Northwestern Terra Cotta Co. v. Caldwell

Citation234 F. 491
Decision Date19 June 1916
Docket Number4521.
PartiesNORTHWESTERN TERRA COTTA CO. v. CALDWELL et al.
CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)

[Copyrighted Material Omitted]

E. H Scott, of Omaha, Neb. (L. F. Crofoot and W. C. Fraser, both of Omaha, Neb., on the brief), for plaintiff in error.

J. A C. Kennedy, of Omaha, Neb. (T. J. Mahoney, of Omaha, Neb., on the brief), for defendants in error.

Before HOOK and SMITH, Circuit Judges, and REED, District Judge.

SMITH Circuit Judge.

George W. Caldwell and Lester Drake, as copartners under the name of Caldwell & Drake, entered into a contract for the construction of a new courthouse at Omaha, Neb., and gave a bond to the county dated April 10, 1909, with the Fidelity & Deposit Company of Maryland as surety which provided:

'Now the condition of this obligation is such that if the above bounden Caldwell & Drake shall pay off and discharge all debts due to subcontractors, laborers and mechanics and all debts of every nature due for labor and material used in and about said building in the performance of said contract * * * then the above obligation to be void, otherwise to be and remain in full force and effect.'

The building was to be of stone, with certain terra cotta trimming, and Caldwell & Drake let the contract to furnish the terra cotta to plaintiff for $13,000, and the Fidelity & Deposit Company of Maryland signed as surety a separate bond to the Northwestern Terra Cotta Company for the payment of the amount of said contract by Caldwell & Drake. The contract between the plaintiff and the defendants Caldwell & Drake for the terra cotta work stipulated that the plaintiff should be designated as the contractor, and Caldwell & Drake should be designated as the owners and contained the following provisions:

'Article I. The contractors shall and will provide all the materials and perform all the work for the furnishing and delivering f.o.b. cars Chicago, with allowance of freight to Omaha, for the architectural terra cotta for the Douglas county courthouse to be erected at Omaha, Neb., as shown on the drawings and described in the specifications prepared by John Latenser, architect, which drawings and specifications become hereby a part of this contract.
'Art. II. It is understood and agreed by and between the parties hereto that the work included in this contract is to be done under the direction of the said architects and that their decision as to the true construction and meaning of the drawings and specifications shall be final. * * *
'Art. V. Should the contractors at any time refuse or neglect to supply a sufficiency of properly skilled workmen, or of materials of the proper quality or fail in any respect to prosecute the work with promptness and diligence, or fail in the performance of any of the agreements herein contained, such refusal, neglect or failure being certified by the architects, the owners shall be at liberty, after three weeks written notice to the contractors, to provide any such labor or materials, and to deduct the cost thereof from any money then due or thereafter to become due to the contractors under this contract; and if the architects shall certify that such refusal, neglect or failure is sufficient ground for such action, the owners shall also be at liberty to terminate the employment of the contractors for the said work and to enter upon the premises and take possession, for the purpose of completing the work included under this contract, of all materials, tools and appliances thereon, and to employ any other person or persons to finish the work, and to provide the materials therefor; and in case of such discontinuance of the employment of the contractors they shall not be entitled to receive any further payment under this contract until the said work shall be wholly finished, at which time, if the unpaid balance of the amount to be paid under this contract shall exceed the expense incurred by the owners in finishing the work, such excess shall be paid by the owners to the contractors; but if such expense shall exceed such unpaid balance, the contractors shall pay the difference to the owners. The expense incurred by the owners as herein provided, either for furnishing materials or for finishing the work, and any damage incurred through such default, shall be audited and certified by the architects whose certificate thereof shall be conclusive upon the parties.
'Art. VI. The contractors shall complete the several portions and the whole of the work comprehended in this agreement by and at the time or times hereinafter stated, to wit: They shall begin delivery on cars Chicago of the first material required for the building on or before October 10, 1910, and shall follow up with further shipments so as to complete the entire work on or before October 25, 1910.
'Should the contractor fail to complete said work by and at said time, he shall pay to the owner liquidated damages of fifty (--) ($50.00) for each and every day after October 25th, 1910, and the owner shall pay to the contractor a bonus of fifty dollars ($50.00) for each and every day the said work is completed prior to October 25th, 1910.
'Art. VII. Should the contractors be delayed in the prosecution or completion of the work by the act, neglect or default of the owners, of the architects, or of any other contractors employed by the owners upon the work, or by any damage caused by fire or other casualty for which the contractors are not responsible, or by combined action of workmen in no wise caused by or resulting from default or collusion on the part of the contractors, then the time herein fixed for the completion of the work shall be extended for a period equivalent to the time lost by reason of any or all the causes aforesaid, which extended period shall be determined and fixed by the architects; but no such allowance shall be made unless a claim therefor is presented in writing to the architects within forty eight hours of the occurrence of such delay.
'Art. VIII. The owners agree to provide all labor and materials essential to the conduct of this work not included in this contract in such manner as not to delay its progress, and in the event of failure so to do, thereby causing loss to the contractors, agree that they will reimburse the contractors for such loss; and the contractors agree that if they shall delay the progress of the work so as to cause loss for which the owners shall become liable, then they shall reimburse the owners for such loss.

