If the defendant's contract is to refrain from action, difficult questions often arise as to the value of his performance. Breach of a contract to forbear temporarily to sue a debtor prima facie gives rise merely to nominal damages, if the creditor would have been entitled to interest for the period during which he had agreed to defer his action.93 A contract for permanent forbearance can ordinarily be set up as a complete defence to an action on the claim.94 But damages for breach of such a contract if made the basis of an action are the amount of the claim with interest and costs.95 A breach of a contract not to engage in business necessitates a valuation of the profits or increased profits the plaintiff would have made had the defendant kept his contract.9* And the profits the defendant made by doing business may be evidence of the added profit the plaintiff would have made had the defendant refrained from business.97 Not only the added profits the plaintiff would have made are recoverable but also compensation for any injury suffered by him in his remaining business.98 On breach of a contract to give the plaintiff an exclusive agency he is entitled to recover the profits he would have made on transactions entered into by the principal through others.99
92 Cleveland v. Bryant, Id S. C. 634; Masaie v. State Nat. Bank, 11 Tex. Civ. App. 280, 32 S. W. 797; James v. Kibler's Adm., 94 Va. 165, 26 S. £. 417; Oldfield v. Angeles, etc., Co., 62 Wash. 260, 113 Pac. 630, 35 L. R. A. (N. S.) 426, Ann. Cas. 1912 C. 1050.
94 See supra, Sec.338.
95 Indiana, etc., Ry. Co. v. Scearoe, 23 Ind. 223.
96 Gregory v. Spieker, 110 Cal. 150, 42 Pac. 576, 52 Am. St. Rep. 70;
Bauwens v. Qoethals, 187 111. App. 563; Galucha v. Naso, 147 la. 309,126 N. W. 146; Long v. O'Bryan, 28 Ky. L. Rep. 1062, 91 S. W. 659. See also Moorman v. Parkerson, 131 La. 204, 59 So. 122; Smith v. Brown, 164 Mass. 584, 42 N. E. 101; Salinger v. Salinger, 69 N. H. 589, 45 Atl. 558; Buckhardt v. Buck-hardt, 36 Oh. St. 261, 42 Oh. St. 474, 51 Am. Rep. 842.
97 Pelts v. Eicheie, 62 Mo. 171; Bennett Water Co. v. Millvale, 200 Pa. 613, 50 Atl. 155; Whorley v. Tennessee, etc., Co. (Tenn. Ch.), 62 S. W. 346. But see Montgomery, etc., Society v. Harwood, 126 Ind. 440, 26 N. E. 182, 10 L. R. A. 532; Dose v. Tooie, 37 Ore. 13, 60 Pac. 380.
81407. Alternative contracts.
As has been seen, contracts are sometimes put in the form of alternative agreements where the intention is to compel the promisor to perform one alternative by providing as the other alternative a performance so much more onerous as to be a penalty; or an alternative sum named may be liquidated damages.1 The interpretation of contracts made with such a purpose is that the desired performance must be rendered by a certain time, and that on default the liquidated damages or penalty shall automatically become due. The validity of such contracts has been previously considered,2 and it remains here to consider only such contracts as may be interpreted as intended to give a genuine choice rather than to subject the obligor to damages for failing to perform what was understood to be his real obligation.
A promise of one of several alternative performances will give the choice of alternatives, unless the contrary is stated,3 to the person who is to render the performance.4 This will
98 Evans v. Elliott, 20 Ind. 283, 83 Am. Dec. 319; Galucha v. Naso, 147 la. 309, 126 N. W. 146.
99 Cincinnati etc. Co. v. Western Ac. Co., 152 U. S. 200, 38 L. Ed. 411, 14 Sup. Ct 523; Wells v. National life Assoc., 99 Fed. 222, 53 L. R. A. 33, 39 C C. A. 476; Corbin v. Taussig, 137 Fed. 151; Schiffman v. Peerless M. C. Co., 13 CaL App. 600, 110 Pac. 460; Mueller v. Bethesda Ac. Co., 88 Mich. 390, 50 N. W. 319; Emerson v. Pacific fa. Packing Co., 96 Minn. 1,104 N. W. 573, 1 L. R. A. (N. 8.) 445, 113 Am. St. Rep. 603; Dunham v. Hastings, etc, Co., 95 N. Y. App. Div. 360, 88 N. Y. S. 835; Wakeman v. Wheeler, etc, Co., 101 N. Y. 205, 4 N. E. 264, 54 Am. Rep. 676; Bredemeier v. Pacffic Supply Co., 64 Ore. 576, 131
Pac. 312; Cofield v. E. A. Jenkins Motor Co., 89 S. C. 419, 71 S. E. 969; Cranmer v. Kohn, 7 S. Dak. 247, 64 N. W. 125; Dr. Harter Medicine Co. v. Hopkins, 83 Wis. 309, 53 N. W. 501. But see Union Refining Co. v. Barton, 77 Ala. 148; Carlson v. Stone-Ordean-Wells Co., 40 Mont. 434,107 Pac. 419.
1See supra, Sec.781.
