McGrann v. Pittsburgh & Lake Erie Railroad Co.

• Decision Date: 18 January 1886
• Citation: 111 Pa. 171,2 A. 872
• Parties: McGrann v. The Pittsburgh and Lake Erie Railroad Company
• Court: Pennsylvania Supreme Court

2 A. 872

111 Pa. 171

McGrann v. The Pittsburgh and Lake Erie Railroad Company

No.

Supreme Court of Pennsylvania

January 18, 1886

Argued November 3, 1885 [Copyrighted Material Omitted]

Error to the Court of Common Pleas No. 2, of Allegheny county: Of October and November Term, 1885, No. 130.

This was an action of debt brought 25th September, 1883, by B. J McGrann against the Pittsburgh and Lake Erie Railroad Company to recover for extra work done and materials furnished in the construction of the defendant's railroad.

On the trial before Ewing, P. J., the following facts appeared from the testimony of the plaintiff.

The defendant was incorporated to construct a railroad from Birmingham Pa., to Hazleton, Ohio, a distance of about sixty-eight miles.

After some negotiations between the parties a contract was finally entered into between them on the 26th of September, 1877.

The duties of the respective parties under the contract were, in brief, as follows:

The plaintiff was to make the necessary surveys and fix the location. He was, to that end, to furnish engineering service for such survey and location, and for the construction of the road, as well as for the preparation of necessary maps profiles and plans. His engineers were to stake out and indicate the work to be done, and instruct sub-contractors, laborers and workmen as to the means for its accomplishment.

The defendant was to appoint a chief engineer to examine the plaintiff's maps, profiles and plans, and it was his duty to approve them when in accordance with the specifications. It was his duty also, to inspect and examine the work during its progress, and to approve the same when it conformed to the contract requirements. When the plaintiff selected a route which agreed with that prescribed by the agreement, in the named particulars of grade and curvature, it thereupon became the duty of the defendant to furnish him rights of way, so that the building of the railroad thereon might be promptly proceeded with.

Further the defendant agreed to pay the plaintiff the sum of $ 2,500,000, $ 1,115,000 in cash, $ 1,115,000 in bonds of the company and $ 200,000 in stock of the company. Fifteen per cent. of the amount found due by monthly estimates by the defendant's engineer was to be retained until the final completion of the work. The contract further provided: "And upon the final completion of the work, at the request of the party of the first part, the said chief engineer shall examine all the work done, and if he finds the same completed in accordance with this contract and specifications, he shall so certify to the parties hereto, and thereupon the full amount of ($ 2,500,000) two million five hundred thousand dollars, less such former payments as may have been made on this account, shall be due and payable to the party of the first part by the party of the second part, and shall be so paid upon his giving a release from all further claims arising out of this contract."

The plaintiff produced testimony to show that he was not permitted to build the road in accordance with the terms of the contract between him and the defendants. That the defendants to avoid paying large land damages changed the location of the road from that fixed by him, the plaintiff claimed that the additional cost to him resulting from this change was $ 131,593.30. The plaintiff claimed that the additional cost to him from a change of location of the bridge across the Ohio river after he had the bridge in the place fixed by himself under the contract partly manufactured was about $ 30,000. The change of the kind of masonry from that specified by the contract was the plaintiff claimed another great additional cost. The expense of maintaining these portions of the road after completion and which were used by the defendants from the time of completion until the whole road was completed and of repairing them when destroyed by floods and extraordinary storms aggregated some $ 75.000.

The plaintiff presented an itemized statement of his claim under each of the following extras:

1. Extra work resulting from changes between Jones & Laughlin's and Chartiers.

2. Work done on original location from Chartiers to Neville Island, (line graded and then abandoned by company's direction.)

3. Borrow pit at Lashell, extra cost of work.

4. Extra work, Stoup's Ferry to Shousetown.

5. Work on abandoned location through Telford's.

6. Work done on abandoned culvert.

7. Changes in character of masonry in structures at stone culverts when extended.

8. Extra cost for erection of Ohio R. R. bridge and viaduct, resulting from change at Beaver side.

9. Beaver road crossing -- overhead substituted for grade.

10. Material hauled away from Sharon and Fallston road to grade street.

11. Fallston road bridge, overhead substituted for grade crossing.

12. Change at Fort Wayne crossing at Beaver Falls.

13. Extra work at Clinton, grading and masonry, outside line, resulting from change of line.

14. Wampum bridge changed to double track.

15. Bridge at Robinson & McClelland's, rendered necessary by arbitrary location.

16. Extra work at Lowell from change to double track.

17. Maintenance and repair of railroad from Beaver Falls to Hazelton from September 15th, when company took possession, to December 15th, three months, at $ 10,000.

