C.w. Hunt Co. v. Boston Elevated Ry. Co.

• Decision Date: 09 May 1908
• Citation: 199 Mass. 220,85 N.E. 446
• Parties: C. W. HUNT CO. v. BOSTON ELEVATED RY. CO. BOSTON ELEVATED RY. CO. v. C. W. HUNT CO.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

199 Mass. 220

85 N.E. 446

C. W. HUNT CO. v. BOSTON ELEVATED RY. CO.

BOSTON ELEVATED RY. CO. v. C. W. HUNT CO.

Supreme Judicial Court of Massachusetts, Suffolk.

May 9, 1908

COUNSEL

Brandeis, Dunbar & Nutter (Edward F. McClennen, of counsel), for C. W. Hunt Co.

Authur P. Stone, for Boston Elevated Ry. Co.

OPINION

LORING J.

1. We are of opinion that the auditor was right in proceeding on the footing that the Hunt Company was entitled to recover if 'the towers did conform to the contract and specifications, as modified by the parties in March, 1903 and that if they were not satisfactory to the vice president of the railway company they ought to have satisfied a reasonable man.'

This is not a contract 'into which considerations of taste or personal preference may enter,' as was said by Knowlton C.J., in Noyes v. Eastern Accident Association, 190 Mass. 171, 172, 76 N.E. 665, 666. That is to say, it is not a case within McCarren v. McNulty, 7 Gray, 139, Brown v. Foster, 113 Mass. 136, 18 Am. Rep. 463, White v. Randall, 153 Mass. 394, 26 N.E. 1071, and Webber v. Cambridgeport Savings Bank, 186 Mass. 314, 315, 71 N.E. 567. The case at bar is for work of a business character and comes within Hawkins v. Graham, 149 Mass. 284, if as matter of construction it was to be done to the satisfaction of the defendant and not to that of a third person as arbitrator.

The provision of the contract is: 'The contractor agrees that all material furnished and work done hereunder shall be subject to acceptance by the railway company and its vice president; that all apparatus furnished and work done shall be subject at all times to the inspection of said vice president or his authorized agents, and that any work performed or material furnished which may be deemed by said vice president to be not in accordance with the terms of this contract and accompanying specifications shall be immediately replaced by the contractor at its own expense.' There are also these provisions in the specifications: 'The work shall be executed under the direction and supervision of the vice president of the Boston Elevated Railway Company, or his authorized representative. * * * The vice president of the Boston Elevated Railroad Company, without relieving the contractor from any responsibility therein, reserves the right to direct the manner and order in which the work shall be executed.'

Had Mr. Sergeant been a third person and not an officer of the defendant corporation, the provisions of the specifications would have been enough to make him a quasi arbitrator within the rule applied in Atkins v. County, 97 Mass. 428, Palmer v. Clark, 106 Mass. 373, Flint v. Gibson, 106 Mass. 391, Robbins v. Clark, 129 Mass. 145, National Contracting Co. v. Commonwealth, 183 Mass. 89, 66 N.E. 639, and Norcross v. Wyman, 187 Mass. 25, 72 N.E. 347.

But Mr. Sergeant represented the railway company in this transaction, and was not a third person. That being so, the provision that the work was to be done 'subject to acceptance by the railway company and its vice president' would have brought this case within Hawkins v. Graham without a doubt had that been the only provision of the contract on this point. In such a case Mr. Sergeant in accepting or not accepting the work would have acted for and represented the railway company, and would not have been a third person acting as arbitrator.

Although, as we have said, the provisions in the specifications look the other way, we are of opinion on the whole that Mr. Sergeant must be taken to have been the representative of the defendant and not a third person in this matter. This conclusion is enforced by the fact that all the correspondence set forth in the report which took place under the contract was carried on by Mr. Sergeant in behalf of the railway company.

2. The railway company urges that the auditor is wrong in his conclusion from the correspondence set out in the report 'that if the changes specified were made, and if they accomplished the results which they might fairly be expected to accomplish, the railway company would be satisfied with the towers and would accept them.'

This contention of the railway company is based on these words in the closing letter of April 3d: 'We have no desire whatever to interrupt the work, but we waive none of our rights under the contract to reject any or all of it if it proves unsatisfactory when completed.' This statement is to be taken in connection with what went before.

