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GUADY v. SEAMAN (03/18/59)

March 18, 1959


Appeal, No. 215, April T., 1958, from judgment of Court of Common Pleas of Indiana County, Sept. T., 1956, No. 140, in case of Michael Guady et ux. v. Andrew H. Seaman. Judgment affirmed.


James G. Moore, for appellant.

James W. Mack, Jr., with him Vasil Fisanick, for appellees.

Before Rhodes, P.j., Hirt, Gunther, Wright, Ervin, and Watkins, JJ. (woodside, J., absent).

Author: Hirt

[ 188 Pa. Super. Page 476]


The plaintiffs had bought a licensed restaurant at Alverda in Pine Township, Indiana County. They operated the business there for 8 1/2 months until the end of the term of their lease when they were obliged to surrender the premises. In anticipation of moving to

[ 188 Pa. Super. Page 477]

    a new location they negotiated a lease of a building owned by the defendant, in the same township, for a term of two years from September 15, 1952. The use to be made of the premises as recited in the lease was the conduct of a "restaurant with liquor license", and the plaintiffs secured a transfer of the license to the new location. In consideration of the rents reserved, which the plaintiffs agreed to pay under the terms of the lease, it was agreed: "Lessor shall furnish water for the leased premises." A dependable and adequate water supply was essential to the lawful conduct of the plaintiffs' business and that fact was within the contemplation of the parties when the lease was entered into. In adapting the building to the conduct of a restaurant business, the plaintiffs repainted the rooms on the first floor of the building; they made changes in the plumbing; they rewired the premises and incurred the expense of installing a compressor and other appliances necessary to the conduct of the business. The plaintiffs opened for business on October 3, 1952 and up to that date there was an adequate water supply from a well on the premises. Two or three days later the defendant completely cut off the water supply to the building by removing the electrically driven pump from the well. Since then, in spite of the plaintiffs' demands that he comply with his obligation, the defendant has refused to furnish water as he was bound to do under his lease agreement. Plaintiffs carried water to the restaurant from another source for about two weeks and then closed the business because of the defendant's default. They removed from the premises and it was not until 1954 that they were able to lease a suitable building to reopen their restaurant at a new location.

This action was brought to recover damages from the defendant resulting from breach of his agreement to provide a water supply to the demised premises. The

[ 188 Pa. Super. Page 478]

    principal element of damage was plaintiffs' loss of profits, during the period within the term of their lease, when defendant by his default made it impossible for them to operate their restaurant. At the trial plaintiffs were permitted to prove their loss by the expert testimony of a well qualified public accountant who was familiar with plaintiffs' business, from having served them in making up their tax returns. From plaintiffs' books, showing the returns from the business at Alverda and from the few days of operation on defendant's property, as well as the books of account of the business after plaintiffs reopened their restaurant at their present location, the witness testified that in his opinion plaintiffs' damage measured by loss of profits was $3,387. The jury found for the plaintiffs in the sum of $2,000.

We are unable to find merit in appellant's contention that the court erred in admitting this evidence, over his objection. "Damages are recoverable for losses caused or for profits and other gains prevented by the breach [of a contract] only to the extent that the evidence affords a sufficient basis for estimating their amount in money with reasonable certainty": Restatement, Contracts, § 331. In Comment (a) under § 331, it is said: "In these cases the defendant usually has reason to foresee this difficulty of proof and should not be allowed to profit by it. In such cases, it is reasonable to require a lesser degree of certainty as to the amount of loss, leaving a greater degree of discretion to the jury, subject to the usual supervisory power of the court." Our Supreme Court in Western Show Co., Inc. v. Mix, 308 Pa. 215, 223, 162 A. 667, and in a second appeal, 315 Pa. ...

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