Bryan Elevator Co. v. Law

In the first count of the complaint plaintiff seeks to recover the sum of sixteen thousand dollars upon a written contract entered into by plaintiff and defendant, January 20, 1905, for the construction and installation of an elevator plant and service by plaintiff for the Monadnock Building, San Francisco. The second count was for necessary repairs to the elevators, elevator equipments, and elevator hatchways in said building of the alleged value of $4,604.33. The third count is for elevator parts and supplies alleged to have 'been sold and delivered to defendant by plaintiff, for which defendant agreed to pay the sum of $2,053.10. Plaintiff had judgment on the first count for the sum of $13,375, with interest from May 1, 1908. The findings and judgment on the second and third counts were in favor of defendant.

Both parties appeal from the judgment. Defendant’s appeal is presented in this record and plaintiff’s appeal on the same transcript is presented in No. 1466. Defendant also appeals from the order denying his motion for a new trial. The cause was tried by the court without a jury. The issues tried may be understood from the findings of facts by the court:

“II.. That thereafter and on or about the 1st day of September, 1905, the said plaintiff entered upon and commenced the installation of said elevators, and proceeded with said installation as rapidly as the unfinished condition of said building would permit. That on or about the 18th day of April, 1906, and prior to the completion of the installation of said elevators, said building was injured and almost completely destroyed by earthquake and fire; that by reason of the damage suffered by said building, through said earthquake and fire, plaintiff was unable to continue with the performance of its said agreement for a long time thereafter; that as soon as said building was sufficiently repaired to make the work of installation of said elevators possible, the plaintiff continued the work of such installation; that plaintiff at all times, in good faith proceeded with the performance of the obligations imposed upon it by said agreement and furnished the materials and performed the labor required of it by said contract and honestly and faithfully performed said contract and completed the performance thereof on or about the 1st day of May, 1908, except as regards the controlling devices

“III. That the agreement hereinabove ■ referred to was completed by said plaintiff on or about the 1st day of May, 1908, except that the defendant was not satisfied with the controllers on the said five passenger elevators and declined to accept the said controllers. That the length of time in completing said agreement by the said plaintiff was no greater than the amount of time said plaintiff was prevented from performing by the neglect of the said defendant in completing said building and by the earthquake and fire above referred to.

“IV. That in all regards, other than as above set forth, the plaintiff duly and faithfully performed all the conditions of said agreement above referred to on its part to be performed according to the terms of said agreement; that said plaintiff completely installed and equipped the elevators referred to in the said agreement in accordance with the plans and specifications attached to said agreement and made a part thereof, with the exception that the said defendant was not satisfied with said passenger elevator controllers or the elevator machines connected therewith and he declined to accept the same and removed all of said controllers and all of said elevator machines from said building and replaced the same with other elevator controllers and other elevator machines and installed said last mentioned controllers and machines in said building.

“That the reasonable market value of said elevator controllers and elevator machines so installed by said defendant was and is the sum of $15,156.00; and in this connection the court finds that the reasonable market value of said controllers go installed by defendant was and is the sum of $2625.00.

“VI. That the sum of $21,375.00 is the reasonable value of the work done and the materials furnished by plaintiff in installing elevator machines and equipment for the defendant in said Monadnock Building, and the reasonable value of the materials furnished and accepted -and the installation work accepted and used by defendant and that said defendant has paid plaintiff the sum of $8,000.00 and has suffered damages on account of plaintiff’s failure to furnish controlling devices satisfactory to him in the sum of $2625.00; and that, after deducting from the contract price the said payment of $8,000.00 and the sum of $2625.00 to indemnify and compensate" the defendant for the damages so suffered by him, there is now due, owing and unpaid from said defendant to said plaintiff the sum of $13,375.00, together with interest thereon at the rate of 7% per annum from the 1st day of May, 1908. . . .

“And as conclusions of law from the foregoing facts, the court finds the plaintiff is entitled to judgment against the said defendant for the sum of $13,375.00, together with interest on said sum from the 1st day of May, 1908, at the rate of 7% per annum, amounting to $4228.72, and for its costs of suit herein expended.”

Plaintiff was properly to install, furnishing all the labor and materials therefor, four passenger elevators and one passenger elevator and safe lifter, and to alter the old passenger elevator then in use in the Bishop Building into a freight elevator, and to install two hydraulic ram sidewalk elevators, together with a flashlight signal system in accordance with certain plans and specifications made by Meyer & O’Brien, who were the architects of said building and of said work.

