District of Columbia v. Gallaher, 124 U.S. 505 (1888)
Case details
Citation
124 U.S. 505
Full caption
DISTRICT OF COLUMBIA v. GALLAHER.
Country
United States
Jurisdiction
Federal
Court
Supreme Court of the United States
Decided
Feb. 6, 1888
DISTRICT OF COLUMBIA v. GALLAHER.
APPEAL FROM THE COURT OF CLAIMS.
Argued January 23,1888. —Decided February 6, 1888.
When, in the performance of a written contract, both parties put a practical construction upon it which is at variance with its literal meaning, that construction will prevail over the language of the contract.
In this case the defendant in error having under a written contract with the agents of the plaintiff in error constructed a sewer which in the course of construction was, by mutual consent, and for reasons assented to by both parties, made to vary in some respects from the plans which formed part of the contract, but without any agreement as to a change in the contract price; Held, for the reasons given by the Court of Claims, that the judgment of that court awarding the contract price for the work is affirmed.
The case is stated in the opinion of the court.
Ur. Assistant Attorney General Howard for appellant. Mr. Attorney General was with him on the brief.
Ur. Thomas Hughes and Mr. Woodbury Blair for appellee. Mr . Just ice Matthews delivered the opinion of the court.
This suit was brought against the District of Columbia for the recovery of the sum of 8138,459.55 ; of this $35,436.49 were alleged to be payable as the balance due upon a contract for building and completing the brick arch upon stone abutments of Tiber Creek sewer, as set out and described in the p. 506contract and specifications attached to the petition, at the price of $113 per lineal foot. The additional sum of $98,130.44 was alleged to be due on account of extra work and materials furnished by the contractors beyond the requirements of the contract in and about the same work. This indebtedness was denied, and the defendant also filed a plea of set-off in the sum of $82,176; of this, $7176 was for the value of stone alleged to have been sold by the defendant to the claimants; $35,000 » on account of deficiencies in the construction of the sewer, and
$40,000 as the reasonable cost and expense of filling the canal for the whole length of the sewer, which the defendant claimed the petitioners were bound by their contract to do. Upon the facts found by the court, it was held that the claimants were entitled to recover upon their claims the sum of $43,935.74; that the defendant was entitled to recover upon the set-off and counterclaim the sum of $1479 ; and judgment was rendered in favor of the petitioners for the difference, being the sum of $42,456.74.
The facts as found by the court, so far as material, are as follows:
The Tiber Creek, prior to the year 1871, was a natural stream of water flowing through the city of Washington and discharging into what was then known as the Washington Canal, on Third Street west, between Maine and Missouri avenues, and by that into the Eastern Branch.
Among the improvements projected by the Board of Public Works was that of utilizing this stream in connection with the sewerage system of the city, and the general plan adopted was that of constructing a main sewer of masonry and brickwork along its course, through which the stream should flow, receiving and conducting the sewage from lateral connections on either side.
It was constructed for the most part in sections by contrac with different parties, and the part here in controversy was the final or outlet section. It was commonly styled the Tiber Creek sewer or arch.
On and before July 14, 1873, a portion of this sewer ha been completed, which (so far as is here material) exten e p. 507from the north side of Pennsylvania Avenue, across the Botanical Garden, into Third Street, and along and under Third Street to a point 3 feet north of the south building line of Maryland Avenue, at which terminus the sewer was (so far as here material) of the following construction and size, namely : The side walls were of masonry, about 3 feet high and 5 feet 6 inches thick, supporting an approximate semi-elliptic arch of 30 feet span and 7 feet 10 inches rise. The extrados of the arch, including the skew-back course, was backed up with rubble masonry to the level of its crown.
The timber sleepers for the foundations were 41 feet in length.
