Marconi Wireless Telegraph Co. v. North Pacific Steamship Co.

This is an action wherein plaintiff seeks to recover from the defendant certain sums of money claimed to be due it for the installation and operation of certain wireless equipment on vessels in the possession of the defendant, under two written contracts. The complaint is in two counts. The first count is based on a contract dated January 15, 1914, and the second upon a contract dated July 1, 1913. Judgment went for the plaintiff on the first count for the sum of one dollar, and on the second count for the sum of $1,620. Both parties being dissatisfied with the judgment have appealed therefrom, plaintiff from that part thereof which awards to it only nominal damages, and defendant from the portion thereof by which plaintiff recovers the sum of $1,620.

Considering plaintiff’s appeal first, it is disclosed by the record that in the month of January, 1914, the parties entered into the first of the above-mentioned contracts, whereby

There is no dispute between the parties as to the measure of damages applicable to the case if the plaintiff is entitled to any damages at all. If we understand the contentions of the parties, the damages recoverable by the plaintiff consist of the profit which would have resulted to it if it had been permitted to carry out its contract, plus any costs and expenses incurred as a consequence of the breach. (McConnell v. Corona, 149 Cal. 60 , 65, [ 8 L. R A. (N. S.) 1171 , 85 Pac. 929 ]; Civ. Code, sec. 1512; Ahlers v. Smiley, 163 Cal, 200 , 205, [ 124 Pac. 827 ] ; 13 Cyc. 156.) The question upon which counsel disagree is as to where lies the burden of proof, plaintiff’s contention in that behalf being that the payments required by the contract furnish prima fade the measure of damages, and that the burden of proof was on the defendant to show, if it could, that such were not the actual damages. Applying this principle, it is pointed out by plaintiff that upon the submission of the case, it having shown the facts as above narrated, and the defendant having shown nothing in mitigation of damages, the plaintiff was entitled to judgment for nine hundred dollars.

There is a class of cases in which if the obligor to the contract repudiates it before the obligee has had an opportunity to perform, the contract price is prima facie the measure of damages, and matters of mitigation and reduction must be shown by the obligor. Such are cases of contracts for personal services (Milage v. Woodward, 186 N. Y. 252 , [ 78 N. E. 873 ]; Howard v. Daly, 61 N. Y. 362 , 371, [ 19 Am. Rep. 285 ]),

In the last-mentioned case an advertiser desired to cancel its contract with a publisher under which the latter was to publish an advertisement once a month for twelve months for a certain sum to be paid when the contract was fully performed. The publisher refused to consent to the cancellation, and continued the publication for the entire period, and upon the advertiser declining to pay therefor, brought an action for the contract price. Upon the trial the plaintiff proved the contract and its performance, and rested. Thereupon the defendant produced evidence to the effect that it had canceled the contract, and rested. It was held that the contract was prima facie the measure of damages, and the rule applied that where a contract for future employment had been entered into and afterward revoked by the employer, in an action for breach of contract the damages are prima facie the amount of wages for the full term, and the burden of proof is upon the defendant to show facts in mitigation of damages. Commenting upon the conclusion arrived at in that case the court said: “In reaching the result * above indicated we wish it understood that it is not our purpose to extend the rule beyond the facts found in this ease. Nor is it our purpose to limit or impair the rule that in the breach of an ordinary contract for the manufacture of an article or the supplying of goods or merchandise, including that which is known as ordinary job printing, the damage is the difference between the contract price and the cost of the goods, merchandise, or manufactured article, in which the burden of showing the damage rests on the plaintiff. The distinguishing feature in this case, as we regard it, is that the publishing of an advertisement in a periodical

While the present case in some of its features is similar to the cases cited, it is more like an action for breach of contract for board or lodging (13 Cyc. 163), or for goods sold and delivered (Hellings v. Heydenfeldt, 107 Cal. 577 , 585, [ 40 Pac. 1026 ]; Winans v. Sierra Lumber Co., 66 Cal. 61 , [ 4 Pac. 952 ]), or to construct a tunnel (McConnell v. Corona City W. Co., 149 Cal. 60 , [ 8 L. R. A. (N. S.) 1171 , 85 Pac. 929 ]), or a contract to furnish freight (Utter v. Chapman, 43 Cal. 279 ), in which cases actual damages only are recoverable; and the burden of showing such damages rests on the plaintiff. Here the plaintiff w;as to install wireless equipment and keep it in repair, and to furnish and pay a competent operator. It is obvious that plaintiff would be put to more than trivial expense in performing its part of the contract, and that its profit would be substantially less than the contract price. Hence, we think, it cannot be held that the mere introduction of the contract, and showing the breach thereof, made out a prima facie case of damages for the unpaid contract price. It may not be amiss to add that the fact that the proof of the profit which plaintiff would have made if the defendant had complied with its contract was chiefly, if not entirely, within the control of the former, furnishes a strong reason for placing that burden upon it. We think it follows that the trial court correctly concluded upon the showing made that the plaintiff was entitled to no more than nominal damages.

We will now consider defendant’s appeal. In its answer it alleged, as it now contends, that the contracts here sued upon are void because the plaintiff failed to file with the railroad commission of this state a schedule of rates for the transmission of messages between points within and without the state under the provisions of section 18 of the Public Utilities Act. The trial court rejected this contention and rendered judgment for plaintiff for $1,620 under the second count, as before stated.

The legislature of this state declared (Stats, 1911, p. 18 et seq., sec. 18, p. 30) that upon the Public Utilities Act becoming effective, every telegraph (including wireless) corporation (section 2) should print and file with the railroad commission a schedule showing the charges for the transmission of messages between all points within this state and all points without the state upon its route; and between all points within the state and all points without the state upon every route operated or controlled by it (section 18) ; and the legislature further declared that every telegraph (including wireless) corporation which should violate or fail to comply with any provision of the act should be subject to a penalty for each offense (section 76), and that every officer of such corporation who should violate or fail to comply with any provision of the act should be guilty of a misdemeanor (section 77).

Assuming, without deciding, that the plaintiff is within the category of section 18 of this act, and that the company would be subject to the penalties therein provided, and its officers guilty of misdemeanors, for noncompliance with the provisions of the act, still we think this contract is not void, as contended by the defendant, so as to prevent recovery upon it. Section 18 of the act does not undertake to make

So here, even if section 18 of the Public Utilities Act in its requirement for the filing of schedules of rates included the kind of service involved in this case (and we do not think it does), it does not render unlawful or void a contract for such service. The penalty imposed by section 76 of said act is aimed directly at the failure to file the schedule of rates, and not at the act of transmitting business without having filed such schedule; nor is there anywhere in the act any inhibition against transacting business before compliance with such requirement. The situation here is entirely dissimilar from that where a license is required for the conducting of business and its prohibition in the absence of such license. There the sanction of the statute is directed to the act of doing business, while in the case at bar the

It results from what we have said that as to each' appeal the judgment must be affirmed, and it is so ordered.

Lennon, P. J. and Beasly, J., pro tern., concurred.