Benjamin Foster Co. v. Commonwealth
| Decision Date | 07 May 1945 |
| Citation | 318 Mass. 190,61 N.E.2d 147 |
| Parties | BENJAMIN FOSTER COMPANY v. COMMONWEALTH. |
| Court | United States State Supreme Judicial Court of Massachusetts Supreme Court |
December 7, 1944.
Present: FIELD, C.
J., QUA, DOLAN RONAN, & WILKINS, JJ.
Contract, What constitutes, Building contract, Rescission, Construction Performance and breach. Fraud. Warranty. Practice, Civil Auditor: findings; Inferences.
In a case referred to an auditor whose findings were to be final, findings of the auditor which are not inconsistent with each other and which are not shown by the report to be erroneous in law are binding upon the trial court and upon this court, except that the auditor's conclusions of fact reached solely by way of inference from other facts are open to review as matter of fact by the trial court and by this court, and either court may draw additional inferences from facts found. Per QUA, J.
The mere fact, that there was an ambiguity on plans included in a signed building contract containing a provision that questions as to the interpretation of the plans and specifications should be decided by an engineer, furnished no ground for a contention that the minds of the parties never met and that no contract ever came into existence. Approval of a "plan of operation" which an elaborate building contract required the contractor to submit to show the manner of doing the work called for by the contract was not a condition precedent to the existence of the contract, which must be deemed to have been made on the day of its execution by the parties.
A contractor was not entitled to rescind a contract with the Commonwealth for the construction of an embankment to the satisfaction of its engineer on the ground that he was induced to enter into the contract by fraud consisting of nondisclosure by the engineer of his decision not to allow all the material for the embankment to be taken from a certain convenient borrow area but, within powers given him under the contract, to require at least some of it to be taken from another, less convenient borrow area, where it was found that, although the contractor hoped and expected to use only the convenient area, he contemplated the possibility of using the less convenient area also, that even if he had known of the engineer's decision he would not have refused to enter into the contract and his bid would not have been higher, and that loss subsequently sustained by the contractor through being required to cease using the convenient area was not attributable to the nondisclosure.
A reading of an entire contract with the Commonwealth for the construction of an embankment did not show that there was any implied warranty to the contractor that he would be allowed to obtain all the necessary materials from a certain convenient borrow area.
Broad powers given, by a contract with the Commonwealth for the construction of a large earthen embankment at a unit price, to the engineer of the Commonwealth to control the performance of the work in order to ensure proper construction, although they did not authorize the engineer to abrogate or change the contract and must be exercised for the purpose of carrying out the work originally intended, did authorize decisions by the engineer, made in the free exercise of his own best judgment in good faith, by reason of which he ordered an increase in the thickness of and the proportion of fine material in the core of the embankment resulting in the contractor's having to obtain material from a less convenient borrow area and in the wasting of fine material, and also ordered a temporary change in the method of bringing in and placing material; and the requirements so made of the contractor by the engineer's decision were not a breach of the contract.
Provisions of a contract with the Commonwealth for the construction of an embankment made the engineer of the Commonwealth a quasi arbitrator respecting broad powers given him to control the performance of the work in order to ensure proper construction, and his decisions arrived at in the free exercise of his own best judgment in good faith were not controlled by any extrinsic standard of reasonableness or necessity.
PETITION, filed in the Superior Court on September 17, 1940. The case was heard by Goldberg, J., upon an auditor's report.
D. Stoneman, (W.
E. McCurdy with him,) for the petitioner.
R. T. Bushnell, Attorney General, (J.
G. Bryer, Special Assistant Attorney General, with him,) for the Commonwealth.
This petition is prosecuted under G. L. (Ter. Ed.) c. 258 to recover for work done and for damages sustained by the petitioner acting as contractor for the metropolitan district water supply commission (St. 1926, c. 375; St. 1927, c. 321) in respect to "Item 8" of "Contract No 52," dated August 24, 1936, relating to the construction of the embankment for the main dam of Quabbin Reservoir. The work out of which this litigation arises was performed during the spring, summer and autumn seasons of the years 1937 and 1938.