Proposing to continue the sewer to its outlet with the same construction and size, the Board of Public Works, on July 14, 1873, sent to H. L. Gallaher & Co., consisting of Hugh L. Gallaher and Edwin H. Smith, a written proposal for continuing the Tiber Creek sewer from its existing terminus at Maryland Avenue and Third Street southwest, along the line of the Washington Canal to its junction with the James Creek Canal, the size and manner of construction of the sewer to be the same as that of the portion of the same sewer constructed on Third Street southwest, and to be paid for at the rate of $113 per lineal foot; and they were requested by return mail to notify the board of their acceptance or rejection of the proposal. On the same day H. L. Gallaher & Co., by writing, accepted it. A written contract bearing date July 19, 1873, was executed between the parties in the same terms as that set forth in the petition. Before work was commenced under it the District engineer was instructed to give the grade of the sewer, to be laid out with the same dimensions as of the existing sewer, which he did in the summer of 1873. It was proposed, however, and consented to by both parties, to deviate from the contract, by which the continuation of the sewer was to follow and be laid in the bed of the canal, so as to take by a curve from the point of connection on the westerly bank and then proceed parallel with and along said bank to the terminus. About the time of giving the grade Gallaher applied for a plan of the sewer, when by direction of the p. 508engineer a plat or working drawing of the structure in transverse section, exhibiting its form and dimensions according to a fixed scale, and representing a structure similar to that of the completed section at the point of connection, was furnished. Gallaher and Smith then proceeded with the work in accordance with that plan, and completed some part of the excavation, and procured and brought on the ground material, but had not constructed any portion of the arch, when Joseph G. and Henry E. Loanfe, two of the petitioners, bought out the interest of Smith in the contract, and thereupon the original contract was cancelled and one in similar terms executed on December 22, 1873, by the Board of Public Works with the claimants, composing the firm of Gallaher, Loane & Com-. pany, a copy of which is set out with the petition. The claimants on entering into said contract received from Gallaher & Smith the working plan furnished to them by the District engineer. It represented the plan and dimensions of the several parts of the structure of the sewer to be built under their contract, and was similar to the completed section with which it was to connect, as provided by the contract, and was the plan under which the work had been commenced and carried on. They proceeded with the work in accordance with the plan, and without calling the attention of the board to any alleged or apparent variation of the same from the contract, and constructing the flooring, masonry, and arch according to the dimensions appearing thereon, and had finished about 680 lineal feet thereof when the Board of Public Works was abolished by act of Congress of June 20, 1874. The work as thus far done was constructed under the direction of the District engineers, but neither they nor the Board of Public Works intimated to the claimants that the work was not progressing to their satisfaction and in accordance with the former sample work, in which the skew-back was constructed of rubble masonry.
Under the new form of government established by that ac for the District, Bichard L. Hoxie was detailed as engineer on July 6, 1874, and forthwith made a careful examination of the I work being done by claimants, as to its character and p. 509conformity with the specification of the contract, in the presence of one of the claimants.
He found that, generally, it was being built in conformity with the specifications,, but there were several departures. The flooring and sleepers were, as he thought, inferior to the quality required; the masonry was not strictly in conformity with the specifications; there were too few bond stone used; the inside walls were not dressed, and the stones generally were small. But what attracted his attention, and was of the most importance, was the manner of constructing the skew-back. It was made of small stones, spalls, and mortar, while it should have been made, as he thought, of large dimension stone. He called the attention of the party present to these alleged variations, and particularly to the skew-back, which he wished constructed of dimension stone. He was informed that to procure the stone would cause considerable delay in the prosecution of the work. Thereupon he directed that the skew-back might be made of brick, and added that he should make a deduction in price, but named no sum. Thereafter claimants proceeded with their work, making the skew-back of brick, under the direction of defendant’s engineers, without further complaint.
In August, 1874, the claimants applied for measurement of the work so far as completed and a partial payment. The engineer thereupon transmitted to the board of audit, which, by the act of June 20, 1874, was charged with the settlement of such accounts, a statement with the measurement requested. In that statement the engineer represented that the contract required the inside sewer face of the stone wall rough-dressed, and a skew-back stone not less than a three-foot six-inch bed, and in length of not less than four feet; and that these requirements of the contract had not been complied with. He, therefore, on this account, recommended a deduction of $8.94 per lineal foot of the sewer. The board of audit audited the account with that deduction from the contract price, in accordance with the statement of the engineer. The claimants received the partial payment under protest. The amount of this deduction upon the entire work performed by the claimants constitutes the sum of $35,436.49, for which they sue.
