Municipal Excavator Co. v. Siedhoff

• Decision Date: 04 October 1926
• Docket Number: No. 7154.,7154.
• Citation: 15 F.2d 10
• Parties: MUNICIPAL EXCAVATOR CO. v. SIEDHOFF.
• Court: U.S. Court of Appeals — Eighth Circuit

15 F.2d 10 (1926)

MUNICIPAL EXCAVATOR CO. v. SIEDHOFF.

No. 7154.

Circuit Court of Appeals, Eighth Circuit.

October 4, 1926.

James S. Twyford, of Oklahoma City, Okl. (Benjamin F. Hegler, of Wichita, Kan., and Solon W. Smith, of Oklahoma City, Okl., on the brief), for plaintiff in error.

A. L. Noble, of Wichita, Kan. (W. A. Ayres, Hal M. Black, and C. A. McCorkle, all of Wichita, Kan., on the brief), for defendant in error.

Before VAN VALKENBURGH and BOOTH, Circuit Judges, and PHILLIPS, District Judge.

BOOTH, Circuit Judge.

This is a writ of error to a judgment affirming the report of a referee, which awarded recovery to defendant in error, plaintiff below, in an action on contract. The action was commenced in the state district court of Sedgwick county, Kan., by defendant in error against plaintiff in error and Lillian L. Derr. The defendants removed the cause to the United States District Court for the District of Kansas, on the ground of diversity of citizenship.

Neither in the pleadings nor in the removal papers do jurisdictional facts sufficiently appear; but no question of jurisdiction was raised by the parties in the court below or in this court. From the record, and from the findings of the referee, however, it appears that plaintiff, Siedhoff, was a resident and citizen of the state of Kansas, that defendant Municipal Excavator Company is a corporation organized under the laws of the state of Oklahoma; that defendant Derr is a mere nominal party, and had nothing to do with the transaction in controversy. We have therefore concluded that, upon the whole record, jurisdiction is sufficiently disclosed.

The complaint as amended alleged: That plaintiff, under the name of the George H. Siedhoff Construction Company, entered into a contract with the city of Wichita, Kan., for the construction of a sewer; that by the terms of the contract the company was to furnish labor and material, except concrete pipe. The company was to furnish and maintain machinery, tools, and equipment. The cost was estimated not to exceed $214,000. The city was to pay the company the actual cost of labor and material, pay for the concrete pipe, and pay the rental charge for a trenching machine employed in the work, provided the charge for such machine was agreed to in writing and approved by the city manager before the work should proceed. The city was to pay also $20,000 to the company for its services and equipment, and, if the entire cost was less than $214,000, the difference was to be divided between the company and the city; if the cost exceeded $214,000, the company was to pay all the excess cost.

The complaint further alleged that the company made an oral contract with the Municipal Excavator Company for the use of a trenching machine; that the agreed rental was 20 cents per cubic yard of earth excavated; that this rental covered the cost of transportation, setting up, dismantling, repairing, and maintaining such trenching machine, but the labor for operating the machine was to be paid for, like other labor; that the excavator company was to have general supervision of the whole work and employ the labor; that a bookkeeper, acting jointly for the construction company and the excavator company was to keep all accounts and records, and his salary was to be part of the cost of construction; that, if the total cost of the sewer should be less than $214,000, the excavator company was to have the one-half of the saving which by the contract with the city was to go to the construction company.

The complaint further alleged that a special bank account was opened by the parties, in which was placed all moneys paid by the city; that Charles Derr, representing the excavator company, checked out the moneys of said account; that the excavator company entered upon the performance of said contract, but did not complete the same; that the excavator company checked out of the special bank account all the moneys placed therein which came from the city, and $2,934.73 which the construction company had placed therein; that the construction company was obliged to complete the construction, which it did at a total cost for the sewer of more than $227,000, not including the $20,000 fee for the construction company; that the excess cost was due to improper charges by the excavator company — among others, charges for the repairs and replacements on the trenching machine, amounting to $10,039.39, labor charges in making said repairs and replacements, $3,000, and padding of pay roll, $5,000; that these and other payments were in violation of the terms of the contract, and that by reason thereof, and by reason of the appropriation by the excavator company of a back-filler purchased at the joint expense of the construction company and the excavator company at the cost of $3,840, the excavator company was indebted to plaintiff in the sum of $24,313.

The excavator company in its answer set up a general denial; also a cross-petition, in which it alleged that the excavator company had originally proposed to the construction company a contract which provided a rental for the trenching machine of 15 cents per cubic yard, but the upkeep, etc., was to be paid as part of the expense of the work; that this proposal was not approved by the city manager; that thereafter the construction company had proposed a contract which provided a rental for the trenching machine substantially as alleged in plaintiff's complaint; that the excavator company would not agree to said proposed contract; that thereafter it was agreed that the work should be done under the original proposal, but that the excavator company should turn in estimates for the construction company to the city at 20 cents per cubic yard, as if the same had been figured under the second proposal; and the cross-petition further alleged that "the said Siedhoff agreed that, if the extra five cents per cubic yard did not take care of the expenses for the upkeep of the trenching machines and repairs and other expenses incidental to the construction of said sewer ditch, which were to be taken care of by the said George H. Siedhoff Construction Company, corporation, as provided in Exhibit A the first proposal, the said George H. Siedhoff Construction Company, corporation, would pay said expenses"; that both parties agreed to this arrangement; and that thereafter the excavator company proceeded to excavate the ditch.

The cross-petition further alleged that, after crediting the construction company with the moneys received from the city under the contract, there was still due from the construction company to the excavator company, for repairs, upkeep, etc., of tools and the trenching machine, $8,132.37.

The construction company, in its reply, denied the allegations of the cross-petition. With the issues thus formed, the...