The petitioner contends that no express contract ever came into existence between the parties, or that if such contract did come into existence the petitioner was induced to enter into it by representations made in behalf of the Commonwealth which were substantially false or which were at least only half truths that by reason of concealment of material facts amounted to fraud, and that the Commonwealth broke the contract after it was made. Claim 1 of the petition is a claim to recover $892,581.30 and interest for breach of contract in several respects which, in so far as they are still pressed, will be dealt with later in this opinion. Claim 2 appears to be a claim for damages for deceit, but since damages cannot be recovered against the Commonwealth in tort, Arthur A. Johnson Corp. v. Commonwealth, ante, 88, 92, this claim need not be further considered. Claim 3 is for an undisputed balance most of which has now been paid. An offer of judgment has been made for the remainder. This claim is no longer in controversy. Claim 4 is to recover $892,581.30 and interest on quantum meruit for work and materials and rests upon the theory that no express contract ever came into existence or upon the theory of rescission of the contract for the alleged fraud. Long v. Athol, 196 Mass. 497 , 506. Claims 1 and 4 are in the alternative. No question has been raised as to the propriety and sufficiency of the pleadings. We treat claims 1 and 4 as adequate bases for recovery on the grounds contended for by the petitioner, if necessary facts have been established.
The case was heard by an auditor whose findings of fact were to be final. Where cases are referred in this way findings of the auditor which are not inconsistent with each other and which are not shown by the report to be erroneous in law are binding upon the trial court and upon this court, except that the auditor's conclusions of fact reached solely by way of inference from other facts are open to review as matter of fact by the trial court and by this court, and either court may draw additional inferences from facts found. United States Fidelity & Guaranty Co. v. English Construction Co. 303 Mass. 105 , 109-112. Galluzzi v. Beverly, 309 Mass. 135. See Arthur A. Johnson Corp. v. Commonwealth, 306 Mass. 347 , 350, 351.
In compliance with an order of the court the auditor filed a report on questions of liability only. Thereupon the trial judge ruled that the petitioner was not entitled to recover for work performed and furnished in connection with "Item 8," except as hereinafter stated. He denied a motion of the petitioner that the court determine that the respondent is liable to the petitioner for work performed and furnished and order further hearings upon the question of damages, and he allowed motions of the respondent for judgment in its favor on claims 2 and 4 and that "a final decision . . . be entered" in its favor on claims 1 and 3 in so far as they relate to "Item 8" of "Contract 52," except as to the balance admittedly due of $12,801.64. He then reported his action upon the motions. G. L. (Ter. Ed.) c. 231, Section 111. The action of the judge is a decision in favor of the respondent of all issues argued before us.
The embankment of the main dam, now known as Winsor dam, is about a half mile in length and rises to a height of about one hundred seventy feet above the original valley surface. It crosses the bed of Swift River. Its ends rest upon hills on each side of the river. It is constructed of earthen materials. According to the "Information for Bidders" which accompanied the contract it is about eight hundred feet wide between the upstream and downstream faces at a distance of one hundred thirty feet from the top, toward which the slopes taper. It creates a lake of an area of about thirty-nine square miles. It was estimated to contain three million five hundred fifty thousand cubic yards of earth. The total bid of the petitioner for all the work contained in "Contract No. 52" was $2,317,445. Of this sum $1,136,000 was for the embankment, calculated at a unit price per cubic yard. The embankment was designated as "Item 8."
The embankment was required to be built by the so called full hydraulic method. The dominating characteristics of this method may be described as follows. The embankment is built upon a foundation which is in the form of a very broad shallow trough, the lowest part of which is along the center line of the dam. The materials of which the dam is to be composed such as earth, sand, gravel, and small stones, are mixed with water and sluiced through pipes upon the sides of the trough at their outer edges. The coarsest and heaviest materials come to rest near what are to be the outside faces of the dam. Finer materials are...
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