School District No. 1 v. Howard

• Decision Date: 10 December 1935
• Docket Number: 1879
• Citation: 52 P.2d 421,49 Wyo. 41
• Parties: SCHOOL DISTRICT NO. 1 v. HOWARD, ET AL
• Court: Wyoming Supreme Court

52 P.2d 421

49 Wyo. 41

SCHOOL DISTRICT NO. 1 v. HOWARD, ET AL

No. 1879

Supreme Court of Wyoming

December 10, 1935

APPEAL from the District Court, Laramie County; CYRUS O. BROWN Judge.

Action by School District No. 1, in Albany County, against John W Howard and others, as executors of the last will and estate of Frank A. Roedel, deceased. Judgment for defendants, and plaintiff appeals.

Judgment affirmed.

For the plaintiff and appellant there was a brief by C. M. Eby and A W. McCollough, of Laramie, Wyoming, and oral arguments by Mr. Eby and Mr. McCollough.

This action is founded upon an award rendered by the supervising architect, from which no appeal was taken. The award cannot be impeached except for fraud or collusion with the owner. The court erred in refusing to make special findings of fact and conclusions of law. The contract provides that an award made by the architect shall be final. Awards are defined by the authorities. Sharswood Com., 3 C. L., Section 2; 1 Bouvier 205; Olston v. Company, 97 P. 538; McCloskey v. Marks, 106 A. 729; Seim v. Krause, (S. D.) 83 N.W. 584; Murphy v. Salt Lake City, 236 P. 683; Dickson v. Reedor, 109 P. 1060; U. S. v. Hurley, 182 F. 778; Firestone Company v. Bridge Company, 247 F. 629. The architect's certificate was conclusive. 9 C. J. 772. Investment Company v. Company, 144 P. 68. The status of the architect is defined by the contract. Hurley v. Koons, 215 P. 21; Williams v. Board, 139 S.W. 1136; McNulty v. Keyser Company, (Md.) 76 A. 1113; Brown v. Coffee, (Calif.) 121 P. 309; Hutchinson v. District, (N. D.) 199 N.W. 484; Smity v. Board, (W. Va.) 85 S.E. 513. The court erred in overruling plaintiff's objections to evidence relating to the status of the architect. The court erred in refusing to render special findings of fact and of law. Parrott Brothers v. City, 167 P. 807; Outwater v. Moore, 26 N.E. 329.

As against defendant's sureties, appellant contends that upon the death of Fred A. Roedel his executors were substituted as defendants. A copy of the award was filed against the estate of Roedel, deceased. A claim of this kind need not be as specific as a pleading. Thompson v. Koeller, (Calif.) 191 P. 927; Sargent v. Foland, 207 P. 349; Doolittle v. McConnel, 174 P. 305; Sowers v. King, 32 Wyoming 167; Martin & Company v. Brosnan, 123 P. 550; Allerton v. Allerton, 233 P. 632. There was no misjoinder of defendants. 89-715 R. S., 2 Bates P. & P. 1119. The Wyoming statutes require a building bond for public works. 94-201, 4, R. S., Surety Company v. Holliday, 42 Wyo. 415; Gintjee v. Keieling, (Calif.) 170 P. 641.

For defendants and respondents, there was a brief by C. R. Ellery, Thomas Hunter and Bard Farrall, of Cheyenne, and oral arguments by Messrs. Hunter and Ellery.

A contract such as the one involved providing that an award shall be a "condition precedent" to legal action, does not mean that such an award shall be final and conclusive, as might be the case in a different form of contract. The decisions are not in harmony on the question of arbitration. From an award of arbitrators, or a decision of an architect unappealed from, to be conclusive, two things are necessary: First, the executory agreement to submit, and second, an actual submission. Plaintiff seeks to eliminate the second of these requirements and contends that a binding award can be predicated alone upon an executory agreement which, after the dispute arises, has been breached by one of the parties. The following authorities support the foregoing principles: Construction Company v. Steel Company, 211 F. 849; Guaranty Trust Company v. Company, 11 S.Ct. 513; 5 C. J. 20; Fuller Company v. Young Co., 126 F. 343; Chandley v. Borough, 49 A. 772; 5 C. J. 26; County v. Construction Company, 134 So. 509; Canning Company v. Seed Company, 190 N.W. 167; Dolman v. Board of Commissioners, 226 P. 240; Short Heritage v. State, 88 N.E. 114; Hudson Trading Company v. Durand, 185 N.Y.S. 187; Finucane Company v. Board of Rochester, 82 N.E. 737; Ruch v. York City, 81 A. 891; 47 L. R. A. (N. S.) 385. Ware, the architect, had no authority to make a money award (see Articles 20, 31 of Contract); nor authority to pass on any of the defects mentioned in his award. See Articles 25, 38 of Contract; Schliess v. City of Grand Rapids, (Mich.) 90 N.W. 700; Laycock v. Moon, (Wis.) 72 N.W. 372; Wright v. Meyer, (Tex.) 25 S.W. 1122; City Company v. City, (Calif.) 101 P. 309; Stewart v. Breckenridge, (Colo.) 169 P. 543; Chemical Company v. O'Brien, (N. C.) 92 S.E. 594; Boettler v. Tendick, (Tex.) 11 S.W. 497; Pippy v. Winslow, (Ore.) 125 P. 298; City v. Stookey, 154 F. 772 (8th Cir.); Granette Company v. Newmann, (Iowa) 221 N.W. 197; Edmundson v. Wilson, 108 Ala. 118; Johnston v. Dunn, 19 L. R. A. (N. S.) 1065; Ashland Company v. Shore, (Wis.) 81 N.W. 136; Chicago R. R. Company v. Price, 11 S.Ct. 290; Duell v. McGraw, 33 N.Y.S. 528. The award was impeached by defendant. Ware was attempting to function as an arbitrator and his partiality amounted to constructive fraud. Fass v. Ins. Co., 89 S.E. 1040, 1044; Downey v. R. R. Co., (Kan.) 57 P. 101; Lantry Company v. Ry. Co., (Kan.) 172 P. 527.

