American Surety Co. v. Choctaw Const. Co.

135 F. 487 | 8th Cir. | 1905

HOOK, Circuit Judge,

after stating the case as above, delivered the opinion of the court.

1. The Circuit Court properly declined to give the instruction upon the question of fraud which was tendered by the surety com.pany. A thorough examination of the record discloses no warrant for that ground of contention, and a trial court is not required to instruct a j'ury, at the instance of a defendant, concerning a defense which, as njatter of law, is insufficiently supported by the evidence.

2. Much of the charge of the court and the briefs of counsel is devoted to a consideration of the defense that the contract, for the faithful performance of which the surety company obligated itself, was changed, and that the surety company was thereby released from liability upon the bond. We are unable to perceive any merit in this defense. The contractors knew when they went over the Sugar Creek route that the survey was merely preliminary, and that there had been no permanent location of the line. There was no contract or agreement, either express or implied, binding the constructing companies to the selection of that particular route. The Booneville or northern route was finally selected as the permanent line on October 29, 1898, and the contract and bond now in controversy were executed on the 12th of the following December. There is nothing whatever in either of those instruments even remotely indicating that the Sugar Creek route was intended. The termini of the contemplated line of railroad as specified in the contract were not changed. The Booneville and Sugar Creek surveys covered but an intermediate portion of the contemplated line of railroad, and both of them ran in the same general direction. In a railroad' sense, they were parallel, being at their point of widest separation but a few miles apart. They diverged and came together at common points. The Booneville route was in the general line of connection between the termini specified in the contract, and, under the terms of that instrument, its selection was open to the constructing companies, in the fair fulfillment of their obligations under the cqntract. Had the contractors desired to restrict the companies to any particular line or route, they should have caused a stipulation to that effect to be inserted in the contract, or have made suitable reference to some map, plat, or other accompanying instrument to accomplish the same result. The problem of selection, between the two routes, as presented to the railroad officials, was simply one of expediency, which to a greater or less degree presents itself in the construction of every railroad of appreciable length. If one contracting to furnish materials for the construction of a railroad does not limit it to a certain line, route, or survey, the option of reasonable selection between the termini is open to the constructing company. Of course, this does not mean, as counsel contend, that a surety for the faithful performance of a contract to construct a railroad between two specified cities could be held responsible for a failure of his principals to construct a railroad between other cities widely distant from those mentioned. There was no reference in the contract before us to any survey, plat, map, or to-any specific’ intermediate route; and the line which was actually adopted, and on which the road was finally constructed, was fully within the letter of the contract. We are unable to see that, under the facts in the case which were either conceded or fully proved, the contract was changed at all; and this makes unnecessary a consideration of the question whether a change in a contract must be-a material one, to effect a release of a surety.

3. There was evidence which tended to show that Graham & Miller had a contract to furnish the Missouri, Kansas & Texas Railway Company with ties at a price which, after deducting the cost of production, transportation, and delivery, would have yielded-them a profit of 5 cents per tie; that, after the completion of the railroad of the Choctaw Companies, there were certain ties along the line which were cut by subcontractors of Gra,ham & Miller, and were available for use under that contract; that, although Graham & Miller were embarrassed by lack of funds of their own to pay for the ties, the Missouri, Kansas & Texas Company stood ready to pay for them when they were inspected and loaded upon the cars, and that difficulty would thereby have been avoided; that the last-mentioned company was also ready to furnish the cars for the transportation of the ties to South McAlester, the place of delivery, but the Choctaw Companies, in violation of their express obligation, refused to furnish the motive power for their movement. The evidence upon this subject was sufficient to require its submission to the jury, and the Circuit Court should not have withdrawn that defense from their consideration. It should be observed, however,, that, viewing the evidence in a light most favorable to the surety company, the damage proved to have been sustained by their principals by reason of the default of the Choctaw Companies might have amounted to, but could not have exceeded, the sum of $2,000.

The order will therefore be that if, within 30 days after this date,, the defendants in error shall file in the Circuit Court a remittitur and satisfaction in the sum of $2,000, and shall file a certified copy of such remittitur and satisfaction in this court, the judgment as-so reduced will be affirmed; otherwise it will be reversed, and.a new trial awarded. In either event the defendants in error shall pay the costs of this proceeding in error.