Williams v. National Surety Corporation, 16925.

Decision Date30 June 1958
Docket NumberNo. 16925.,16925.
Citation257 F.2d 771
PartiesClyde O. WILLIAMS et al., Appellants, v. NATIONAL SURETY CORPORATION et al., Appellees.
CourtU.S. Court of Appeals — Fifth Circuit

R. Clifford Fulford, Birmingham, Ala., for appellant.

James E. Clark, Birmingham, Ala., London, Yancey, Clark & Allen, Birmingham, Ala., and Richard U. Simon, Fort Worth, Tex., of counsel, for appellee.

Before HUTCHESON, Chief Judge, and BROWN and WISDOM, Circuit Judges.

John R. BROWN, Circuit Judge.

With all of its 1700 pages of typewritten evidence, 170 more of transcript, endless brief of 533 pages, replies, rejoinders, surrejoinders and replications, this case when it finally boils down has small compass for us. That is so because of the inherent nature of the several responsibilities of trial court, of jury and appellate court in the final winding-up of a complex case. A hard thing for any loser to accept is that we do not sit to review the facts nor, as the briefs with their lengthy treatment of it unwittingly asks us to do, are we to sift and weigh, accept and reject, each piece of evidence either separately or as it fits into the mosaic pattern, to determine what conclusion out of this mass of affirmation and denial was the truth. That was for the jury provided only that first, the evidence had that minimal quality required to allow conflicting inference, and second, that the cause was not, over timely objection, submitted in disregard of accepted standards. The case becomes all the simpler because, as to these two conditions, the first is not really presented at all since no motion for instructed verdict was made and for the second, the complaints now made turn out in many respects to have been made for the first time here. The case is simpler too because while tried below as a consolidation of two, only one is before us and the other remains pending in a sort of limbo.

The dispute which has precipitated this multi-party Donnybrook likewise has a simple frame. It is a suit by a subcontractor against the contractor to recover the unpaid balance of the contract price for the performance of the painting on the huge 1352 unit Public Housing Administration apartment project named Desire located in New Orleans, Louisiana. Ball1 was the prime contractor under the $11,000,000 contract. W. & B.2 was the painting subcontractor under the contract of November 1953 for an initial subcontract price of $268,000. In the summer and fall of 1955, W. & B. and Ball became embroiled in a controversy over the sufficiency of W. & B.'s performance. Not being settled, Ball removed W. & B. from the job, completed the work itself and, it claimed, spent considerable money to complete and correct prior deficiencies in W. & B.'s work. At the time of W. & B.'s removal Ball had previously made progress payments aggregating $179,625. Ball claimed it owed nothing further. W. & B., on the other hand, claimed that it had then completed approximately 97% of the work and that Ball owed it the balance of approximately $86,000, plus extras aggregating another $30,000.

Thus it stood when the litigation commenced. It did not really change even though from the necessity of suit and countersuit against and by the respective sureties for Ball and W. & B., it has a deceptively complex facade.

W. & B. sued Ball3 in Civil Action 8328 for the contract balance and claimed extras.

In its defense Ball denied performance by W. & B. and asserted that it had expended sums to complete the work and correct deficiencies for which it was due full credit. Ball subsequently filed a suit (Civil Action 8564) against U. S. F. & G., the surety for W. & B., who impleaded W. & B. This was for the recovery of all sums spent by Ball in excess of the unpaid balance of the original contract price. The two cases were consolidated for trial without objection. On the consolidated trial the battle lines were sharply drawn with W. & B. claiming that Ball owed it approximately $86,000 (plus extras) and Ball claiming that W. & B. owed it some $20,000. It all turned on whether W. & B. had or had not substantially performed the subcontract, and if not, the extent to which Ball had incurred costs to complete or correct the work. The jury on a general charge which required the return of separate verdicts in each case brought in a verdict for defendant Ball in W. & B.'s suit (C.A. 8328) and for plaintiff Ball in its suit (C.A. 8564) against W. & B. for $15,000 which amount was subsequently reduced to $11,630.89 by Ball's remittitur. Final judgment for defendant Ball was entered in W. & B.'s suit (C.A. 8328). No final judgment4 has yet been entered in Ball's suit against W. & B. Only the judgment in W. & B.'s suit (C.A. 8328) is now before us.

