Crane Elevator Co. v. Clark

• Decision Date: 22 May 1897
• Docket Number: 346.
• Citation: 80 F. 705
• Parties: CRANE ELEVATOR CO. v. CLARK.
• Court: U.S. Court of Appeals — Seventh Circuit

80 F. 705

CRANE ELEVATOR CO. v. CLARK.

No. 346.

United States Court of Appeals, Seventh Circuit.

May 22, 1897

This is an action of assumpsit brought by Crane Elevator Company, the plaintiff in error, to recover the unpaid balance of the contract price for the furnishing and construction in a 12-story and basement building in the city of Chicago of three high-pressure hydraulic passenger elevators. C. Everett Clark, the defendant in error, was the contractor for the construction of the building for William D. Boyce, the owner. The declaration contained a special count setting forth the contract with the plaintiff in error, which contained the following provision: 'One-half of the contract price shall be paid when the cylinders are in permanent position the balance when the plant is running to the satisfaction of the architect, and has been accepted by him. ' The special count alleges performance of the contract, and that the 'elevators, and each of them, were accepted by Henry Ives Cobb, the architect of said building, and the agent of said W. D. Boyce and of the defendant in that behalf. ' The declaration contained a special count upon an independent agreement for the use of certain steam-belt freight elevators, touching which there was no contest, and also contained the common counts. The plea was the general issue. At the trial the plaintiff gave evidence tending to prove The performance by it of the work specified in the contract. That on the 24th day of October, 1893, the plant was tested to determine whether the contract had been performed with reference to speed and load. This test was prearranged, the defendant (by his agent) and the owner of the building being present. The architect was notified of the test to be made and was requested to be present or be represented at such test, and promised to be represented, and was represented by his assistant, C. J. Clark, who, after the conclusion of the test, then and there expressed his satisfaction; stating that the test, as to capacity and the speed of the elevators, fulfilled every condition of the contract, and that he was perfectly satisfied with it. That, upon application to the architect for a certificate, he made no specific objection, but stated certain objections that had been urged by the owner of the building. The defendant gave evidence tending to prove that in certain respects the contract had not been performed. The architect testified that the elevators were not completed to his satisfaction, and had not been accepted by him; that he declined to give a certificate 'until the work was completed according ti contract'; that he thought he gave some reasons, 'as I usually do,' but could not recall the reasons, if any, that he gave. He did not, at the trial, give any particulars wherein the work was defective or incomplete. He stated that before the test he had observed that the elevators did not start and stop properly, and were too noisy; that he is not an expert with respect to elevators, and he does not state whether the failure to start and stop properly was owing to a defect in workmanship or in operation; that noise is incidental to the operation of all elevators; that on the 31st day of October, 1893, he received from the owner, Mr. Boyce, a letter which states that he is informed that Mr. Cobb contemplated acceptance of the elevator plant, and states certain objections, and, closing, 'I do most positively protest against the acceptance of the elevators in my name or in my behalf, and forbid you to do so.' A copy of this letter he sent upon the following day to the plaintiff in error without comment. The witness made this further statement: 'I think it is well to explain my understanding of my position relative to this contract. I look upon myself as an arbiter between the two,-- the owner and the contractor. If the owner, Mr. Boyce, had agreed to accept these elevators in spite of the report of my inspector being that they were not satisfactory, he has a right to do it, and, as they both agree that they shall be accepted, I have to accept them, because the two parties agree.' There was no evidence given of any report made by Mr. Clark to the architect, nor was the former called as a witness. There was also evidence tending to prove that after the test the owner, Mr. Boyce, took possession of the elevators and contracted for their operation; and evidence was given tending to the effect that the objectionable noise arose from the operation of an electric pump placed at the request of the owner, and contrary to the advice of the plaintiff in error.