'Should the owners and contractors fail to agree as to the amount of loss comprehended in this article, the determination of the amount shall be referred to arbitration as provided in article XII of this contract.'

'Art. XII. In case the owners and contractors fail to agree in relation to matters of payment, allowances or loss referred to in Articles III or VIII of this contract, or should either of them dissent from the decision of the architects referred to in Article VII of this contract, which dissent shall have been filed in writing with the architects within ten days of the announcement of such decision, then the matter shall be referred to a board of arbitration to consist of one person selected by the owners, and one person selected by the contractors, these two to select a third. The decision of any two of this board shall be final and binding on both parties hereto. Each party hereto shall pay one-half of the expense of such reference.' The contract contained no special designation of the amount of terra cotta to be furnished except by reference to the plans and specifications. A controversy arose between Caldwell & Drake and the Northwestern Terra Cotta Company as to just what terra cotta was to be furnished under the contract. The parties agreed that it called for sufficient for the cornice below the coping, and Caldwell & Drake claimed it included the coping and certain lintels upon the tower. The Northwestern Terra Cotta Company claimed that neither the coping nor lintels was embraced in the contract. The property which both sides agreed was covered by the contract was all manufactured and ready to be shipped and cars ordered by October 25, 1910. Caldwell & Drake, after the making of the contract, requested that shipments be made over the Chicago Great Western Railroad. The Northwestern Terra Cotta factory was on the line of the Chicago & Northwestern Railway, and compliance with the request of Caldwell & Drake to ship over the Chicago Great Western caused the slight delay beyond the date mentioned in the contract. The shipments were in five cars, and were actually made, two cars on October 26th, one on October 27th, one on October 29th, and one on November 2d, and all reached Omaha before they were needed in the construction of the building. There was some confusion in the plans and specifications as to what material the coping and lintels were to be of. One of the plans, Exhibit 4, shows the lintels of brick and the coping of stone. Another of the plans, Exhibit 5, does the same. Another plan, Exhibit 6, shows the coping as terra cotta, but indicates nothing as to the lintels. A fourth plan, Exhibit 7, shows the lintels in terra cotta, and shows nothing as to the coping. It appears to be agreed that the question as to the lintels was submitted to the architect as provided in article II of the contract, and he held that they were of terra cotta, but permission was given to use stone, and by agreement of the parties stone was used by Caldwell & Drake. This was done at a cost of $41.06. No question was ever submitted to the architect, as provided in the contract, as to the coping, but he testified:

'I did not make a decision whether or not the coping should be of terra cotta or of stone, but if the
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8 cases
  • Garland v. Samson
    • United States
    • United States Courts of Appeals. United States Court of Appeals (8th Circuit)
    • September 16, 1916
    ...... court upon this question (Northwestern Terra Cotta Co. v. Caldwell, 234 F. 491, . . . C.C.A. . . .), because ......
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