TAYLOR v. JOHNSTON

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Court of Appeal, Second District, Division 4, California.

H. B. TAYLOR, Plaintiff and Respondent, v. Elizabeth G. JOHNSTON et al., Defendants and Appellants.

Civ. 41960.

Decided: July 03, 1974

West & Girardi, Daniel W. Gage, Thomas Girardi, Los Angeles, and Robert E. Courtney, Redondo Beach, for defendants and appellants. Walter S. Weiss, John Onesian, Long & Levitt and Richard B. Wolf, Los Angeles, for plaintiff and respondent. Iverson, Yoakim, Papiano & Hatch, Neil Papiano, Los Angeles, and Donald M. Robins, Pasadena, amicus curiae, on behalf of defendants and appellants.

In January 1965 plaintiff was the owner of two thoroughbred mares, Named Sunday Slippers and Sandy Fork; defendants were the owners of a thoroughbred stallion named Fleet Nasrullah. The parties entered into contracts calling for the service of Fleet Nasrullah in breeding the two mares, during the 1966 season. In October 1965, defendants sold their stallion to a snydicate and the horse was taken from California to Kentucky. Extensive negotiations followed, the effect of which was that the new owners denied any legal obligation to satisfy defendants' contractual obligation to plaintiff, but they did agree to make Fleet Nasrullah available, in Kentucky, at such time during the 1966 breeding season as he was not being utilized at stud by the new owners. Attempts to secure the stallion's services at times when the two mares (who had been sent to Kentucky for that purpose) were in heat failed because the new owners never made him available. Concluding, as the 1966 breeding season was about to end, that Fleet Nasrullah was not going to become available that season, plaintiff bred his mares to another stallion, Chateaugay, a winner of the Kentucky Derby. These breedings produced twins which were aborted.1

I

In spite of the effort of appellants to obfuscate the issues by arguing only about the events in 1966, the basic issue is clear and simple. Plaintiff was entitled, by his contracts with defendants, to a 1966 breeding by Fleet Nasrullah, in California, with the possibility of receiving two California bred foals2 that would be available for sale at the 1968 yearling sales. When defendants sold the stallion to the Kentucky syndicate without preserving plaintiff's rights to his services, and when they permitted the stallion to be removed from California, they made performance of the contracts impossible and were, at that time—i. e., in October of 1965—guilty of an anticipatory breach of the contracts.

It is immaterial, in finding breach of contract, that plaintiff was willing to, and did, by sending the mares to Kentucky and by negotiating directly with the new owners, cooperate in an effort to mitigate his damages. It was for defendants, having breached their contracts, to secure for plaintiff a substitute performance acceptable to him. This they did not do. Their liability is clear.

II

Defendants argue that, in spite of plaintiff's efforts in 1966 to mitigate damages, first by trying to arrange for a Kentucky breeding by Fleet Nasrullah and, when it was apparent that that effort would fail, by securing the (unfortunately unsuccessful) services of Chateaugay, they were also obligated to have the mares serviced in 1967.3 The contention is fallacious.

The contracts, as we have above pointed out, were for 1966 breeding, looking toward foals available for sale as yearlings in 1968. No 1967 breeding, by Fleet Nasrullah or any other stallion, could possibly have resulted in foals available as yearlings before 1969. The loss of the 1968 possibility, for which plaintiff had contracted, was irremediable and unmitigable at the close of the 1966 breeding season.4

III

Defendants argue that the damages allowed were speculative. We do not agree. It is, of course, true that no breeding is guaranteed of success and that a viable foal may not be salable as a yearling. But there was expert testimony, which the trial court was entitled to accept, that, given the past breeding experience of the mares and stallion and the racing successes of their blood lines, an informed estimate of the probability of a successful breeding and of the sale value of their progeny could be made. An intentional violator of contractual obligations is entitled to no more.