Thomas Hunter for defendants Hofmann and Executors of Roedel Estate.

Plaintiff never filed a sufficient claim against the estate of Roedel. O'Keefe v. Foster, 5 Wyoming 343; Flynn v. Driscoll, 223 P. 524; Giles v. Reed, 186 Cal. 614; Harwood v. Scott, 186 P. 693; Empson v. Fortune, 172 P. 873. There was a misjoinder of defendants and of causes of action, Hofmann and the Roedel Estate not being parties to the instrument. The equities are with the sureties. In addition to the matters set forth in this brief, the sureties claim the right to rely upon all defenses set forth in the separate brief of defendant Howard.

C. M. Eby and A. W. McCollough in reply.

The authorities cited by counsel for defendant are not in harmony in support of their contention. An examination of them will show that they are predicated upon various forms of building contracts and some of them are governed by statutes in the jurisdictions where decided. Revocation of an agreement to arbitrate must be of equal dignity with the submission. 5 C. J. 57; Morse on Arbitration, 232. There must also be notice of revocation. 5 C. J. 58; Maud v. Patterson, 49 N.E. 974; Frederick v. Margwarth, 70 A. 797; Morrison Company v. Lewis, 122 S.E. 747. It is clear that Ware had authority to make an award. 13 C. J. 525; Articles 20, 31, 39 and 40 of Contract. The courts favor arbitration proceedings. 2 R. C. L. 389; Lake Michigan Company v. Company, (Ind.) 123 N.E. 703; Chatfield v. O'Neal, 93 A. 133.

KIMBALL, Chief Justice. BLUME and RINER, JJ., concur.

OPINION

KIMBALL, Chief Justice.

This is an appeal from a judgment on a general finding in favor of the defendants after trial to the court in an action by a School District against a building contractor and his sureties to recover the amount certified by the architect as damages for defects and omissions in the construction of a school building at Laramie, Wyoming.

The building was constructed under a contract evidenced by writings, called the contract documents, consisting of an agreement, general conditions, drawings and specifications. The agreement and general conditions are the standard form put out by the American Institute of Architects.

The agreement provides that payment of the contract price, $ 201,000, shall be made on certificates of the architect who, when he "finds the work acceptable under the contract and the contract fully performed," is required to issue a final certificate. The architect named in the agreement was W. A. Hitchcock.

The general conditions are set forth in 44 articles covering 9 printed pages. We quote the parts that seem pertinent.

Article 20, headed "Correction of Work after Final Payment," provides.

"Neither the final certificate nor payment nor any provision in the contract documents shall relieve the contractor of responsibility for faulty materials or workmanship and, unless otherwise specified, he shall remedy any defects due thereto and pay for any damage to other work resulting therefrom, which shall appear within a period of one year from the date of substantial completion. The owner shall give notice of observed defects with reasonable promptness. All questions arising under this article shall be decided by the architect subject to arbitration."

Article 25 provides for issuance by the architect of certificates for amounts due the contractor, and that

"No certificate issued nor payment made to the contractor, nor partial or entire use or occupancy of the work by the owner, shall be an acceptance of any work or materials not in accordance with this contract. The making and acceptance of the final payment shall constitute a waiver of all claims by the owner, other than those arising from unsettled liens, from faulty work appearing after final payment or from requirement of the specifications, and of all claims of the contractor, except those previously made and still unsettled."

Article 31, headed "Damages," provides:

"If either party to this Contract should suffer damage in any manner because of any wrongful act or neglect of the other party or of anyone employed by him, then he shall be reimbursed by the other party for such damage.

"Claims under this clause shall be made in writing to the party liable within a reasonable time of the first observance of such damage and not later than the time of final payment, except as expressly stipulated otherwise in the case of faulty work or materials, and shall be adjusted by agreement or arbitration."

Article 38, headed "Architect's Status," provides:

"The architect shall have general supervision and direction of the work. He is the agent of...