dispatch was an order for salt, as an article of merchandise, and that the plaintiff would fill the order as delivered; and that if the salt was shipped to Chicago, it would be shipped there as an article of merchandise, to be sold in the open market. And the market price in Chicago being less than the market price in Oswego, that they would lose the cost of transportation, and the difference between the market price at Chicago and the market price at Oswego. I think, therefore, that the rule of damages adopted by the referee was sufficiently favorable to the defendant. The damages allowed were certain, and they were the proximate, direct result of the breach.

I do not think, under the facts of this case, that the plaintiffs, when they found the state of the Chicago market, were bound to re-ship this salt to Oswego. For anything that appears in this case, the cost of transportation to Oswego would have been equal to the difference in the market price between the two places. Then there was the risk of the lake transportation at that season of the year, and the uncertainty in the Oswego market when the salt should again be landed there. If the plaintiff had shipped it, and it had been lost upon the lake, the total loss would not have been chargeable to the defendant. By the wrongful act of the defendant, the salt had been placed in Chicago, one of the largest commercial centers in the country, and the plaintiffs had the right to sell it, there in good faith, and hold the defendant liable for the loss.

§256 PRIMROSE v. WESTERN UNION TELEGRAPH COMPANY.

Supreme Court of United States, 1894. [154 U. S. 1.]

On June 16, 1887, the plaintiff wrote and delivered to the defendant at Philadelphia, for transmission to his agent, William B. Toland, at Ellis, in the state of Kansas, a message:

"To Wm. B. Toland, Ellis, Kansas:

"Despot am exceedingly busy bay all kinds quo perhaps bracken half of it mince moment promptly of purchases. "Frank J. Primrose."

On the evening of the same day, an agent of the defendant delivered to Toland, at Waukeney, upon a blank of the defendant company, the message in this form:

"To W. B. Toland, Waukeney, Kansas:

"Destroy am exceedingly busy buy all kinds quo perhaps bracken half of it mince moment promptly of purchase.

"Frank J. Primrose."

The difference between the message as sent and as delivered is shown below, where so much of the message sent as was omitted in that delivered is in brackets, and the words substituted in the message delivered are in italics.

"[Despot] Destroy am exceedingly busy [bay] buy all kinds quo perhaps bracken half of it mince moment promptly of purchase [s]."

By the private cipher code made and used by the plaintiff and Toland, the meaning of these words was as follows:

"Yours of the [fifteenth] seventeenth received; am exceedingly busy; [I have bought] buy all kinds, five hundred thousand pounds; perhaps we have sold half of it; wire when you do anything; send samples immediately, promptly of [purchases] purchase."

The plaintiff testified that he then was, and for many years had been engaged in the business of buying and selling wool all over the country, and had employed Toland as his agent in that business, and early in June, 1887, sent him out to Kansas and Colorado, with instructions to buy 50,000 pounds, and then to await orders from him before buying more; that, before June 12th, Toland bought 50,000 pounds, and then stopped buying; and that he had sent many telegraphic messages to Toland during that month and previously, using the same code.

The defendant's agent at Philadelphia, called as a witness for the plaintiff, testified that he sent this message for the plaintiff, and knew that he was a dealer in wool, and that Toland was with him, but in what capacity he did not know; that he had frequently sent messages for him, and considered him one. of his best customers during the wool season. The plaintiff also introduced evidence tending to show that June 16, 1887, was a bright and beautiful day at Ellis and Waukeney; that Toland, upon receiving the message at Waukeney, made purchases of about 300,000 pounds of wool; and that the plaintiff, in settling with the sellers thereof, suffered a loss of upwards of $20,000.

GRAY, J.: . . . Under any contract to transmit a message by teleghaph, as under any other contract, the damages for a breach must be limited to those which may be fairly considered as arising according to the usual course of things from the breach of the very contract in question, or which both parties must reasonably have understood and contemplated, when mak ing the contract, as likely to result from its breach. This was directly adjudged in Telegraph Co. v. Hall, 124 U. S. 444, 8 Sup. Ct. 577, 31 L. Ed. 479. . . .

In Telegraph Co. v. Gildersleeve, 29 Md. 232, which was an action by the sender against a telegraph company for not delivering this message received by it in Baltimore, addressed to brokers in New York, "Sell fifty (50) gold," Mr. Justice Alvey, speaking for the Court of Appeals of Maryland, and applying the rule of Hadley v. Baxendale, above cited, said: "While it was proved that the dispatch in question would be understood among brokers to mean fifty thousand dollars of gold, it was not shown, nor was it put to the jury to find, that the appellant's agents so understood it, or whether they understood it at all. 'Sell fifty gold' may have been understood in its literal import, if it can be properly said to have any, or was as likely to be taken to mean fifty dollars as fifty thousand dollars by those not initiated; and, if the measure of responsibility at all depends upon a knowledge of the special circumstances of the case, it would certainly follow that the nature of this dispatch should have been communicated to the agent at the time it was offered to be sent, in order that the appellant might have observed the precautions necessary to guard itself against the risk. But without reference to the fact as to whether the appellant had knowledge of the true meaning and character of the dispatch, and was thus enabled to contemplate the consequences of a breach of the contract, the jury were instructed that the appellee was entitled to recover to the full extent of his loss by the decline in gold. In thus instructing the jury, we think the court committed error, and that its ruling should be reversed." 29 Md. 232, 251, 96 Am. Dec. 519.

