niture. Except that the five bedroom suites of furniture and the plaintiff's other goods were upon the Hawthorn Inn premises, there was no connection whatever between the two sets of chattels. They differed in kind, use, particular location, and value. The case cited by my learned associates to sustain their conclusion (Kimball v. Cunningham, 4 Mass. 502, 3 Am. Dec. 230) arose out of a contract for the exchange of chattels. There the plaintiff's action. rested upon his right to rescind the contract for fraud. He failed in his action because he had retained part of the consideration he had received in the exchange. The court held that, if he elected to rescind, he must disaffirm the whole contract, returning the entire consideration he had received. I submit that the principle of the case is not applicable here, and that nothing the court there said is pertinent to the facts of the present case.

I am for reversing the judgment of the court below not only upon the assignment respecting the bedroom suites, but also upon other assignments touching the admission of evidence and the instructions. as to what constituted conversion, but I would reverse, with the award of a venire facias de novo.

(130 Fed. 696.)

UNITED STATES v. WITHERS et al.

(Circuit Court of Appeals, Second Circuit. April 27, 1904.)

No. 173.

1. CONTRACTS-BREACH-DUTY TO PREVENT Loss.

A bidder for furnishing supplies to the Post-Office Department, who, on the acceptance of his bid, failed to execute the contract in accordance with his guaranty, cannot be held liable for the difference between the contract price of certain articles and the price paid by the department to the public printer for such articles three months after the default, where it is shown that at the time of such default and for several weeks thereafter the articles could have been purchased in the market for less than the contract price, and especially where it does not appear that the price subsequently paid was the market price, which alone could fix the measure of damages.

2. ERROR-GROUNDS FOR REVERSAL-RIGHT TO NOMINAL DAMAGES.

A judgment for defendant entered on a verdict directed by the court will not be reversed because plaintiff may have been entitled to nominal damages, where no permanent right is affected.

In Error to the Circuit Court of the United States for the Southern District of New York.

This cause comes here upon appeal from a judgment of the Circuit Court, Southern District of New York, in favor of the defendants in error (who were defendants below), entered upon a verdict in their favor which was directed by the court.

Arthur M. King, for plaintiff in error.

Charles F. McCandeles, for defendants in error.

Before LACOMBE, TOWNSEND, and COXE, Circuit Judges. LACOMBE, Circuit Judge. The defendant Withers made a bid. offering to enter into a contract to furnish certain stationery sup

plies for the Post-Office Department at prices named in the said bid. The only item as to which testimony was taken is "7,500 doz. scratch blocks or pads at 151/2 cents." Withers and his codefendants, Morse and St. John, guarantied that if his bid were accepted he would within 10 days enter into and duly execute a contract to furnish such supplies at the prices named, and that, in case of failure to enter into such contract, the bidder and his guarantors would forfeit and pay to the United States the sum of $3,000. The bid was accepted somewhere about the latter part of June, 1900, and Withers was notified of such acceptance, and was requested to fill out the contract and send it back, so that it might be accepted and filed. He failed to do so, although repeatedly requested to execute it, and by the middle of July (the record does not give the exact date of notification to sign contract) the 10 days had expired, Withers was in default, and the government officers were entitled to advertise for new bids and enter into a new contract for the supplies in question. No steps were taken to effect a new contract in the usual way, and finally, about the 1st of October, the supply of pads was exhausted, and the post offices throughout the country had to be supplied. Thereupon the Post-Office Department ordered 3,3331/3 dozen pads from the public printer at 30816/1000 cents per dozen. This action was brought to recover the difference of price paid from the failing bidder and his guarantors.

The United States attorney quite properly decided that recovery could not be had for the penalty named ($3,000), but only for the actual damages which had been sustained through defendants' default. The price paid the public printer was $1,027.20, the articles at prices named in the bid would have cost $516.67, and the government sought to recover as actual damages $510.53. It appeared on the trial that the pads bought from the public printer were of slightly better quality than those which Withers had offered to furnish, and that $85 fairly represented such difference in quality, whereupon the United States attorney apparently conceded that the plaintiff's claim should be reduced by that sum. It further appeared that the market price of pads such as Withers offered to furnish was 14 cents in July and August. What the market price was subsequently does not appear.