2 See 8upra, Sec.Sec. 781, 782.
3 As in, e. g., Standard Ac. Co. v. Breed, 163 Mass. 10, 39 N. E. 346.
4 Co. Iitt. 145a. "Fourthly, in case an election be given of two several things, alwaies he, which is the first agent, and which ought to do the first act, shall have the election. As if a man granteth a rent of twentie shillings or a robe to one and to his heires, the grantor shall have the ordinarily be the promisor,5 but may possibly be the promisee.6 It should be noticed that even where a choice of performances is given to the promisor, the obligation may be so expressed as to indicate that the primary duty relates to one of them, and that unless the promisor manifests an election to perform the other his duty is single.7 And even under a true alternative contract the promisor's right of choice may be limited by a provision that the right to select one of the alternatives shall cease by a certain time or on a certain contingency. In such a case after the lapse of the time within which one alternative might be chosen, the obligation becomes single and the measure of damages for breach thereafter is based upon the value of the remaining alternative.8 The same is true after one alternative has been expressly chosen;9 or where all but one alternative are or have become impossible of performance,10 or illegal.11 Where, however, no choice has been made either expressly by the promisor or automatically by the terms of the contract, or by law, the measure of damages for breach of such election; for he is the fast agent, by payment of the one, or deliverie of the other. So if a man maketh a lease, rendering a rent or a robe, the leasee shall have the election causa qua supra. And with this agree the bookes in the margent, 2 H. 7. 23. a. But if I give unto you one of my horses in my stable, there you shall have the election; for you shall be the first agent by taking or seisure of one of them. And if one grant to another twentie loads of hasill or twentie loads of maple to be taken in his wood of D. there the grantee shall have election; for he ought to do the first act, scil. to fell and take the same."
5 Co. lit. 145a; Foster v. Gold-schmidt, 21 Fed. 70; Galloway v. Legan, 4 Mart. (N. S.) 167; Barker v. Jones, 8 N. H. 413; McNitt v. Clark, 7 Johns. 465; Smith v. Sanborn, 11 Johns. 59; Mayer v . Dwinell, 29 Vt. 298.
6 See example, supra, n. 4.
7 For example, the right commonly given an insurer against fire to restore the injured or destroyed property does not prevent the sole obligation of the insurer from being one for the payment of money until an election is made to substitute an obligation to restore.
8 Deverill v. Burnell, L R. 8 G. P. 475; Russell v. Wright, 23 S. Dak. 338, 347, 121 N. W. 842; Wilson v. Graham, 14 Tex. 222; Levy v. Gold-soil (Tex. Civ. App.), 131 S. W. 420. See also Walton p. Coulson, 1 McLean, 120 (affd. 9 Pet. 62, 9 L. Ed. 51); Wolfe v. Parham, 18 Ala. 441.
9 Morrell v. Irving F. Ins. Co., 33 N. Y. 429, 88 Am. Dec. 396; Dimmick v . Banning, 256 Pa. 295, 100 Atl. 871.
10 Bute v. Thompson, 13 M. A W. 487; Drake v. White, 117 Mass. 10; State v. Worthington's Ex'rs, 7 Ohio, 171. But see laughter's Case, 5 Co. 22.
111 Erie R. Co. v. Union, etc.,Co., 35 N. J. L. 240.
a contract is the value of the alternative least onerous to the defendant.12 An inconsistent and, it seems, erroneous rule has been laid down in a few cases, which, relying on a passage from Coke relating to grants rather than contracts,18 hold that if the promisor fails to make an election the promisee thereupon has the option.14 Such a rule would entitle the promisee after breach to recover damages based on the performance most onerous to the defendant. Doubtless it is possible for the parties to make a contract that until a certain time the promisor may choose but that thereafter the promisee shall have the choice. There seems no propriety, however, where the parties have not made such a contract In the court making it for them. An exception to the general rule is made if one of the alternatives is to pay a certain sum of money. As has been seen,15 a contract for the payment of a certain amount of money in goods to be taken at a certain value has been generally construed as amounting in effect to a promise to pay the money unless goods are tendered at the maturity of the contract. Somewhat similarly where an alternative contract provides as one alternative for the payment of a sum of money the damage for breach of the obligation is the sum of money promised, though that conceivably may have been the alternative more onerous to the defendant.16 Such promises are in effect con-
12 Hoiliday v. Highland, etc., Co., 43 Ind. App. 342, 87 N. E. 249; Kimball v. Deere, 108 la. 670, 77 N. W. 1041; Pope v. Campbell, Hardin (Ky.), 31, 3 Am. Dec. 722; White v. Green, 3 T. B. Mon. (Ky.) 155; Hixon v. Hixon, 7 Humph. (Tenn.) 33.
13 Co. lift. 145a. "The feoffee by his act and wrong may lose his election, and give the same to the foeffor. As if one infeoffe another of two acres, to have and to hold the one for life, and the other in taile, and he before election maketh a feoffment of both; in this case, the feoffor shall enter into which of them he will, for the act and wrong of the feoffee."
14 Cotes v. Peek. 96 Ind. 333, 49
Am. Rep. 161; Phillips v. Cornelius (Miss.), 28 So. 871; Patchin v. Swift, 21 Vt. 292; Corbin v. Fairbanks, 56 Vt. 538. The same doctrine is staged in suits for specific performance in Amanda Gold Min. Co. v. People's, etc., Min. Co., 28 Colo. 251, 64 Pac, 218; Coles v. Peck, 96 Ind. 333, 49 Am. Rep. 161. The correct procedure insuch a suit is suggested in Taylor v. Mathews, 53 Fla. 776, 787, 44 So. 146, namely, that if the contract is one suitable for equitable intervention, the defendant should be compelled to elect. See also Allender v. Evans-Smith Drug Co., 3 Ind. Ty. 628.
15 Supra, (1398.
16 Layton v. Pearce, 1 Doug. 15; Pennsylvania Ry, v. Reichert, 58 strued as binding the promisor to a certain performance by a certain day or in default thereof to make a money payment in the nature of liquidated damages, and unless the sum fixed is penal the agreed sum is recoverable.