Defendants point to the fact that the breeding by Chateaugay was unsuccessful and suggest that a breeding by Fleet Nasrullah would have resulted in the same defect. Again, the plaintiff's experts, and the trial court, were entitled to determine, from the results of other breedings by the mares and by Fleet Nasrullah, that any genetic defect resulting in multiple births lay with Chateaugay and not with the three horses involved in defendants' contracts with plaintiff.

IV

Defendants contend that the damages awarded were excessive in that they exceeded the amount prayed for. In the original complaint, filed in August 1966, after Sunday Slipper had been bred to Chateaugay but before her foals had been aborted, plaintiff had claimed a value for the potential foal by Fleet Nasrullah at $75,000, offset by an estimated value of $25,000 for the potential foal by Chateaugay. At the trial, the Chateaugay breeding having failed and further information as to the value of Sunday Slipper's offspring and those of Fleet Nasrullah being available, the evidence gave the value of the potential Fleet Nasrullah-Sunday Slipper foal at $100,000, with no offset. The trial court adopted this higher figure and gave judgment accordingly.5

No issue was made at the trial over the increased valuation, other than to question plaintiff about the difference—which he explained. Nor could any objection properly have been made. There is nothing erroneous in a party offering evidence to show that his loss not only was as great as he claimed in his complaint but actually was greater.

The first notice defendants had that damages were to be awarded on a higher valuation of the potential Sunday Slipper foal than that alleged in paragraph XXIV of the complaint was when they were served with proposed findings. They promptly objected; their objection was not sustained. They again raised the point on an unsuccessful motion for a new trial. At no time did plaintiff seek or secure an amendment of his complaint to conform to proof.

Plaintiff argues that the judgment did not exceed the amount alleged in the complaint because, in paragraph XXVI of his first cause of action,6 he had alleged additional damages amounting to $40,000 for loss of California breeders' fees and that the share of those fees attributable to the potential Sunday Slipper foal would equal or exceed the $25,000 differential.7 However, we are directed to no place in the record where evidence in support of the allegations in paragraph XXVI was introduced nor is there any reference to that element of damages in the findings of fact. Lacking either evidence or finding that such a practice exists or, if it does exist, that the fees accrue to the breeder after he has sold the foal, we cannot hale that the award did not exceed the specific allegations of the complaint.

However, as to actions for breach of contract, ‘[d]espite occasional dicta to the contrary, it is now well-established that while it may be better practice to allege that damages have been sustained in a certain sum where such is the fact, it is not essential to include such a formal allegation. Where the facts alleged are such that damages will necessarily flow from them, and damages in a specific sum are prayed for, this will suffice to state a monetary claim without a formal allegation of damages in the body of the complaint.’ (1 Chadbourn, Grossman and Van Alstyne, California Pleading (1961), § 931, p. 903.) As we have indicated above, the evidence in this case supported the claim that the kind of damage allowed was the expectable and reasonably ascertainable consequence of defendants' breach. The complaint on which the case was tried prayed for damages in the lump sum of $133,000, together with a prayer for the costs of sending the two mares to Kentucky.8 The judgment was for the lump sum of $103,122.50 plus the said shipment and associated costs, together with interest and taxable costs, i.e.: well within the general prayer.9

V

Defendants argue, also, that it was improper to allow prejudgment interest. As to the interest on the portion of the award that allowed plaintiff to recoup his costs in sending the mares to Kentucky, the contention is without merit, That element of damage was liquidated and allowable under subdivision (a) of section 3287 of the Civil Code.

As to the interest allowed on the remainder of the damages, defendant relies on pre-1967 law which withheld prejudgment interest on unliquidated damages in breach of contract cases. But in 1967 the Legislature added subdivision (b) to section 3287, reading as follows:

‘Every person who is entitled under any judgment to receive damages based upon a cause of action in contract where the claim was unliquidated may also recover interest thereon from a date prior to the entry of judgment as the court may, in its discretion, fix, but in no event earlier than the date the action was filed.’

We cannot say that the trial court abused the discretion that the 1967 amendment conferred on it.

