Baumgardner v. Burnham , 93 Pa. 88 ( 1880 )

Chief Justice Sharswood

delivered the opinion of the court, February 16th 1880.

It is very probable that if the full charge had appeared on the bill of exceptions, this judgment would not have been reversed. It will always be wise for the learned judges of the courts below to see to it that so much of their charges at least are set out as may be necessary to explain the particular parts excepted to. We have here a single isolated sentence taken from the charge without any thing that went before or came after. It may possibly have been harmless, but as it stands, we think it was calculated to mislead the jury.

The action was on a book account for work and materials in the repair of a locomotive. The claim was attacked as excessive. The true question for the jury was, what was the ordinary price for such work and materials charged by other persons in the same business as that of the plaintiffs. Their book was prima facie evidence not only of the work done and materials furnished, hut of the prices. They gave further evidence, however, of the character of the repairs, to show that there had nothing been done hut what was necessary to put the engine in complete working order. The defendants then introduced' testimony as to the prices charged in other establishments, and proved without objection, the profit they added on the amount paid for labor. Garrett, a master mechanic in the West Philadelphia railroad shops, said : “ In the railroad company where I was employed before going with the Pennsylvania Railroad, the point came up as to what ought to be added to the actual labor to cover the cost of tools and machinery. The president wanted to bring it down to the actual cost on some work done for another road, and we considered that fifteen per cent, added would cover. In the Pennsylvania Railroad, wo add fifty per cent, on work done for other roads to cover cost and profits. This bill is a question of profits, and I cannot speak for others.” The plaintiffs in rebuttal called one of their number, who said: “ There are general expenses which cannot bo assigned to any particular piece of work ; as for instance, tools and the maintenance of tools, stationary-engine, boilers and machinery, gas, clerks, office expenses, interest, &c. The one hundred per cent, added to the actual cost for labor is to cover these general expenses, and we add twenty-five per cent, for profit.” Now, if the learned judge had intended to instruct the jury that it was not their province to determine what ought to be the rate of profit in any particular business, it would not have been error. That is settled at the lowest rate at which the business can be carried on by the effect of free competition in the market. Prices, where there is no monopoly, naturally settle down as near as tnay be to the ordinary profits on invested capital. There are many apparent exceptions, however. Such is the case of an apothecary, who must add to ordinary profits on the materials he uses, a liberal compensation for his own skill, acquired by years of patient study and apprenticeship, as well as the cost of attending lectures, and, moreover, there is to be added a premium for the responsibility he incurs for himself and his employees. Hence, considering the small sum he pays for his materials, and the short time it takes to compound a prescription, to the unthinking, his profits would seem out of all proportion to the rate of ordinary profits in other business. The same thing, though not to the same effect, may be true of loeomotiye engine builders. They must have skilled workmen, scientific superintendents, with a great outlay of capita], and also responsibility for the safety of those who put in operation the works they send out. If the learned judge then had contented himself with saying to the jury : “ You are not to set yourselves up as judges of what locomotive engine builders ought to charge as profits, but simply whether the charges in the plaintiff’s bill are the usual charges in the trade,” there would have been no error, but he went much further where he instructed them : “ It is not jour province to say how much profit ought to be charged by the plaintiffs.” That profits necessarily entered into the price was shown by the evidence on both sides, and how could the jury decide intelligently as to the price without considering what was the usual rate of profits and whether the plaintiff’s charges conformed thereto ?

Judgment reversed and a venire facias de novo awarded.