137 P. 857 | Or. | 1914
delivered tbe opinion of tbe court.
On tbe 7th day of July, 1910, tbe plaintiff entered into a contract with tbe defendants S. A. Cobb for tbe construction of eight miles of railroad in Clatsop County. By this contract tbe defendant Cobb agreed to commence tbe work of building in 15 days from tbe date of tbe execution of said contract, and to prosecute tbe same with such force and means as would, in tbe opinion of tbe chief or assistant engineers of tbe plaintiff, insure tbe completion of tbe eight miles of road by or before tbe 1st day of November, 1910; said work to be at all times open to tbe inspection of tbe chief or assistant engineers of tbe plaintiff, and to conform to tbe rules and general specifications annexed to said contract. Tbe defendant Cobb agreed not to assign or transfer said contract, or relet any of said work,
The defendant Cobb and the Pacific Surety Company executed to the plaintiff a bond, dated July 7, 1910, in the sum of $20,000, conditioned that, if the defendant Cobb should faithfully perform the said contract for the building of said eight miles of railroad on his part, according to the terms, covenants, and conditions thereof (except as provided in said bond), then said obligation should be null and void, otherwise to remain in full force and effect. Said bond contained the following conditions, to wit:
“(1) Notwithstanding that said contract is hereby referred to, this bond is nevertheless issued subject to the following express conditions, which shall be conditions precedent to the right of the ‘owner’ (the plaintiff) to recover hereunder.
“(2) The ‘owner’ (the plaintiff) shall keep, do and perform each and every, all and singular, the matters and things set forth and specified in said contract to be by the ‘owner’ kept, done and performed exclusively at the times and in the manner, as in said contract 'specified.
“(3) Provided, that said ‘surety’ shall be immediately notified of any breach of said contract by said ‘principal’ or of any act on the part of the said ‘principal,’ or his agent or employees, which may involve a loss for which the said ‘surety’ may be liable hereunder, immediately after the occurrence of such act shall have come to the knowledge of said ‘ owner ’ or of his duly authorized representative or representatives who shall have the supervision of the completion of the said contract; said notification must be given in writing to the president of said ‘surety’ at its principal office in San Francisco, California.”
The amended complaint sets up said contract, for the construction of said eight miles of railroad, and also the said bond, executed by both of the defend
The defendant company, by its answer, denied that the plaintiff had performed the terms and conditions of the said Cobb contract on its part, and admits that Cobb failed to perform his part of said contract, and that the plaintiff on October 12, 1910, notified the defendant company of that fact, but denies on information and belief, paragraphs VII, VIII and IX of the amended complaint, with a few exceptions. The answer of the defendant company sets up two defenses. The first defense is, in substance, that the bond sued on provided, as a condition precedent to a right of the plaintiff to recover thereon from the defendant company, that the plaintiff (referred to in said bond as the “owner”) shall keep, do, and perform each and every, all and singular, the matters and things set forth and specified in said (Cobb) contract to be by the plaintiff kept, done, and performed exclusively at the times and in the manner as in said contract specified, and said defendant alleged that the condition precedent of said bond was not complied with, in that under the terms of the contract set forth in paragraph III of said complaint (the Cobb contract) it was the duty of the plaintiff to furnish the defendant Cobb with all lumber, iron, and piling needed in the performance and completion of the work contemplated in said contract at the location where the same was to' be used, and at
The defendant Cobb filed a separate answer, denying much of the amended complaint, and alleging that the plaintiff failed to furnish him with the lumber, iron and piling substantially as pleaded in the answer of the defendant company.
The plaintiff filed replies, denying parts of the answers, mentioned supra, but admitting that it agreed to furnish Cobb all lumber, iron and piling at the locations where it was to be used, but alleging that the contract did not specify any time for the delivery of said lumber, iron or piles, and admitting that there was some slight delay in the delivery of the lumber and pilings at the times required by S. A. Cobb, claiming, however, that such delays were not sufficient to prevent Cobb’s completing his contract by November 1, 1910, etc. The case was tried by a jury, and resulted in a verdict and judgment for the defendants.
