Waldo Bros. Co. v. Platt Contracting Co.

• Decision Date: 28 February 1940
• Citation: 25 N.E.2d 770,305 Mass. 349
• Parties: WALDO BROS. COMPANY v. PLATT CONTRACTING CO. INC.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

305 Mass. 349

25 N.E.2d 770

WALDO BROS. COMPANY v. PLATT CONTRACTING CO. INC.

Supreme Judicial Court of Massachusetts, Middlesex.

February 28, 1940

December 7, 1939.

Present: FIELD, C.

J., DONAHUE LUMMUS, COX, & RONAN, JJ.

Contract Construction, Performance and breach.

A tripartite contract, made on June 25 by a general building contractor, a subcontractor who had since March partially performed his subcontract and had, so far as appeared, been paid thereunder by the general contractor for all work done through June 14 and a materialman to whom the subcontractor was indebted, and providing that the materialman would continue to supply the subcontractor with materials necessary to enable him to complete the subcontract, that the subcontractor assigned to the materialman all sums then due or thereafter to become due from the general contractor, and that the general contractor would pay the materialman on July 3 a stated percentage of labor and materials furnished by the subcontractor "up to and including" June 25, less certain deductions, was construed by this court, in the circumstances, to mean that the general contractor's payment to the materialman should be based on the labor and materials furnished by the subcontractor after

June 14 only.

The obligation of a general contractor, under a tripartite contract between him a subcontractor and a materialman of the subcontractor, to pay the materialman a percentage of materials and labor furnished by the subcontractor during a certain period, was not affected by a failure of the subcontractor to perform a promise by him in the same contract to submit requisitions to the general contractor, where it appeared that the materialman had fully performed his obligations under the contract.

A materialman, who was not in default in the performance of his obligations under a tripartite contract in writing between him, the general contractor and the subcontractor whereby the general contractor had promised to pay him a percentage of certain materials and labor furnished by the subcontractor, was not precluded from recovering from the general contractor by the fact that the general contractor had not determined the value of such materials and labor, although the subcontract provided that the general contractor should determine those values and under the tripartite contract the subcontractor promised to complete the subcontract "in accordance with its terms and provisions."

CONTRACT. Writ in the Superior Court dated July 19, 1937. The action was heard by Williams, J.

The plaintiff requested the following rulings: "1. In a suit by A against B on a contract wherein A, B, and C have severally assumed certain obligations, if A has completely performed, he is not chargeable with C's defaults and can recover from B the performance which B promised, even though C has not performed those duties which he assumed. B's rights are against C for breach of contract, and do not affect B's obligations to A if A has completely performed. 2. If the plaintiff fully performed everything which, under the agreement of June 24, 1937, it agreed to perform, it is entitled to performance of the defendant's agreement thereunder, even though Wilgoren did not perform those things which he agreed to perform. 3. Default by Wilgoren, not caused or procured by the plaintiff, is not chargeable to the plaintiff and does not prevent the plaintiff from recovering from the defendant if the plaintiff has fully performed everything which, under the terms of said agreement of June 24, 1937, it agreed to perform. 4. The agreement of June 24, 1937, is not merely an assignment to the plaintiff of money due or thereafter to become due from the defendant to Wilgoren, but is a contract under the terms of which each of the parties acquired rights and incurred obligations. 5. The legal effect of said agreement of June 24, 1937, is not conclusively determined by the use therein of the word `Assignee' to designate the plaintiff. 6. By entering into the contract of June 24, 1937, the plaintiff became bound to the defendant to do certain things which previously the plaintiff had not been bound to do, and if the plaintiff performed all such things, the plaintiff is entitled to performance by the defendant of the defendant's obligations thereunder, even though Wilgoren did not completely perform those things which he agreed to perform."

The trial judge refused the foregoing requests; ruled in substance that "the value to which reference is made in paragraph 3 of the agreement of June 24, 1937, between the plaintiff and the defendant, are the values to be determined in accordance with the provisions of the contract between the defendant and Wilgoren"; stated that he was "unable to find that the plaintiff had sustained the burden of proving what, if anything, was due to Wilgoren on any of the material dates"; and found for the defendant. The plaintiff alleged exceptions.

