and it is quite possible that Lord Cockburn, in stating as he did the first alternative of a party aggrieved by repudiation of a contract, did not appreciate that his statement justified a violation of that duty.49

It need not be contended that in every case the principle of damages in question will deprive the plaintiff of the right to continue performance of the contract after it has been repudiated. There may be cases where so doing will not needlessly enhance damages, and it is a question of fact in every case whether such enhancement of damage will be caused.50 But one distinction is to be observed, so far as the question here under consideration is concerned, between cases where repudiation or countermand takes place before manufacture or work under the contract has been begun and those where notice is given after work has been done, or manufacture begun by him. Where nothing has been done it will almost always be the proper course for the seller to refrain from doing anything, and the measure of his damages will be simply the profit he would have derived had the contract been carried out.51

Where manufacture has been begun, however, another element must be considered. If work or manufacture is stopped it African Trust Co. (C. A.), 74 L.T. 769.

"Lord Cockburn's statement is also sometimes repeated by American courts, which would not be likely to enforce it to its logical conclusion. See Foss, etc., Co. v. Bullock, 59 Fed. 83, 87, 8 C. C. A. 14; Smith v. Georgia Loan Co., 113 Ga. 975, 39 S. E. 410; Strauss v. Meertief, 64 Ala. 299, 307, 38 Am. Rep. 8; Claes, etc., Mfg. Co. v. McCord, 65 Mo. App. 507; Walsh v. Myers, 92 Wis. 397, 66 N. W. 250.

A possible situation is well illustrated by Southern Cotton Oil Co. v. Heflin, 99 Fed. Rep. 339, 39 C. C. A. 546. The plaintiff had agreed to sell all the cotton-seed cake and meal its mill produced during a specified year. In the course of the year the defendant repudiated the contract. The cake and meal was but one prod

uct made from perishable raw material by the plaintiff's mill. To stop making the cake and meal would have involved abandoning the manufacture of other products, and would also have involved a violation by the plaintiff of contracts for the sale of oil and other materials. Accordingly the plaintiff was held entitled to recover the difference between the contract price and the market price of the cake and meal manufactured after the notice of repudiation. See also Feick v. Stephens, 250 Fed. 185, 162 C. C. A. 321; Martin v. Meles, 179 Mass. 114, 60 N. E. 397.

51 To refrain from manufacturing the goods might involve in some cases closing a factory at a large loss. In such a case it seems the manufacturer may proceed with the contract.

may cause the waste of what he has done, and it is in such cases particularly that it may prove less expensive to continue manufacture and complete the goods for the repudiating buyer rather than to stop performance. But it may be the least expensive course to stop peformance even though a waste is thereby caused. Such waste, however, must be included as part of the damages for which the buyer is liable. 52 Also, where a seller or manufacturer is under a duty to more than one person to perform the contract, a countermand by one, as it will not justify breach of contract with the others, should be inoperative. If in spite of the buyer's countermand the seller tenders the goods, an acceptance of them, or even a recognition of the contract by taking the goods into his possession, will be an assent to the disregard of the countermand.54

53

$1300. American decisions sound.

Judged in the light of every consideration of mercantile convenience the American decisions are correct. The facts of one of the few cases 55 which are directly opposed to them need only be stated to illustrate this. The defendant, resident in Illinois, contracted to buy of the plaintiff, resident in New Jersey, 500 tons of barbed wire. After 120 tons had been delivered the defendant requested the plaintiff to stop further shipments, and on the refusal of the latter, telegraphed, "Will not take wire if shipped." Nevertheless, the plaintiff went through the

52 In Chicago v. Greer, 9 Wall. 726, 19 L. Ed. 769, the defendant contracted to buy ten-inch leather hose to be manufactured by the plaintiff. After the leather had already been cut the buyer repudiated the contract. There was no general market for hose of such large size, and the seller, therefore, cut the leather down to the size necessary for making nineinch hose. This involved waste. The seller was held entitled not only to the profit that would have been made on the contract but also the waste due to cutting the leather down. See also Feick v. Stephens, 250 Fed. 185, 162 C. C. A. 321.

53 Martin v. Meles, 179 Mass. 114 60 N. E. 397. This point seems to have been overlooked in King v. Rhodes, 47 D. C. App. 316, cert. denied 248 U. S. 560, 39 S. Ct. 7.

54 Trinidad Asphalt Mfg. Co. v. Buckstaff Bros. Mfg. Co., 86 Neb. 623, 126 N. W. 293, 136 Am. St. Rep. 710.

55 Roebling's Son's Co. v. LockStitch Fence Co., 130 Ill. 660, 22 N. E. 518. See also Lake Shore, etc., Ry. Co. v. Richards, 152 Ill. 59, 38 N. E. 773, 30 L. R. A. 33; Chicago Washed Coal Co. v. Whitsett, 278 Ill. 623, 116 N. E. 115. Cf. Rounsaville v. Leonard Mfg. Co., 127 Ga. 735, 56 S. E. 1030.

futile and expensive steps of preparing and sending the rest of the wire, and was held entitled to recover damages for so doing. 56

§ 1301. Inconsistency of Cockburn's language-True rule.