VI

Defendants contend that a statement by the trial judge, during a settlement conference, indicated that he had prejudged the case to their detriment. Contrary to defendants' briefs, the statement came at an adjourned conference, after some evidence had been taken, exhibits had been received ant trial briefs had been exchanged and filed. The parties had stipulated that the trial judge should participate in the conference. The conduct of the trial in its entirety shows clearly that the opinion complained of was tentative only and that there was no prejudgment of the case.

VII

Other procedural points raised by defendants are based on the theory, which we have rejected above, that the breach occurred in June of 1966. They need not be further considered.

The judgment is affirmed.

FOOTNOTES

1.  A veterinarian had determined that each mare was about to drop twin foals. It is not denied that, in thoroughbred horse breeding, twins are undesirable and the abortions were legitimate.

2.  We take judicial notice that the place of breeding is of importance to breeders and owners. Whether some other breeder would have preferred a Kentucky bred foal is immaterial; plaintiff contracted for a California bred foal; he was entitled to his choice.

3.  The argument is based on a provision in the contracts whereby, had the expected breeding taken place and been unsuccessful, plaintiff could have had the services of Fleet Nasrullah in 1967 for a second breeding without additional fee. As we point out in the text that provision is immaterial in considering the 1965 breach.

4.  The new owners had stalled plaintiff in his attempts to secure the services of Fleet Nasrullah until after June 14, 1966. The trial court was entitled to conclude that, had plaintiff waited until the mares next came into heat, the breeding would have been beyond the 1966 season and that plaintiff was entitled to attempt to mitigate his damage by securing a substituted stallion on June 14th.

5.  No issue is here raised as to the portion of the judgment based on the potential Sandy Fork foal. The specific allegation as to that foal was greater than the potential value found by the trial court. ($45,000 as against $20,000.)

6.  Defendants are in error in contending that the breeder fee allegations were in the rejected second cause of action.

7.  ‘The plaintiff is in the business of breeding and selling horses in the State of California for the purpose of thoroughbred racing; as a direct and proximate result of the defendants' breach of said contract and agreement, as hereinabove alleged, and by reason of his shipment of FLEET NASRULLAH to Kentucky as hereinabove alleged, and plaintiff's reliance on the promises and representations of defendants in shipping his said two mares to Kentucky in order to secure the breeding and stallion service of FLEET NASRULLAH and the subsequent necessity of breeding said mares, and each of them to CHATEAUGAY, all as heretofore alleger, plaintiff was, and will continue to be deprived of special breeders' fees, which attach to all horses bred and born within the State of California and by reason of which there are paid to said breeders sums based upon the purses won by such California bred horses; plaintiff is informed and believes and thereon alleges that the damages sustained as a result of said breeders' fees is Forty Thousand Dollars ($40,000.00).’

8.  ‘WHEREFORE, Plaintiff prays judgment against Defendants, and each of them, as follows on each of the First and Second Causes of Action:‘1. Damages in the sum of One HundredThirty-three Thousand Dollars ($133,000.00), together with the costs and expenses of the care and transportation of each of said mares and their foals as more fully alleged in Paragraph XXII herein, according to proof;'

9.  ‘1. Plaintiff H. B. Taylor shall have and recover from defendants Ellwood B. Johnston and Elizabeth G. Johnston, individually and as co-partners doing business as Old English Rancho, a co-partnership, the sum of #103,122.50 plus interest on $99,800.00 thereof at the rate of 7% per annum from August 1, 1968 until August 18, 1972, amounting to the sum of $28,268.48, and interest on $3,322.50 thereof at the rate of 7% per annum from August 30, 1966 until August 18, 1972, amounting to the sum of $1,387.07, or an aggregate sum of both principal and interest in the amount of $132,778.06, together with taxable costs and also costs of services of expert witnesses, if any, as provided in Code of Civil Procedure § 998, herein taxed in the amount of $2,946.60.’

KINGSLEY, Associate Justice.

JEFFERSON, Acting P. J., and DUNN, J., concur.