Fairbanks, Morse & Company v. J. L. Welshans & Company

Decision Date09 June 1898
Docket Number8119
Citation75 N.W. 865,55 Neb. 362
PartiesFAIRBANKS, MORSE & COMPANY ET AL., APPELLANTS, v. J. L. WELSHANS & COMPANY ET AL., APPELLEES
CourtNebraska Supreme Court

APPEAL from the district court of Douglas county. Heard below before AMBROSE, J. Reversed.

REVERSED AND REMANDED.

Virgil O. Strickler, Byron G. Burbank, Kennedy & Learned, B. N Robertson, and Isaac W. Hascall, for appellants.

Congdon & Parish, O'Neill & Gilbert, James W. Carr, L. I. Abbott Rich & Sears, and A. C. Wakeley, contra.

OPINION

RAGAN, C.

Fairbanks Morse & Co., an Illinois corporation, brought this suit in the district court of Douglas county against J. L. Welshans & Co., a Nebraska copartnership; J. L. Welshans, the surviving member of said copartnership; David C. Patterson, administrator of the estate of J. H. Dwelley, the deceased member of said copartnership; Anna Dwelley, widow of J. H. Dwelley, deceased; Daniel Keniston, Josiah Kent, and David C. Patterson, sureties on certain bonds executed by said copartnership; and the Crane Company, a creditor of said copartnership. The N. O. Nelson Manufacturing Company, also a creditor of said copartnership, intervened in the action and filed an answer in the nature of a cross-petition against the persons made defendants to Fairbanks, Morse & Co.'s action. Numerous other parties, being creditors of said copartnership, were also brought into the action. Fairbanks, Morse & Co. will hereinafter be designated as Morse & Co.; the N. O. Nelson Manufacturing Company as the manufacturing company; Patterson, Keniston, and Kent will hereafter be denominated the sureties.

When the case came on for trial in the district court the sureties and all the creditors of the copartnership of Welshans & Co., except the manufacturing company, objected to the introduction of any evidence on the part of Morse & Co. or the manufacturing company, on the grounds that neither the petition of the former nor the cross-petition of the latter stated facts sufficient to constitute a cause of action against the objectors. These objections were overruled. The court heard the case and rendered a decree therein, which is now before us on appeal.

1. In view of the conclusion reached by us we have thought it best to set out all the material allegations of the petition of Morse & Co. They are as follows:

"(3.) That on the said 29th day of May, 1893 J. L. Welshans and J. H. Dwelley, doing business as J. L. Welshans & Co., as aforesaid, entered into a written contract with Major C. F. Humphrey, quartermaster of the United States army, to furnish all labor and material necessary to do and perform all of the plumbing, steam heating, and gas piping in all of the buildings then being erected by the United States at Fort Crook, Sarpy county, Nebraska. * * *

"(4.) That to secure the faithful performance of all of the covenants, requirements, and conditions of said contract, plans, and specifications the said J. L. Welshans & Co., as principals, and defendants and David C. Patterson and Daniel Keniston, as sureties, did, on the said 29th day of May, 1893, make, execute, and deliver their certain bond to the United States in the sum of $ 11,708. * * *

"(5.) That on the 2d day of August, 1893, the said J. L. Welshans and J. H. Dwelley, doing business as J. L. Welshans & Co., entered into a contract for $ 6,355 with Major C. F. Humphrey, quartermaster of the United States army, to furnish certain labor and material in and about the construction of certain other buildings at Fort Crook not included in the contract, marked 'Exhibit A,' and on said date the said J. L. Welshans and J. H. Dwelley, as J. H. Welshans & Co., made, executed, and delivered a bond to the United States to guaranty the faithful performance of said contract, which said bond was for the sum of $ 2,225, signed by defendants Daniel Keniston and Josiah Kent as sureties; that on September 11, 1893, the said J. L. Welshans and J. H. Dwelley, as J. L. Welshans & Co., entered into a contract for $ 1,331 with the said C. F. Humphrey, quartermaster of the United States army, as aforesaid, to furnish certain labor and material in and about the construction of a storehouse at the quartermaster's depot at Omaha, Nebraska, and that to secure the faithful performance of said last named contract the said J. L. Welshans * * * made, executed, and delivered to the United States a certain bond for $ 446, which said bond was signed by defendants David C. Patterson and Josiah Kent as sureties.