The plaintiff relies on a section of the United States Revised Statutes which reads as follows:

"Sec. 3709. All purchases and contracts for supplies or services, in any of the departments of the government, except for personal services, shall be made by advertising a sufficient time previously for proposals respecting the same, when the public exigencies do not require the immediate delivery of the articles, or performance of the service. When immediate delivery or performance is required by the public exigency, the articles or services required may be procured by open purchase or contract, at the places and in the manner in which such articles are usually bought and sold, or such services engaged, between individuals." [U. S. Comp. St. 1901, p. 2484.]

Incidentally it may be noted that articles of stationery are not usually bought "between individuals" of the public printer, and whether the price of articles sold by him compare favorably or unfavorably with their prices in the open market, where individuals

65 C.C.A.-2

purchase, does not appear. However this may be, the case seems to be determined by the application of the familiar principle that there can be no recovery for damages which might have been prevented by reasonable efforts on the part of the person injured. The defendants were in default in July; with reasonable diligence the Post-Office Department could have readvertised and secured a new bidder in August; even if it had not advertised, it could have obtained the pads by purchase in the open market during that month at a sum less than that at which Withers had agreed to furnish them. The most ordinary diligence to avoid disastrous results. from the breach of contract would have prevented any loss at all. Moreover, since the record failed to show at what price the pads could have been bought in the open market in October, when at last they were bought there was nothing upon which the jury could have assessed any substantial damages, for the measure of damage was the difference between the contract price and the market price. It is contended that plaintiff was at any rate entitled to recover nominal damages, and that the court erred in directing a verdict. for defendants. But it is well settled that there should be no reversal when a nonsuit has been directed in a case where plaintiff could recover nominal damages only, unless some permanent right is affected, or some error of the court has crept in by which the jury has rendered an erroneous verdict, or, possibly, the recovery of costs has been affected. Ellsler v. Brooks, 54 N. Y. Super. Ct. 73; Funk v. Evening Post Pub. Co., 76 Hun, 497, 27 N. Y. Supp. 1080; Brantingham v. Fay, 1 Johns. Cas. 264. In the case at bar no permanent right is affected, the jury has not been misled, no costs would have followed the recovery of nominal damages, and none were entered against the United States in the judgment under

review.

The judgment is affirmed.

(130 Fed. 641.)

ALLEN et al. v. FIELD.

(Circuit Court of Appeals, Second Circuit. April 21, 1904.)

No. 109.

1. CONTRACTS-ACTION FOR BREACH-EFFECT OF ASSIGNMENT.

Defendants contracted for the purchase of the greater part of the product of plaintiff's distillery for 15 seasons, to be delivered in bond at a stipulated price per gallon. The practical construction placed upon the contract by both parties was that it was not assignable by either party without the consent of the other. Defendants having made an assignment, plaintiff refused to accept the assignee as a substitute, except with the understanding that defendants would still be bound, while defendants insisted on such acceptance. Plaintiff subsequently agreed to, and did, deliver to the assignee, as requested by defendants, but with a statement to them that he did not waive his right to hold them if the assignee should make default. The contract was treated as in force by both parties for several months thereafter, and until both the assignee and defendants refused to accept further deliveries or to pay therefor. Held, on the evidence, that there had been no breach by plaintiff which justified such refusal, and that plaintiff was entitled to recover damages from defendants for their breach.

2. SAME-BREACH-MEASURE OF DAMAGES.

On the repudiation of such contract by defendants without legal right, after it had been in effect for one or two seasons, plaintiff was not bound to continue to operate his distillery during the remainder of the term and to market the product, for the purpose, if possible, of reducing the damages resulting to him from defendants' breach, but was entitled to sue for the breach at once, the measure of his damages being the difference between the contract price and the cost of manufacture.

