US SUPREME COURT DECISIONS

In an action to recover less than $5,000, in which the defendant asks for judgment upon a counterclaim for more than that sum and the circuit court renders a general judgment for the plaintiff, a writ of error sued out by the defendant is within the jurisdiction of this Court under the Act of February 15, 1875, c. 77, § 3.

In an action for goods sold and delivered, tried in the circuit court of the United States in Pennsylvania, the defendant, under a plea of "payment with leave" and by way of recoupment, may prove damages resulting to him from a breach of warranty or from a fraudulent representation of the seller that the goods were of a certain quality or fit for a certain purpose.

Under the statute of Pennsylvania of 1705 which allows the defendant, in an action upon a contract, to set off any matter of contract and to recover judgment thereon against the plaintiff upon proving that the plaintiff owes him more than he owes the plaintiff, the defendant, in an action for goods sold and delivered, may set off a claim in the nature of assumpsit upon a warranty, but not a claim for a fraudulent representation or other claim sounding in tort only.

If rags sold as clean and free from infection, and fit to be manufactured into paper, are proved to have been infected with the smallpox, and to have caused it to break out in the buyer's paper mill, whereby some of the workmen died, others were disabled from working, and the buyer paid certain sums to support those so disabled, and was obliged to run his mill shorthanded, and lost a considerable part of a profitable trade, and the seller testifies that he bought the rags in a region where he knew chanrobles.com-red

Page 120 U. S. 631

the smallpox was epidemic, from any and all dealers, not knowing where they were collected, and that they were assorted and baled up under his instructions, and falsely testifies that the rags sold had been baled up in his warehouse for a year before, and had no disinfectants in them, this is sufficient evidence to be submitted to a jury of a breach of warranty or a fraudulent representation on the part of the seller, and of damages to the buyer. But the court may properly decline to permit the buyer to testify in general terms what he estimates the amount of his damages to be without stating the items of damage or any facts upon which his opinion is based.

The testimony of witnesses not shown to be experts that the infected condition of rats was the cause of a breaking out of the smallpox is incompetent.

This was an action of assumpsit brought by Benedict, a citizen of Pennsylvania and rag dealer at Pittsburgh, against Dushane and Stonebraker, citizens of Maryland and papermakers at Hagerstown, to recover $813.03 for rags sold and delivered by him to them on February 7, 1882, as appeared by the plaintiff's affidavit to a copy of the bill from his book of original entry.

Plea:

"Defendants plead payment, with leave &c., and the special matter stated in affidavits of defense, and they claim damages upon the cause of action stated in said affidavits in the sum of seven thousand dollars in excess of the amount sued for by plaintiff."

The defendants had filed, before their plea, two affidavits of Stonebraker, the statements in the second of which included those in the first, and were as follows

"The following facts are stated as a just defense to the whole of plaintiff's claim. Plaintiff is a rag dealer, having his stock in trade in the City of Pittsburgh. In February, 1882, he came to see defendants at Hagerstown, Md., and solicited an order for rags and paper. On behalf of defendant firm, I gave him an order for substantially the quantities and kinds described in the exhibit attached to his affidavit. Nicely assorted print and book rags were designated as the subject matter of said contract, but no rags were accepted, inspected, or even seen by defendants or anyone acting for them. The rags which the plaintiff shipped from Pittsburgh, professedly in fulfillment of said contract, were packed in bales, and their

Page 120 U. S. 632

character could not be discovered until the bales were unpacked. After some of them had been unpacked and used, nine of defendants' sorters were stricken with smallpox and varioloid, and the disease spread rapidly among the employees and those living near the mill, causing the death of five persons and preventing many others from working. Others became alarmed. When the reports of the epidemic spread, customer's refused to buy defendants' paper. They were unable to hire workmen at the usual rates, and some refused to work on any terms. By reason of the premises and of the interruption of defendants' business occasioned thereby, money paid for the support of those disabled by said, disease, injury to defendants' said business, &c., defendants suffered loss and were put to expense far exceeding the amount of plaintiff's bill. The said rags were infected with smallpox before plaintiff shipped them. I am informed and believe, and expect to prove, that he well knew there to be infected before he shipped them. If defendants had known them to be infected, they would have refused to receive them. The rags they contracted for and were to receive, according to the clear understanding between there and plaintiff, were good merchantable rags, free from infection. The infection conveyed in said rags was the sole cause of the breaking out of said disease in the manner above described, and they were shipped by plaintiff with intent to deceive, cheat and defraud the said defendants. As soon as practicable after the discovery of said infection, defendants wrote to plaintiff, stating the facts and telling him that all the rags not consumed before said discovery was made were held subject to his order, and they were all still so held until defendants' foreman, being compelled to remove the said rags and mistaking defendants' orders to the contrary, turned them into the rotary boiler without sorting them, for the purpose of getting rid of the risk of infection attendant upon their remaining in the mill."