The record shows that there were two main issues tried in the court below. The first was whether the plaintiff failed to comply with its part of the contract with the defendant S. A. Cobb for the construction of the eight miles of railroad. Said contract contains the following provisions: “It is understood that all lumber, iron and piling is to be furnished by the first party, at location same is to be used.” It is claimed that the plaintiff did not comply with its agreement to furnish that part of the material, and that delays and losses resulted, which are a bar to the plaintiff’s right of action. The other main issue that was tried in the court below was whether the plaintiff had given the defendant surety company notice of the defaults in the performance of the contract on the part of Cobb and his subcontractors and agents, as required by the surety bond sued on.
“Notwithstanding that said contract [the Cobb contract] is hereby referred to, this bond is nevertheless issued subject to the following express conditions, which shall be conditions precedent to the right of the ‘owner’ [the plaintiff] to recover hereunder.
“ (2) The ‘owner’ [the plaintiff] shall keep and perform each and every, all and singular, the matters and things set forth and specified, in said contract to be by the ‘owner’ kept, done, and performed exclusively at the times and in the manner as in said contract [the Cobb contract] specified.
“(3) Provided, that said ‘surety’ shall be immediately notified .of any breach of said contract by said principal (Cobb), or of any act on the part of the said principal, or his agents, or employees which may involve a loss for which the surety (defendant company)*581 may be liable hereunder, immediately after the occurrence of such act shall have come to the knowledge of said ‘owner,’ or of his duly authorized representative or representatives who shall have supervision of the completion of the said contract; said notification must be given in writing to the president of said surety at its principal office in San Francisco, California.”
By the provisions of said bond cited supra, the performance of- all of the conditions of the Cobb contract on its part by the plaintiff, and the giving of notice to the defendant company by the plaintiff of the defaults made by Cobb, or his agents or employees, in the performance of the Cobb contract, is .made a condition precedent to a right of action upon said bond by the plaintiff. Such being the meaning of said bond, the plaintiff had no right of recovery thereon, unless it had performed said condition precedent.
7 Am. & Eng. Ency. of Law (2 ed.), page 121, says:
“Failure to perform a condition precedent is a breach of the contract. It involves the one so failing in all the consequences of a breach, deprives him of his remedies under the contract, releases the other party from liability to perform, and affords the latter a right of action against him.”
4 Ency. Pleading & Practice, page 627, says:
“A condition precedent calls for the performance of some act or the happening of some event, after the terms of the contract have been agreed upon before the contract shall take effect; that is to say, the contract is made in form, but does not become operative as a contract until some future act is performed or some subsequent event occurs.”
If the plaintiff performed all of the conditions of the Cobb contract and of the bond sued upon on its part, it was entitled to recover; otherwise not.
The instructions given to the jury by the trial court cover 17 pages of the printed record. They cover fully and fairly every issue made by the pleadings. We have read them carefully several times, and are satisfied that all questions at issue were fairly submitted to the jury. In one or two charges we think that the rule was stated a little more favorably to the appellant than it should have been. We are sure that the appellant has no right to complain of the instructions as a whole.
The following are the charges given by the court to which the plaintiff excepted:
“And the first question for your determination in this case is, Who breached the contract? Was it breached by the railroad company in failing to furnish the iron, lumber and piling, or was it breached by Mr. Cobb? That is the first inquiry for you in this ease— that is the first inquiry which arises in this case under the statement made in the complaint that the railroad company has complied with all the conditions on its part to be complied with. Tour first inquiry will be, Who breached this contract?
“Now, before there can be a recovery against the defendants, the railroad company must show upon its part it complied with all the conditions of this contract. If it has shown here that it furnished this iron, material, lumber and piling within a reasonable time — that is, the time required — there is no time mentioned in this contract when this material is to be furnished, but the law says and reads into a contract that it is to be furnished within a reasonable time — if it*585 was furnished within a reasonable time, why, the railroad company complied with this contract in that respect.
