Ritchie v. The City of Topeka

Citation91 Kan. 615,138 P. 618
Decision Date07 February 1914
Docket Number18,759
PartiesJOHN RITCHIE, Appellant, v. THE CITY OF TOPEKA, Appellee
CourtUnited States State Supreme Court of Kansas

Decided January, 1914

Appeal from Shawnee district court, division No. 1; ALSTON W. DANA judge.

Judgment affirmed.

SYLLABUS

SYLLABUS BY THE COURT.

1. MUNICIPAL CORPORATIONS--Paving Contract--Waiver of Provision for Forfeiture for Delay. In a paving contract it was provided that time was material, that the work should be completed in a fixed time, and that the contractor would forfeit to the city $ 10 for each day of delay beyond the stipulated time. The city, by its own act and omission, prevented the contractor from proceeding with the work for a considerable part of the allotted time, and when an application for an extension of the time was presented to the city authorities by the contractor they agreed that the contractor should proceed with the work thereafter and complete it within a reasonable time. Held, as the city by its fault and neglect prevented the contractor from proceeding with the work, and as it subsequently agreed to an extension of the time of completion, it waived the time provision of the original contract and is not in a position to insist on a payment of liquidated damages for the delay in the completion of the work.

2. SAME--Action Involving Examination of Accounts--Reference Proper. In an action to recover on the paving contract the city pleaded, by way of set-off, overpayments made on a previous contract between the plaintiff and the city for the construction of a sewer, and as the settlement of the claims of the parties involved the examination of a long and intricate account between them the court was warranted in directing a reference of the case.

3. SEWER CONTRACT--City Engineer to Supervise Work--Bad Faith--To What Extent City Engineer's Estimates are Conclusive. In the sewer contract it was provided that the work should be done under the supervision and to the satisfaction of the city engineer, that his interpretations of the plans and specifications were to be binding and final, that he was to decide all questions which might arise as to the amount and quality of the work done, and he or his assistant were present on the work almost every day during its progress. During the time the city engineer changed the grades of the sewers, thus relieving the contractor from much of the work provided for in the contract, and the contractor presented claims and secured the approval of the same by the city engineer for much material not furnished and for a great deal of work that was not done. The estimates of the city engineer, which were not made in good faith, embraced large overcharges, and on these payments were made by the city without knowledge of their fictitious character. Held, that the fact that the estimates and decisions were made by the city engineer did not preclude a recovery of the overcharges by the city.

4. SAME--Voluntary Payments--May be Recovered Back. The rule as to voluntary payments does not prevent a recovery by the city of its money from the contractor who received the illegal and unauthorized payment from city officers.

5. SAME--City Proper Party to Recover Overcharges. The contract being with the city, and it having issued improvement bonds to pay for the construction of the sewer binding upon the municipality as a whole, the city is the proper party to sue for the overcharges, although the property in the benefit district will be assessed for the payment of the improvement bonds.

J. J. Schenck, of Topeka, for the appellant.

W. C. Ralston, city attorney, and Frank G. Drenning, of Topeka, for the appellee.

OPINION

JOHNSTON, C. J.:

The controversy in this action grew out of two contracts between the parties, one for the paving of streets and alleys, and an earlier one for the construction of a sewer. John Ritchie, the appellant, brought the action to recover $ 12,343.75 for the paving of streets and alleys in the city of Topeka under a contract with the city made in April, 1909, in which it was stipulated that the work was to be completed on or before January 1, 1910, and that for every day that the work remained uncompleted after that time Ritchie should forfeit $ 10 per day. The contract was not fully executed until October 27, 1910, and at that time the city engineer estimated that there was due Ritchie the sum sued for. The city answered, setting up a counterclaim of $ 3000 as liquidated damages, the amount alleged to have been forfeited by Ritchie by delaying the completion of the paving for three hundred days after the stipulated time. The city also pleaded a set-off of $ 23,665.50 arising from alleged overpayments on a sewer contract entered into by Ritchie and his partner, Hanley, with the city on March 20, 1905. As to the set-off, it was alleged that Ritchie and his partner received payment for certain sewers not constructed, and that the city engineer, without the consent or knowledge of the city, included in his estimate such overcharges to the amount of about $ 5740.50. It was further alleged that the city engineer raised grades and changed the size of sewers, thus relieving Ritchie of the excavation of about 13,000 cubic yards provided for in the contract, and gave estimates of the work as if it had been fully performed in accordance with the requirements of the contract, and that in this way Ritchie was overpaid the sum of about $ 7800. It was further alleged that there was an overcharge in the rock excavations to the extent of $ 10,125, and that the city engineer included this overcharge in his estimates and thereby enabled Ritchie to obtain payment for work which was not done. In his reply Ritchie alleged that the delay in completing the paving contract was caused by the city, and further, that if the city had any right to claim a forfeiture for failure to complete the contract within the specified time it had been waived. As to the set-off claimed under the sewer contract Ritchie replied that the work was done in accordance with the directions of the city engineer, who was acting for the city, and that no changes in the work done or material furnished were made except such as were ordered by the city engineer with the knowledge of the city. He also averred that work not included in the contract was done under the direction and approval of the city engineer in place of work contracted for but not performed, and that this substitution was made with the knowledge of the city, and that all the money paid to him under the sewer contract had been fully earned and was justly due.

The pleadings disclosed that a trial of the case involved an examination of a long and intricate account between the parties, which included many items and was too complicated to be tried by a jury, and the court rightly determined it was a referable one and on its own motion referred the case to Robert Stone, Esquire, with power to try the issues and report his findings of fact and conclusions of law to the court within a fixed time. Upon a trial by the referee he found that Ritchie had furnished material and done work under the paving contract for which he was entitled to $ 10,941.33, but that because of his delay in completing the contract the city was entitled to a deduction of $ 2000, which left a balance due Ritchie under that contract of $ 8941.33. He also found that Ritchie was indebted to the city for payments made to him on overcharges under the sewer contract in the sum of $ 20,173.46 with interest thereon from December 18, 1907, at six per cent per annum, and that the city was entitled to a judgment against Ritchie in the sum of $ 16,035.48. Ritchie moved the court for judgment on the findings of fact made by the referee, contending that the conclusions of law were not justified by the facts found. This motion was overruled, as was one made by him to set aside the report of the referee. Final judgment was then rendered by the court upon the conclusions of the referee in favor of the city for $ 16,035.48 with interest thereon at the rate of six per cent per annum from October 23, 1912.

It is contended on this appeal that the forfeiture of $ 2000 for delay in finishing the paving and the deduction of that sum from the amount due Ritchie for the paving done by him is error. This contention is based on two grounds, one that the city in fact caused the delay by its own wrong and neglect, and the other that it had effectually waived performance of the contract within the stipulated time. The finding of fact relating to the responsibility of the city for the delay of Ritchie is:

"John Ritchie was delayed one hundred days in the performance and completion of such work by reason of the failure of the said City of Topeka...

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