"For the rags so used, it is submitted that defendants ought not to pay the price charged by plaintiff, but such amount only as they were reasonably worth, if they were worth anything. Defendants will ask for a certificate for the

Page 120 U. S. 633

amount of damages in excess of the true amount to which plaintiff may be entitled."

The plaintiff, by counteraffidavit of claim, denied that the rags were infected or that the contract provided that they should be free from infection, or that the alleged infection was the cause of the breaking out of the disease, or that he knew the rags to be infected before he shipped them, or that he shipped them with any intent of deceiving, cheating or defrauding the defendants, or that the defendants suffered any loss in consequence of the alleged infection.

At the trial, the plaintiff, having been called as a witness in his own behalf, testified on cross-examination that the rags in question were collected by him in Pittsburgh, Allegheny City, and the country round about, and were assorted in his establishment and baled under his special instructions by his foreman; that he bought rags from any and all dealers who offered him merchantable rags, not knowing where they were collected; that he thought the word "clean" was not used in his offer to the defendants; that to the best of his knowledge and belief, the rags shipped to the defendants were clean, and there was no sulphur, carbolic acid or other disinfectant in the bales; that he never used disinfectants in his establishment; that he knew that the smallpox was epidemic in those two cities at and before the time when the rags were shipped, but that these rags had been baled up and lain in his warehouse for a year or more before.

One of the defendants, being called as a witness in their behalf, produced a letter received from the plaintiff with the invoice of the rags, in which the plaintiff said that he had shipped some of them that day, and expected to ship the rest the next day, and that he might not have quite enough then, but would send them a few days after. And three of the workwomen in the mill testified that the rags, when opened, smelt strongly of sulphur and carbolic acid.

The defendants also introduced evidence tending to show that the contract was for clean, nicely assorted, print and book rags; that the rags, when delivered at the mill,

"were packed in bales, which were immediately opened; that the"

chanrobles.com-red

Page 120 U. S. 634

rags were very filthy, emitted a sickening smell, and were infected with the smallpox; that twelve days afterwards, the smallpox broke out in the mill, and caused the death of some of the workpeople, disabled others, frightened away some, and prevented customers from coming to the mill; that the infected condition of the rags was the cause of the breaking out of the disease; that the defendants supplied the sick with provisions and other necessaries to the amount of $200, and were obliged to run their mill shorthanded, made less paper, and lost a considerable part of a profitable country trade, but offered no other evidence of the particulars of the damage which they had suffered.

While one of the defendants was on the witness stand, their counsel asked him what be estimated the amount of his damage to be. The plaintiff's counsel objected to the question on the ground

"that it was not competent for the witness to give a lumping estimate of the defendants' damages, but that he should specify the items of damage, and testify to facts, his opinion being inadmissible."

The court sustained the objection and excluded the evidence.

The court also excluded testimony of one of the persons who had taken the smallpox that the breaking out of the disease was caused by these rags, and testimony of another workman that two of his children had taken the smallpox by playing with infected rags.

In answer to an inquiry of the court, just before charging the jury, "what, under the proofs, the position of the defendants was," their counsel stated that "the defendants only insisted upon their counterclaim for damages on the cause of action growing out of the infected condition of the rags," and thereupon the court charged the jury as follows:

"The sale at the price sued for and the delivery of the rags are admitted, and it is shown that the defendants used the whole of them in the manufacture of paper, which they disposed of. The defendants, however, allege, and this is the sole ground of defense insisted on, that the rags were infected with smallpox and introduced the disease among the defendants' employees, a number of whom took smallpox, and

Page 120 U. S. 635

several of whom died of the disease, and the defendants maintain that by reason of such introduction of the disease into their mill, they were injured in their business and sustained damages in excess of the plaintiff's claim, and hence that they not only have a full defense to this claim, but are entitled to a certificate for the damages sustained by them in excess of his claim."

"The defendants go to the length of charging that the plaintiff knew the rags were infected with smallpox when he shipped them to the defendants, and in so doing acted with positive bad faith to the defendants. But it seems to me that the evidence would not justify the jury in so finding or the court in submitting to the jury the question of bad faith, nor can I now recall evidence sufficiently showing that the plaintiff was even guilty of culpable negligence in his purchase of those rags."

"However, the damages claimed by the defendants, if not in their nature to remote and speculative, are, it seems to me, altogether uncertain under the evidence. I am of opinion, and charge you, that the evidence in the case is not such as would enable the jury to ascertain the amount of damages, if any, which the defendants sustained."

"Upon the whole case, the court instructs the jury to find a verdict for the plaintiff for the mount of his claim."

The jury returned a verdict for the plaintiff accordingly, and the defendants excepted to the rulings excluding evidence, and to those portions of the charge above printed in italics, and sued out this writ of error.