3. SAME EVIDENCE OF COST OF PERFORMANCE.

Evidence of the average cost of manufacturing and the average price of the grain used during a series of years was competent as furnishing a basis on which the jury might estimate the probable cost during the remainder of the term.

4 SAME-CONSTRUCTION-DAMAGES RECOVERABLE FOR BREACH.

A contract by which plaintiff agreed to manufacture for defendants, and defendants to buy, stated quantities of whiskey, not less than 3,000 barrels each season, for a term of 15 years, at a stipulated price per gallon, provided that, if the price of corn in the Chicago market should be more than 45 cents per bushel on the first Tuesday in October in any year, plaintiff should not be obligated to manufacture during that season, but that, if he should manufacture to exceed 500 barrels, defendants should have the right, at their option, to demand the usual quantity and up to 5,000 barrels at the agreed price. Held, that such provision did not render the contract unilateral, but was one for the mutual protection of the parties in a contingency which might arise, and the fact that it became operative in one season, after defendants had refused to further perform, did not affect plaintiff's right to recover damages on account of the breach for subsequent seasons, and that the effect of such provision on the amount of damages which would result to plaintiff from the breach during the remainder of the term was properly left to the determination of the jury. 5. SAME-DAMAGES RECOVerable for BREACH-SALE of Product tO BE MANUFACTURED.

Where plaintiff, who was the owner of a distillery, on the refusal of defendants to further perform a contract by which they agreed to take and pay for the entire product of his distillery for a term of years, except

5. Contracts for sale of things to be produced or manufactured, see note to Star Brewery Co. v. Horst, 58 C. C. A. 363.

ing a certain number of barrels each year, brought suit for breach of the contract, to recover as damages the profit he would have made during the remainder of the term, defendants were entitled to show that plaintiff continued to operate his distillery after the breach, and the profits he actually made thereby up to the time of trial, and to have the same set off against his estimated profits under the contract.

6. SAME-EXPERT TESTIMONY.

In such case defendants were also entitled to a reasonable deduction for the less time engaged and the release from the trouble, risk, and responsibility attending the full execution of the contract, and upon the question as to the amount of such deduction the testimony of experts familiar with the business in the locality where plaintiffs' distillery was situated was admissible, if properly limited to the particular matters as to which the witnesses had experience.

7. SAME.

The contract containing a provision that the whiskey was to be delivered to defendants in plaintiff's warehouse, and that storage should be paid thereon at a stipulated price per month until it was withdrawn, and it being shown that whiskey was customarily left in the warehouse for some years, and that there was a profit in its storage, plaintiff was entitled to recover damages on account of the loss of storage, which was an item presumably taken into consideration by the parties when the contract was made.

In Error to the Circuit Court of the United States for the Southern District of New York.

This cause is brought here by writ of error from a judgment of the United States Circuit Court for the Southern District of New York, entered upon a verdict by the jury in favor of plaintiff for $50,000 damages for breach of contract. The plaintiff in the court below has died since the commencement of the action, and his estate is represented on this appeal by his executors.

Levy Mayer, for plaintiffs in error.

William Lindsay, for defendant in error.

Before LACOMBE, TOWNSEND, and COXE, Circuit Judges.

TOWNSEND, Circuit Judge. Prior to the commencement of this action, plaintiff was a distiller of whiskey in Kentucky. The defendants are wholesale dealers in whiskey at New York. The negotiations between the parties herein appear from the record to have been opened by a letter from defendants to plaintiff, stating that, as they had sold their Louisville distilleries to the Kentucky Distilleries & Warehouse Company, and must have goods to substitute for those whiskeys, which they no longer handled, if they could make some arrangement with him to control the output of his house, under an arrangement extending over a term of years, and providing for the restriction of the production within what they would consider proper limits, and at a price which would make it an object for them to go into such a transaction, the matter might be considered. On April 12, 1899, the parties entered into a written contract whereby plaintiff undertook to manufacture and deliver to defendants certain quantities of whiskey, under certain conditions, for 15 distilling seasons. The material portions of said agree-.

ment are as follows: