Appeal
from Mahaska Circuit Court.
SOMETIME
in the year 1875, a number of the citizens of Oskaloosa
desirous of securing an extension of the Washington & Sigourney branch of the Chicago, Rock Island & Pacific
Railroad from Sigourney to Oskaloosa, agreed to pay to the
Chicago, Rock Island & Pacific Railroad Company the sum of
twenty thousand dollars when the track of said railroad
should be completed from the town of Sigourney into the city
of Oskaloosa, provided that if the track should not be
completed from the town of Sigourney into the city of
Oskaloosa on the first day of January, 1876, the parties
executing said agreement should be discharged from the
obligation to make payment of one-half of said sum.
On the
10th day of June, 1875, the Chicago, Rock Island & Pacific
Railroad Company entered into a contract with Queally & Bro
for the building of a portion of said road. This contract
contains the following provisions: "The work shall be
commenced immediately and shall be fully completed in
accordance with the terms of this contract, on or before
December 1st, A. D. 1875. If the parties of the first part
refuse or unreasonably neglect to remedy any imperfections
pointed out by the engineer, or in any manner violate the
conditions of this contract, so that in the judgment of the
engineer there will be just grounds of apprehension that the
work will not be completed in the manner and within the time
specified, then it will be the duty of the engineer to serve
a written notice upon said party, setting forth the grounds
for this apprehension, and specifying the manner together
with the reasonable time in which the party of the first part
may cause such grounds of apprehension to be removed, and if
at the expiration of said time said grounds of apprehension
be not removed, then full power is hereby vested in said
engineer to declare the contract forfeited, and upon such
declaration being given in writing to the parties hereto this
contract shall determine immediately, and the party of the
second part may forever retain the reserved per centum in
consideration of the damages they may have sustained by
reason of the forfeiture of the contract, or as an
alternative to the declaration of forfeiture the party of the
second part shall, on written report to the engineer that
apprehensions are entertained that this contract will not be
completed in the time and manner herein stipulated, have the
right to take such measures as may be deemed by the engineer
necessary to insure the completion of the work in the time
and manner herein stipulated, and to deduct from the monthly
and final estimates of the work done under the contract such
sum or sums as may be required to defray the expenses of such
measures. Among the measures which, under such circumstances
may be resorted to are the execution by their own agents of
such portion of the work as said engineer may select, or the
requirement that the parties of the first part shall provide
for and employ in the most efficient manner such additional
men, carts, teams, etc., as the party of the second part may
furnish, in which case said parties of the first part agree
to employ said men, carts, teams, etc., in the manner
directed by the engineer, who shall have the right to retain
from the estimates an amount sufficient to pay said men
carts, teams, etc." Pursuant to this contract Queally & Bro. commenced work in June, 1875. On the 13th day of August,
1875, they executed a power of attorney to C. A. Weed,
authorizing him to do all things necessary to the carrying
out of the above contract, and placed him in the actual
management of the work. On the 26th day of August, 1875, J.
J. A. Queally, the senior and active business member of the
firm of Queally & Bro., died.
The
contract proved not to be a profitable one, and up to the
time of the death of the senior member of the firm it had
been carried on at a great loss, and a large amount was due
to merchants and others for provisions and supplies which had
been advanced to laborers, the amount of which was deducted
from their pay on the rolls. After the death of J. J. A.
