178 P. 906 | Nev. | 1919
This is an action against a railroad corporation organized under the general laws of the state to recover for the alleged breach of a written contract, whereby the plaintiff was employed by one T. F. Dunaway, the agent and vice-president of the defendant corporation, to build certain fences, sections, or portions of fence, along its right of way, as the defendant or its agents should designate, between Madeline and Cameron, Calif.; the fences in the aggregate to be not less than forty miles in length. It appears that the defendant’s agents, before the commencement of the work, designated sixty miles of fences in length as that to be built in accordance with the terms and specifications of the contract. It is the contention of the plaintiff that while it was actively engaged in the construction of the fences, and had built approximately thirty miles thereof, defendant required and compelled plaintiff to discontinue the construction work, and failed, neglected, and refused to continue with the work for more than six months after the plaintiff had commenced work, this being the time stated in the contract for its completion, to the plaintiff’s damage in the sum of $1,800.
The defense to the action rests upon two grounds: First, that Dunaway, neither as agent nor as vice-. president of the defendant, nor otherwise, had any power or authority to make and enter into the alleged contract; that the contract was made and entered into without the knowledge, authority, or consent of the defendant’s board of directors; was never in any manner ratified or adopted by said board, and that the contract was null and void as to the defendant; and, second, that the plaintiff breached the contract, and was fully paid by defendant for all work or labor performed under the contract, and sustained no damage whatsoever.
The case was tried by the court without a jury. The court made findings of fact and conclusions of law, and upon these judgment was entered for the defendant. The plaintiff appeals from the judgment, as well as
The proof tends to show that Dunaway, agent and vice-president of the defendant, and Cox, its general manager, who succeeded Dunaway as agent, directed plaintiff in the performance of the contract. There was, however, no evidence of Dunaway’s authority to make the contract, or that of Cox to ratify it, except such as the title to their offices implies. The district court decided, and in effect found, that under section 3520 of the Revised Laws (Stats. 1865, p. 427) the contract in question was not such as could be made by the defendant’s employees, and that to be binding upon the defendant it should have been made and entered into by and with its board of directors or ratified by said board.
“As between the corporation and third persons, where the agent’s power is not limited by the charter or by*417 positive law, the corporation will generally be held bound by his acts performed within the scope of his apparent authority; and this is true, not only of his contracts but of all his other acts and omissions.”
Although railroad corporations are not required by statute to fence their property, it is not unfair to presume that a -necessity existed for inclosing defendant’s property at the points designated by its agents. In fact, from the testimony of its general manager, we are led to believe that an emergency existed for fencing at least a few miles of its road between the points designated, for the immediate protection of its property and that of the public. Upon whom, we may inquire, more than the managing agent of the company, would the duty of making a contract similar to the one in suit properly rest? It was doubtless this consideration that led the court in the Sacalaris case, supra, to the conclusion that the defendant’s president and manager was the officer who, in the ordinary course of business, would be expected to employ the plaintiff, and that the plaintiff had the right to presume that the officer was so authorized (citing authorities).
As wé reach the conclusion that the managing agents of the defendant acted within the scope of their apparent authority, and thus bound their principal, it is unnecessary for us to discuss the question as to the ratification by the defendant of the contract, or to cite authorities upon that point.
The trial court was also of the opinion that, conceding the contract in question to be in all respects regular and binding, the plaintiff failed to establish its breach, and also found that its failure to comply with the request of the defendant to build two miles of fence in December, 1914, as requested, constituted a breach of the contract. This question must be determined, not only by the terms of the contract itself, but from the subsequent acts and conduct of the parties; and we may also look to the circumstances of the case in order to see whether the plaintiff, after having partially performed the contract,
The contract, among other things, provides:
“Material: The owner agrees to furnish, at its own expense, to the contractor, all the posts, wires, wire netting, staples and stays, and any other material that may be required in the construction of these fences; and it is agreed that said material shall be delivered by the owner and distributed along its track at the points needed for use in erecting said fences. * * *
“Time: The work shall be commenced as soon as possible after the delivery of the material, which the owner agrees to deliver as soon as the weather permits, and shall be completed in less than six months after it is begun.
“Delays: Should the contractor be delayed in the progress or completion of the work by any act or neglect of the owner, or by any damage caused by fires or floods, or any other cause for which the contractor is not responsible, then the time herein fixed for the completion of the work shall be extended for a period equivalent to the time lost in such delay.”
