91 W. Va. 387 | W. Va. | 1922
This is an action in debt instituted in the name of the State for the use of the county court of Randolph County against R. M. Hudson Paving and Construction Company, hereinafter called the “contractor,” and United States Fidelity and Guaranty Compaq, its surety, upon a bond executed in favor of plaintiff in the sum of $46,000, conditioned for the faithful performance by the contractor of a road building contract, being one of five contracts, executed by the same contractor for the building of certain roads in Leadsville District, under a road bond issue. The particular contract is known as “Contract No. 1 Beverly Pike and Seneca Road.” It is dated August 12, 1916, and is one of the “blanket form” contracts commonly used in the con-
There are but three main questions in this case, all involving a construction of the contract, and they will be taken up in order.
First: Was the county court bound to take over and complete the work before bringing suit ? This point is raised by defendant’s demurrer to plaintiff’s declaration, and also by its special plea No. 4 which was rejected by the court. The defendant claims that the remedy provided by the contract, in case of the contractor’s default, is exclusive. The provision in the contract upon which defendant’s counsel rely in this respect is as follows:
“If the Contractor shall become insolvent, or be declared bankrupt, or shall from any other cause, in the judgment of the engineer, be unable to carry, on .the work; or if he shall make default in the due performance of the agreement or any or all of the conditions herein enumerated, or in diligently proceeding with the work, and the Engineer shall give notice in writing of such delay, neglect or default to*391 the Contractor, specifying the same, and if the Contractor shall, for a period of ten (10) days after such notice, not proceed satisfactorily in accordance therewith, then the County Court shall, on written certificate of the Engineer of the fact of such delay, neglect or default, and on the Contractor’s failure to comply with such notice, have full power and authority, without violating this contract, to take the work wholly or in part out of the hands of said Contractor, to appropriate and use any or all of the materials and tools on the ground as may be suitable and acceptable, and may enter into a contract for the completion of said work according to the terms and provisions of the contract. The cost and charges incurred by the Court, together with the cost of the completion of said work,'shall be deducted from any moneys due or which may become due said Contractor, and in case the expense so incurred by the Court is less than the sum which would have been payable under this contract if the same had been completed by the said Contractor, then the said Contractor shall be entitled to receive the difference, and in case- such expense shall exceed the last sum, then the Contractor shall on demand, pay the amount of said excess to the County Court, but such excess to be paid by the Contractor shall not exceed the amount of the security for the performance of this contract.”
For this proposition we are cited to the case of Goss v. Northern Pacific Hospital Association, 50 Wash. 236, 96 Pac. 1078, and to 13 C. J. 696. The case cited arose upon a building contract. The principal contractor sued the owner for certain deductions made by the architect and for extra work done and for damages occasioned by the delay of another who had an independent contract to do the plumbing work. Goss was employed to build the hospital but he was not 'required to put in the plumbing nor to install the heating plant in the buildings. Goss’s work was delayed through the fault of the plumbing contractor. It was provided in Goss’s contract: "Should the contractor be obstructed or delayed in the prosecution or completion of his work by the act, neglect, delay or default of the owner or the architect, or any other contractor employed by the owner upon the work, or by any damage which may happen by fire, lightning, earthquake or
Second: It is contended by defendant, the Guaranty Company, that after the contract and bond had been executed the contract was materially changed by an agreement made between the county court and the contractor to the prejudice of the surety and without the surety’s consent, and that this operated as a discharge of the surety; on the other hand, it is claimed by plaintiff that the surety authorized the change, though plaintiff claims that no authority was necessary. If no consent on the part of the surety was necessary, then we need not inquire whether such consent was actually given.
Bearing in mind that this is a “blanket form” contract
“The said Engineer, with the written consent of the County Court shall have, and is hereby given, the right and power to make any alterations or changes in the work, and the materials required by the plans, drawings, descriptions and specifications of this contract as he may deem proper and necessary, but in case of any such changes or alterations the same shall be ordered in writing by the County Court and the price or prices thereof shall be mutually agreed upon. In the absence of such written order or agreement, it shall be deemed, taken and treated as conclusive upon all parties, that no change or alteration has been ordered.
It is distinctly understood and agreed that if in any one or more instances a change or alteration is or shall be made, as herein provided, whereby any part or feature of this contract or said plans, specifications, etc., shall be dispensed with, or which shall reduce or lessen the cost and expense on the part of the party of the second part, the consideration to be paid by the party of the first part shall be reduced to the extent of the reduction of the cost and expense incurred in any way by the said party of the second part in consequence thereof which shall be fixed and determined by the said Engineer by a calculation b^ised as far as possible upon and at the prices named for the kind of labor and material involved therein worked, or worked and in place, as the case may be, as specified and set forth in the proposal of the said party of the second part made at the time of letting this contract.”
