Vandegrift v. Cowles Eng'g Co.

• Decision Date: 09 January 1900
• Parties: VANDEGRIFT v. COWLES ENGINEERING CO. et al.
• Court: New York Court of Appeals Court of Appeals

161 N.Y. 435

55 N.E. 941

VANDEGRIFT

v.COWLES ENGINEERING CO. et al.

Court of Appeals of New York.

Jan. 9, 1900.

Appeal from supreme court, appellate division, First department.

Action by Frederick B. Vandegrift against the Cowles Engineering Company and Vaulx Carter, as assignee for the benefit of creditors, and others. From an order of the appellate division reversing a judgment in favor of defendants, dismissing the complaint (56 N. Y. Supp. 1118), the engineering company and its assignee appeal. Reversed.

Appeal from an order of the First appellate division, reversing a judgment which dismissed the complaint, and granting a new trial. From that order the defendants the Cowles Engineering Company and Vaulx Carter, its assignee, appealed to this court. On the 3d day of March, 1893, the engineering company entered into a written contract with the Interstate Steamboat Company, by which the former agreed to build and complete for the latter a steamboat of the character, dimensions, and speed therein provided, and to deliver the same at a time and place provided in the contract. In consideration thereof the Interstate Company was to pay $50,000 as follows: Ten per cent. on the signing of the agreement; 25 per cent. when all the steel for the steamer was in the yard and shops of the defendant company, being worked upon; 25 per cent. when the steamer was in the frame, and the principal forgings, castings, plates, and tubes for the engines and boilers were in the shops of the defendant company, being worked upon; 25 per cent. when the steamer was launched; and the remaining 15 per cent. upon its completion in accordance with the agreement. Five thousand dollars of the fourth and $5,000 of the fifth payments were permitted to be paid in the bonds of the plaintiff's assignor, to be made and to become due as therein mentioned, and to be secured by a first mortgage upon property therein described. It was also mutually agreed that in case the defendant company should not complete the steamer on or before the 22d of August, 1893, it should forfeit to the plaintiff's assignor the sum of $100 per day after that date as damages for each day's delay in the completion of the steamer, to be deducted from the amount of the bonds which the plaintiff's assignor might pay on the final payment. It was also agreed that, if the steamer was not completed within two months after the time named, the plaintiff's assignor might accept or reject her upon her completion, and that, if she was rejected, then the defendant company should repay, with interest, all sums paid to it under this agreement. It was likewise agreed that all the time which delay in the completion of the steamer should be caused by strikes of workmen, whether in the works of the defendant company, or in the works where any of the materials or machinery for such steamer were made, or by epidemics, or by the elements, or by delays of carriers, or by other causes beyond the control of the defendant company, should be added to the time fixed for the completion of such steamer, and the time extended accordingly. A bond in the penal sum of $25,000 was executed by the defendant company, and by the defendants Nevins and Tumbridge as sureties, conditioned for the performance of the contract by the defendant company. The latter entered upon its performance, and in August, 1893, the first four installments provided for, amounting to $42,500, had been paid by the plaintiff's assignor. During that month the defendant company failed, and upon the 30th day of the month it executed a general assignment to the defendant Carter for the benefit of its creditors.

Upon the trial the plaintiff proved the contract and specifications, the bond, and an assignment by his assignor to him, which assigned the bond and all the debt and obligation thereby secured; that the plaintiff's assignor executed a mortgage upon its real estate and upon certain personal property to the Camden Safe-Deposit Company, as trustee, to secure its bonds; and that bonds were issued under that mortgage to the amount of $26,000. The plaintiff then proved that his assignor made all the payments required by the contract, except the last; that the boat was launched the early part of August, 1893, was named by the plaintiff's assignor, but was never completed by the defendant company; that when launched she had some decking, her hull, and engines, but no boilers, and there was nothing above the hull; that no offer or tender of the boat to the plaintiff's assignor was made by the defendant company; that there were parts of the boat in the shops of the defendant company, brass works, parts of the rudder, tiller wheel, brass fittings for the different parts of the boat, and a number of things; that the boilers, brass fittings, and other things were sold by the sheriff of Kings county, but it was not proved when the sale occurred; that they were not purchased by the defendant company, but were bought by a young man in the office of Parsons, Shepard & Ogden; that the boat laid at Bush's Wharf, Brooklyn, six weeks, during which time she was in charge of the employés or officers of the Interstate Company, and on the 9th or 15th of October was, by the direction of the president of that company, taken to Philadelphia and completed by direction of the plaintiff's assignor. Briefly stated, this is all the evidence that was given upon the trial.