18. Maintenance and repair of railroad from Chartiers Creek to Beaver Falls from November 1st, date when company took possession, till February, 1879, three months, at $ 15,000.

19. Excess of value of work on account of changes in character of masonry.

20. Change from iron to steel in track, lock-nuts, sidings and spring frogs.

The whole amount of extras claimed for was $ 453,372.23.

In January, 1879, the road having been, in the judgment of the engineers, completed, a final tour of inspection was made. Mr. Wimmer, the company's chief engineer, accompanied by his assistant, Mr. Ackenheil; Mr. McGrann, the contractor, with his chief engineer, Mr. Saylor, made a trip over the entire road. Returning to Rochester on January 31st, the chief engineer expressed himself as satisfied with the road. Thereupon he told the contractor that he might discharge his force.

Wimmer, the chief engineer of the company, gave the plaintiff the following certificate:

Office of the Chief Engineer P. & L. E. R. R. Pittsburgh, February 5th, 1879.

After due and careful examination of the Pittsburgh & Lake Erie railroad, on notice of the contractor, B. J. McGrann, of its completion, I hereby certify that said Pittsburgh & Lake Erie railroad is completed in accordance with the terms of the contract and specifications, and that the same is now ready for the ordinary freight and passenger traffic of the standard railroads, with the reserve, however, that seventy thousand dollars' worth of work is yet to be done in order to cover all points of the contract and specifications, to be subtracted from the bills of extra work claimed by the contractor and submitted to me. Sebastian Wimmer.

To B. J. McGrann, Contractor of P. & L. E. R. R.

On the next day the plaintiff presented his claim to the board of directors of the defendant company. They refused anything for extras. He thereupon stated that his claim for extras was only that which had already been examined and approved by the engineers, that he asked for nothing more.

To this the reply was made, "the report of the engineer is that you are not entitled to any extra work." When he asserted the contrary, and that he had the engineer's certificate, the reply was made: "Oh! but he has been here since and reported that you are not entitled to any extra work." They also informed him that if he did not like the contract price he might retain the road, and he would be held responsible for anything that might happen it. He replied he was compelled to take it. He accordingly took it, and gave the following receipt:

"Received, Pittsburgh, Pa., February 6th, 1879, of the Pittsburgh & Lake Erie Railroad Company, one hundred and eighty-three thousand one hundred and ninety and 56-100 dollars ($ 183,190.56) being as follows: one hundred thousand dollars in the capital stock of the company, fifty thousand dollars in mortgage bonds of the company and thirty-three thousand one hundred and ninety and 56-100 dollars in cash, being in full of all claims and demands of any and every kind whatever by me on account of the construction of railroad for said railroad company, and I hereby deliver up possession, custody and control of said railroad to the said railroad company. And said railroad company by its president hereby accepts said railroad as completed in accordance with said contract." (Signed) B. J. McGrann.

Attest: J. H. McCreery.

(Signed)

Pittsburgh & Lake Erie Railroad Company,

By Jas. I. Bennett, President.

The plaintiff testified that he was induced to take the contract price, and give the foregoing receipt by the belief that what the directors stated to him, as the statement of the chief engineer, was true. That this statement was untrue was testified to by several witnesses.

Charles Davis, an engineer of the defendant, being on the stand, plaintiff's counsel propose to ask the witness this question: "Whether or not the masonry work done by the plaintiff on defendant company's road was of a character substantially the same as that provided for in the contract which plaintiff refused to enter into at or about the time that this contract was made, for the reason, among others, that he was unwilling to undertake such masonry at the price named?"

Objected to as irrelevant. Objection sustained and bill sealed for plaintiff. (First assignment of error.)

Francis H. Saylor, an engineer of the plaintiff, being on the stand was asked: You...