took on 17 new lines that produced $151,433 in commissions over
the next 21 months. See PX 23. Briggs testified that they would
not have taken on ten of those seventeen lines, which totaled
$62,367 in commissions, if Salton had not breached the contract
because they were not electric houseware items and therefore
were outside of Ullman-Briggs' field of expertise. See 5/90 Tr.
at 23-28; PX 23. The Court finds that testimony credible.
Accordingly, the Court accepts $62,367 as an appropriate
deduction for mitigation of damages from the gross lost
As noted above, that mitigation figure must be reduced by the
total expenses that Ullman-Briggs incurred in earning those
commissions. See Morgan v. Morgan, 81 Misc.2d 616, 619, 366
N.Y.S.2d 977, 980 (Sup.Ct.N.Y.Co. 1975). The evidence
established that after the breach Ullman-Briggs sustained
increases in travel, entertainment, telephone, postage and
freight, and trade show expenses in their efforts to obtain new
lines totaling $23,993. See DX 1. The Court rejects plaintiff's
testimony that this increase in expenses was due solely to the
accounts that they would not have taken on but for the breach.
See 5/90 Tr. at 28-37. It is hardly rational to believe that
Ullman-Briggs would have incurred $23,993 in expenses in order
to obtain and service ten lines that realized $62,367 in
commissions, and no expenses in obtaining and servicing seven
lines that brought in $90,859.80. See DX 1, PX 23. It is more
reasonable to conclude, and the Court so finds, that the
additional expenses should be apportioned on a pro rata basis
between the lines that Ullman-Briggs would have represented
without a breach and the lines that it would not have acquired.
Since the commissions allocable to the lines the Ullman-Briggs
took in mitigation of its damages constitutes approximately 40%
of the total commissions received, the amount of mitigation
expenses to which Ullman-Briggs is entitled as an offset to the
commissions earned should also be 40% of their total increase
in expenses after the breach, which is $9,597.20. Thus, the
Court finds that Ullman-Briggs' net damage award before
interest is $464,380.40.
Ullman-Briggs is clearly entitled to prejudgment interest on
its damages. See N.Y.Civ.Prac.L. & R. ("CPLR") § 5001(a)
(McKinney 1963). CPLR § 5001(b) states that when damages are
incurred at various times, interest may be computed upon each
item from the date it was incurred or upon all of the damages
from a single reasonable intermediate point. Both parties
request that interest commence on October 5, 1986, and
therefore the Court finds that date to be the "single
reasonable intermediate point" for purposes of computing
interest on the damages.
For the reasons stated above, the Court concludes that
defendant Salton is liable to plaintiff Ullman-Briggs for
breach of contract and awards plaintiff the sum of $464,380.40
plus interest at the statutory rate of 9% per annum commencing
on October 5, 1986. Plaintiff shall submit an appropriate
judgment to the Court on notice to the defendant within two
weeks of the date of this Opinion and Order.
It is SO ORDERED.