Lord Cockburn's statement of the plaintiff's second alternative is that "The promisee may, if he thinks proper, treat the repudiation of the other party as a wrongful putting an end to the contract, and may at once bring his action as on a breach of it." The two clauses of this sentence logically contradict each other. If the contract is put an end to, no action can be brought upon it.57 If an action may be brought at once or at any time in the future, it is not put an end to.58 The question of the time when the action should be brought is not immediately essential here, and that question being left for subsequent discussion, it may be laid down as a more logically coherent and more practically useful statement that the promisee may, if he thinks proper, treat the repudiation of the other party as a ground for putting an end to the contract by rescission.59 If this course is adopted no rights under the contract can remain, though a quasi-contractual right to recover the value of anything which has been done will survive. Or the promisee may decline to continue to perform and sue the promisor for his breach of contract.60 Ordinarily, of course, a plaintiff in an ac

The Uniform Sales Act adopts in Sec. 64 (4), the prevailing American doctrine:

"(4) If, while labor or expense of material amount are necessary on the part of the seller to enable him to fulfill his obligations under the contract to sell or the sale, the buyer repudiates the contract or the sale, or notifies the seller to proceed no further therewith, the buyer shall be liable to the seller for no greater damages than the seller would have suffered if he did nothing towards carrying out the contract or the sale after receiving notice of the buyer's repudiation or countermand. The profit the seller would have made if the contract or the

sale had been fully performed shall be considered in estimating such damages."

57 Heagney v. J. I. Case Machinery Co., 4 Neb. (Unof.) 745 96 N. W. Rep. 175; McCormick Machine Co. v. Brown, 5 Neb. (Unof.) 356, 98 N. W. Rep. 697; Ward V. Warren, 44 Oreg. 102, 74 Pac. 482. "Rescission" means that both parties to a contract shall be wholly released as though it had not been made. Jones v. McGinn, 70 Or. 236, 140 Pac. 994.

58 Speirs v. Union Forge Co., 180 Mass. 87, 92, 61 N. E. 825.

59 See infra, §§ 1455 et seq.
60 Supra, § 1303.

tion upon a contract cannot succeed if he has himself failed to perform at the proper time; but if that failure to perform was excused by the defendant's own conduct this principle does not apply. The authorities furnish abundant illustration of this when the excuse for the plaintiff's failure to perform consisted of a prior serious breach of the contract by the defendant.

The same principle covers the case of repudiation without an actual breach of contract. The reason why the plaintiff must ordinarily have performed in order that he may recover is the same reason which underlies the doctrine of failure of consideration. The mutual performances in a bilateral contract are, barring exceptionally cases, intended to be given in exchange for each other, and if the exchange fails on one side owing to defective performance, the other party may likewise decline to perform. This reason was pretty well hidden during the early development of the doctrine under the terminology of implied conditions, but it is sufficiently apparent at the present day.61

Now, if it be an excuse which will justify a promisor in breaking his promise that his co-contractor has failed to give the performance agreed upon as an exchange, it should likewise be an excuse that the co-contractor has made it plain, as by repudiation, that he will not give such performance when it becomes due in the future. A promisor can no more be expected to perform his promise when he is not going to receive counter-performance than when he actually has not received it. Baron Parkea judge not likely to stretch too far the rules of the common law in order to work out justice-so held in Ripley v. M'Clure,62 and the law is clearly to that effect.63

§ 1302. Contract not terminated.

Neither where the plaintiff's excuse for his own non-performance is the defendant's actual breach of the contract nor where that excuse is a prospective breach because of repudiation does the plaintiff terminate the contract merely by availing himself of his excuse. The contract still exists, but one party to it has a defence and an excuse for non-performance.64

61 See supra, §§ 813 et seq., and e. g., Hull Coal Co. v. Empire Coal Co., 113 Fed. 256, 258, 51 C. C.A. 213.

62 4 Ex. 345.

63 See supra, §§ 875 et seq.

64 Hasler v. West India S. S. Co.,

It may be thought that this statement differs from that of Lord Cockburn's second alternative only in words. Even so, words have their importance. If wrongly used, wrong ideas are sure to follow, and wrong decisions follow wrong ideas. It is a source of serious confusion in the cases that a contract is frequently spoken of as "rescinded" or "put an end to," when in truth one party to the contract has merely exercised his right to refuse to perform because of the wrongful conduct of the other party.65