Hudson v. McCartney

BurLDiHG Conteact. (1, 3) Superintendent's certificate a condition precedent to payment — If withheld, what Milder must show, to recover. (3) How fraud in withholding cerrtificate must■ he shown. (4) Rights of superintendent p/nder such contract. ■ (5) Pleading and proof in action by builder. 1. It was competent for plaintiffs, contracting to erect a dwelling for defendant, to stipulate that they should receive payment for the work only as the same was executed to the full and complete satisfaction of the person employed to superintend the erection of such dwelling, and upon his certificate as the work progressed. And after entering into such stipulation, they cannot recover the price agreed to he paid for the work, except upon the superintendent’s certificate, unless his refusal to certify should be disregarded or annulled on the ground of fremd or bad faith, or upon clear evidence of mistake on his part. 3. Whether plaintiffs could recover in such a case without showing that the certificate was eorruptly withheld by the superintendent in collusion with the defendant, or upon the procurement of the latter, is not decided. fi. If fremd in the superintendent or other arbiter in such a case can ever be established by proof that the work was in fact duly and properly performed, it can only be in cases where his refusal to certify is shown to have been grossly and palpably perverse, oppressive and unjust, so much so that the inference of bad faith would at once arise when the facts were known. Having stipulated to submit to the decision of a skilled arbiter the question whether his work conforms to the contract, the party cannot, in general, substitute the judgment of a jury upon that question. Baasen v. Baehr, 1 Wis., 531, approved. 4. It was necessarily incident to the authority given the superintendent to withhold his certificate if not satisfied that the work was being executed in accordance with the “true spirit, meaning and intent” of the contract, that he should have power to determine the proper meaning of the contract, plans and specifications, and that his determination should be final and conclusive; and an express provision to that effect in the plans and specifications did not add any. thing to the force of the contract in that particular. 5. Plaintiffs, in an action upon the contract, cannot introduce evidence of fraud or mistake on the part of the superintendent in refusing to grant them such certificates, unless they have set up the facts in their complaint.

APPEAL from the Circuit Court for Winnebago County. In April, 1870, plaintiffs entered into a written contract with defendant, to do all the brick and stone work (except, etc.), and furnish mortar therefor, and all the lathing and plastering and furnish materials for the same (with certain exceptions) required in the erection of a dwelling house for defendant, “ as described in the specifications and shown on the plans for said dwelling, and at the time mentioned therein,” which plans and specifications were declared to be a part of the contract. And defendant, “in consideration of the said second parties [plaintiffs] fully and faithfully executing the aforesaid work, and furnishing the materials for the same, as before mentioned, so as fully to carry out the design according to its true spirit, meaning and intent, and to the full and complete satisfaction of J. McDonald, superintendent of the erection of said dwelling,” agreed to pay plaintiff $800, “ in payments on the certificates of the architect” as the work progressed. The complaint, after reciting this contract, alleges that plaintiffs, “ on or about the 12th of May, 1870, entered upon said employment under said agreement, and duly discharged all the duties thereof and have at great expense collected materials, employed men, and expended much time and money under and pursuant to said contract, and were so proceeding in all things as in said contract agreed upon by said plaintiffs, to and including the 27th day of May, 1870; ” that, on the day last mentioned, “ the defendant ordered and by force drove the plaintiffs and the men in their employ then at work on said building in pursuance of said contract, from said building, and did then and does still” forcibly prevent plaintiffs from further working on said building or under said contract, although plaintiffs have at all times been ready and willing to complete their work under said contract as therein agreed, as was well known to defendant: to plaintiffs’ damage in the sum of $800, for which judgment is demanded. The answer