42 Wis. 679 | Wis. | 1877
Lead Opinion
This action is brought by plaintiff, as assignee of one Dalton, to recover the balance claimed to be due from the defendants, on a contract for grading a portion of the road-bed of the Wisconsin Central Eailroad. The defendants were principal contractors with the company, and Dalton a subcontractor under them. The principal defense relied on was, that Dalton did not perform his contract according to its terms, but that, without any reasonable excuse, he abandoned the work, or refused to complete it. It is a conceded fact, that the defendants furnished men and teams to finish the work which Dalton undertook to do; but whether this was in pursuance of an understanding between the parties that Dalton was to be released from doing the balance of the work, the defendants agreeing to do it for him, or whether the defendants were compelled to finish the work because Dalton had abandoned it, in order to fulfill their contract with the company, was a matter
The other errors assigned are predicated upon the refusal of the court below to give four requests asked on the part of the defendants, and upon exceptions taken to certain portions of the charge. It was provided in Dalton’s contract, that the defendants should make payments to him at a stipulated rate per cubic yard, between the 15th and 18th day of each month,
It was claimed by defendants’ counsel that such a result was in direct conflict with the decision in Jackson v. Cleveland, and the following passage from the opinion in that case was relied upon to sustain his position: “But it is very clear that, unless the plaintiffs perform their contract as they agreed to do, or show some valid excuse for not performing it, they cannot recover this fifteen per cent. This is in accordance with the stipulation of the parties, and in strict harmony with many well adjudicated cases upon the precise point.” p. 411. For myself, as I do not understand that case as deciding what the counsel claims, I may add a word of explanation in answer to the view the counsel took of it. In Jackson v. Cleveland, the plaintiffs were subcontractors, and did not complete the work according to their contract, but abandoned it — as the court by implication held — without legal excuse, or default on the part of Cleveland, the contractor. But, nevertheless, upon the facts stated in the complaint and shown upon the trial, they insisted they were entitled to recover the entire fifteen pér cent., without regard to the matters stated in the counterclaim of the defendant. By their default to perforin, Cleveland alleged, in his counterclaim, he was damnified largely in excess of this fifteen per cent., and offered evidence on the trial to prove these damages. But the circuit court,
The judgment of the circuit court must be affirmed.
Concurrence Opinion
I concur in the judgment of this case, but desire to say something for myself of the grounds on which I do so.
I think that the true construction of contracts like those in this case and Jackson v. Cleveland is, that the periodical estimate is fully earned by the contractor, and due to him when made, and that the percentage reserved is in the nature of
And there appear to me to be but three aspects in which the reserved percentage can be regarded: first, as a penalty, limiting the amount of damages to be proved under it; second, as liquidated damages agreed on by the parties; third, as a mere security for damages, neither limiting nor liquidating the amount. In either of these aspects, the periodical estimate is debitiwn in prcesenti, of which payment is deferred to abide a future contingency. And subject to such deduction, the contractor has a right of action for it upon the determination of the contract, however determined.
I am not at all sure that the better view is not that the reserved percentage is a mere security. I have seen no case, however, so holding it. The only question seems generally to have been, as in Jackson v. Cleveland, whether it was in the nature of a penalty, or of liquidated damages.
Judge Eedfield, in his work on Eailways, says that the amount so reserved is in the nature of liquidated damages. 2 Eedfield on Eailw. (5th ed.), 427. But that view appears to me contrary to sound principle, and is, on several grounds, inadmissible in this state. Layman v. Babcock, 40 Wis., 503. In Jackson v. Cleveland the reserved percentage is held to be in the nature of a penalty. And if it be either penalty or liquidated damages, I have no doubt that it was correctly held to be the former.
If it could be held to be liquidated damages, it would be by force of the provision that it is payable only upon final completion of the contract. That provision has an effect nearly or quite equivalent to calling it liquidated damages. But, by the rule of this court, no words can operate to make that liquidated damages, which the nature and justice of the case require to be held in the nature of a penalty. Yenner v. Hammond, 36 Wis., 277; Lyman v. Babcock, supra.
If the fifteen per cent, reserved by the appellants in this case
It is remarkable that both parties relied on Jackson v. Cleveland. And, upon a critical examination of the case, I confess that I am unable to reconcile different things said in that case, or all that is said to any theory, either of penalty, or of liquidated damages, or of mere security. There are passages in the case which appear to me to regard the reserved percentage in all three of those lights.
Jackson sued for the reserved fifteen per cent., not having completed his contract. And the judgment, in two passages, seems to hold that he could not recover it without showing performance, or excuse for nonperformance. That appears to me to enforce the provision that the reserved percentage is recoverable only upon full performance, and to deal with it as liquidated damages.
Cleveland sued by counterclaim for his actual damages by Jackson’s nonperformance, and the judgment holds him entitled to recover. This appears to me to deal with the reserved percentage as a penalty.
If it were in the nature of a penalty, Jackson was clearly entitled to recover it, subject to deduction of Cleveland’s actual damages. If it were liquidated damages, Cleveland was entitled to retain it absolutely, without showing any actual damages. And his defense was complete without counterclaim.
In another passage it is held that Cleveland should apply the reserved percentage upon his actual damages, and have judgment for the excess. This appears to me to deal with it as security merely, neither liquidating nor limiting the damages.
I cannot doubt that what seem to me inconsistencies and inaccuracies in the judgment, were mere oversights; or that the judgment was intended to be as Mr. Justice Cole’s opinion in this case suggests. It is only wonderful to me that such inaccuracies do not more frequently arise, from the hurry in which this overburdened court is obliged to discharge its duties.
If I could think the opinion of the court in Jackson v. Cleveland, as reported, could bear the construction now put upon it by Mr. Justice Cole, I think that I could concur in all of its positions, except Cleveland’s right to recover more than the reserved percentage, of which I entertain great doubt.
Be this as it may, it appears that Jackson v. Cleveland has misled the bar, and might do so again. And I have deemed it due to the court and to the profession to make these comments upon it, as my dissent from things said in it.
By the Court. — The judgment of the circuit court is affirmed.