147 Va. 778 | Va. Ct. App. | 1926
delivered the opinion of the court.
This suit grew out of a contract between Katherine Elkins Hitt, plaintiff in the trial court, and George T. Smallwood, defendant, entered into in June, 1920, to build a garage of stone upon the plaintiff’s farm in Loudoun county, Virginia, known as the “Millsville farm,” by the defendant for the sum of $14,291.80, plus the cost of hauling and delivery of materials to the site of the building, with an additional ten per cent of such hauling cost to the defendant for Ms services.
Shortly after the execution of the above contract the plaintiff entered into a second contract, providing for certain extra work in connection with this garage to be performed on a cost-plus basis, said contract
As the work progressed the defendant furnished statements to Gaither for the labor and materials furnished for the building, properly allocated, every two weeks, whieh were paid, including the statement of November 30, 1920. After that some payments were made but not regularly, and in April, 1921, Mrs. Hitt dismissed Smallwood from the job, whereupon he presented to Gaither his account for $26,607.94, the total amount due for the building and extra work, divided as follows: Contract work, $14,291.80; extra work, labor hauling, etc., $12,315.14. This statement was considered incorrect and Gaither and Smallwood got Lawson, a teacher in the high school, to go over same and make corrections in additions and otherwise. Some errors in charges and additions were discovered by Lawson and the balance due to Smallwood, according to this account, was $11,954.66, but Gaither declined to pay it.
Thereupon Gaither and Smallwood, upon advice of Ed. E. Garrett, Esquire, employed E. L. McFarland, assistant cashier of the National Bank of Leesburg, Virginia, to go over the books and papers and make a correct statement of the account. Gaither did not keep any books, but had. the statements furnished by Smallwood, certain bills rendered, and the checks and
These statements, bills for materials, checks, drafts and account book were delivered to McFarland with instructions to make up a correct account between the parties, showing amounts properly chargeable to the contract work, and extra work, the amounts paid thereon, and the balance due. After conference with the parties, McFarland, with considerable labor, stated the account as follows:
Total amount claimed by Smallwood, $26,607.94, composed of contract work, $14,291.80; extra work, labor, hauling, etc., $12.315.41. This statement showed that appellant had paid Smallwood on the original contract $13,633.38, and on the extra work, $4,112.87, or a total payment of $17,746.25, leaving a balance due from the appellant of $8,861.69. The evidence tends to prove that Gaither admitted that the account was correct, and promised that same would be paid.
After some delay the appellant refused to pay this balance, or any part thereof. Thereupon, about November 18, 1921, Smallwood brought an action against Mrs. Hitt in the Circuit Court for' Loudoun county, Virginia, and filed his declaration in assumpsit claiming damages in the sum of $9,000.00.
On June 5, 1922, appellant filed her bill in this case, charging that the appellee’s account was erroneous, grossly excessive or fraudulent, and asking for the production of the books, papers and records of the appellee,
In due course an answer was filed, which was sworn to. by the appellee, and after hearing a motion to dis-so ve the injunction and upon the answer, a decree was entered February 23, 1923, overruling the appellee’s demurrer, denying the motion to dissolve, referring the cause to a master commissioner for an accoúnit, and requiring the production of all papers, books and records before the commissioner, and continuing the injunction in effect until the further order of the court.
The taking of depositions was begun on September 19, 1923, and were concluded on May 21, 1924. After several months of consideration Commissioner Franklin made his report, which was filed on September 3, 1924, and therein found a balance due from the appellant to Smallwood of $6,115.63. The appellant filed a written motion to recommit the report, with instructions to the ■commissioner to correct the same in the particulars stated. Both parties filed exceptions to the report.
On February 10, 1925, the case came on to be heard on the report of the commissioner, the motion to recommit and the exceptions to the report, and upon consideration thereof the court overruled the motion to recommit, and the exceptions of appellant and appellee, entered the decree approving and confirming the commissioner’s report and gave judgment against the appellant for $6,115.63 with interest thereon from the 10th day of February, 1925, and costs. From this decree the appellant appealed and the appellee has assigned cross error.
It is necessary, in order to properly consider this appeal, that the contractual relations of the parties be
The duty of keeping the accounts for material, labor and other costs was imposed upon him, and semimonthly payments were to be made upon his statements. However, George T. Gaither had general supervision over him and the work as representative' of Mrs. Hitt.
The books kept and statements furnished by Smallwood are presumed to be correct, especially those furnished Gaither and paid by him, and the condensed statement made by Mr. McFarland and admitted by Gaither to show the correct balance. Therefore, the burden of proof was upon appellant in this proceeding to show that the accounts were incorrect or fraudulent. She assumed the burden of surcharging and falsifying these accounts, and recognized that obligation under the familiar rules of chancery practice, when by her bill she .required Smallwood to answer under oath and that all his books and papers be produced before the court for inspection and examination. Nor does
The report of the commissioner in chancery does not bind the court like the verdict of the jury. While the court possesses the absolute power of review, it is the practice to accept the report as prima facie correct and to adopt it, unless there is dissatisfaction with the report expressed in the form of exceptions. When this is done, it is both the province and duty of the court to examine the evidence and review the conclusions of its commissioner, provided the evidence on which his conclusions are based is returned with his report, or the proper steps are taken to put it before the court. In suits in equity the chancellor is judge of both the law and facts, and is presumed to be more competent to pass' upon the evidence and draw correct conclusions from it than the commissioner.
