Missouri Furnace Co. v. Cochran – Case Brief
Missouri Furnace Co. v. Cochran, 8 F. 463 (W.D. Pa. 1881).
Facts: Missouri Furnace Co. (P) contracted with Cochran (D) for the delivery of 36,621 tons of coke in installments at $1.20 per ton. After Cochran had delivered about 4,000 tons of coke he rescinded the contract. P then made a contract with Hutchinson for the delivery of 29,587 tons at $4 per ton. P sued for the difference in price between the $4 and $1.20 price agreed upon. The trial court only instructed the jury on the market price difference as the measure of damages. The jury returned a verdict in favor of P and awarded damages of $22,171.49 and P moved for a new trial.
Issue: What is the measure of damages for a failed delivery of goods in installments?
Holding and Rule: The measure of damages for a failed delivery of goods in installments is the difference between the contract price and the market price of each delivery on the day it should have been made.
The contract with Hutchinson was made when the market price was temporarily higher than usual but that was for a brief duration and the price fell back to $1.30 per ton within 30 days. The court stated that P entered into the new contract at his own risk and could not fairly claim that D’s liability be based on the higher price paid under the Hutchinson contract.
Disposition: Motion for a new trial denied.
Notes: This case was decided before the UCC was enacted. D should have been liable for P’s loss because P acted reasonably and in good faith under the circumstances.