On February 19, 1903 (that is to say, six months after the first tower and 5 1/2 months after the second tower should have been completed and in working order), Mr. Sergeant wrote to the Hunt Company a letter stating that 'up to this time there is no indication that these towers are likely to prove in any degree adequate or satisfactory,' complaining that the Hunt Company's men had left the work, and ending with this threat: 'Unless you proceed without further delay to complete your contract we shall be compelled to install an efficient apparatus at your expense.' In answer the president of the Hunt Company wrote a letter of explanation ending with this request: 'If you will kindly point out any feature of the contract which has not been carried out by us, I would be pleased to have you advise me of the same, and it will be given immediate and careful attention, and meanwhile we say, courteously but emphatically, that we deny your right 'to install an efficient apparatus at your (our) expense,' or any apparatus at our expense, and in the same way we repudiate the suggestion contained in your letter, that the machinery is not in accordance with our contract, or in any wise inefficient through any fault of ours.' Thereupon a personal interview took place on March 3d, 4th and 5th, in which Mr. Sergeant undertook to tell the representative of the Hunt Company 'in what respects the towers failed to meet the requirements of the railway company.' These were embodied in a letter from Mr. Hunt, dated March 17th, under 6 heads, and stated that 'each of the other points noted in the conference was are now in the process of making such changes in, as we have no doubt will meet your approval.' Another conference took place on March 19th and 20th, and the points discussed were embodied in a letter of Mr. Hunt dated March 23d, under 14 heads. In this letter Mr. Hunt states what he proposes to do in respect to each of the 14 matters. On the 24th Mr. Sergeant discusses each of the 14 heads and what the Hunt Company proposes as to each, and on the 27th Mr. Hunt answers, dealing with the 14 items in a similar way. Then follows a correspondence not set out in the report but which is characterized by the auditor as 'some rather lively correspondence * * * as to who was now causing delay'; and on April 3d this is closed by a letter from Mr. Sergeant in which he states that he is 'pleased to note that you now wish to immediately proceed with the completion of the towers in accordance with my letter of the 24th ult. We supposed you would do so immediately on receipt of that letter, nor was there anything in your subsequent letter of the 27th ult. which appeared to be in conflict with the work proposed to be done. We were therefore at a loss to understand your telegram of 1st inst. So far from holding up the work, we have demanded and do demand that you proceed forthwith to complete your contract.' Then follows the paragraph here relied on by the railway company, which we repeat in full: 'You mention a desire that we should, in acknowledging your letter, state that the work can proceed to completion without interruption. We have no desire whatever to interrupt the work, but we waive none of our rights under the contract to reject any or all of it, if it proves unsatisfactory when completed.' We agree with the auditor that this closing paragraph reserves the railway company's right to accept or reject the work done under the contract as modified by these interviews and this correspondence, and that defects not then pointed out and insisted upon were waived.

3. We find no error with the way in which the auditor dealt with the provision of the contract that 'the towers may be operated by two men or one man as may be preferred,' and the contention of the railway company 'that the boom does not swing in a horizontal plane sufficiently to make its swinging of any practical value.' The first of these two matters is disposed of by the auditor in these words: 'If this was a difficulty, I find that it was one which was apparent in March, 1903.' And the second was as follows: 'If this was a defect, I find that it too was apparent in March, 1903. And I find that so far as these two objections to the towers are concerned, they were waived by the railway company by virtue of the conferences and correspondence above referred to--not expressly, but by necessary implication.'

4. During the hearings before the auditor a crack appeared in the upper part of the left-hand frame of each engine. Counsel for the railway company assumed in his argument that these cracks appeared there for the first time, not that they existed before, but were discovered then, as the auditor in one part of his report seems to imply. We shall treat the fact on the footing assumed by the railway company's counsel. The auditor found that these cracks came not from a faulty design but from some fault in the casting, and that they 'constitute a serious defect.' The railway company contends 'that this justified the rejection of the towers and [that] the contract has never been fulfilled.' Under this finding the frames of the engines did not meet the requirements of clause 1 of section 6 ^[1] of the specifications, nor the requirements of section 3 ^[2], as that section has...