So far as this appeal reaches, the only -dispute we are to settle relates to the installation of the five passenger elevators. -And as to these the objection raised by defendant was to the unsatisfactory operation of the electrical controllers.

On June 5, 1907, defendant’s manager, Mr. Huntington, Wrote plaintiff as follows: “As Mr. Law has already notified you, we wish the controllers on the elevators now in- the Monadnock Building changed to the Otis Elevator Company’s controller. You may place it first on No. 2 elevator, and we Will try it out.”

The matter drifted along, the correspondence and the testimony showing that each party attributed to the other party the alleged failure of the controllers to give proper service, until, October 15, 1907, we find that plaintiff wrote defendant as follows: “Since writing to you yesterday we learn that •you are taking our machines out of the Monadnock Bldg., and to this we make the most emphatic protest. We demand that we be allowed to demonstrate that these engines are all right 'by having them put entirely in our charge for sufficient time to prove our claims. All we ask of you is to have doors put on the engine room and have both your employees and all outsiders kept out of it. As our contract at the Monadnock Bldg, is not completed, we 'desire to know from you at once whether we shall go ahead with this final work ? Await

It does not appear at what date defendant removed the plaintiff’s machines, but Mr. Robbins, manager of Otis Elevator Company, testified that the first bill rendered by his company was dated October 12,1907, “and that was not made until after the Otis machines were put in the building—after they were put in, the machines which they substituted were removed. I don’t just remember the date when that was done.” As we understand the evidence, the Otis machines were taken to the building about October 12, 1907, the plaintiff’s controllers and machines were then removed from their settings and the Otis machines and controllers put in their place.

Defendant states in his brief: “The court found, that the real defect in the elevator plant was in the controller, and we think it was justified in reaching this conclusion.” The correspondence as well as the testimony shows that the construction of the elevators, the machinery and appliances used in operating the plant, except the controllers, were entirely satisfactory to defendant. The contract did not-specify any particular type of controller, though doubtless plaintiff contemplated putting in the one it manufactured. The provision of the contract was: ‘ ‘ The contractor agrees that the elevator service going by the machines shall be continuous and that the control of the car shall be positive and the operation of elevators shall give satisfaction in every particular. In the event that the elevator machine or the controlling device proves unsatisfactory or inadequate to requirements, the contractor shall replace the machinery or controlling device with other machinery and control satisfactory to the owner. In the event of any dispute of the efficiency of any part of the

It appeared from the testimony that the controller was so far independent in its construction that a controller of the Otis or any other design than the Bryan controller could be substituted and the engines and other machinery connected with and required in operating the completed- elevator remain undisturbed. The court found and- the evidence was that the Otis controllers had a value each of $525, and the five installed, $2,625.

The court found that the reasonable value of all the work done and materials furnished by plaintiff in installing elevators and equipment, “and the reasonable value of the materials furnished and accepted and the installation work accepted and used by defendant,” was $21,375, from which the court deducted the payment of eight thousand dollars, and the value of the five Otis controllers, $2,625, leaving due plaintiff $13,375.

The portion of the findings to which defendant now objects is the following: “That defendant was not justified in rejecting the elevator machines so furnished by plaintiff or any part of them, and was not justified in installing other elevator machines in place of them and that said defendant could and 'did replace said controllers with controllers of a design, workmanship and efficiency satisfactory to him, for the sum of $525.00 each, or a total sum of $2625.00.” Defendant’s position is thus stated in his opening brief: “These findings which we have just quoted cannot be harmonized in any way, for if under the evidence defendant was justified in rejecting the controllers, he was equally justified in rejecting the machines; not because the machines were defective in any particular, 'but because it was impossible to buy any controllers that could be used with these machines. The only proper controllers on the market were those manufactured by the Otis Elevator Company, and these could not be had> as we have pointed out, without the purchase of the Otis Elevator machines. It follows, therefore, that as Mr. Law was compelled to pay $15,156 for the Otis elevator controllers and machines, that he is entitled to deduct that amount from the contract price.”