admits that plaintiffs commenced work under said contract on the 12th of May, 1870, and that on the 27th of that month defendant ordered them and their workmen to cease work on the building, and refused to allow them to further work thereon unless they conformed to said plans and specifications. It further avers that plaintiffs failed to perform their covenants in said contract in the following respects: that in erecting the brick walls of the building, they neglected and refused, upon repeated requests of defendant, to lay the brick in said wall straight, plumb, or in a workmanlike manner, or to straighten and clip the joints in said walls as required by the plans and specifications, and that they did not execute the brickwork to the satisfaction of J. McDonald, superintendent, etc., and that it was only after they had utterly refused and neglected to conform to the demands of said McDonald, and of the defendant, that they should execute the work according to the plans and specifications, that defendant forbade them from further proceeding, as aforesaid. The answer also alleged a payment of $42.21, and it set up a counterclaim for damages resulting to defendant from the failure of plaintiffs to execute the work according to contract. There was a reply in general denial of the counterclaim. The “ specifications.” referred to in the contract contained the following provisions, which were relied upon by the defendant : 1. “ In all disputes arising as to the proper interpretation of the plans or specifications, or as to the fitness of workmanship or materials, the decision of the-superintendent shall be final.” 2. “The whole outside of the building to be laid up with the-best quality of sound, hard burned, common brick, * * all laid straight and plumb, * * * * the joints will be straightened and clippedj’ etc. Upon the trial, plaintiffs made proof of the amount of work they had done, and the value of the materials they had furnished for the building in question, the length of time they had lain idle in consequence of not being permitted to proceed with the work, and other facts bearing upon the question of the amount of damages to which they were entitled, if any; and they rested without offering any evidence as to the manner in which the work was done. Defendant moved for a nonsuit, which was denied. The superintendent, McDonald, as a witness for defendant, then testified: “Plaintiffs laid the water table, with a level foundation, and proceeded to lay the brick to a certain stage, until I notified him • [meaning the senior plaintiff] to do it in a different manner from that in wbicb he was doing it. * * The difference between the manner in which he was doing the work and that which the contract calls for, was in not straightening the joints and clipping. The joint of the mortar should have been straightened with the straight edge, and the refuse mortar over and above the straight edge should have been clipped off. * * The plaintiffs were using the common manner of laying common brick work,— that is, taking off the mortar, and then pointing it with the edge of a trowel, drawing the edge of a trowel over it as is ordinarily done in common brick work. The work was not done to my satisfaction. I objected to it when it was partially done. This straightening and clipping should be done before the mortar gets too hard. Part of the wall was up as far as I thought it should be before the joint should be finished. * * I requested plaintiffs to do the work in a different manner from that in which they were doing it. He [the senior plaintiff] made objections on the ground that I would not like the work, — it would not suit me. Then I told him it was none of his business ; to go and do the work. * * He did some small portion of the work in one corner of the building, nearly in conformity to the design, and then the work seemed to go along without his doing it, and the mortar began to harden, and I required him to do it again. He did not. Then I served a written notice on him to do it. I do not recollect that plaintiffs refused to do the work in the way I wanted, but they did not do it. * * When I found that Hudson was not obeying my orders and directions, I served him with the notice -to suspend the further execution of the work. It was not being done according to the agreement, and it must stop, or else he must go on in accordance with the agreement.” The testimony of Thompson, living in Wisconsin, a mason and plasterer sixteen years; of Wilson, a builder, contractor and bricklayer, engaged in that business about forty-nine years, and