At the conclusion of the testimony, and upon motion of the defendant, the court directed a verdict for the plaintiff in error to the amount of $1,218.07, the sum of certain undisputed items, and refused to submit to the jury the right of the plaintiff to recover the unpaid balance upon the contract, amounting to $8,332.50. The court, with respect thereto, instructed the jury as follows: 'I regret that the view of the court as to the law applicable to the contract renders it impossible for the plaintiff to recover upon it in the present form of action in this case. The contract that was entered into between the Crane people and Clark was a contract that, so far as my evidence before the court or jury goes to show, was deliberately and fairly and understandingly entered into. It was stipulated in that contract that the last payment should not become due or payable until the elevators had been completed to the approval of Henry Ives Cobb, a disinterested architect selected mutually by the parties to pass on that question,-- until they had met his approval, and until he had accepted them. There is no evidence in this case, gentlemen of the jury, that that condition of things has happened, and, in the view the court takes of the law, there can be no recovery until that has happened or has been dispensed with or waived, and there is no averment in the pleadings in this case that there has been any waiver. The suit is a straight, square suit, alleging on the part of the plaintiff that the contract has been completed in all its terms, and the proof shows that it has not been. I do not say anything about the evidence as to whether or not the work was such that Henry Ives Cobb ought to have accepted it or not. There might have been a recovery, under a proper state of the pleadings, if that had been the case, but that is not the condition of the pleadings here. That is not the state of the case here. The proof in this case is absolutely clear, without any contradiction, to show that at least that term of the contract has not been performed; and, in the judgment of the court, there can be no recovery under that contract, any more than, if I should execute a note due in sixty days, a party could recover on it before the sixty days have gone by.'

Henry W. Prouty, for plaintiff in error.

Cyrus Bentley, for defendant in error.

Before WOODS, JENKINS, and SHOWALTER, Circuit Judges.

JENKINS Circuit Judge (after stating the facts as above).

The contract between the parties provided that one-half part of the contract price should be paid 'when the plant is running to the satisfaction of the architect, and has been accepted by him. ' This clearly constituted him the arbiter of disputes between the parties to the contract with respect to its performance. The general doctrine is not disputed, that, when the payment of the contract price is conditioned upon the obtaining of the umpire's certificate, such certificate is a condition precedent to the right of the contractor to recover the contract price. The question arises, however, in regard to the right of the contractor when he has specifically and in good faith performed his contract, and the umpire refused to accept the work or to give the required certificate. The English and early American cases held to the doctrine that the completion of the work to the satisfaction and acceptance of the umpire, or the obtaining of his certificate, is a necessary affirmative act of performance, and that the decision of the umpire can be refuted only for fraud, collusion, or bad faith. The later decisions of the courts of some of the state, of which Thomas v. Fleury, 26 N.Y. 26; Nolan v. Whitney, 88 N.Y. 648; Weeks v. O'Brien, 141 N.Y. 199, 36 N.E. 185; Chism v. Schipper, 51 N.J.Law, 1, 16 A. 316,-- are examples, hold to the doctrine that the architect, in his relation as umpire, is the agent of the party for whom the work is to be done and for whose benefit the stipulation is made; that, when the work has been specifically and in good faith performed, a refusal to accept or to issue a certificate is unreasonable; and that a recovery may be had upon evidence other than the architect's certificate of performance. It is not necessary that we should consider the numerous cases to which we have been referred, and which are, perhaps, somewhat in antagonism, because we are bound and precluded from independent judgment by the decisions of the supreme court. The earliest case upon the subject in that court is U.S. v. Robeson, 9 Pet. 319. There the government stipulated to pay under a charter party upon the certificate of the officer commanding the men transported thereunder. A certificate was given, and payment made for the sum covered by the certificate, but recovery was sought for other service than that certified to. It was ruled that the obtaining of the certificate was a condition precedent, the court observing with respect to the right of the contractor (page 327):

'He cannot compel the payment of the amount claimed, unless he shall procure the kind of evidence required by the contract, or show that, by time or accident, he is unable to do so; and, as this was not done by the defendant in the

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