In Baldwin v. Telegraph Co., which was an action by the senders against the telegraph company for not delivering this message: "Telegraph me at Rochester what that well is doing," Mr. Justice Allen, speaking for the Court of Appeals of New York, said: "The message did not import that a sale, of any property or any business transaction hinged upon the prompt delivery of it, or upon any answer that might be received. For all the purposes for which the plaintiffs desired the information, the message might as well have been in a cipher or in an unknown tongue. It indicated nothing to put the defendant upon the alert, or from which it could be inferred that any special or peculiar loss would ensue from a non-delivery of it. Whenever special or extraordinary damages, such as would not naturally or ordinarily follow a breach, have been awarded for the nonperformance of contracts, whether for the sale or carriage of goods or for the delivery of messages by telegraph, it has been for the reason that the contracts have been made with reference to peculiar circumstances known to both, and the particular

loss has been in the contemplation of both, at the time of making the contract, as a contingency that might follow the non-performance." "The dispatch not indicating any purpose other than that of obtaining such information as the owner of property might desire to have at all times, and without reference to a sale, or even a stranger might ask for purposes entirely foreign to the property itself, it is very evident that whatever may have been the special purpose of the plaintiffs, the defendant had no knowledge or means of knowledge of it, and could not have contemplated either a loss of a sale, or a sale at an undervalue, or any other disposition of or dealing with the well or any other property, as the probable or possible result of a breach of its contract. The loss which would naturally and necessarily result from the failure to deliver the message would be the money paid for its transmission, and no other damages can be claimed upon the evidence as resulting from the alleged breach of duty by the defendant.” 45 N. Y. 744, 749, 750, 752, 6 Am. Rep. 165. See, also, Hart v. Cable Co., 86 N. Y. 633.

The Supreme Court of Illinois, in Tyler v. Telegraph Co., 60 Ill. 421, took notice of the fact that in that case "the dispatch disclosed the nature of the business as fully as the case demanded." 60 Ill. 434, 14 Am. Rep. 38. And in the recent case of Cable Co. v. Lathrop, the same court said: "It is clear enough that, applying the rule in Hadley v. Baxendale, supra, a recovery cannot be had for a failure to correctly transmit a mere cipher dispatch, unexplained, for the reason that to one unacquainted with the meaning of the ciphers it is wholly unintelligible and nonsensical. An operator would, therefore, be justifiable in saying that it can contain no information of value as pertaining to a business transaction, and a failure to send it or a mistake in its transmission can reasonably result in no pecuniary loss." 131 Ill. 575, 585, 23 N. E. 583, 7 L. R. A. 474, 19 Am. St. Rep. 55. .

In the present case the message was, and was evidently intended to be, wholly unintelligible to the telegraph company or its agents. They were not informed, by the message or otherwise, of the nature, importance, or extent of the transaction to which it related, or of the position which the plaintiff would probably occupy if the message were correctly transmitted. Mere knowledge that the plaintiff was a wool merchant, and that Toland was in his employ, had no tendency to show what the message was about. According to any understanding which the telegraph company and its agents had, or which the plaintiff could possibly have supposed that they had, of the contract between these parties, the damages which the plaintiff seeks

to recover in this action, for losses upon wool purchased by Toland, were not such as could reasonably be considered, either as arising, according to the usual course of things, from the supposed breach of the contract itself, or as having been in the contemplation of both parties, when they made the contract, as a probable result of a breach of it.

In any view of the case, therefore, it was rightly ruled by the Circuit Court that the plaintiff could recover in this action no more than the sum which he had paid for sending the message.

Judgment affirmed.

FULLER, C. J. and HARLAN, J., dissented.

$257. The Nature of a Telegraph Company's Liability.The weight of authority is in accord with the Primrose case on the question of the measure of damages. For a summary of cases on a Telegraph Company's duty with respect to cipher and unintelligible telegrams, see the note in 43 L. R. A. (N. S.) 502. Cf. also Postal Telegraph Cable Co. v. WarrenGodwin Lumber Co. (1919), 251 U. S. 27.

The case of Primrose v. Western Union Telegraph Co. is also interesting because it raises the problem of how far the law will enforce certain stipulations limiting the liability of such companies which are now commonly contained in the printed blanks on which the sender writes his message.

1. May a telegraph company by contract exempt itself from liability caused by negligence? The decided weight of authority answers in the negative. It may, however, by special contract with the sender limit its liability to defaults occurring on its own line, and protect itself against liability arising from negligence of a connecting company.

2. May it enforce a stipulation to the effect that it will not be liable for errors, delays or non-delivery of messages for more than the amount received for sending, unless the message is ordered to be repeated? The authorities are about evenly divided but perhaps the weight of authority on the point is opposed to the Primrose case. Most of the state courts hold that this stipulation also is against public policy and therefore unenforceable. There are also some state statutes to that effect.