Burgin v. Smith

• Decision Date: 23 December 1909
• Citation: Burgin v. Smith, 151 N.C. 561, 66 S.E. 607 (N.C. 1909)
• Parties: BURGIN v. SMITH et al.
• Court: North Carolina Supreme Court

66 S.E. 607

151 N.C. 561

BURGIN v. SMITH et al.

Supreme Court of North Carolina

December 23, 1909

Appeal from Superior Court, Burke County; J. S. Adams, Judge.

Actions by R. J. Burgin, on behalf of himself and the taxpayers of McDowell County, against B. F. Smith and others, and by the Board of County Commissioners against B. F. Smith. From the judgment denying relief in the first action and avoiding damages to plaintiff in the second action, both parties appeal. Reversed.

A county may be sued only in and for such causes as may be provided for by statute.

This was a civil action instituted in McDowell county, and by proper order duly removed for trial to Burke county. This action was originally begun by R. J. Burgin, on behalf of himself and other taxpayers of McDowell county, against the board of commissioners of said county, the treasurer and sheriff of said county, and B. F. Smith, trading as the B. F Smith Fireproof Construction Company, seeking to enjoin the payment of certain notes issued by the board of commissioners of said county to B. F. Smith, in the sum of $1,500--three notes of $500--and to enjoin the collection of a special tax levied to raise money to pay the same. The board of commissioners of McDowell also brought suit against B. F Smith; the purpose of this action being to recover judgment for defective work done under the contract, hereinafter more fully recited, for improving and enlarging the courthouse in said county. In the Burgin suit the then board of commissioners (its members having been changed) answered admitting the allegations of the complaint and praying to be made party plaintiff. This was done, it seems, without objection, and the board of commissioners took a nonsuit in the separate action instituted by it against Smith. The pleadings were reformed to meet this change of parties. In the Burgin suit, the restraining order was issued and continued to the hearing of the action. The first draft of the complaint alleged that the board of commissioners of McDowell were authorized by chapter 242, p. 374, Pub. Laws 1901, to issue coupon bonds or county script, in an amount not exceeding $5,000, for the purpose of improving and enlarging the courthouse in Marion; that in January, 1902 the then board of county commissioners entered into a contract with the defendant, B. F. Smith, trading as the B. F. Smith Fireproof Construction Company, with the plans and specifications thereto attached, for the purposes specified in the act, and agreed to pay the said Smith the sum of $6,500 therefor, to raise which said sum the county agreed to issue, and did issue, $5,000 in coupon bonds of the county and county script, in the sum of $1,500--3 notes of $500 each--payable in five years with interest at 5 per cent. per annum; the interest on the bonds was at the rate of 6 per cent. and payable semiannually, evidenced by coupons attached to the bonds. The contract with Smith bound him "to well and sufficiently provide all necessary material, tools and appliances, and perform all the labor required in the proper construction, erection and completion of a new addition to the county courthouse and appurtenances for said second party (board of commissioners), including metal fixtures and appliances," to be erected etc., according to plans and specifications on file in the office of the register of deeds of said county. The commissioners reserved the right to make changes or alterations, and the contract provided a way for determining whether the alterations increased or diminished the contract price; the work was to be completed on or before July 15, 1902; then the contract proceeds: "In consideration of the foregoing covenants and agreements being well and faithfully performed by said first party (Smith), the said second party agrees to pay said first party or order the sum of six thousand five hundred dollars ($6,500) as follows: $5,000 in cash and $1,500 in three notes of $500 each, due and payable in five years from issue, drawing interest at five per cent., the county reserving the right to redeem any or all at any interest-paying period." As the work progressed, it was stipulated that 75 per cent. of the value of material furnished for and labor performed in the construction of said building and its appurtenances should be paid on or about the first day of each month, and the remainder upon final completion "of said building and its equipments and appurtenances, as required by said specifications." Smith was required to give bond in the sum of $6,500, and it was further stipulated that "said second party shall appoint a superintendent or committee, qualified to judge as to the quality and character of the material and work required by this agreement, whose duty it should be to inspect and report upon the work and material during the construction of said building, and should any material be furnished therefor, or work be done thereon, which, in his or their opinion, is not in accordance with the requirements of the plans and specifications therefor, it shall be his or their duty to notify said first party thereof, in person or by written notice," and the contract then provides the manner of adjusting any difference on this account, including arbitration, and, "upon final completion of the work embraced in this agreement, the said second party shall examine the same, and if completed according to contract shall immediately accept the same and make final settlement with said first party therefor." It was also stipulated that "this contract covers the work in its entirety," and contained "all the understandings and agreements had between the parties hereto, in relation to the erection and completion of said building and its equipments and appurtenances and the payments therefor," etc. The work was completed and accepted on June 2, 1902, and the board of commissioners on that day gave a statement to Smith, saying that he had executed the contract to the entire satisfaction of the board of commissioners and the workmanship was first class, and the work was in every respect up to plans and specifications. During the progress of the work, there were some slight changes, but the cost of these was adjusted. On March 20th, there arose a controversy as to whether the walls of the building were to be raised 18 inches, and the board of commissioners requested a settlement of this matter, pursuant to the terms of the contract. The defendant satisfied the board that the plans and specifications did not call for this, and the work proceeded. The board of commissioners, under the provisions of the contract, appointed one Walter Graham as its superintendent of the work; then L. P. Crawford, chairman of the board; then J. G. Neal, a member of the board (who was dead at the time of the trial). The complaint alleged defective work and poor materials; that the walls were not raised to the height required, and that in a short time after the completion of the work the defects began to appear; that the acceptance was procured by the fraudulent devices and circumvention of the defendant, and the defective work so skillfully covered up and concealed that the commissioners could not discover it. The plaintiff further alleged that the 3 notes of $500 were void, as issued without authority and contrary to the provisions of chapter 242, p. 374, Pub. Laws 1901, demanded their surrender and cancellation, and damages in the sum of $1,999.99 for breach of the contract. The defendant denied the allegations of the complaint, claiming that the work and materials were in accordance with the contract, denying any and all fraud, and stating that he had, upon the first notice of defective work, offered to make it good, and requested permission of the board of commissioners to make it good, and that they had refused to permit him to make good the defective work.

