Grier-Lowrance Const. Co. v. Winston-Salem Journal Co.

• Decision Date: 12 February 1930
• Docket Number: 517.
• Parties: GRIER-LOWRANCE CONST. CO. v. WINSTON-SALEM JOURNAL CO.
• Court: North Carolina Supreme Court

151 S.E. 631

198 N.C. 273

GRIER-LOWRANCE CONST. CO. v. WINSTON-SALEM JOURNAL CO.

No. 517.

Supreme Court of North Carolina

February 12, 1930

Appeal from Superior Court, Iredell County; Harding, Judge.

Action by the Grier-Lowrance Construction Company against the Winston-Salem Journal Company. Judgment for plaintiff, and defendant appeals. Modified and affirmed.

Excluding original contract in contractor's action against owner held not error, where settlement agreement provided for additional charges or credits.

The plaintiff is a corporation engaged in general contracting business, and on the 19th day of August, 1926, entered into a contract with the defendant to furnish labor and material necessary for the construction and erection of a building in the city of Winston-Salem, according to plans and specifications furnished by Harold Macklin, architect. The contract price was $144,950.

The plaintiff began work on the building, but the defendant neglected to comply with the provisions of said contract which were to be kept and performed by the defendant, in that said defendant failed to make monthly payments according to the agreement. Subsequently the plaintiff notified the defendant that it would not proceed further with the work. Thereupon plaintiff alleges that it was mutually agreed "that the defendant would pay the plaintiff the total cost of all labor, material, equipment, repairs, power and rent of property, telephone, telegraph, equipment rental, and all miscellaneous expenses, and also interest expense caused by not receiving checks for estimates when due, discounts lost by not receiving checks when estimates were due, and interest on deferred payments of estimates."

The plaintiff then proceeded to complete the building according to plans and specifications. Thereafter, in pursuance of such new agreement, the plaintiff submitted to the defendant a statement, which was introduced in evidence and referred to as "Exhibit 1." This paper writing is as follows:

"Grier-Lowrance Construction Company, Statesville, N. C.

"Final Estimate.

"Winston-Salem Journal Building. August 25, 1927.

Total labor, material, equipment, repair, power, rent on property, telephone, telegraph and misc. expenses to August 1, 1927 .......	$149,229.50
Material, labor, and misc. expenses from August 1st, to date .......	1,573.69
Balance to be billed on T. M. B. flooring ..........................	1,007.84
Balance to be billed on oak flooring ...............................	720.00
Amount due plaster contract ........................................	300.00
Equipment rental ...................................................	1,500.00
Interest expense caused by not receiving checks for estimates when due ..............................................................	2,522.53
Discounts lost by not receiving check when estimates were due ......	14,522.11
Interest on estimates (deferred payments) ..........................	1,034.26
	-----------
	$159,409.93
Plus 10 per cent................................................	15,944.00
	-----------
	$175,353.93
Less amount previously paid ....................................	132,763.50
	-----------
Amount payable ................................................	$ 42,590.43
Less 10 per cent. on the above interest charges ($5,008.90) ....	500.89
	-----------
	$ 42,089.54
Less balance to be billed on oak flooring ......................	720.00
	-----------
	$ 41,369.54

"There may occur some additional charges or credits which may affect the above statement, but in the event we will make an additional statement to the Winston-Salem Journal showing these charges or credits, and attaching our check to cover in the event that the credits are larger than the debits.

"Approved for payment: H. Macklin, Architect, Aug. 25th, '27."

In accordance with the terms of said Exhibit 1 the defendant gave the plaintiff a note for $41,369.54, which was afterwards paid in full.

The plaintiff made a subcontract for the roofing and certain metal work on said building with the Ingold Roofing Company. Subsequent to the settlement above referred to, in November 1927, the plaintiff discovered that the Ingold Company had never been paid for the roofing and sheet metal work. The Ingold Company sent a bill to the plaintiff at that time for $2,080 for material which had been used in said building. The defendant refused to pay the bill, and thereupon the plaintiff brought suit. A single issue of indebtedness was submitted to the jury, and the jury answered the issue in favor of plaintiff, awarding a recovery of $2,228, with interest from date.

From judgment upon the verdict, the defendant appealed.

Manly, Hendren & Womble, of Winston-Salem, for appellant.

Grier & Grier, of Statesville, for appellee.

BROGDEN J.

Can a contractor sue the owner and recover the contract price for labor and material furnished such owner by a subcontractor or materialman; and, if so, under what circumstances?

In Morgantown Hardware Co. v. Schools, 151 N.C. 507, 66 S.E. 583, 584, this court said: "Even a cursory perusal of our statute (Revisal 1908, c. 48) will make it plainly appear that a subcontractor or a person who furnishes materials for the construction of the building has no claim against the owner apart from the claim he acquires by virtue of his lien after notice to the owner, and before he settles with the contractor. The statute was not intended to change the well-settled general principle that there must be privity of contract before any liability by one person to another can arise. We know that this general principle has its exceptions, arising out of the peculiar nature of the cases to which they apply."

The identical question involved in the present suit was...