
    Wood et al. v. Carleton.
    
      (Supreme Court, General Term, Fourth Department.
    
    July 20, 1889.)
    1. Sale—Breach of Warranty—Measure of Damages.
    It is error, in estimating the damages resulting from a breach of warranty as to the power of a water-wheel, to consider the rental value of the mill with the wheel as it was and the rental value with the wheel as it was warranted to be, where it appears that the purchaser of the wheel occupied the mill during the entire time, and used the wheel.
    2. Same.
    Where the purchaser continued to use the wheel, and made no offer to return it because of the defect, the-cost of setting it should not be allowed.
    Appeal from judgment on report of referee.
    Action by Augustus G. Wood and William G. Percival against James Carleton. In the fall of 1882 plaintiffs agreed with defendant to manufacture and deliver to him at his mill in Camden a turbine water-wheel, for the price of $300. The wheel was manufactured and delivered about the 9th February, 1833. Defendant, on the 24th May, 1883, by note, which was afterwards paid, paid on the price the sum of $200. This action was brought in July, 1885, to recover the balance of the price, together with several small items of account. Defendant, in his answer, by way of counter-claim alleged that plaintiffs warranted that the water-wheel should be of 55 horse-power; that plaintiffs were informed at the time of the contract that defendant designed to use the wheel in his mill for the motive power thereof; that the wheel did not in fact exceed 25 horse-power, and a shaft connected with it and furnished by plaintiffs was defective and soon broke; that the lack of power and defect in shaft were unknown to defendant, and.not discovered until after the wheel was put in operation in the mill; that by reason of such lack of power and inability to-run the mill to its full sawing capacity, and the defective character of the shaft, the mill became and remained unoccupied and unoperated for a long time, and still remains partially unoccupied and incapable of being completely and fully operated, and defendant was put to great loss of time and expense ■ in repairing the mill, and to great loss of earning capacity and rental value, to his damage of $1,500. The referee found that plaintiffs warranted that the wheel should be of the capacity of 55.40 horse-power under an 18 feet head of water, and would saw and cut out 1,000 feet of lumber per hour under said head; that the wheel did not have such capacity; that the fair rental value of the mill with the wheel as furnished was $200 a year; that such value, if the wheel had been of 55.40 horse-power capacity, would be $300 a year; that the cost to defendant for putting in and setting up the wheel was. $75; and as matter of law he found that defendant was damaged by reason of plaintiffs’ breach of contract the sum of $200. Plaintiffs appeal,
    
      Argued before Hardin, P. J., and Merwin and Martin, JJ.
    
      George W. Smith and Davies <& Johnson, for appellants. Alpha F. Orr, for respondent.
   Merwin, J.

The evidence authorizes the finding that plaintiffs warranted that the wheel should be of the capacity stated, and that there was a breach of such warranty. The plaintiffs claim the wheel was not properly set, but the evidence warrants the conclusion of the referee that it was set substantially as the plaintiffs directed. The plaintiffs claim there was no warranty except as coupled with the condition that the wheel should be tried within 30 days, and, if not satisfactory, or made satisfactory, then to be returned. Whether there was such a condition was a question of fact for the referee to dispose of. His finding against it was not against evidence. We must therefore assume there was an express warranty; and this, although the contract was executory, the defendant had a right to rely upon; he was not obliged to rescind. Brigg v. Hilton, 99 N. Y. 529, 3 N. E. Rep. 51, and cases cited.

