Tomlinson Lumber Yard v. Engel

216 N.W.2d 87, 1974 N.D. LEXIS 254
CourtNorth Dakota Supreme Court
DecidedJanuary 31, 1974
DocketCiv. 8922
StatusPublished
Cited by3 cases

This text of 216 N.W.2d 87 (Tomlinson Lumber Yard v. Engel) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tomlinson Lumber Yard v. Engel, 216 N.W.2d 87, 1974 N.D. LEXIS 254 (N.D. 1974).

Opinion

ERICKSTAD, Chief Justice.

By summons and complaint dated November 11, 1969, Tomlinson Lumber Yard, a Minnesota corporation, commenced an action against Ralph C. Engel to adjudicate and foreclose a mechanic’s lien arising out of the construction of a hogbarn on Mr. Engel’s property. Mr. Engel asserted in his answer that Tomlinson is not entitled to a mechanic’s lien on his property or to a foreclosure of such a lien, because the building was constructed in such an unskill *88 ful manner that it was of no value to him, has not been completed, and as a consequence he suffered damages in the sum of $40,000 in the fall of 1969 because he was unable to use the building as a hog-farrowing structure. Tomlinson in its amended reply asserted, among other things, that if the building was not completed or if it was not completed in time it was because of the carelessness, negligence and obstruction of Engel.

The trial judge concluded that Tomlin-son had substantially complied with the contract for the construction of the hog-farrowing facility and that accordingly Tomlinson was entitled to recover the sum of $11,455 less $1,400, which the court determined to be necessary to remedy defects in the construction and to complete the construction, and that Engel was entitled to a set-off of $9,000 on his counterclaim for the loss of sows and pigs as a consequence of not being able to use the structure for farrowing in the fall of 1969.

Although on appeal Tomlinson demands a trial de novo, Tomlinson does not seriously dispute the trial court’s allowance of $1,400 found to be necessary to correct the defects in the building and to complete it. Tomlinson, however, does assert that the trial court was in error in allowing the set-off of $9,000, which Tomlinson asserts to be an allowance for loss of profits not within the contemplation of the parties arid therefore too remote to be considered a consequence of Tomlinson’s failure to timely complete the structure in a workmanlike manner.

Engel does not take issue with the allowance of $1,400 to correct the defects and complete the facility, nor does he dispute the trial court’s conclusion that the contract was substantially complied with. Accordingly, the issue on this appeal revolves around the allowance of the $9,000 for the loss of profits.

During the trial Engel testified that he lost 30 sows and 617 little pigs during November and December of 1969 from the elements as a consequence of Tomlinson’s failure to complete the hog-farrowing facility in a workmanlike manner by August 8, 1969.

The contract, which is sketchy in many respects, did not include a completion date. Engel permitted work to be done on the premises after August 8. It is asserted by Tomlinson that by understanding arrived at through a conversation with Engel on August 27, Tomlinson’s people were to correct various defects in the construction and complete the construction thereafter, but that when they arrived on the premises on September 2 they were asked to leave the site, and that Engel placed a telephone call to Tomlinson’s requesting that its men be taken off the job at that time. In other words, it is Tomlinson’s contention that Engel prevented the completion of the project and, accordingly, cannot recover for damages resulting from his inability to use the structure for farrowing purposes thereafter.

In support of its contention that Engel cannot recover for loss of profits in the instant case, Tomlinson refers us to an 1891 decision of the Supreme Court of the United States holding that anticipated profits prevented by the breach of a contract are not recoverable in damages for such breach.

In that case the court laid down the grounds upon which the general rule rests. We quote therefrom.

“The grounds upon which the general rule of excluding profits, in estimating damages, rests, are (1) that in the greater number of cases such expected profits are too dependent upon numerous, uncertain, and changing contingencies to constitute a definite and trustworthy measure of actual damages; (2) because such loss of profits is ordinarily remote, and not, as a matter of course, the direct and immediate result of the nonfulfilment of the contract; (3) and because most re-quently the engagement to pay such loss of profits, in case of default in the per *89 formance, is not a part of the contract itself, nor can it be implied from its nature and terms.” Howard v. Stillwell and Bierce Manufacturing Company, 139 U.S. 199 at 206, 11 S.Ct. 500 at 503, 35 L.Ed. 147 (1891).

In Hozvard the plaintiff agreed to complete a flour mill by a certain date and failed to do so. In disallowing damages for loss of profits the court said:

“There was no stipulation in the contract that the defendants should make profits on flour from the wheat ground up by the machinery which the plaintiff contracted to furnish and erect in the mill. Nor were there any special circumstances attending the transaction from which an understanding between the parties could be inferred that the plaintiff was to make good any loss of profits incurred by a delay in furnishing and putting up such machinery, according to the terms of the contract.” Howard v. Stillwell and Bierce Manufacturing Company, supra, 139 U.S. 199 at 210, 11 S.Ct. 500 at 504.

In addition, Tomlinson asserts that Engel cannot recover for loss of profits arising out of the loss of his sows and pigs, for the reason that he failed to attempt to reduce the damages resulting from his alleged inability to use the hog-farrowing facility. He refers us to a decision of this court in which the doctrine of avoidable consequences is applied.

“The doctrine of avoidable consequences upon which the defendants rely is stated in 15 Am.Jur., Damages, Sec. 27, pages 420-422.

“ ‘One who is injured by the wrongful or negligent acts of another, whether as the result of a tort or of a breach of contract, is bound to exercise reasonable care and diligence to avoid loss or to minimize or lessen the resulting damage, and to the extent that his damages are the result of his active and unreasonable enhancement thereof or are due to his failure to exercise such care and diligence, he cannot recover; or, as the rule is sometimes stated, he is bound to protect himself if he can do so with reasonable exertion or at trifling expense, and can recover from the delinquent party only such damages as he could not, with reasonable effort, have avoided. It is also an elementary principle that a party claiming damages must not be in fault in contributing to them by his own want of proper care; and such care must extend to the protection from further loss after the act complained of. If he fails to use such diligence, his negligence is regarded as contributing to his injury, and, furthermore, such damages as could have been so avoided are not regarded as the natural and probable result of the defendant’s acts.’

“This rule is applicable to damages to property, and is stated thus in 15 Am.Jur., Damages, Sec. 40, page 439.

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Bluebook (online)
216 N.W.2d 87, 1974 N.D. LEXIS 254, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tomlinson-lumber-yard-v-engel-nd-1974.