“When, however, the evidence consists of the depositions of witnesses and they are taken by the commissioner or in his presence (as was done in the instant cáse), he would have the advantage of noting the demeanor of the witnesses and their manner of testifying, which is important in judging of then-credibility and the weight to be attached to their evidence when they contradict each other.
“When, therefore,, the commissioner has seen and examined the witnesses and the testimony is conflicting, and his conclusions are clearly supported by competent and unimpeached witnesses, the court will not set
The testimony in this case went into the character of construction in considerable detail, the quantities of material and labor necessary to produce the results to be accomplished. The theory of the appellant’s testimony being that the claim for labor and materials for the so-called extra work was excessive and unreasonable, and he could only recover what was the reasonable cost thereof, while the appellee undertook to prove that all the labor and material charged in his account to extra work went into the same, thus was presented a sharp conflict in the evidence. Upon this record the learned chancellor reviewed the evidence, weighed the expert testimony against the direct testimony and overruled all exceptions to the commissioner’s report and confirmed the same. We are asked to review and annul this decision.
It is essential that the third and fourth assignments of error, to-wit, that the charges for labor and materials for the so-called extra work were excessive and unreasonable, and that the commissioner should have found what was the reasonable cost, be considered first, because they are practically the basis of the appellant’s case. This controversy arose from the belief of Mrs.
Upon reason and authority, where a person agrees to do work for another upon a cost-plus basis, it is his duty , to keep accurate and correct accounts of all material used and labor performed, with the names of. the materialmen and laborers, so that the owner may check up the same. He must use the same skill and ability in the extra work as he uses in contract work for a gross sum. If the aggregate cost upon the face of the account is so excessive and unreasonable as to suggest gross negligence or fraud, the law would
The case of Title Guaranty & Trust Company v. Pam, 155 N. Y. Supp. 333, sustains the principle of law above set forth. In that case, the construction company contracted to do the work according to plans and specifications at cost and a percentage. The court held that it owed to the owner the same skill and ability on the work as would be given where the contractor must do the work at less than contract price to secure its profit. The contractor refused to allow the owner’s inspection of the work, and it was found that the work was done in reckless disregard of its obligations. In short, the contractor refused to allow any supervision of the work and required the owner to implicitly trust him, and when it had been shown that the work had been done in ruthless disregard of its obligation, the burden rests upon the contractor to prove that the moneys which he claims to have expended were necessarily paid for materials and work upon the job.
In the Pam Case, the conclusion is inescapable that the contractor purposely undertook to defraud the owner by the reckless manner in which work was done. In the instant case there was no concealment, and in fact supervision was invited. During the progress of the work statements were furnished semi-monthly of materials and labor. The incompetency and inefficiency of the employees, if any, was revealed in the
As to the exceptions for failure to put cement in the foundation, the only evidence to sustain this was the fact that no cement was found next to the earth. The man who laid the wall says he put sufficient cement in it, and it is hardly probable that any workman would lay a dry wall for a foundation. Opinion evidence based upon the observation of the outside of the wall by McKinsey and the negro laborer should not override the positive testimony of the mason who built the wall, especially as there were no defects shown by settlement in the super-incumbent walls.
The next assignment of error is the refusal of the court to disallow the statement for time made by laborers in the extra work from August 1st to September 30, 1920, as excessive and because the kind of work done is not specified. This statement was furnished to Gaither, and if there was any doubt about its accuracy, he should have demanded an explanation of same before he paid it. The commissioner who saw the demeanor of the witness, and carefully weighed the evidence, allowed the amount, and the trial court confirmed his findings, and we see no error therein.
No good purpose can be served by the discussion of the appellee’s assignments of cross error, in the allow
The final cross error of the appellee is the refusal of the court to allow interest upon the balance except from the date of judgment. While in ordinary eases between debtor and creditor the practice is to allow interest from the due date of the debt, this is not an inflexible rule of law. The appellee had caused the delay in payment by the numerous errors and overcharges in his books and statements, which required legal investigation to ascertain the balance due, and it does not appear just and .equitable that interest should be allowed until the balance had been fixed. The court evidently considered the equities of the ease in awarding interest, and we think it was right.
Upon careful consideration of the record, if we had any fair doubt as to conclusions of the commissioner, we would affirm the decree, and follow the familiar rule, so often emphasized, that the report of a commissioner, when the evidence has been taken in his presence, is entitled to great weight, and should not be disturbed unless its conclusions are clearly unsupported by the evidence, and such a report on the balance due the appellee based upon conflicting testimony, and sustained by the trial court, will not be overruled on appeal. American Surety Co. v. Hannah, 143 Va. 291, 130 S. E. 411-413.
Taking a comprehensive view of the facts in this case, the site of the buildings, the means by which the materials were to be obtained, and labor conditions, it appears that Smallwood was not equal to the aceom
Decree affirmed.
Holt, J., dissenting.