Queally, it is claimed by plaintiff that Weed informed Hugh
Riddle, the vice president and chief engineer of the C. R. I. & P. R. R. Co., of the condition of affairs, and that Riddle,
on the 15th day of September, 1875, requested the work to be
carried on in the name of Queally & Bro., and agreed to pay
whatever debts had been or might be contracted in the
prosecution of the work. From the 1st day of July to the 13th
day of September, 1875, the plaintiff sold and delivered
goods, wares and merchandise to divers persons in the employ
of Queally & Bro., and to the contractors working under
Queally & Bro., on account of which the plaintiff claims of
the defendant the sum of three thousand dollars under the
agreement above claimed. The plaintiff also claims to be
assignee of various persons who furnished hay, corn, meat,
etc., to Queally & Bro., and to the contractors working under
Queally & Bro., and their employes. The evidence shows that
all the claims of the alleged assignors of plaintiff, with
the exception of a very inconsiderable sum, arose prior to
the 12th day of September, 1875, and, as to this small sum
credit was given to the contractors and subcontractors to
whom, and on whose orders, the sales were made. On account of
all the demands the plaintiff claims of the defendant fifteen
thousand dollars. There was a jury trial, resulting in a
verdict for plaintiff for $ 9,797.72. The jury also returned
the following special findings:
"Do
you find that the defendant made a parol promise to pay the
debts of Queally & Bro., and the sub-contractors, that were
due to the plaintiff and his assignors in this suit? Answer:
Yes.
"When
were said promises made--give the months and dates? Answer:
On or about the 12th or 13th of September, 1875.
"To
whom were said promises made; give the names of all persons
to whom you find the said promises to have been made. Answer:
To John F. Lacey, C. A. Weed and F. J. Queally.
"Do
you find that Mr. Riddle about the middle of September, 1878,
made a parol promise to Mr. Weed, as the agent of Queally & Bro., to see that the debts of said Queally & Bro. to the
plaintiff and his assignors in this suit should be paid?
Answer: Yes.
"What
was the consideration for such promises? Answer: It was to
prevent the stoppage of work on the road, and to enable the
railroad company to get its road completed at an early day,
and in order that it might draw the money subscribed by the
citizens of Oskaloosa."
The
defendant's motion for a new trial was overruled, and
judgment was rendered for plaintiff. The defendant appeals.
REVERSED.
OPINION
DAY, J.
The
plaintiff introduced C. A. Weed, general manager for Queally & Bro., who, amongst other things, testified as follows
"I went to Chicago three times after the death of J. J.
A. Queally, to confer with Mr. Riddle about the business, and
I had a conference with him at Oskaloosa in regard to the
financial matters of the work. The first interview was about
September 15, 1875, after the death of Mr. Queally, when I
went to Chicago at the request of Mr. Riddle, with the pay
rolls from the beginning of the work to the 1st
of September, and other papers and figures relating thereto,
which he examined. I told him that Queally & Bro. were losing
money, and that it would be impossible for them to complete
the work at the contract price, and unless they received aid
in some way from the company they would have to throw up the
work. He said that at that time he could not advance the
price, nor would he allow Queally & Bro. to throw up the
work; that he wanted the work to proceed to completion under
the name of Queally & Bro., and for me to remain as manager
of the work, and at its completion, if he saw the work had
been handled economically, that then he would advance money
sufficient to pay the actual expense of the work. He also
said that as Queally & Bro. had proven themselves unable to
carry on the work financially, and it would be necessary for
the company to advance money to pay for the labor, supplies,
etc., that he would send a man to Oskaloosa to handle the
money advanced by the company, taking my receipt for the
money paid out as agent of Queally & Bro., that man to also
vouch for all bills of merchants of whom we were getting
supplies, so that they would feel safe and continue to give
credit to Queally & Bro; it was at my own request that this
man was sent for the above purpose, as the merchants,
mechanics and others whom we had dealt with at Oskaloosa for
necessary supplies, had after the death of Mr. Queally found
that Queally & Bro. were unable to pay their bills, and
would, therefore, give them no more credit, without which the
work would have to stop, all of which I told Mr. Riddle, and
that in order to carry on the work under the name of Queally & Bro. it would be necessary for him to send a man to
Oskaloosa who should have power to approve all debts
contracted for the necessary expenses of carrying on the
work. F. J. Queally was present with me at this interview,
from whom Mr. Riddle required a power of attorney empowering
me to do the business of Queally & Bro. on the contract
between them and the railroad company, said power of attorney
to be signed by F. J. Queally as surviving partner of Queally & Bro., which power of attorney was made out, at the
direction of Mr. Riddle, by some one in his employ. At this time there was quite a large amount due...