His honor submitted issues to the jury, which, with the findings, are as follows: "(1) Did defendant fail to comply with his contract as alleged in the complaint? Answer: Yes. (2) Did the defendant, by false and fraudulent representations, or by false and fraudulent concealments of latent defects in the construction of the building, induce the board of commissioners to accept and approve the work and make settlement for the same? Answer: Yes. (3) Does the contract require the old walls of the building to be built higher, and, if so, did the defendant, by false and fraudulent representations to the board of commissioners as to the meaning of the plans and specifications, induce the said board to abandon and waive the right to require the walls to be built higher? Answer: Yes. (4) Did the board of commissioners exceed the power and authority vested in them by law, in executing the notes referred to in the answer? Answer: No. (5) What damage, if any, have plaintiffs sustained by the fraud of the defendant? Answer: $1,800. (6) Is the plaintiff indebted to the defendant, and if so, in what amount? Answer: No; for the reason that the notes or script pleaded as a counterclaim were not due at the beginning of this action."

Upon the verdict, his honor rendered the following judgment "This cause having been heard before the court and jury, and the jury having found the first, second, third, and fifth issues in favor of the plaintiffs, as set out in the record, it is now on motion of W. T. Morgan, Avery & Ervin, and Avery & Avery, counsel for the plaintiffs, considered and adjudged that the plaintiff board of county commissioners of McDowell county do recover of the defendant B. F. Smith the sum of eighteen hundred dollars ($1,800), the amount of damages assessed by the jury in response to the fifth issue, with interest on the same from May 31st, 1909, until paid, together with the costs of this action to...