The whole controversy between the parties as to this item, and also for a portion of the claimants’ demand on account of extra work and material, arises out of the fact that the letter of the contract and specifications does not correspond with the plan of the work as furnished by the District engineer and the sample of the work which had been done previously by other contractors, and with which that of the present claimants was to connect. The work as actually done was done under the direction and supervision of the District engineer and was performed in accordance with the plan and sample which was supposed and understood to be what was required by the contract, and to be paid for at the contract price. We think that the practical construction which the parties put upon the terms of their own contract, and according to which the work was done, must prevail over the literal meaning of the contract, according to which the defendant seeks to obtain a deduction in the contract price. The other items allowed by the Court of Claims, both to the claimants and the defendant, we think well established upon the facts as ascertained by it. The reasons for its judgment, as set forth in the opinion of the court, we think entirely satisfactory. 19 C. Cl. 564.
The judgment is affirmed-
HOPKINS v. ORR.
ERROR TO THE SUPREME COURT OF THE TERRITORY OF NEW
MEXICO.
Argued January 20, 23,1888. — Decided February 6,1888.
A promissory note, upon which the defendant is shown to have admitte his indebtedness to the plaintiff, may be given in evidence under a count for money had and received. The omission of the word “ dollars,” in a verdict for the plaintiff in an ac
tion of assumpsit, does not affect the validity of a judgment thereon. Under a statute authorizing an appellate court “ to examine the recor , an , on the facts therein contained alone, award a new trial, reverse or
the judgment, or give such other judgment as to it shall seem agreeable to law,” a judgment on a general verdict may be affirmed, if the evidence in the record supports any count in the declaration.
Under a statute requiring an appellant to give bond, with sureties, to prosecute his appeal to a decision in the appellate court, and to perform the judgment appealed from, if affirmed; and enacting that if the judgment of the appellate court be against the appellant, it shall be rendered against him and his sureties; a judgment of the appellate court, affirming a judgment below for a sum of money and interest, upon the appellee’s remitting part of the interest, may be rendered against the sureties, as well as against the appellant.
This was an action of assumpsit, brought April 3, 1882, by Orr and Lindsley against Hopkins in a district court of the Territory of New Mexico. The declaration contained a special count on a promissory note for $1314.65, made by the defendant on October 1, 1881; and the common counts for the like sum due on that day for goods sold, for money lent, for money paid, and for money had and received. The plaintiffs filed with their declaration the following note:
'“$1314.65. St. Louis, October 1st, 1881.
“ Four months after date I, the subscriber, of Ft. Wingate, county of-----, State of New Mexico, promise to pay to the order of Orr and Lindsley (a firm composed of William 0. Orr and De Courcey B. Lindsley) thirteen hundred and fourteen A5o dollars, with exchange, for value received, with interest at the rate of ten per cent per annum after maturity until paid, without defalcation or discount, negotiable and payable at 1st National Bank Santa Fe, N. M.
“L. N. Hopkins , Jr .”
The description of the note in the special count corresponded with the note filed, except that it did not state that the note was payable with exchange and at a particular place. The defendant pleaded non assumpsit and payment.
At the trial, the plaintiffs put in evidence the note filed, and were permitted to read it to the jury, notwithstanding the defendant objected that there was a variance between the note and the declaration. The only other evidence introduced was testimony of the plaintiffs’ attorney that on March 7, 1882, p. 512he presented this note to the defendant, and the defendant admitted the indebtedness, and asked him not to bring suit upon it before April 1, and on that day he would pay it, but he failed to do so. The defendant objected to the evidence as incompetent and immaterial. But the court overruled the objection, and instructed the jury to find for the plaintiffs for $1399.48, being the amount of the note with interest computed at the rate of ten per cent.
The jury returned a verdict saying that “ they find for the plaintiff in sum of thirteen hundred and ninety-nine and T4&.” The court overruled motions for a new trial and in arrest of judgment, and gave judgment “ that the said plaintiffs do have and recover from the said defendant, Lambert N. Hopkins, the said sum of thirteen hundred and ninety-nine and ($1399.48), and also the costs in their behalf laid out and expended, to be taxed, but that execution shall not issue therefor until further order of the court.”
The defendant appealed to the Supreme Court of the Territory, and executed to the plaintiffs a bond, with sureties, the condition .of which was that “ the said Lambert N. Hopkins shall prosecute his said appeal with due diligence to a decision in the Supreme Court, and that if the judgment appealed from be affirmed, or the appeal be dismissed, he will perform the judgment of the district court, and that he will also pay the cost and damage that may be adjudged against him upon his said appeal.” Thereupon the district court allowed the appeal, ordered execution to be stayed while it was pending, and allowed a bill of exceptions tendered by the defendant to the rulings aforesaid.
