Fisher Electric Co. v. Bath Iron Works

• Citation: 116 Mich. 293,74 N.W. 493
• Court: Supreme Court of Michigan
• Decision Date: 15 March 1898
• Parties: FISHER ELECTRIC CO. v. BATH IRON WORKS, LIMITED.

74 N.W. 493

116 Mich. 293

FISHER ELECTRIC CO. v. BATH IRON WORKS, LIMITED.

Supreme Court of Michigan

March 15, 1898

Error to circuit court, Wayne county; Willard M. Lillibridge Judge.

Action by the Fisher Electric Company against the Bath Iron Works Limited, to recover a balance due for materials and labor. Judgment for plaintiff, and defendant brings error. Reversed. Rowland M. Connor (John D. Conely, of counsel), for appellant.

Wells Angell, Boynton & McMillan, for appellee.

GRANT C.J. (after stating the facts).

1. Assuming that there was delay on the part of the inspector to furnish to plaintiff the drawings, specifications, and other information mentioned in the contract, is the defendant liable for such default? It is urged by counsel for the defendant that plaintiff accepted all the chances of delay on the part of the inspector, and thereby relieved it from any duty in regard to this information. There was no contractual relation between plaintiff and the government. The contract for the construction of the boats was between defendant and the government. Defendant had agreed with the government to furnish these boats with electric light plants. Whether defendant installed them itself or let the contract was immaterial to the government. The agreement to furnish these drawings, etc., was made with the plaintiff, and the defendant could look to it, and no one else, for the failure to furnish them. The original specifications were furnished to plaintiff, and formed the basis of the contract. The inspector represented the defendant, not the plaintiff. The court was therefore correct in holding the defendant liable for any damages which resulted from delay in furnishing the drawings, etc.

2. During the period from the date of the contract in 1891 to its completion in 1893, various improvements had been made in electrical apparatus, and plaintiff furnished some more expensive articles than those commonly known and in use at the time the contract was made. The court instructed the jury that the contract was made with reference to fixtures and appliances best known and in common use at the time the contract was made, and that, if plaintiff was required to and did furnish more expensive articles than those which were in common use at that date, it was entitled to recover for them. The correctness of this instruction depends upon the construction to be given to the term "plant" used in the specifications under the title "Plant." Houston's Electrical Dictionary defines the term as follows: "Plant-a word sometimes used for installation, or for the apparatus required to carry on any manufacturing operation. An electric plant includes the steam engines or other prime motors, the generating dynamo or dynamos, the lamps and other electro-receptive devices, and the circuit connected therewith." It is insisted that the term in this contract means a plant as above defined. Defendant's position is based upon that clause of the contract which says: "All working parts of the plant *** must be the most compact, the lightest, and best adapted for marine work, particularly at sea, of any that can be obtained at the time it is placed in the ship." It is insisted that this clause includes everything in every part of the boats which is covered by the numerous specifications. But, clearly, this language is restricted to the plant as defined in the subdivision in which it is used. The parties have there seen fit to define the plant to which this language applies, and have confined it to two engines and two dynamos. All the language of this subdivision is peculiarly appropriate to the plant as described in the first sentence. The mere fact that the term "plant" is used in its broader sense in other subdivisions of the specifications, does not affect the construction of the term as restricted by the subdivision in question. The court was therefore correct in holding that the plant meant the engines and dynamos.

3. All labor charges for overtime were made by the plaintiff at $1.50 per hour, or $15 a day. For most of this work plaintiff actually paid $26.50 a week. Upon this point Mr. Fisher testified as follows: "The labor charge was agreed upon by Mr. Hanscom and witness at $1.50 per hour. Witness had the conversation fixing the charge for labor at $1.50 per hour with Mr. Hanscom, the superintendent of the defendant company, in December, 1891. Q. What was that conversation? A. The conversation was with reference to the extras, and Mr Hanscom said: 'Of course, we expect to make a good deal of money out of this extra work. The government expects to be soaked on it, and we will help you get all you can for it-for anything extra.' Q. What was said about the price? A. I think that I told him at that time that we should charge on all labor at the rate of $15 a day for extra work. Q. And this deal was made in accordance with this arrangement? A. Yes, sir." On cross-examination he testified: "Q. You had a positive agreement with Hanscom to allow you $15 a day? A. Yes, sir. Q. That was upon the understanding that the government would be soaked? A. Yes, sir." The circuit judge instructed the jury that, if the parties entered into an agreement to charge an excessive price to the government, or "soak it," such an agreement was against public policy, and void, and added: "But, if you believe that the agreement between Fisher and Hanscom was, as counsel for the plaintiff claims, that the United States government expected to be 'soaked' in the matter, and that the agreement was that the Bath Iron Works would allow $1.50 an hour, if that agreement was made, then it is binding; and if you believe from the testimony that such an agreement was made between Hanscom and Fisher, that settles the question of extra labor, and you must allow $1.50 an hour." The charge is grossly excessive. Under the instructions, plaintiff was permitted to recover about four times what the actual damages were. As an illustration, one Moag, plaintiff's employ�, who was paid $26.50 per week,...