This circumstance, ignored altogether by W. & B., is one which, on the basic merits of the appeal, we regard as decisive. For in W. & B.'s suit, W. & B. was the plaintiff. Apart from procedural errors later discussed, W. & B. must demonstrate that there was no evidence to sustain the jury verdict against it. In our view W. & B. fails in any such effort. First, because this is really not open to review since no motion for directed verdict was made by it at any time and this is ordinarily indispensable. Stokes v. Continental Assurance Co., 5 Cir., 242 F.2d 893; De Fonce Construction Co., Inc., v. City of Miami, 5 Cir., 256 F.2d 425. Second, if an examination of the record is nevertheless undertaken, it demonstrates an adequate basis in the evidence.

In this examination the nature of W. & B.'s burden is important. On it rested the burden of proving that it had (a) substantially performed its contract thus (b) entitling it to the unpaid balance of the full contract price (plus whatever extras were established), and that (c) to the extent that the contract had not been fully performed, the cost to Ball for such completions or corrections was less than the unpaid balance, thus leaving some amount yet due. That was the theory of the lawsuit submitted with articulate skill in the Court's general charge which was fully accepted by W. & B. without objection of any kind. The matter is then to be tested in the light of whether the plaintiff established all of these as a matter of law, rather than, as argued so vigorously in these lengthy briefs, whether the defendant Ball established in its countersuit (C.A. 8564) with requisite certainty the items and the aggregate of the added costs for completion or correction.

W. & B. cannot meet this test. A few brief illustrations will demonstrate that in this lengthy record, this was a jury matter. There is, first, the question of substantial performance by W. & B. This whole controversy was precipitated by a dispute over whether, on some 10,000 interior metal doorframes, the less expensive Penetrex varnish sealer applied by W. & B. as the first field coat (over the factory shop coat) complied with the specifications for the more expensive Du Pont Du Lux metal protective paint or its equivalent. This was a hard fought issue and the jury was certainly justified in its implied finding that this was not compliance with the contract, that use of Penetrex for the metal frames had never been authoritatively approved, and that long after objection was made to its use, W. & B. persisted. The context of this dispute raised other and more disturbing inferences whether this action was perhaps due to complicity between W. & B. and the Chief Inspector of the project whose discharge uncovered the fact that reports of complaints to him by subordinate painting inspectors had been suppressed out of partisan favoritism for W. & B. with whom he had a close personal association if not some outside business interests.

Another incident had the dual implication of plain violation of contractual obligation and overtones of complete indifference as a matter of business morals. The specifications called for a mixture of Dianol, an insecticide, for wall and ceiling paint for bathrooms and the kitchen-dining room areas in all of the 1325 units. The evidence was overwhelming that on the basis of maximum purchases of Dianol, W. & B. had mixed less than 1/10th the required amount. On a minimum, conservative estimate of the amount required for a proper mixture, the cost not actually incurred was charged back as a credit of over $5,000.

Likewise, the specifications called for top and bottom of all interior doors to be brush-painted. Admittedly this was not done in most instances, and Ball's men had to do this on over 10,000 doors. W. & B. claimed this was not their responsibility since it required unhanging and rehanging of the doors at considerable expense. It was certainly an item of importance for whether, as W. & B. contended, such painting would not take over a few minutes, or, as Ball asserted, it took over 20 minutes for each door, the cost for labor at the high hourly rates ran into thousands of dollars.

To this must be added a major and substantial expense incurred later by Ball in repainting, retouching and refinishing interior walls and ceilings of hundreds of these rooms, because the finish was declared by the Housing Authority painting inspectors to be unsatisfactory. Whether this was due to poor workmanship by W. & B. or in part to thinning the paint excessively with water was for the jury. Similar retouching and cleaning up was required for exterior painting, removal of paint splotches on plumbing fixtures, floors and the like. That the jury could find that much of it was undoubtedly due to long passage of time since the work had been done did not compel any helpful inference. This is so since the subcontractor and the prime contract5 expressly imposed the obligation to turn over the job at final completion date in good order. This in turn placed the burden of deterioration or damage done by others on the shoulders of W. & B. with the only escape offered being the opportunity to prove that such damage was due to the "direct...

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