Hall v. Bennett

Headnote

Building contract—construction of—extension of time—notice that principal will finish building at contractor'’s cost, &a.—“ reasonable cause'1'1— value of old building on site of new one, to whom, allowed.

Appeal by defendant (1) from judgment entered in favor of the plaintiff upon a verdict of the jury for the sum of $17,110.08, exclusive of costs; (2) from order denying defendant’s motion upon the minutes for a new trial; and (3) from an order made before trial denying defendant’s motion to make certain lienors parties defendant, and for a stay of proceedings.

The court at general term said: “ This action is brought by the plaintiff against the defendant as executor, to recover for a breach of a contract made February 5, 1872, by the plaintiff with defendant’s testator for the erection of a building situate on Ann, Nassau and Fulton streets in the city of New York. The alleged breach consists in not having been allowed by the defendant to finish the work under the contract. Upon the trial the plaintiff undertook to recover only for work actually done and remaining unpaid.

“ Upon a former appeal (48 Super. Gt. 302), it was held by this court, upon the authority of Westervelt v. Levy ( 2 Duer, 354 ), that the pendency of the litigation instituted by certain lienors for the foreclosure of mechanics’ liens under the same contract, which was pleaded as a defense, does not constitute a bar to the present action. This disposes of the appeal from the order denying defendant’s motion to make these lienors parties defendant and for a stay of proceedings.

“It was also held: (1) that this .action was properly brought against the defendant as executor ; (2) thafc, if the

plaintiff establishes a breach of contract by the defendant, it is not necessary for the plaintiff to produce, or to account for the non-production of, any architect’s certificate which the contract provided should be procured, at a time subsequent to the time of the breach ; and (3) that the two clauses in the specifications regulating the rate of progress of the work and the number of men to be employed by the contractor, must be read in connection with the fourth provision of the contract, and that by the latter the right of the owner to proceed to do the work depended upon the owner giving to the contractor three days’ notice in writing.

“ These three points, therefore, will not be reviewed again.

“It was further held that, inasmuch as the plaintiff had denied the receipt of any notice, the question whether or not the proper three days’ notice was given should have been left to the jury, and it was mainly for the reason that said question was not submitted to the jury, but decided by the trial judge against the plaintiff, that a new trial was granted to the plaintiff.

“Upon the trial now under review, the plaintiff was. forced to admit, and did admit, that the letters of June 6, and July 6,1872, containing the notice formerly in dispute, were received by him. The evidence also clearly showed, as has been admitted on the argument of the present appeal, that the attorney who signed the letter of July 6, had authority to do so. It was claimed, however, that both these notices became nugatory by the conduct of the defendant subsequent to their service. The plaintiff showed I hat for about two months after July 6, 1872, he was allowed to remain in full charge of the work; and that during that period he did a good deal of work in the erection of the building, and received payments.

“ The defendant, on the other hand, showed that on or about_ September 10, 1872, and bearing date of said day, a third letter was sent to the plaintiff as follows:

‘103 Fulton Street, N. Y., Sept. 10, 1872.

‘Dear Sir—As attorney for Mr. Bennett, and at his request, I have to inform you that you having neglected to supply a sufficiency of material and workmen for the continuance of the work on the building on Nassau street, corner of Fulton and Ann streets, and having otherwise delayed the progress of the work, and it being apparent that you cannot proceed with the building so as to complete it in the stipulated time, Mr. Bennett will finish the said building at your expense, .and you are required forthwith to withdraw with your workmen, tools and other effects from said premises to enable Mr. Bennett to get at the work. You will please render a full account of the work to the present time. I feel bound to say that Mr. Bennett has concluded to take this step with extreme reluctance and regret. Yours obediently, John Townshend.’

To Edward Hall, Esq.’

“ The defendant also proved that the letter last referred to was left at plaintiff’s house on September 10,1872, between the hours of 4 and 5 P. M. with a young lady supposed to be a daughter of the plaintiff, and that thereafter the plaintiff called upon Mr. Townshend, the attorney of the defendant, and admitted the receipt of the letter and discussed with him the contents thereof.

“The plaintiff denied the receipt of the letter and that in consequence thereof he called and discussed the matter as alleged.

“In the aspect of the case most favorable to the plaintiff, for it is not necessary to be more precise, this change in the evidence created a' new issue, namely, whether service was made of the notice of September 10, 1872, and the issue was one which had to be submitted to the jury. In case the jury determined that issue in favor of the plaintiff, the further question presented itself as to what the parties had a right to charge against each other. This under the evidence was also a question for the jury.

“ The important questions involved in the present ap

peal relate therefore in the main to the instructions under which the case was submitted to the jury. In substance the jury were, in various forms, instructed that the notice contained in the letter of September 10, 1872, did not entitle the defendant to take any steps under it unless Mr. William Paul, the superintendent of the work, had reasonable cause to give it. This I think was error.

“ The parties had agreed in the specifications that William Paul should be the superintendent of the work, that as such he should regulate the number of men to be employed, and the rate of progress of the work ; and that, if in his opinion sufficient progress was not made to insure the completion of the building and its delivery to the owner entirely completed on or before April 1, 1873, he, the superintendent, should have full authority • to cause said work to be executed as he might deem advisable.

“By another part of the specifications the rate of progress and the number of men to be employed was left, to the direction of the architect, Arthur Gilman.

