N.J. Fid. & v. Gen. Electric Co

• Decision Date: 16 March 1933
• Court: Virginia Supreme Court
• Parties: NEW JERSEY FIDELITY & PLATE GLASS INS. CO. v. GENERAL ELECTRIC CO.

168 S.E. 425

NEW JERSEY FIDELITY &PLATE GLASS INS. CO.

v.GENERAL ELECTRIC CO.

Supreme Court of Appeals of Virginia.

March 16, 1933

.

Error to Circuit Court of City of Norfolk.

Action by the General Electric Company against the New Jersey Fidelity & Plate Glass Insurance Company. Judgment for plaintiff, and defendant brings error.

Reversed and rendered.

Argued before CAMPBELL, C. J., and HOLT, EPES, HUDGINS, GREGORY, BROWNING, and CHINN, JJ.

W. R. L. Taylor, of Norfolk, for plaintiff In error.

Vandeventer, Egglcston & Black, of Norfolk, for defendant in error.

BROWNING, Justice.

The General Electric Company instituted an action in the circuit court of the city of Norfolk against the New Jersey Fidelity & Plate Glass Insurance Company to recover certain attorney's fees and interest aggregating the sum of $3,730.84. All matters of fact and law were submitted to the court without the intervention of a jury and judgment was rendered in favor of the General Electric Company. The correctness of that judgment is before this court upon a writ of error.

The facts, most of which are not in dispute, may be stated as follows: The Spear Engineers, a Virginia corporation, operated a shipbuilding plant in the city of Portsmouth, Va., and on August 14, 1928, entered into a contract with the city of Portsmouth and the county of Norfolk, which were the owners and operators of the Norfolk County Ferries, for the construction of a ferryboat. Under the terms of the contract the builder was to be paid as the work on the boat progressed. The contract provided that the boat should be kept clear of all liens and claims of any kind. It also provided that the contractor or builder should enter into a bond, with good and sufficient surety, to secure the faithful performance of the contract, and to protect and save harmless all subcontractors, laborers, and others who performed labor or furnished materials in and about the construction of the boat. Such a bond was duly executed on August 14, 1928, and the plaintiff in error, a surety company, became surety thereon.

On January 25, 1929, the contractor, the Spear Engineers, contracted with the General Electric Company, the defendant in error, for the purchase of certain electric propulsion motors and equipment for installation in the boat. It was provided in this contract that the title to the motors and equipment should be retained by the General Electric Company until they were fully paid for. The contract was recorded in the office of the clerk of the corporation court of Norfolk on March 13, 1929, and in the office of the clerk of the circuit court of Norfolk county on May 31, 1929. It was conceded that the contract for the reservation of title was not recorded in the proper clerk's office and therefore it was not effective for its purposes, except as between the parties thereto and the city of Portsmouth and the county of Norfolk which entities otherwise had notice thereof.

The General Electric Company furnished and delivered to the Spear Engineers equipment and material, under the contract, to the amount of $19,361.18, a part of which, $6,600, was paid in cash, leaving a balance of $12,761.18.'

The Spear Engineers, under its contract with the owners, was to receive the third payment on the construction work, $42,120, when the boat was 60 per cent, completed. The requisite percentage of completion was not attainable unless there was included in the computation the materials and equipment furnished by the General Electric Company, and which was then on the shipyard.

The General Electric Company was concerned about the payment of the balance due it which was evidenced by two notes of equal amount, which were past due, and through its legal department, wrote to the city of Portsmouth on May 7, 1929, asking that it and the county of Norfolk set aside a sufficient sum to pay such balance due by the Spear Engineers to be taken or deducted from the next payment to be made by them to the Spear Engineers on their contract. In this letter the General Electric Company made claim to the electrical equipment by reason of its reservation of title thereto. Pursuant to this letter the equipment referred to was embraced in the computation and thereby the 60 per cent, of completion of the boat was reached and the third payment became due the contractor. This payment was made, after deducting therefrom the $12,-761.18 due by the contractor to the General Electric Company, and it was segregated and set apart as requested by being placed in the hands of C. U. Freund, superintendent of the ferries, for the benefit of the General Electric Company. It was later deposited in the American National Bank of Portsmouth to the credit of "Chas. U. Freund, Supt. Special Account--General Electric Lien. 6--1--29. Checks as follows: $12,761.18+182.88=$12,944.06"

The Spear Engineers received the residue of the third payment made by the owners...