The Supreme Court of the Territory held that there was a variance between the special count and the note offered m evidence, but that the note was admissible in evidence under the common counts, and that under those counts and the statutes of the Territory the plaintiffs were entitled to recover the sum of $1314.65, with interest thereon computed at the rate of six instead of ten per cent; and ordered that, if the plain i should file a remittitur of the excess of four per cent interest, the judgment of the district court be affirmed, but, if fbey p. 513should fail to do so, the judgment be reversed and the case remanded for a new trial. Thereupon the plaintiffs filed such a remittitur; and the Supreme Court of the Territory affirmed the judgment of the district court against the defendant and the sureties on his appeal bond, and adjudged that the plaintiffs recover against them the sum of $1314.65 and interest at the rate of six per cent. The defendant and the sureties sued out this writ of error.
Mr. 0. D. Barrett and JZr. John H. Knaebel for plaintiffs in error.
Mr. Henry Wise Garnett for defendant in error. Mr. W. B. Childers was with him on his brief.
Mr . Justic e Gray , after stating the case as above reported, delivered the opinion of the court.
It was not contended in either of the courts of the Territory that any question of fact should have been submitted to the jury; but the contest was upon the sufficiency of the evidence and the verdict, in matter of law, to support a judgment for the plaintiffs.
Upon the testimony that the defendant admitted his indebtedness on the note given in evidence, that note, though varying from the description in the special count, was admissible under the common counts as evidence of money had and received by the defendant to the plaintiffs’ use. Grant v. FawyAm, 3 Burrow, 1516; Page v. Bank of Alexandria, 7 Wheat. 35; Goodwin v. Morse, 9 Met. 278. And by the statutes of the Territory the sum so admitted to be due bore interest at the rate of six per cent. Prince’s Laws, c. 79, § 4; Comp. Stat. § 1734.
The omission of the word “ dollars ” in the verdict was not such a defect as to prevent the rendering of judgment accordmg to the manifest intent of the jury, although it might have been more regular to amend the verdict before judgment. Parks v. Turner, 12 How. 39; Beall v. Territory, 1 New Mexico, 507, 519.
vol . cxxrv—33
It was argued for the defendant that under the rule recognized in Maryland v. Baldwin, 112 U. S. 490, the verdict being general on all the counts, and the evidence not supporting the special count, no judgment could be rendered on the verdict without first amending it so as to limit it to the common counts. But the technical rule of the common law in this matter has been changed by statute in many parts of the United States. Bond v. Dustin, 112 U. S. 604. In New Mexico, that rule has been abrogated by the statute of the Territory, by which “ the Supreme Court, in appeals or writs of error, shall examine the record, and on the facts therein contained alone shall award a new trial, reverse or affirm the judgment of the district court, or give such other judgment as to them shall seem agreeable to law.” Prince’s Laws, c. 16, § 7; Comp. Stat. § 2190. The manifest object of the statute is, not merely to restrain the appellate court from going outside of the record, but to enable it to render such a judgment as upon a consideration of the whole record justice may appear to require.
The Supreme Court of the Territory was therefore authorized to affirm the judgment rendered by the district court upon the general verdict for the plaintiffs, if the facts contained in the record supported any count in the declaration, as we have seen that they did. And there can be no doubt of its authority to make its affirmance of the judgment conditional upon the plaintiffs’ remitting part of the interest awarded below. Bank of Kentucky v. Ashley, 2 Pet. 327.
The statutes of the Territory further enact that, on an appeal from the judgment of a district court, execution shall be stayed upon the appellant’s giving bond, with sureties, such as was given in this case, “ conditioned that the appellant shall prosecute his appeal with due diligence to a decision in the Supreme Court, and that if the judgment or decision appealed from be affirmed, or the appeal be dismissed, he will perform the judgment of the district court, and that he will also pay the costs and damages that may be adjudged against him upon his appeal.” Prince’s Laws, c. 16, § 4; Comp. Stat. § 2194. They also contain a general provision that “ in case of appeal p. 515in civil suits, if the judgment of the appellate court be against the appellant, it shall be rendered against him and his securities in the appeal bond ; ” and this court has adjudged that provision to be valid. Prince’s Laws, c. 45, § 5; Comp. Stat. § 2206; Beall v. New Mexico, 16 Wall. 535; Moore v. Huntington, 17 Wall. 417.
