Sheffield Birmingham Coal, Iron Ry Co v. Gordon

• Decision Date: 15 January 1894
• Docket Number: No. 176,176
• Parties: SHEFFIELD & BIRMINGHAM COAL, IRON & RY. CO. v. GORDON et al
• Court: U.S. Supreme Court

151 U.S. 285

14 S.Ct. 343

38 L.Ed. 164

SHEFFIELD & BIRMINGHAM COAL, IRON & RY. CO.

v GORDON et al.

No. 176.

January 15, 1894.

Statement by Mr. Justice BROWN:

This was an intervening petition filed by the firm of Gordon, Strobel & Laureau, in a case pending in the circuit court for the northern district of Alabama for the foreclosure of a deed of trust, setting up and claiming a mechanic's lien on certain furnace property described in the petition, to secure the payment of a large balance due to them as builders. The Central Trust Company of New York, trustee under the deed of trust, and plaintiff in the foreclosure suit, the Sheffield & Birmingham Coal, Iron & Railway Company, the mortgagor, Jacob G. Chamberlain, who was receiver in the foreclosure suit, and one Charles D. Woodson, as holder of certain bonds of the company, were made defendants to the petition. Petitioners' claim arose under a contract whereby they agreed to construct for the Alabama & Tennessee Coal & Iron Company, the predecessor of the appellant corporation, three iron blast furnaces at Sheffield, in Colbert county, Ala., for $564,000, 90 per cent. of which amount was to be paid from time to time during the construction of the furnaces, and which 90 per cent. had been practically paid as agreed between the parties, the claim of the appellees being the balance, together with some amounts alleged to have been paid out for excessive freight charges, and upon material furnished to repair and reconstruct one of the furnaces.

Joint and several answers were filed by the defendants, setting forth certain defenses to the petition, and demanding proof of each allegation thereof. It was admitted that the defendant company had become liable for whatever amount was due the petitioners by the original Alabama & Tennessee Coal & Iron Company. The main defense was that Gordon, one of the interveners, had undertaken to supervise the blowing in of one of the three furnaces, in which operation the furnace was ruined, and subsequently abandoned; that, in the blowing in of a second furance, it suffered such damage that it required about six months to put it in good condition; that the furnaces were not built according to the plans, specifications, and agreements of the contract, but were constructed in so faulty and inadequate a manner that their daily expense for coal was much larger than it would have been had they been properly constructed.

A decree was entered by consent, referring the case to a special master to examine and report the facts as to the existence of the contract, the construction of the furnaces, the payments made therefor, the amount due the petitioners, the existence of their lien, and also to report upon all matters of defense stated in the answer.

In pursuance of this order the master took the depositions of a number of witnesses, found the facts, and reported a balance due of $57,808.12, with interest from September 18, 1888. Exceptions were filed to this report by the defendants, which, upon argument, were overruled by the court, and a final decree entered in favor of the interveners for the amount reported by the master. From this decree an appeal was taken to this court.

Henry B. Tompkins, for appellant.

W. A. Gunter and R. C. Buckell, for appellee.

Mr. Justice BROWN, after stating the facts in the foregoing language, delivered the opinion of the court.

An interlocutory decree was entered in this case by consent, and the questions in issue arise upon exceptions to the report of the special master, to whom the case was referred to take proofs, and to report the amount found by him to be due. He was not, however, required to report the testimony. Defendants excepted to so much of said report, and the findings of the master in reference thereto, as determined——

'(1) That the defenses set up by the defendants are not sustained by the evidence.

'(2) That the petitioners, Gordon, Strobel & Laureau, are entitled to be paid the contract price for their work and material.

'(3) That the sum of $57,808.12, with interest from the 18th day of September, 1888, is the amount due the interveners. And——

'(4) That the interveners have a lien upon the property described in their petition. And for grounds and reasons for such exceptions they assign the following:

'First. Because the evidence in the case sustained the defenses set up by the defendants; and showed, second, that the work and materials done and furnished by interveners were not up to the requirement and guaranty of their contract, by which the value of the plant, as built and equipped, was worth sixty or seventy-five thousand dollars less than the contract price; and, third, because such report is contrary to the weight of testimony on each of the matters so reported.'

There are two difficulties in the way of considering the case upon these exceptions.

1. The exceptions themselves are too broad, and amount simply to a general denial of the facts and conclusions of the master. The first three are to the finding of the master,—that the defenses are not sustained, that the petitioners are entitled to the contract price, and that the sum awarded is the amount due. In other words, they are general denials of the merits of the claim. The fourth is a denial of petitioners' lien because the evidence sustained the defenses, because the work was not up to the requirements of the contract, and because the report was against the weight of testimony. This exception is scarcely more definite than the other. There are no exceptions here to the findings of the master, now assigned as error, that the interveners did not guaranty that the work or plant, as a whole, should be adequate in design, strength, and capacity for the purposes intended and specified; or to the finding that the petitioners were entitled to be paid the freight excess payments and extra material furnished for the construction of the furnaces; or that the furnaces had attained the product in the making of pig iron, as specified in the contract.

Proper practice in equity requires that exceptions to the report of a master should point out specifically the errors upon which the party relies, not only that the opposite party may be apprised of what he has to meet, but that the master may know in what particular his report is objectionable, and may have an opportunity of correcting his errors or reconsidering his opinions. The court, too, ought not to be obliged to rehear the whole case upon the evidence, as the main object of a reference to a master is to lighten its labors in this particular. In the case of Dexter v. Arnold, 2 Sumn. 108, an exception to a report of a master that he had stated and certified that there was due on a certain mortgage a certain sum, when he ought to have reported that there was nothing due, was held...