Bromberg v. Signal Gasoline Corp.

HOUSER, J.

In effect, the pertinent facts upon which the instant appeal is based are as follows: By the terms of a contract, the defendant became obligated to sell to the plaintiff a specified quantity of casing-head gasoline at a price per gallon fixed at 2V2 cents less than the retail price per gallon of a product known as Red Crown gasoline. Upon the refusal of the defendant to comply with the provi

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sions of the agreement in that regard, the plaintiff commenced an action against the defendant for the damages which the plaintiff claimed had resulted from said alleged breach. The trial court found that the agreement had been breached by the defendant, but rendered a judgment in favor of the plaintiff for nominal damages only, to wit, in the sum of one dollar. It is from such judgment that the plaintiff prosecutes this appeal.

Appellant contends that, since at a price per gallon

equal

to the retail selling price per gallon of Red Crown gasoline, or, what would amount to a profit of 2% cents per gallon, it might have resold all the casing-head gasoline which the defendant agreed to deliver to the plaintiff, it was entitled to recover from the defendant such profits as would have resulted from such resale. On the other hand, without in any manner conceding that the evidence adduced on the trial of the action shows that the plaintiff could have resold the gasoline, the respondent insists that (except in circumstances not shown by the evidence to have been present) the rule of damages applicable to the facts herein is that the plaintiff was entitled to recover such damages only as would be represented by the difference between the price agreed to be paid per gallon and the price per gallon at which plaintiff could have purchased the casing-head gasoline in the open market. That the said contention of the respondent is the correct rule, see sections 3354 and 3308 of the Civil Code, as was provided by the latter section prior to June 19, 1931; also, 8 Cal. Jur. 785, 823; 22 Cal. Jur. 1043; 1928 Supp. to Cal. Jur., par. 107, of Sales, p. 1450; and authorities therein respectively cited. It is clear that, although the method adopted by the parties to the contract for the purpose of determining the selling price of casing-head gasoline was novel or unusual, nevertheless it afforded a means by which such price might be ascertained and made certain. If such contract price, determined in accordance with the provisions of the agreement of the parties, had been less than the market price for the casing-head gasoline, necessarily the damage to plaintiff which resulted from the breach of the contract would have been the difference between the contract price, thus determined, and the market price. The fact that the retail price of a commodity known as Red Crown gasoline was selected as a basis for