. The testimony was that the Otis Elevator Company would not sell its controllers to plaintiff or to defendant, without

The testimony was that, during all the time and up to the day it learned its machines were being' removed, plaintiff was endeavoring to bring its elevators up to a standard of efficiency which would be reasonably satisfactory to defendant, and during all this time there was a constant controversy between the parties as to the way the. elevators were being run 'by defendant’s employees, plaintiff complaining that they were careless and inattentive to their duties in not properly caring for the machinery and in not properly operating the elevators; defendant contending that this was not true, and pointing out specific defects. And, finally, without previous notice of his intention so to do, defendant removed the machines and controllers and substituted Otis machines and controllers, and notified plaintiff to take its property away, which plaintiff did, under an agreement that in doing so the rights of neither party should be prejudiced. Witness Greenbaum testified on cross-examination as follows: “Q. What became of the machines after they were taken out? A. They were taken across the bay and stored. Q. Taken across the bay by yourself? A. We took them over there. Q. Where did you store them? A. In the Van Emon elevator plant. Q. What use was made of them subsequently? A. I

The inquiry seems to us to be narrowed to the question, Was defendant justified in substituting entirely new machines and controllers, entailing a loss to plaintiff of the machines and controllers installed by it? The court -made no specific finding of the value of these machines and controllers, but it found the value of all the work done and machinery furnished to be $21,375, from which it deducted the payment made, eight thousand dollars, and the value of the controllers furnished by defendant, $2,625. The court found that defendant was justified in putting in the Otis controller, but in view of the testimony that a controller of other design could have been put in without removing plaintiff’s machines, it found that the cost of these controllers, $525 each, was the limit of defendant’s damage. And this narrows the inquiry still further to the single question, Was the plaintiff properly chargeable also with the cost of the Otis machines, which was $12,530?

What was the right with which the contract clothed defendant? It is not necessary to discuss the question as applicable to what defendant did in the present case. He decided that the Bryan controller was not satisfactory, and the evidence and the finding of the court sustained him in his decision. Neither is it necessary to discuss his right to have an Otis controller, for he got it and the court allowed him the cost of it. It is claimed, however, that because he was obliged to take and pay for the Otis machines in order to get the Otis controller, defendant was within his rights in removing plaintiff’s machines, although he had made no objection to

As we shall presently see, the authorities do not agree with the rule here stated—that it is sufficient if the purchaser “acts in good faith and not in mere caprice.” It will be observed that in the ease cited the contract was for the purchase of an entire machine. In the present case the contract recognized two distinct parts—the machines and the controllers. In the case cited the hoist was regarded as a novelty in design, and the objection was to the working of the entire machine, which may have influenced the decision. It is possible the opinion would have been different had Singerly objected only to the duplex pump, which could have been supplied in the open market if the one furnished had been objected to. In the

The rule, as we understand it, found in Singerly v. Thayer, supra, that where the contract requires work to be done to the satisfaction of the person contracting for the work, his rejection of it cannot be called in question “if he acted in good faith and not in mere caprice in refusing to accept it, ’ ’ we think is too broad and not in harmony with the generally accepted rule. It was said in Gladding, McBean & Co. v. Montgomery, 20 Cal. App. 276 , 279, [ 128 Pac. 790 ] : “A stipulation in a contract to perform to the satisfaction of one of the parties only calls for such performance as should be satisfactory to a reasonable person.” (Citing cases.) In Keeler v. Clifford, 165 Ill. 544 , [ 46 N. E. 248 ], the action was to recover for certain grading and leveling done under a contract which provided that all grading was to be done to the satisfaction of said Keeler. The court said: “Where a contract is required to be done to the satisfaction of one of the parties, the meaning necessarily is that it must be done in a manner satisfactory to the mind of a reasonable man. The plain construction of the contract in this regard is that the work was to be completed in accordance with the contract, in such a manner that appellant, as a reasonable man, ought to be satisfied with it.” (Hawkins v. Graham, 149 Mass. 284 , [ 14 Am. St. Rep. 422 , 21 N. E. 312 ]; Richison v. Mead, 11 S. D. 639 , [ 80 N. W. 131 ], and eases cited in the opinion.)

Under the rule contended for by appellant it would be difficult, if not impossible, to show that the party was not acting in good faith, and his right to say he was not satisfied would 'be practically arbitrary, excluding all question of its exercise being reasonable or unreasonable. ,v.

In the present case appellant not only refused to be satisfied unless Otis controllers were used, but he claimed the right to exercise this refusal, knowing that these controllers

The judgment and the order appealed from are affirmed.

Hart, J., and Ellison, J., pro term., concurred.

A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on October 5, 1916.