The matter of damages presents a more serious question. It is claimed by the defendant that the difference between the rental value of the mill with the wheel as furnished and such value with the wheel as warranted to be, together with the cost of taking out this wheel and putting in a new one, furnish the basis for damages. The referee has apparently proceeded on this basis, as he finds no other facts upon which to rest his conclusion of law as to the amount of damages. The evidence is not sufficient upon any other basis to support the finding as to damages. How much the referee allowed for the difference of rent, and how much for expense of removal, does not appear. His findings are excepted to as well as the evidence given on the subject. The defendant, to sustain his position, cites Griffin v. Colver, 16 N. Y. 496; Rogers v. Beard, 36 Barb. 37; Stamping Works v. Koehler, 45 Hun, 150; Cassidy v. Le Fevre, 45 N. Y. 562, In the Griffin Case the plaintiff agreed to build a steam-engine with boilers, etc., for the defendants, and deliver it by a certain day. There was a delay of a week in the delivery, during which time the defendants lost the use of certain machinery, which the engine was intended to drive, as the plaintiff knew. The plaintiff sued for the price, and the defendants recouped their damages for the delay. It was held that the ordinary rent or hire which could have been obtained for the use of the machinery whose operation was suspended for want of the steam-engine could be recovered as damages. In the Cassidy Case the same principle was asserted as applicable to a case where the use of machinery was lost during the time spent in making repairs to defective boilers. In the Rogers Case there was a neglect to repair a vessel within the time called for by the contract, and it was held that the measure of damages for the delay was the value of the rent of such a vessel as used or chartered at the time. In the Stamping Works Case the plaintiff leased of the defendant for a year certain premises, together with all the steam-power the plaintiff needed in a certain business known to defendant. There was a failure by defendant to furnish such steam-power. It was held that evidence tending to show what was the ordinary rent or hire of the machinery during the time of the deficiency of power was properly rejected, as no claim for damages upon this ground was alleged in the complaint; it being said that if there had been the proper allegation the evidence would have been admissible. These cases hardly sustain the defendant’s position. Here there was a sale with a warranty as to capacity; no question about delay in delivery. After the wheel was put in it was in use for two weeks, when the shaft broke. That was soon repaired, and then there was some further use or opportunity for use, when, upon 24th May, 1883, $200 of the price was paid. At that time, as the defendant téstifies, one of the plaintiffs told him that if the wheel did not turn out all right he would make it all right. During the summer it was used to a considerable extent, and nothing further said to plaintiffs about it till September, when some complaint was made. There was no return of the wheel or offer to return it. So far as the case shows there was abundant opportunity to test it before the making of the payment. The defendant had no special contracts in which lie suffered damage by reason of insufficient capacity. As the wheel was not taken out or offered to be returned it is a little difficult to see how the expense of putting it in or taking it out is an element of damages. It was not worthless, and the defendant has had, and still has, the benefit of it. If the difference in rental value is an element, what is the limit as to time? Can it be said that the rental value for an indefinite time was within the reasonable contemplation of the parties? In Edwards v. Collson, 5 Lans. 324, it was held that a warranty of a steam-engine as having a capacity for work to a certain horse-power, as sound, and in good order, and as having the ability to perform labor to the extent of»the capacity warranted, is a general warranty, and the damages allowed for its breach are merely the difference between the actual value of the engine and that which it would have liad if as warranted, and that this would be so although the engine was sold for the purposes of the defendant’s saw-mill then about to be erected, and was to be placed in that mill in running order. We think this case is quite in point, and presents the proper rule for the present case as it is now developed. If the breakage of the shaft is chargeable to the plaintiffs, and within the warranty, the damage or expense and delay occasioned by that may be an additional element. So if, before the discovery of the defects, or reasonable opportunity to do so, there was special damage unavoidably sustained, that would be allowable if within the complaint, according to the case of Zuller v. Rogers, 7 Hun, 540. We are therefore of the opinion that the rule adopted as to damages was erroneous, and on that ground the judgment must be reversed.

Judgment reversed on the exceptions, and a new trial ordered before another referee, with costs to abide the event.

Martin, J., concurs.

Hardin, P. J.

I am inclined to the opinion that the long-continued use of the wheel by defendant as disclosed by the evidence warranted a finding that the defendant liad accepted the wheel. Brown v. Foster, 108 N. Y. 387, 15 N. E. Rep. 608. I assent to a reversal.  