living in Oshkosh; and of debo, a mason about fourteen or fifteen years, and living at Green Bay —confirmed that of McDonald as to the proper'meaning of the words “joints straightened and clipped.” The defendant himself testified that “ when he was young ” he had been “ engaged in the mason trade ” for about ten years, and since that time, though he “ had not done any work himself, he had had it done frequently, and superintended it some.” He testified in the same manner as McDonald as to the meaning of the words above quoted, and the fact that plaintiffs did not comply with the specifications in that particular. For the plaintiffs were then called five witnesses: Kellogg, a resident of Green Bay, an architect and builder for about fifteen years; Hudson, Sr., one of the plaintiffs; Meyer, a mason, resident in Green Bay, who had worked upon the building in question as foreman under the plaintiffs; Frost,, a mason and builder for twenty-three years, residing at Fond du Lac, who had also done some work upon the building in question as an employee of plaintiffs; and Gunn, a resident of Green Bay, a mason for over thirty years. These all testified, in substance, that the brick work done by plaintiffs was in their opinion “ straightened and clipped ” as required by the specifications ; and that it was not necessary for that purpose to make use of a “straight edge.” The last named witness, however, testified that “ there are a great many different meanings to the term ‘ straightened and clipped ; ’ every one seems to have his own definition of it; I don’t intend to fix the definite meaning it has among architects.” The plaintiffs also introduced the following evidence as to the state of feeling previously existing in the mind of McDonald toward Hudson, Sr. ; an objection by defendant, that there was no ground laid in the pleadings for impeaching the good faith of McDonald, being overruled. The witness Frost testified that in a conversation held with McDonald a short time before the work here in question was done, McDonald said that “ he liked Samuel Hudson, the younger one, but that he had got through with the old gentleman.” The witness Gunn testified that about a year before the contract here in question was let, he had a conversation with McDonald, in which the latter said that he would not allow the elder Hudson “ to do a job that he had anything to do with; that he wouldn’t have him to work on a job.” Mr. McDonald was then recalled for the defendant and testified that he did not believe he had ever made to the witness Gunn the statement testified to by the latter; that he never had any reason for making such a statement to him; that he never had any ill.will toward the Hudsons, but quite the reverse; that he remembered the conversation referred to by the witness Erost, and that a part of it was about Frost’s going into partnership with Hudson; that he thought he expressed the opinion that if Frost would go into partnership with the younger Hudson, he (McDonald) would do everything he could to further their interests; but that he “ would not like to have anything to do with the old man, on account of his being- quarrelsome and la wing,” the witness added: “I was not instrumental in procuring this job for the plaintiffs, that I recollect. I was favorable to their getting it, and took particular pains to explain the work to them.” After the evidence was all in, defendant again moved for a nonsuit, on the ground that it appeared upon the undisputed evidence that the work was not done to the satisfaction of the superintendent, as the contract required. The motion was denied. The court instructed the jury, in substance, that if there was no dispute as to what “ straightening and clipping the joints” meant, if those words required the work to be done in one particular manner, and there was no dispute as to what that manner was, and if it was done in that manner, then it would be obstinate and unreasonable for McDonald to withhold his assent, and plaintiffs might recover, notwithstanding his refusal to be satisfied with the work; that, on the other hand, if there . were different ways of straightening and clipping the joints, if the words were understood differently by different mechanics, so that from the testimony it could not be ascertained certainly and precisely how the work was to be done, or whether the contract, in that regard, had been complied with, then plaintiffs could not recover without doing the work to the satisfaction of McDonald; that it might, however, be shown, in case McDonald withheld his assent, that he did so