Promisee may recover his outlay in preparation for the performance, subject to the privilege of the promisor to reduce it by as much as he can show that the promisee would have lost, if the contract had been performed.
Plaintiff appealed decision of the United States District Court dismissing its complaint for recovery of the contract price for machines delivered to defendant and awarding plaintiff a recovery in quasi contract, and defendant appealed the dismissal of its complaint for breach of contract. Defendant buyer refused to accept any machines plaintiff seller delivered after delivery of two machines was delayed. Plaintiff sued for the price of all machines, and defendant filed a counter suit for breach of contract. Both parties appealed the lower court's judgment.
Did a breach of contract existed between plaintiff seller and defendant buyer after the delivery of two machines was delayed?
Dismissal of plaintiff's complaint was affirmed because the contract was a single contract, and defendant was entitled to reject all four machines because the delay in delivery was too long considering the changes in market conditions. Plaintiff's quasi contract recovery was affirmed, with the addition of interest, because defendant's use of a motor was a conversion but did not constitute acceptance of all goods delivered. By modification of the ruling, defendant was allowed to set off expenses incurred, with interest, in preparation for plaintiff's performance subject to plaintiff's privilege to deduct from that set off any sum that it could prove defendant would have lost on the contract.
Judgment affirmed with modification granting plaintiff interest on quasi contract recovery and allowing defendant to set off expenses incurred in preparation for plaintiff's performance subject to plaintiff's privilege to deduct from set off any sum it could prove defendant would have lost on contract if plaintiff had timely performed.