The contract clearly shows that the parties contemplated future changes in the work and materials. Permanent road building was then, as indeed it still is, in the experimental stage, and the County Court very wisely reserved the right
In Wehr v. German Evangelical Lutheran St. Matthew’s Congregation, 47 Md. 177, it was held: “But if by the terms of the original contract, additions to, or alterations in, the work are provided for, or left to the judgment and discretion of the other contracting party, either without limit or within certain limits, then the variation, if within the prescribed limits, is allowed by the contract itself, and the surety cannot complain of a variation which he has agreed to by the original contract.” This view is sustained by many authorities, among which are the following: United States v. Walsh, 115 Fed. 697; Getchel etc. Co. v. National Surety Co., 124 Ia. 617, 100 N. W. 556; McLennan v. Wellington, 48 Kan. 756, 30 Pac. 183; Hedrick v. Robbins, 30 Ind. App. 595, 66 N. E. 704; Kretschmar v. Bruss, 108 Wis. 396, 84 N. W. 429; Blauvelt v. Kemon, 196 Pa. St. 128, 46 Atl. 416; Drumheller v. American Surety Co., 30 Wash. 530, 71 Pac.
Third: The remaining question concerns the measure of damages. The defendant insists that the damages should be ascertained as of November 1, 1917, the date fixed in the contract for the completion of the work, and its counsel claim that that is the time of the breach alleged in the declaration. We do not find that that date is the date alleged in the declaration. It avers that the work, according to the terms of the contract, was to be completed on that date and that the contractor did not then nor has it since that time completed the work. The County Court did not treat the contract as having been broken on November 1, 1917. It did not do this until after it had served notice on the contractor and surety in February, 1919, to proceed with the work. Not until the time fixed in that notice had expired, and they had failed to respond to it and proceed with the work, did the court treat the contract as breached. The contract had been partly performed, and there is nothing in the record indicating that the contractor and its surety unequivocally repudiated the contract until after February, 1919. That date, it appears to us, is the date, upon the record, when the contract was broken, and the time at which the damages should be determined. The contract specifically gives to the County Court the right to extend the time of the completion of the work, and if it did not demand strict performance within the time limited, the defendants should not complain. They acquiesced in the delay. They relied in part on railroad embargoes on road materials as a defense. Indeed, their instruction No. 12 told the jury that if they believed from the evidence that embargoes had been imposed by the railroads by the authority of the Federal Government rendering the performance of the contract practically impossible, then such embargoes were a legitimate excuse for not going forward with the contract, and that if the jury should believe that such embargoes were still in existence at the time the suit was brought, the jury should find for defendant. We do not think this instruction should have been given in that form but it shows that the defendants did not at the time the suit was brought claim the
Again, counsel insist that inasmuch as defendants showed that the cost of completing the work was less at the time of trial than in the spring of 1919, the damages should be fixed as of the date of trial. Instruction No. 5 1-2 given at their instance so told the jury. Of course, the defendants can not complain, but they were not entitled to this instruction. As a general rule, the rights of parties under a contract which has been discharged by breach are fixed at the time of such breach, and we see nothing in this case which takes it out of the general rule. The breach occurred when the defendants, after demand was made by the County Court, refused to proceed with the work. We repeat there was no renunciation of the contract till that time; then the breach occurred, the rights of the parties were determined, and the damages should be assessed as of that date. The contract expressly provides, in ease the work is unnecessarily delayed or the contractor wilfully violates any of the covenants or conditions of the contract that the County Court may enter and take possession of the work in its incomplete state, and shall have power to place such and as many persons as it may deem necessary, by contract or otherwise, to work at or complete the work, and to charge the expense against the original contract price. The amount saved is to be paid to the contractor; the excess cost, if any, is to be paid by the contractor. The contract itself fixes the time for assessment of damages as of the date of the breach. The court instructed the jury that the measure of damages was the difference between the contract price of the work and what the same work would have reasonably cost at the time of the breach, and, we think, under the circumstances shown in this case, this was correct. Prom this amount the jury, was instructed to deduct the amount in the plaintiff’s hands, being the 10 per cent of the completed work. We find there is ample evidence to support the verdict and that it is not excessive.
It may be that the instructions given for plaintiff and defendants were inconsistent as respects the time of the breach of the contract and hence different measures of damage were
It is claimed by defendants’ counsel that to allow plaintiff to recover damages as of April, 1919, the date of the breach, will in effect give the county court more money than it will cost now to complete the work, and that it is entitled to only enough money to complete the road according to the contract, and they raise the query, what is to be done with the excess money? We think the County Court can find an answer to that question, as we haA^e never known a County Court to complain of having too much money at its disposal.
Some minor points have been raised, but they are all involved in the main questions already disposed of. We find no error prejudicial to defendants and therefore affirm the judgment.
Affirmed.