fraudulently, or in bad faith; and this would entitle plaintiffs to recover. Verdict for the plaintiffs, for $175. The defendant moved for a new trial on the ground that the verdict was contrary to the evidence and to the instructions of the court; and that the court erred in refusing a nonsuit, and in submitting to the j ury the question of good faith on the part of the superintending architect, there being no evidence in the case to impeach his good faith. as to the effect of the stipulation to pay upon the superintendent’s being satisfied, or upon his certificate, argued, 1. That the satisfaction of the superintendent and the execution of his certificate, were a condition •precedent to plaintiffs’ right of action ; and they could not recover until the occurrence of such condition precedent, even though the superintendent withheld his satisfaction and certificate obstinately, or from prejudice, or in bad faith. Milner v. Field, 5 Exch., 829, and 1 Eng. L. & E., 531; Clarice v. Watson, 18 0. B. (N. S.), 278 ; Batterbury v. Vyse, 2 Hurls. & Colt., 42; Morgan v. Birnie, 9 Bing., 672; Grafton v. Eastern Counties R. R. Co., 8 Exch., 699, and 22 Eng. L. & E., 557; [Lang-dell’s L. 0. on Contracts, 539, 598, 850, 508, 550] ; Wersley v. Wood, 6 Term, 710; Glen v. Leith, 22 Eng. L. & E., 489 ; Butler v. Tucker, 24 Wend., 447; Canal v. Dubois, 15 id., 89, 90, 92; Smith v. Brady, 17 1ST. Y., 173, 175-6; McCarren v. Mc-Nulty, 7 Gray, 139; TJ. S. v. Robeson, 9 Pet., 319; McAvoy v. Long, 13 Ill., 147; 1 Hilliard on Con., pp. 127, 128. Counsel both criticized and distinguished the case of Thomas v. Fleury, 26 N. Y., 26. 2. That if the fraud or bad faith of the superintendent in withholding his satisfaction were any excuse for the nonperformance of this condition precedent, this could not be shown under the pleadings. Under an allegation of performance, an excuse for nonperformance is not admissible; but such excuse must be specifically pleaded. Avery v. Scott., 20 Eng. L. & E., 334; Oakley v. Morion, 1 Kern., 30; Brown v. Overbury, 34 Eng. L. & E., 610; Grafton v. Eastern Counties B. B., 22 id., 557; Milner v. Field, 5 Exeh., 829; 7 Barb., 169; 2 Wend., 399; 8 Johns., 392; 9 id., 115; Warren v. Bean, 6 Wis., 120; Baasen v. Baehr, 7 id., 516. 3. That the evidence utterly failed to show fraud or bad faith on the part of McDonald. The utmost attempted to be shown was, that at sometime, long before he was called upon to decide on plaintiffs’ work, he was not on very good terms with one of the plaintiffs. Evidence that the work was done according to the contract cannot be received to show bad faith on his part. Otherwise the clause requiring the work to be done to his satisfaction is useless. II. As to the effect of the stipulation that in all disputes as to the interpretation of the plans and specifications, or as to the fitness of workmanship, the superintendent’s decision should be final, counsel argued, 1. That the clause is a prospective submission to arbitration, and the decision of the superintendent, when made, is an award, which can only be impeached for fraud or mistake. Smith v. Boston B. B., 36 N. H., 458; Underhill v. Cortlandt, 17 Johns., 405 \ Leonard v. House, 15 Gra., 473; Bobinson v. Fiske, 25 Me., 401; Bauman v. Young, 31 Pa. St., 306; Beynolds v. Caldwell, 51 id., 298; Jebb v. McFiernan, Moody & Malk., 340; Hopldns v. Gilman, 22 Wis., 476; Lansing's Appeal, 10 id., 120; Baasen v. Baehr, 7 id., 516; Cle-worth v. Piclcford, 7 Mees. & W., 314. 2. That fraud or mistake, to be available to impeach the decision, must be alleged fully and specifically. Baasen v. Baehr, supra; Perkins v. Giles, 53 Barb., 342. 3. That there was no evidence of either fraud or mistake on the part of the umpire. The fact that the judgment of others brought them to a different conclusion from that reached by him, is immaterial. Even if he erred in judgment, this is not the kind of mistake intended by the rule. Robinson v. FisJce, 25 Me., 401; Boston Water Co. v. Cray, 6 Met., 131. contended that the court properly charged the jury as to the effect of a want of good faith on the part of the superintendent (7 Wis., 516; 26 N. Y., 26 ; 39 id., 377); that there was evidence enough to cany the question to the jury ; and they undoubtedly found that he was not acting in good faith. They further contended that proof of McDonald’s mistake or bad faith was admissible under the complaint ; or, if otherwise, that the complaint was amendable (Tay. Stats., 1445, § 35, and 1446, § 41), and, the evidence being all in, the judgment would not be issued on that ground.