204 Pa. 596 | Pa. | 1903
Opinion by
The first reason given by the appellant why the appellee ought not to recover from it is, that, upon the default of the subcontractor, a proffer ought to have been made to it,»as the surety on his bond, of the privilege of completing the work, and the appellee having himself proceeded to do so without such proffer, it is discharged from all liability. The default occurred on August 5, 1898. On the same day McNally notified the Mercantile Trust Company, in writing, of Kaufman’s default, and that he would look to it, as his surety, for all damages he might sustain under the contract by reason of such default. A day or two áfterwards he called upon E. L. Porter, vice president of the company, and talked to him about Kaufman’s abandonment of the work. Porter said: “We won’t admit liability; ” when McNally replied: “ The only thing for me to do is to go ahead on the contract.” That this took place between them is not denied by Porter. Three days after the abandonment, on August 8, McNally notified the company that he would proceed to complete the work abandoned by Kaufman, his subcontractor, and that, while he was under no obligation to consult the company, he was willing to consider any suggestions it might make and would confine the cost of finishing the work to the lowest possible figure, that the loss might be as low as possible. To this, reply was made within a few days, stating that the company admitted no liability on the bond, but was willing to extend any courtesy that would facilitate the completion of the contract at the least expense.
There is nothing in the contract or the bond providing that, upon the default of Kaufman, McNally was to give the surety an opportunity to complete the work. The bond was executed
Though McNally had the clearly reserved right under the contract “ to discontinue work by said Kaufman,” he did not attempt to do so. He took it up and carried it on to completion, under his obligation to the city of Pittsburg, only after the subcontractor had absolutely defaulted by abandoning the contract. If he had not done so, heavy penalties awaited him. He did all he was required to do, so far as this surety is concerned, when he notified it of the default of the principal in the bond. It might, as a matter of grace, but not of right, in view of what it knew was in the two contracts, have asked to be allowed to complete the work, but it did not do even that. It persistently denied'all liability, and now inconsistently complains that the opportunity was not given it of completing the work. Under the circumstances there was nothing for McNally to do except to go on and complete it himself in accordance with the terms of his contract with the
Appellant’s second ground of complaint is that Kaufman had been overpaid, and that the overpayments, having been in excess of the claim made upon it, were to its prejudice, and it is, therefore, discharged from all liability on the bond. If Mc-Nally did overpay Kaufman without the knowledge or consent of the surety on his bond, such overpayments were in relief of it: General Steam Navigation Company v. Rolt, 6 C. B. R. N. S. 550; Calvert v. London Dock Co., 2 Keen, 638. The answer to this is that Kaufman’s contract witli McNally provided that for material and labor furnished, he should be paid “ in certificates issued by the department of public works of the city of Pittsburg, as from time to time received therefrom by said McNally, and as from time to time made upon estimates calculated on measurements taken by the city’s engineer,” and “ such certificates, when delivered by McNally to Kaufman, shall be accepted to the amount thereof for work done aiid material furnished under this contract.” The city did not know Kaufman. It paid McNally, its contractor, in the mode just indicated, and he, in turn, gave to Kaufman, out of what he received, what was coming to him under the terms of the contract. Kaufman was to receive full payment, not only for all the work he had done, but for all material furnished. The estimates included not only the work actually done on the ground, but material as well that had been furnished, but not used at
Under the assignments of error, no other question remains to be considered.
Judgment affirmed.