"(6.) That after the execution of said contract between the United States and Welshans and Dwelley, as J. L. Welshans & Co., as aforesaid, on the 29th day of May, 1893, and hereto attached as Exhibit A, the said J. L. Welshans & Co. entered into a contract with the plaintiff whereby the plaintiff agreed to furnish to the said J. L. Welshans & Co., to and for the construction of the buildings at Fort Crook as aforesaid, mentioned in Exhibit A, four boilers and necessary trimmings, valves, water columns, gauges, cocks, grates, and all other appurtenances thereto, according to the specifications furnished, for the agreed price of $ 2,735; that the said specifications, which were made a part of the contract between J. L. Welshans & Co. and the government, provided that the boilers should be paid for as soon as they were set in place and accepted, and that the said J. L. Welshans & Co. then and there agreed to and with the plaintiff that the said plaintiff should be paid for the said boilers and other materials so furnished, as aforesaid, out of and have a lien upon the proceeds of said contract, and that as soon as said boilers had been set in place and accepted by the United States the plaintiff should receive the money accruing under said contract therefor; that the plaintiff furnished said boilers and other materials and delivered the same at Fort Crook, Nebraska, on or about the 1st of July, 1894, but that on or about the 10th day of September, 1894, the said boilers and other materials so furnished by plaintiff were rejected by the United States, as plaintiff was notified, upon the ground that said boilers and appurtenances thereto did not come up to the requirements of said specifications.

"(7.) That on the 15th day of September, 1894, the said J. L. Welshans & Co. became insolvent and notified Major C. F. Humphrey, quartermaster as aforesaid, that they would be unable to complete their contracts with the United States; that on said 15th day of September the said J. L. Welshans & Co. attempted to assign, and did assign, in so far as they were able to do, to their said bondsmen, David C. Patterson, Daniel Keniston, and Josiah Kent, defendants herein, all of their rights, titles, and interests in and to all of their contracts with the United States, together with all moneys due or to become due upon said contracts, and gave to their said bondsmen full right and authority to carry on and complete said contracts in the place and stead of the said J. L. Welshans & Co. as fully and completely as the said J. L. Welshans & Co. could or would have done; that by the terms of said attempted assignment the said David C. Patterson, Daniel Keniston, and Josiah Kent were authorized and empowered to collect and receive from the United States all moneys then due the said J. L. Welshans & Co., together with all sums that were to become due under their said contracts, and were empowered, authorized, and directed to proceed with the work under said contracts and to complete the same in the place and stead of said J. L. Welshans & Co.; that the said defendants David C. Patterson, Daniel Keniston, and Josiah Kent accepted, affirmed, and ratified said attempted assignment from said J. L. Welshans & Co. to themselves, together with all the conditions thereof, and immediately on the said 15th day of September, 1894, took charge of the work under said contracts for and in the place of the said J. L. Welshans & Co., and have ever since said time carried on the work under said contracts, and are now carrying on the work under said contracts, in the place and stead of the said J. L. Welshans & Co.

"(8.) That at the time the said David C. Patterson, Daniel Keniston, and Josiah Kent succeeded to said contracts by the attempted assignment from J. L. Welshans & Co., as aforesaid the boilers, together with the other materials furnished by the plaintiff as aforesaid, to be used in the construction of the steam heating plant in and about the contract, hereto attached as Exhibit A, were on the grounds at Fort Crook, but the same had been rejected by the United States and no part of the same had either been received or paid for, and were not at that time inwrought into the building for the reason, as plaintiff was informed, that they did not comply with the specifications; that afterward, and for the purpose of completing the contract, the said defendants David C. Patterson, Daniel Keniston, and Josiah Kent, bondsmen and assignees as aforesaid, required plaintiff to make certain changes in and about said boilers and other materials, for the purpose of making the same conform to the specifications; that the boiler fronts furnished by plaintiff were adjudged not to be of the thickness required by said specifications, and that the said David C. Patterson, Daniel Keniston, and Josiah Kent caused other and different boiler fronts to be provided, and those furnished by plaintiff were returned to plaintiff and the difference between the price of those furnished by plaintiff and those required by the said bondsmen to be provided amounting to nearly $ 200, which said sum was by the said David C. Patterson, Daniel Keniston, and Josiah Kent charged back to the plaintiff upon their contract with the said J. L. Welshans & Co.; that the said David C....

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