Caldwell County v. Durret Const. Co.

• Court: Kentucky Court of Appeals
• Writing for the Court: MILLER, J.
• Citation: Caldwell County v. Durret Const. Co., 180 Ky. 594, 203 S.W. 291 (Ky. Ct. App. 1918)
• Decision Date: 17 May 1918
• Parties: CALDWELL COUNTY v. DURRET CONST. CO.

203 S.W. 291

180 Ky. 594

CALDWELL COUNTY v. DURRET CONST. CO.

Court of Appeals of Kentucky.

May 17, 1918

Appeal from Circuit Court, Caldwell County.

Action by the Durret Construction Company against Caldwell County in which the county filed a cross-petition. Judgment for plaintiff, and defendant appeals. Reversed and remanded.

J. E Baker and R. W. Lisanby, both of Princeton, for appellant.

John C Gates, of Princeton, and E. Levi and Kohn, Bingham, Sloss & Spindle, all of Louisville, for appellee.

MILLER J.

In 1915, the fiscal court of Caldwell county determined to construct so much of a turnpike road leading from Cadiz to Princeton as was located in Caldwell county, at an estimated expense of $6,250, one-half thereof to be paid by the state. The contract for the construction of the road was awarded to the Durret Construction Company under the provisions of the act of 1914, commonly known as the state aid act, and constituting section 4356x of Carroll's Kentucky Statutes. The plans, profiles, and specifications for the improvement, and the contract with the Chicago Bonding & Surety Company as surety thereon, were submitted to and approved by the state commissioner of public roads as required by sections 10 and 11 of the statute, supra. The contract provided that the contractor should be paid 80 per cent. of the contract price of his work as it progressed; and, further, that when the cost of the work which had been finished amounted to as much as $6,250, the sum available for road purposes, the work should cease. Pursuant to section 14 of the statute, the state road commissioner appointed Barnum Davis as state road inspector to represent the state's interest in Caldwell county.

The Durret Construction Company began work on the road in October, 1915, and continued the work, with some intermissions during the winter, until June, 1916, when it ceased work, claiming it had completed its contract. On November 24, 1915, pursuant to section 15 of the statute, the state road inspector and the county road engineer certified to the fiscal court, in writing, that the construction company had performed certain portions of its work under its contract, and that there was then due it for said work the aggregate sum of $2,695.48, of which 20 per cent. ($539.09) should be retained under the terms of the contract. Again, on December 29, 1915, a similar certificate was issued to the court showing the contractor had further performed work of the aggregate value of $1,475.25, of which 20 per cent. ($295.05) should be retained. The fiscal court paid these two estimates, but the record fails to show what orders were entered upon its records, if any, in that connection. At that time the contractor had about finished the excavation and grading work, and was proceeding with the work of macadamizing the road by putting on the rock, rolling it, etc.

The construction company proceeded with the work of surfacing the road until some time in June, 1916, when it claims it had done work of the value of $2,003.32, in addition to that embraced in the two estimates above referred to, and as these three items consumed the $6,250 which had been appropriated for this purpose the company ceased work. Up to this time there had been no dispute between the county and the contractor as to the amount of work done, or the amount of money due therefor, but when the contractor ceased work in June, 1916, claiming it had finished its work, the county contended that it had not completed its contract, and refused to pay the construction company for the work it had done in the spring of 1916, and it further claimed that the construction company had not performed the amount of work which it claimed it had done under the first two estimates furnished in November and December, 1915. The state inspector and the county road engineer refused to certify to the amount of work claimed to have been performed by the contractor in the spring of 1916. The fiscal court entered an order reciting the fact that the construction company had not completed its contract and calling to return and complete it, and a copy of this order was served upon the construction company and its surety.

