Florida N. R. Co. v. Southern Supply Co.

• Decision Date: 26 October 1900
• Citation: 37 S.E. 130,112 Ga. 1
• Parties: FLORIDA N. R. CO. et al. v. SOUTHERN SUPPLY CO.
• Court: Georgia Supreme Court

37 S.E. 130

112 Ga. 1

FLORIDA N. R. CO. et al. v. SOUTHERN SUPPLY CO.

Supreme Court of Georgia

October 26, 1900

Syllabus by the Court.

1. When, in a contract for the construction of a given work, it was stipulated that it was to be completed by a designated date, time as to this matter being of the essence of the contract, and that "the failure on the part of [the contractor], the [other party] having faithfully kept and performed all of [his] covenants, to complete the same in the time specified, may be considered sufficient reason for the forfeiture of" 5 per cent. of the contract price held that, even if the agreement respecting forfeiture be treated as a stipulation for liquidated damages reasonable as to amount, and not for a penalty, the party for whom the work was done was not entitled to retain the 5 per cent. as such damages if he on his part failed to duly keep and perform his covenants as set forth in the contract.

2. A stipulation in such a contract that, if delays in the completion of the work should be "occasioned by epidemics, strikes, or providential causes, a reasonable extension of time for the completion of this contract shall be made," when qualified by the condition that "timely notice of all such delays shall be given" by the contractor to the other party, did not, proprio vigore, operate to relieve the former from liability for damages resulting to the latter because of delays thus brought about, but under such a contract it was incumbent upon the contractor to give actual notice to the other party of such delays within a reasonable time after their occurrence, and make thereon proper claims for extensions of time. Failing in these respects, the consequences of such delays were chargeable to him to the same extent as if they had been occasioned by his own fault or negligence. (a) The error dealt with in this note is corrected by an appropriate direction.

3. Where the work constituting the subject-matter of such a contract was the construction of a railroad, and it was not completed until after the lapse of two months from the date fixed by the contract, the railroad company, even if entitled to damages arising from loss of profits during these two months, could not prove the amount of such loss by showing what were its profits during the corresponding months of the next ensuing year.

4. The material questions of law involved in the present case are disposed of by the preceding notes. As to the issues of fact no sufficient reason for disturbing the findings of the auditor, or the verdict sustaining the same, appears.

Error from superior court, Chatham county; R. Falligant, Judge.

Action by the Southern Supply Company against the Florida Northern Railroad Company and others. Judgment for plaintiff. Defendants bring error. Affirmed.

Denmark Adams & Freeman, for plaintiffs in error.

Garrard & Meldrim, for defendant in error.

LEWIS J.

The Southern Supply Company, hereafter referred to as the "contractor," contracted with the Florida Northern Railroad Company and the Florida Central & Peninsular Railroad Company, both of which, for convenience, will hereinafter be indicated by the collective term "railroad company," for the construction of a line of railroad. Under the contract as originally agreed upon the road was to be completed by September 15, 1893. Subsequently the time was extended to November 1st of that year. In point of fact it was not finished till about January 1, 1894. The contract provided that the railroad company should make monthly payment to the contractor upon estimates furnished by the engineer in charge, such payments to cover 95 per cent. of the value of the work actually done, and upon its completion a final estimate was to be made, and a full settlement had. The contract, after specifying the date by which the railroad was to be finished, and reciting that it was "expressly agreed that the time herein stipulated shall be of the essence of this contract," further provided as follows: "And the failure on the part of [the contractor], the [railroad company] having faithfully kept and performed all of [its] covenants, to complete the same in the time specified, may be considered sufficient reason for the forfeiture of the reserved five per cent; and the [contractor] hereby consents and agrees to this condition. Should, however, delays in the performance and completion of the work to be done by the [contractor] hereunder within the time herein be occasioned by epidemics, strikes, or providential causes, a reasonable extension of time for the completion of this contract shall be made. Timely notice of all such delays shall be given" by the contractor to the railroad company. After the railroad had been finished, and turned over to the railroad company, the contractor brought against it an action for the recovery of a balance alleged to be due upon the contract, and for the enforcement of a lien upon the railroad. An answer denying all liability, and claiming a balance from the plaintiff, was filed, and the case was referred to Mr. W. W. Mackall as auditor, who made a report of the evidence introduced before him, and of his findings of fact and conclusions of law thereon. To this report the railroad company filed numerous exceptions of law and fact. All the former were overruled by the presiding judge. Certain of the latter were submitted to a jury, who sustained the auditor throughout, and a judgment following their verdict was entered in favor of the contractor. The case is here upon exceptions to the order overruling its exceptions of law to the auditor's...