The plaintiff commenced the construction of the fences on May 22, 1914, and actively continued construction until on or about August 14, 1914, when the general manager of the defendant wrote plaintiff as follows:
“Reno, Nevada, August 13, 1914.
“Gentlemen: This is to advise you that as soon as you finish building at Cameron that we will stop work of fence building for the present and will advise you when we are ready to commence work again.
“Yours truly,
R> N_ CoX; General Manager.”
Upon receipt of this letter plaintiff disbanded its crew of twelve men, then engaged in the work, and brought its outfit to Reno, F. D. Bradley, now the sole owner of the plaintiff company (.formerly a partnership), wrote
Nothing further was done by' either of the parties with reference to the subject-matter of the contract until December 19, 1914, when Cox, the general manager, wrote plaintiff, stating that the defendant had been killing considerable stock just south of Horse Lake, and that it was anxious to have about two miles of fence built at that point, “and this is to ask you to commence work before January 5, 1915”; also stating that “this request is made by us per your contract with this company, dated December 1, 1913.” Thereafter, on January 7, 1915, the manager gave written notice to plaintiff stating that, inasmuch as it had failed and neglected to comply with its request of December 19, 1914, the company “hereby declares the said contract terminated, canceled and at an end, and upon receipt of this notice you will cease all further work and operations under said contract.” Thereafter, on August 3, 1915, the plaintiff commenced this action.
The contract is clearly an entire indivisible, executory agreement, whereby the contractor (plaintiff) obligated itself to build for the owner (defendant) a specified length of fence along its right of way, within a specified time, for so much per panel. The owner obligated itself to supply all materials necessary for the performance of the work. These were mutual interdependent covenants that go to the substance of the contract. The furnishing of the material was necessary to the performance of any work at all. It has been frequently decided that a contractor may treat the contract as rescinded where he has been prevented from completing it by reason of the default of the party to supply material
On August 13, 1913, the owner gave the contractor explicit directions to discontinue work, stating therein that it would be notified when to resume. There is nothing in the record to indicate that from that day to this the contractor received any notice to resume work, unless it be considered that the request in December to build two miles of fence, without any mention whatsoever as to the remainder, constitutes notice. The letter to discontinue the work certainly gave the contractor to understand that he need not resume work until notified so to do. He was at liberty to take the owner at its word, and to act accordingly. Baca v. Barrier, 2 N. M. 137. On receipt of the letter the contractor disbanded its crew then engaged in the work, and nearly four months elapsed before the contractor was notified as above stated. This letter, at the time it was written, may or may not have been intended as a rescission of the contract, but, when read in conjunction with the subsequent acts and conduct of the defendant, we are impressed that the contractor was justified in construing
But the district court was of the opinion that the clause in the contract respecting delays, when read in connection with the entire instrument, indicates that both parties contemplated that delays resulting from the act or neglect of the owner should be construed as extending the time for the performance, and not as a breach, of the contract. We do not subscribe to this view. Conceding that the contractor would be given the full six months to complete the contract if delayed by the acts or neglect of the owner, it does not follow that the owner was privileged to so act as to nullify the contract, destroy its mutual covenants, deprive the contractor of his interest in the value of the contract, and thus convert it into a continuing, severable agreement, whereby the owner could dictate to the contractor when to begin, when to cease work, and to build a section or portion of fence at such times as the owner should choose.
It would be absurd to contend as a principle of law that the owner, without the consent of the contractor, was at liberty to thus suit its own conveniénce as to the performance of the contract on its part, and keep the contractor with its crew and outfit waiting indefinitely for materials, and still hold him to his contract; and it would be unreasonable to hold that the contractor should keep itself in readiness at all times to build any particular portion of fence that the owner should designate, without reference to the remainder.
Mr. Sutherland, in his work on Damages, vol. 1, 4th ed. sec. 66, says:
“Where a party has contracted to perform labor from which a profit is to spring as a direct result of the work done at a contract price, and is prevented from earning this profit by the wrongful act of another party, his loss is a direct and natural result which the law will presume to follow the breach of the contract; and he is entitled to recover it without special allegations in his declaration. This he will be entitled to establish by showing how much less than the contract price it will cost to do the work or perform the contract.”
We do not wish to be understood as commending the complaint as a model pleading. It is subj ect to the
Entertaining the views hereinabove expressed, the judgment in this case must be reversed, and the cause remanded.
It is so ordered.