Kunz v. Boll, 140 Wis. 69

Kunz v. Boll

140 Wis. 69 | Wis. | 1909

Lead Opinion

Dodge, J.

Among the defenses interposed was that the owner and the principal contractor had modified the contract to the prejudice and consequent discharge of the sureties by paying large amounts of money thereon before the same was due according to its terms. This was supported by a showing that in the earlier stages of the work large amounts had been paid without any formal certificate of the architect, but the evidence is not so clear that they Were paid before the money was earned according to the provisions of the contract, and there might well be doubt whether they were effective to. release the sureties under the rule on the subject declared in Madison v. Am. S. E. Co. 118 Wis. 480, 95 N. W. 1097. It was made to appear conclusively, however, and indeed declared by the findings, that the building was not completed un*71til September 20th, and that as early as June 9th there had been paid to the contractor the sum of $15,100, while by the express terms of the contract only $13,000 was to be paid to him prior to the final completion of the contract. The efficacy of substantial advance payments upon contracts to discharge sureties is too well settled by the authorities in this state to warrant discussion. The prejudicial effect thereof to the surety has been found both in the removal of the incentive to the contractor to'diligently press his work and from the diminution of the fund which the contract contemplates to remain in the owner’s hands and which may serve as a means of protecting the sureties from liability. Stephens v. Elver, 101 Wis. 392, 77 N. W. 737; Cowdery v. Hahn, 105 Wis. 455, 81 N. W. 882; Lowe v. Reddan, 123 Wis. 90, 93, 100 N. W. 1038. In the present ease it cannot be doubted that both the amount of the advanced payments and length of time in which they antedated the time when they should have been paid were material. In that respect they bear no resemblance whatever to the mere trifling variance from the contract presented in Stephens v. Elver, supra. For this reason we must hold that before the completion of the contract the sureties had been absolutely discharged from their liability, and no judgment can be had against them, which conclusion renders it unnecessary for us to consider the various other contentions.

By the Court. — Judgment reversed on defendants’ appeal, and cause remanded with directions to dismiss the complaint; plaintiffs to take nothing on their appeal.

Dissenting Opinion

TimliN, J.

(dissenting). I think the judgment off the circuit court should be affirmed on both appeals. The contract provided:

“All payments to be on certificates of said architect as the work progresses, to wit: $4,000 on completion of foundation; $3,000 on completion of first story; $3,000 on completion of second story; $3,000 on completion of third story; $3,000 on *72completion of building; and balance sixty days thereafter, reserving fifteen per cent, of each estimate until final certificate is issued. The final payment shall be made within sixty days after the said above work is' completely finished.”

The total amount earned under the contract, with authorized extras, was $19,339.27. There is an apparent distinction between certificates issued as the work progresses and the final certificate. Neither of the five items above provided for includes the final certificate. Fifteen per cent, of each of the five items above is to be reserved until the final certificate is issued. The word “completion” should be given the same meaning in each of the five items. It is common learning that words following a videlicet point out or specify but do not restrain the generality of the preceding words. They particularize and point out. Brown v. Berry, 47 Ill. 175; 8 Words & Phrases. The fair inference is that the itemization points out a rate of preliminary estimates proportioned. to the progress made, so that up to the time of completion of the building not more than the sum of such items, viz., $16,000, shall be paid on preliminary estimates. I think this is a fair and reasonable construction, bearing in mind the subject matter of the contract, how building operations are usually carried on, and having reference to the language of the contract. This amount was not exceeded by preliminary certificates up to the time of completion; hence the sureties were not on this ground discharged. But the sureties were entitled to have applied on claims in favor of third pei'sons and against the contractor for labor and materials furnished the whole amount due from plaintiffs to contractors after completion and on deferred payments, which was $4,239.27.

After the liability of the sureties became fixed, plaintiffs applied part of this on moneys due them from the contractor, and they were therefore properly charged and the sureties credited with the sums so applied. Another part of this $4,239.27 was applied properly to the discharge of claims for *73materials used in tbe building. Tbe whole liability of tbe sureties was $5,000, which, minus $4,239.27, is $760.73, practically tbe amount for which judgment was rendered against the sureties, arrived at by a more roundabout process.

KeewiN, J. I concur in the foregoing dissent of Mr. Justice TiMLiN.