejected by the builders, and the effort now is to hold the company to the same measure of responsibility as if had no place in the contract. This, if permitted, would be to hold the company to a contract it never made, and would operate as a trap and a fraud. The very message that was written out and delivered to the company is the one upon which its liability is to be determined, and appellants cannot now be allowed to show that the option part was understood to be a joke. Kinghorne v. Tel. Go., reported in Allen’s Tel. Cases, p. 113. Buying an option is a very different thing from buying the fee, and the chances are here that if the option had been obtained, the “ boom ” would have exploded, and the fee would have remained in Kessler. Appellants have paid nothing, their losses seem imaginary, but they have had experience, and are better equipped for the next “ flurry ” in real estate.