Albert v. RP Farnsworth & Co.

• Decision Date: 22 July 1949
• Docket Number: No. 12531.,12531.
• Citation: 176 F.2d 198
• Parties: ALBERT v. R. P. FARNSWORTH & CO., Inc.
• Court: U.S. Court of Appeals — Fifth Circuit

176 F.2d 198 (1949)

ALBERT v. R. P. FARNSWORTH & CO., Inc.

No. 12531.

United States Court of Appeals Fifth Circuit.

July 22, 1949.

Kemble K. Kennedy, Baton Rouge, Louisiana, Calvin E. Hardin, Jr., Baton Rouge, Louisiana, for appellant.

Eberhard P. Deutsch, New Orleans, La., for appellee.

Before HUTCHESON, HOLMES and WALLER, Circuit Judges.

HUTCHESON, Circuit Judge.

The suit, brought by the general contractor to whom a contract had been awarded, was for damages for the failure of a subcontractor to stand to, and comply with, his bid to furnish the furring, lathing, and plastering.

The claim was that, after plaintiff had used defendant's sub-bid in computing his general bid and after the general contract had been awarded, defendant, knowing that this was so, had undertaken to withdraw his bid and had refused to stand to, and perform work under it, and plaintiff had relet the work at a cost to it of $6,549.60 over defendant's bid.

The defendant, admitting that it had bid as alleged but insisting that before the bid had been accepted he had withdrawn his bid, denied that a binding contract had resulted.

Defendant's jury demand denied¹ and the cause tried to the court without a jury, there were findings and a judgment for plaintiff.

One of these findings was in effect that the evidence had shown a universal custom in the building trade in Louisiana, that when a subcontractor furnishes a bid to a general contractor it is considered irrevocable after that bid has been used in the preparation of the general contractor's bid to the owner, and that if a subcontractor does not intend that his bid be so taken, it is customary for him to so state in his bid.

Based on the finding of custom, the court concluded: that once the bid of plaintiff in the case was accepted by the owner, it was too late for defendant to withdraw his proposal; that plaintiff had a reasonable time thereafter in which to call upon defendant to perform; and that he did call upon him in a reasonable time.

Urging upon us that his request for a jury, though late, should not have been denied and that the findings and judgment were clearly erroneous, defendant is here insisting that the judgment may not stand.

Conceding as to the jury demand that it was not made as of right, but pointing out: that it was made in ample time for a jury to be, and a jury was, available; that the denial of it was predicated on the expressed view that the case would turn largely on a question of law, rather than a serious question of fact; and that the decision was made to turn on a question of fact, the existence vel non of a binding custom; appellant insists that it was an abuse of discretion to deny it.

As to the judgment on the merits, appellant, insisting that a contract consisting of an offer and an acceptance is not completed until the acceptance by the person to whom it is proposed, invokes art. 1800 of the Civil Code of Louisiana providing: "The contract, consisting of a proposition and the consent to it, the agreement is incomplete until the acceptance of the person to whom it is proposed. If he, who proposes, should before that consent is given, change his intention on the subject, the concurrence of the two wills is wanting, and there is no contract."

Invoking art. 1819, defining "Consent" as a "concurrence of intention * * * reciprocally communicated", appellant points out that an acceptance is not communicated if the party proposing has not received knowledge of it even though the other party may have declared his intention and entrusted its delivery to agencies beyond his control, and that before plaintiff had communicated his acceptance of defendant's bid, defendant had withdrawn it. So pointing, he insists that the court erred in holding, on the basis of a purported custom and practice, that a completed agreement had resulted when by the positive provision of art. 1800, it is provided that "the agreement is incomplete until the acceptance of the person to whom it is proposed", and it is undisputed in the evidence that the bid or offer was withdrawn before it was so accepted.

He urges in addition that the court erred in admitting the evidence of custom because custom was not pleaded, and such evidence as was offered was offered over defendant's objection, and, finally, that the claimed custom was not proven in the clear and definite way required when proof of custom is resorted to.

The appellee, on its part, insists that the evidence, though admitted over the objection that there was no pleading to support it, was made competent by the motion of the plaintiff granted by the court to conform the pleadings to the evidence. To the objection that proof of custom will not vary positive law, the appellant replies the custom proved was not opposed to positive law but was in accordance with Articles 1802² and 1809³ of the Louisiana Civil Code, which state as an exception to the general rule Article 1800 lays down, that offers are revocable until accepted.

Appellee also strongly insists that the case is ruled by Harris v. Lillis, 24 So.2d 689, 691, in which the Orleans Court of Appeal in the course of an opinion affirming a finding that the bid had been accepted before it was withdrawn, added: "Moreover, it seems manifest that, in accordance with the custom prevailing in the building trade in New Orleans, an offer by a subcontracter to a general contractor to do work is irrevocable after the contractor has used the estimate of the subcontractor as a basis for his offer to the owner and the owner has accepted the general contractor's bid." (Emphasis supplied.)

While we agree with appellee as to the force and effect of the code articles it cites, it is quite plain that the case was not tried or decided with those articles in mind, and we cannot agree with it that the case must be affirmed as though it had been properly tried or decided under them. Neither can we agree with appellee that the Harris case, the Court of Appeal decision relied on, is controlling here. The most casual reading of that opinion will disclose that the case was really decided on the testimony of the plaintiff that on Sept. 1, 1940, he formally mailed to the defendant his acceptance of the offer, that the defendant did not claim to have withdrawn the bid until Oct. 9, 1941, and that his offer, having been accepted before it was withdrawn, bound him.

It is quite plain that the part of the opinion which discusses a custom prevailing in the building trade in New Orleans, was not at all necessary to the decision of the cause, and, further, was not intended to lay down a general rule. It is the law in Louisiana as well as elsewhere; that a custom cannot be looked to to change a rule of law,⁴ or to create a contract;⁵ that a custom, when relied upon to take the place of a settled principle of law, must be as definite and specific in negativing the principle as the law which it assumes to supplant is in affirming it.⁶ The evidence in this case, as to custom, is wholly wanting in the requisite certainty, generality,⁷ and reasonableness.

In addition, the custom claimed to be controlling here was not pleaded, nor was it put forward or established in the definite and positive way required. It came in only as an afterthought suggested by questions asked by defendant of a witness for plaintiff, offered on an entirely different matter. This question was whether the witness had not known of cases where low bidders among subcontractors were not awarded the contract. Plaintiff, taking the witness on redirect, then proceeded to question him as to the custom in the building trade in Louisiana relative to the withdrawal of bids by subcontractors.

Defendant's objection that such custom was not pleaded overruled, plaintiff then endeavored to prove the custom on which it now relies. This testimony,⁸ taken together does not at all show a general and reasonable custom understood by all in the trade in the same way, general contractor and subcontractor alike. It presents the varying views of three general contractors as to the construction by general contractors of what they have a right to demand of, or do with, a subcontractor. As the testimony of the last witness shows, this so-called custom establishes no rights whatever in the subcontractor, to receive the contract, but only in the contractor to accept or reject the subcontractor's bid or start new dealings with him, as to the contractor seems fit. A claimed general custom which is no better proved and which has no more mutuality than this is neither legal, reasonable, nor binding, as a custom.

In Williams v. Favret, 5 Cir., 161 F.2d 822, 824, this court dealt with the other side of the picture. There the subcontractor, relying on...