“ And the contract of which the specifications were a part, provided that should the contractor at any time during the progress of the work refuse or neglect to supply a sufficiency of materials or workmen, the owner should have the power to provide materials and workmen after three days notice in writing being given, to finish the work, and that the expense "should be deducted from the contract.

“ These three provisions are both cumulative and mutually supplemental. They must, as was held on the former appeal, be read together. This entitled'the plaintiff in any event to a three days’ notice in writing from the owner. But by parity of reasoning the right of the owner to give I he notice under either of said provisions depended upon the actual state of affairs. If the architect or the owner reached the conclusion that sufficient progress was not made, and the circumstances justified such conclusion, the owner could act, though the superintendent might have been of a different opinion.

“But aside from these considerations the principal

error consisted in submitting to the jury the question of reasonableness as one in dispute, for the evidence as a whole conclusively showed that there was reasonable cause under the contract and specifications to give the notice, and that the owner, architect and superintendent had all reached the same conclusion.

“By the contract it was expressly provided that the new building should be entirely completed and, as thus completed, delivered to the owner on or before April 1, 1873. Time was of the essence of the contract. But the plaintiff from the very start paid no attention to this element of the contract. It took him about a month to take down the old building, and after that his rate of progress with the new work was so uniformly slow, and he kept so comparatively few men at work as to provoke frequent remonstrances from the architect, the superintendent, and defendant’s agent. On July 8, 1872, the architect peremptorily required him to put 80 men to work on the building, and the proof shows that that number could well have been put on. If the plaintiff ever fully complied with this requirement, it was only for a little while. Soon thereafter the working force was reduced again to from 20 to 30. On September 9, 1872, mechanics’ liens commenced to be filed against the building and against the plaintiff as contractor, and it became evident that the plaintiff could not complete. The architect, superintendent and defendant’s agent all arrived at this conclusion. The plaintiff was utterly without means and credit; he owed his laborers and material-men upwards of $13,000, and he had previously admitted to defendant’s agent that he could not complete without receiving payments in advance. Under these circumstances it was not only perfectly reasonable, but it became the duty of the defendant as executor, to take active measures for the protection of the estate in his charge, and hence it conclusively appears that, as matter of law upon the facts stated, the' defendant had reasonable cause for giving the notice of September 10, 1872. There was no real dispute as to these facts. Subsequent occurrences furnish corrob

orative evidence upon this point. A new contract was made with Cockerill & Spaulding, responsible contractors and the next lowest original bidders after the plaintiff, to finish the work remaining undone for $82,000, and the plaintiff sold to them his scaffolding. No claim or suggestion has been made that this price was not a fair and reasonable one. Cockerill & Spaulding immediately put 75 men on the work and thereafter continued to hurry the several parts of the work as fast as it could be done, and yet the building was not fully completed by the first of May, 1,873.

“ Under these circumstances, it was clearly error to submit the question of the existence of reasonable cause to the jury as a disputed question of fact, and to instruct them that upon the fact of such reasonableness as it might be determined by them, depended the right of thé defendant to serve the notice of September 10, 1872. As the proof showed beyond controversy, that plaintiff’s contract price was $97,940; that he had received on account thereof according to his own admissions, $16,308, and that Cockerill and Spaulding were paid in good faith $82,000 for finishing the work, the jury should, under all the circumstances, have been instructed that, if they found that the notice of September 10, 1872, was given and received as claimed by the defendant, it was their duty to render a verdict for the defendant.

“ Another important question presented by the present appeal arises upon the defendant’s claim duly pleaded to an allowance for the value of the old building. The contract provides as follows: ‘ The contractor is to take down all the existing buildings now on the site, and to have the use of the old materials, to be allowed for in his estimate. All such brick and stone as may be found suitable, being used in filling in the walls of the new builing.’ At the trial, the plaintiff, on the theory that the contract had been wrongfully terminated as against him, elected to recover the actual value of the work and materials furnished by him up to the time he was compelled to stop. It was com

petent for him to do so. In such a case the claim is founded upon the election to "consider the contract rescinded, and the rule of damages is the actual value of what has been done under the contract (Clark v. Mayor, 4 N. Y. 338 ; Moran v. Mctiwegan, 33 Super. Ot. 350).

“ The plaintiff by a number of witnesses gave evidence, founded mostly upon measurements, of the value of the work, inclusive of materials, as the work stood at the time the contract was taken out of his hands, and the court charged the jury that the plaintiff, if entitléd to recover, was entitled to recover such value less such sums as had been paid to him. The payments in cash according to plaintiff’s testimony amounted to $16,308, and according to the testim'ony of the defense to $17,308. But the court refused to instruct the jury to take into account the value of the old building, of which the plaintiff had had. the benefit, notwithstanding the defendant by answer had raised an issue upon that point. Of course the defendant was not entitled to a credit for the value of the old building as a building. At most, he could claim the value of the materials in the building after it had been taken down, less the expense of taking it down, and upon this point there was some evidence that for the purpose of being taken down, the building was worth $4,000. But he was at least entitled to a credit which, under all the circumstances, was equitable. To allow him no'thing at all was clearly inequitable.

“ As the views so far expressed call for a new trial, an examination of the other questions involved in the appeal may be dispensed with.”