The case was submitted on briefs.

I. M. Davis & A.

Nemrow, for the plaintiff.

R. Robinson & I.

R. Ostrofsky, for the defendant.

COX, J. The plaintiff brought this action of contract upon a declaration which alleges, in substance, that the parties entered into a contract whereby the defendant agreed to pay to the plaintiff a sum equal to eighty-five per cent of all materials and labor furnished by one of the defendant's subcontractors one Wilgoren, "up to and including the tenth day of July, 1937, less certain payments previously made by the defendant to the plaintiff; that said payment was to be made on the eighteenth day of July, 1937," but that the defendant had failed to pay as agreed. The answer contains a general denial, plea of payment, and, further, an allegation that if there was a contract between the parties, it was "predicated" upon the performance of "the contract of . . . Wilgoren by" him, and that he "breached his contract with the defendant and did not perform the same." The case was referred to an auditor and thereafter was tried by a judge of the Superior Court upon the report of the auditor and other evidence. The judge found the facts as found by the auditor to be true, except as stated in his findings, denied certain requests for rulings of the plaintiff, made certain rulings, and found for the defendant. The plaintiff seasonably excepted to his refusals to rule, to two of his rulings, "and to the court's finding for the defendant."

On February 12, 1937, the defendant had a written contract for the erection of a theatre and stores in West

Newton. On March 5, 1937, Nathan Wilgoren (hereinafter referred to as Wilgoren) entered into a contract with the defendant, as a subcontractor to furnish certain labor and materials called for by the plans and specifications for the structure that the defendant was to build, for a price of $15,750.

Payments were to be made by the defendant to Wilgoren on the third and eighteenth days of each month for eighty-five per cent of the value of the labor and materials furnished up to and including the last day of the previous month and the fourteenth day of the current month, said value to be determined by the defendant; and forty-three days after the completion of all of Wilgoren's work, he was to receive the balance "of 15 per cent of the value of labor and materials.

" This contract provided that "the word `completion', wherever used in this agreement shall mean completion in every form and detail of the work called for under this agreement and shall not mean substantial performance," and that Wilgoren's right to compensation should be based upon completion of his contract within this meaning. There was a further provision that if Wilgoren at any time neglected or failed to begin and prosecute his work with promptness and diligence, the defendant might, after twenty-four hours' notice to him, be at liberty to "repudiate" the agreement and proceed to complete the work; and might charge any proper loss to the account of the payments therein stipulated, and charge Wilgoren with damages for nonperformance of said work. The plaintiff was not a party to either of these contracts and did not know of their provisions. On June 23, 1937, Wilgoren's work had progressed satisfactorily and on time, but he owed the plaintiff $4,589 for materials purchased, "for the most part brick used in the work on the theatre." On that date a conference was held, which Wilgoren and representatives of the plaintiff and defendant attended, and Wilgoren's indebtedness to the plaintiff was discussed. In response to an inquiry, he stated that it would cost "about $2,000 for labor and about $2,000 for materials to finish the work." After considerable discussion, the plaintiff, the defendant and Wilgoren entered into a written agreement which was executed on June 24, 1937. Strange as it may seem in view of this litigation, there is a specific finding by the auditor that all the parties had discussed all matters in the contract fully on the afternoon of June 23, 1937, "and that all parties fully understood the terms thereof."

The agreement executed in triplicate, recites the existence of the contract between Wilgoren and the defendant, its partial performance, and that "certain material and labor still remains to be furnished and performed in order to complete" the subcontract. There are further recitals of the amount due the plaintiff from Wilgoren; that the plaintiff "has agreed and hereby does agree to furnish under the terms and conditions hereinafter set forth" additional material required by Wilgoren to complete his contract "up to but not exceeding $2,000"; that the defendant desires "said additional material be furnished by" the plaintiff and that the contract between it and Wilgoren "be performed and completed...