The county filed an answer and counterclaim traversing the allegations of the petition as to the completion of the work as required by the contract, made it a cross-expetition against the Chicago Bonding & Surety Company, and asked a judgment against the construction company and its surety for $2,540 in damages. By an amendment the allegations of this pleading were made more specific. The circuit court at first overruled demurrers to the answer, counterclaim, and cross-petition, but, upon the demurrers being renewed, the court sustained them. By a second amended answer, counterclaim, and cross-petition tendered by the county on June 4, 1917, it charged that the construction company had practiced fraud upon it in constructing the highway, and that the indebtedness created by the contract exceeded the county's revenue for that year. The court refused to permit the amendment to be filed, dismissed the counterclaim and cross-petition, and entered judgment against the county for the sum of $2,837.45 prayed for.

As grounds for a reversal appellant insists: (1) That a judgment should not have been entered for the full amount found to be due to the contractor, because under the contract, 5 per cent. thereof ($321.50) would not be due until one year after the approval of the work by the state road commissioner as provided by subsection 12 of section 4356x of the Kentucky Statutes, and by the terms of the contract; (2) that the court erred in sustaining the demurrer to the counterclaim which stated a cause of action for damages for the improper construction of the road; (3) that the court erred in sustaining the demurrer to the answer which traversed the plaintiff's claim for work done under the contract; and (4) that the court erred in refusing to permit it to file its amended answer and counterclaim charging fraud against the construction company.

Subsections 12 and 15 of section 4356x of the Kentucky Statutes, read as follows:

"12. The time and manner of payment for work done under any contract awarded under this act shall be set forth in said contract, and at least five per centum of the contract price shall not be paid to the contractor until after the expiration of one year from the completion of the work and acceptance thereof in writing by the commissioner of public roads."

"15. Where any contract provides for partial payment based upon the amount of work done, it shall be the duty of the inspector as each payment becomes due to present to the fiscal court a certificate signed by such inspector and the county road engineer, in which certificate shall be stated as nearly as can be the amount of work done for which payment is to be made and that the same has been done in all respects in strict compliance with the contract, plans and specifications. When the work under contract shall have been fully completed the inspector and county road engineer shall prepare a detailed and itemized statement in quadruplicate of the cost of the improvement, certifying the same, one copy of which shall be filed with the fiscal court of the county, one with the county road engineer and two with the state commissioner of public roads."

1. Preliminary, however, to a discussion of the questions raised by the appellant, the appellee insists that the circuit court was without jurisdiction to review the questions raised concerning the correctness of the estimates covered by the two partial payments made by the fiscal court in November and December, 1915, respectively, and that the propriety of those payments could only have been raised by an appeal from the action of the fiscal court ordering their payment. This contention is based upon the well-established rule that where the fiscal court has statutory authority to appropriate money for the purpose attempted, and the appropriation is within its power, and the order clearly shows the object of the appropriation, the discretion of the court in making it cannot be questioned in a collateral proceeding; it can only be reviewed by an appeal. Elliott v. Commonwealth, 144 Ky. 335, 138 S.W. 300; Hickman County v. Richmond, 148 Ky. 849, 147 S.W. 913; Ray v. Woodruff, 168 Ky. 563, 570, 182 S.W. 662; Mills v. Lantrip, 170 Ky. 83, 185 S.W. 514. This rule, however, has its limitations; one of them being that the order must be a final order before it can be treated as conclusive between the parties.

Section 978 of the Kentucky Statutes provides that:

"Appeals may be taken to the circuit court from all orders and judgments of the fiscal court or quarterly court in civil cases where the value in controversy, exclusive of interest and costs, is over $25.00."

It has repeatedly been held by this court that when exceptions have been filed in the county court to a settlement, and an order is made overruling or sustaining them, the ruling can be reviewed only by an appeal to the circuit court; but where no exceptions are filed, the settlement is only prima facie correct, and errors therein may be corrected by a bill in chancery. Scott's Heirs v. Kennedy's Ex'r, 12 B. Mon. 515; Turley's Adm'r v Barnes, 103 Ky. 127...