When the plaintiff rested, the defendants moved to dismiss the complaint upon the grounds: ‘First. That there is no evidence tending to show that the Interstate Steamboat Company or its assignee, Vandegrift, has sustained any damage by reason of the failure to complete the boat. Second. That it appears that within the time within which, by the terms of the contract, the Cowles Engineering Company was to complete the boat, the Interstate Steamboat Company removed the boat from the possession of the assignee, and deprived him and the Cowles Company of the power of completing the boat. Third. That the removal of the boat within such time, and prior to the expiration of the time for her completion, was an acceptance by the Interstate Steamboat Company of the boat as a completed boat in accordance with the terms of the contract. Fourth. Upon the further ground that there is no evidence of a breach of the contract by the Cowles Engineering Company. On the further ground that he has not shown that the defendant the Cowles Engineering Company was not prevented from completing the boat by strikes.’ This motion was granted, and the plaintiff duly excepted.

Bartlett, Gray, and O'Brien, JJ., dissenting.

Henry W. Goodrich, for appellants.

Esek Cowen, for respondent.

MARTIN, J. (after stating the facts).

This controversy is based upon the agreement between the plaintiff's assignor and the defendant company, and the bond given to secure its performance by the latter. To authorize a recovery upon the bond, upon the contract, or for the money paid thereon, it was incumbent upon the plaintiff to show that there was something due under the agreement, or that it had been broken by the defendant company without fault of the plaintiff's assignor, and anterior to any breach by the latter. This involves a determination as to the time within which the defendant company was required to complete and deliver the steamer to the plaintiff's assignor. The appellants insist that, in any event, the time for the fulfillment of the contract did not expire until the 22d day of October, 1893, and as there was no proof that the company was not delayed by strikes, epidemics, delays of carriers, or other causes beyond its control, it was not shown that its time did not extend beyond that day. The first clause of the contract relating to the subject provides that the steamer shall be completed on or before the 22d day of August, 1893. If this was all of the agreement relating to the question of time, there would be no difficulty in determining it. But we find two others, both of which relate to, and bear directly upon, the intention of the parties as to the time within which the defendant company was bound to complete and deliver the boat. The first is to the effect that the company should forfeit $100 for each day's delay in completing her after August 22d, and, if she was not completed within two months after that time, the plaintiff's assignor might, at its option, accept or reject her upon completion. From this provision the plain and necessary implication is that the defendant company was to have two months' further time for her completion, although it might be liable to pay the specified penalty for its delay. The next provides that any delays caused by strikes or other conditions mentioned should be added to the time fixed for the completion of the work, and that the time should be extended accordingly. Thus, it is manifest that the time for the completion of the vessel was not fixed absolutelyas the 22d of August, so far as the defendant company was concerned. While it may be that the plaintiff's assignor could not have been required to accept the boat and pay the full consideration before that time, yet the provisions of the contract show a clear intent that the defendant company should not be absolutely required to complete her on or before that date. It is true, if it did not it might become liable to pay the penalty prescribed. But this was the only loss or liability to which it was to be subjected until two months after that time, when the plaintiff's assignor might accept or reject her as it saw fit. Thus, prior to October 22d it possessed no right to reject her, and, consequently, if she was completed in accordance with the contract within that time, it was bound by its agreement to accept her and pay the contract price, less only the penalty which was provided for delay after the 22d of August. Moreover, in case of strikes, epidemics, delays of carriers, or othr causes beyond the control of the...