“Now, a reasonable time means such a time as an ordinarily prudent person would have furnished that material to Mr. Cobb along the line of the work as it progressed, and if it was furnished within a reasonable time, the railroad company complied with its contract. And if it was not furnished within a reasonable time, and as a result Mr. Cobb was prevented from completing his contract, then there was a breach on the part of the railroad company here.
‘ ‘ It cannot, however, be against the surety company yet, because it was necessary for you to take one step further. Was there upon the part of the railroad company, or its representatives, a failure to notify the home office at San Francisco, California, of a breach of the contract on the part of Wilson, Eector & Daley, or of a breach of the contract upon its own part, or a failure to furnish the iron, lumber and piling? In order to answer this question, you must consider in this case that the defendant is a compensated surety company; that it is entitled to rely upon breaches of the contract, but they must be- substantial breaches and not technical breaches. They must be such breaches as would work a pecuniary discharge to the defendant, or deprive it of the protection or privilege given to it in this bond. With that in view you take this case and place yourselves mentally as near as you can about that line of work as it appeared at the time when the company became acquainted with the fact that there had been a breach in the contract of Wilson, Eector & Daley, when this notice to Mr. Walter S. Fortiner, who was the chief engineer of the railroad company, and you ask yourselves as between man and man — take all of the things into consideration and say, Would a prudent man, an ordinarily prudent man, situated as the railroad company was, have notified the surety company of the breach of Wilson, Eector &*586 Daley, or of any other breach they knew of? Did its failure to do so work any harm to the Pacific Surety Company, or did it deprive the Pacific Surety Company of any protection or of any privilege reserved to it in the bond? If your answer is, ‘Yes, those men who represented the railway company were bound to notify the surety company of the failure of Wilson, Rector & Daley to complete this part of the contract, because it must have known that the failure of Wilson, Rector & Daley to comply with that contract which it made with Mr. Cobb would prevent Mr. Cobb from doing his work, and if the company was notified or had been notified, they might have protected themselves by something they could have done, or by the failure to give them such notice in addition they were deprived of its pecuniary effect.’
“Now, upon this other point, the defective notice, if a reasonably prudent man taldng into consideration the contract, and all of these things, as well as the bond, would for the protection of the surety company have notified it of the breach of the contract by Wilson, Rector & Daley, as well as its own breach, if there was any breach, then it was the duty of the railroad company to give that notice. ’ ’
In his work on Charging the Jury, Thompson says, at pages 173, 174:
“The charge is entitled to a reasonable interpretation. It is considered and construed as a whole in the*587 same connected way in which it was given, upon the presumption that the jury did not overlook any portion, hut gave due weight to it as a whole; and this is so although it consists of clauses originating with different counsel and applicable to different phases of the evidence. And if, when so construed, it appears probable that the jury were not misled by it, the judgment will not be reversed, although its parts may be in some respects slightly repugnant to each other, or because some one of them, taken abstractly, may have been erroneous. If, therefore, a single instruction is found which states the law incorrectly and yet it is qualified by others in such a manner that the jury were probably not.misled by it, it will not be ground for reversing the judgment.”
We think that, taking the charge as a whole, it states the rule in regard to the giving of notice to the defendant-company of breaches of the Cobb contract a little more favorably to the plaintiff than it should have stated it.
Part of the breaches of the Cobb contract, on his part, occurred when his subcontractors Wilson, Rector & Daley were attempting to perform the contract. Their defaults were legally his. Cobb was doing the work by his subcontractors. The contract provided that he should not assign said contract or sublet any of the work without the written consent of the plaintiff. Said contract provided, also, that Cobb should constantly superintend, in person, all of said work. The plaintiff expressly consented to the subletting of said work to Wilson, Rector & Daley and other parties. As the plaintiff admits that practically all of the work was sublet with its express consent, it is obvious that the defendant company was entitled to notice of all material breaches of the contract, whether made personally by Cobb, or by his subcontractors working under his personal supervision.
Section 556, L. O. L., provides that cases shall he reversed only for errors substantially affecting the rights of the appellant.
We find no reversible error in the proceedings of the court below.
The judgment of the court below is affirmed.
Affirmed.