By the judgment of the Supreme Court of the Territory, affirming the judgment of the district court as to the principal sum due, and also as to interest to the extent of six per cent, upon the plaintiffs’ remitting the excess of four per cent interest, the judgment of the district court was affirmed, within the meaning of the territorial statutes and of the appeal bond. Butt v. Stinger, 4 Cranch C. C. 252; Page v. Johnson, 1 D. Chip. 338.
The result is, that the judgment of the Supreme Court of the Territory was rightly rendered for the plaintiffs against the sureties in the bond as well as against the principal defendant, and must be
Affirmed.
TRASK v. JACKSONVILLE, PENSACOLA AND MOBILE RAILROAD COMPANY.
APPEAL FROM THE CIRCUIT COURT OF THE UNITED STATES FOB THE NORTHERN DISTRICT OF FLORIDA.
Argued January 5, 6, 1888. — Decided February 6, 1888.
On the proof in this case the court holds that Coddington, from whom appellant bought the bonds which form .the subject matter of the suit, took them with knowledge of such facts as would prevent him from acquiring any title by purchase which he could enforce, as a bona fide holder, against the Florida Central Railroad Company, one of the appellees herein; and that appellant as purchaser of the bonds occupies no better position than Coddington.
Bill in equi ty , to collect of the Railroad Companies, defendants, certain bonds of the State of Florida, described in the opinion of the court, which are conceded to be invalid as p. 516against the State. Decree dismissing the bill. Complainant appealed. The case is stated in the opinion of the court.
J/?. Stephen P. Nash for appellant. Nr. D. P. Holland was with him on the brief.
Nr. Wayne No Veagh for appellees. Nr. A. H. Wvatersteen was with him on the brief.
Mr . Chief Justic e Waite delivered the opinion of the court.
This suit was brought by Spencer Trask to collect 192 of the 1000 bonds of the State of Florida, issued to the Florida Central Bailroad Company, which were the subject of consideration by this court in Railroad Companies v. Schutte, 103 IT. S. 118. In that case it was decided that, although the bonds were void as against the State, the railroad company that sold them was estopped from setting up their invalidity as a defence to an action brought by a bona fide holder to enforce the lien the company had given on its property to secure their payment. Accordingly a decree was rendered establishing the lien of the holders of 197 bonds on the railroad of the company, and ordering a sale to pay the amount due thereon. Trask now claims to be a bona fide holder of the 192 bonds he sues for, and seeks the same relief as to them. He concedes the invalidity of the bonds so far as the State is concerned, but as against the railroad company and its property claims the benefit of the same estoppel that was adjudged in the other case to exist in favor of those who recovered there.
The general facts as to the issue of the bonds are stated m the case of Schutte, beginning at page 127 of the volume m which it is reported (103). The correctness of our findings then is not denied now. Indeed, Trask relies upon that decision as the basis of his right to recover, and the only disputed question is, whether he does in law and in fact occupy the position of a bona fide holder. That is substantially a question of fact only, and it presents itself in a double aspect. Trask got his title from Thomas B. Coddington, and the inquiry is, first, as
Opinion of the .Court.
to his own position separate from that of Coddington, and if that is not sufficient then next as to that of Coddington, under whom he claims.
We have carefully considered the testimony bearing on these questions, both in the record as it has been printed in the present case, and in that of the Schutte case brought into this also by stipulation. It would serve no useful purpose to refer to this testimony in detail, and it is sufficient to say that we have had no difficulty in reaching the conclusion that Trask, as a purchaser of the bonds, occupies no better position than Coddington, from whom he bought. His purchase was made September 12, 1881, at an auction sale in the city of New York. The bonds had then been running ten years and more, and no interest had ever been paid upon them. As the sale was made under the agreement of August 29, 1872, Trask is chargeable with notice of the contents of that instrument, which showed on its face that the bonds had been the subject of litigation and had not been obtained by Coddington in the ordinary course of business. His debt, for which they were held, was $40,000, and the bonds, without interest, which had been running ten years at eight per cent per annum, amounted to $192,000. As the bonds were state bonds, the mere fact that no interest had ever been paid furnished the strongest presumptive evidence that they were dishonored. The interest alone, if collected, would much more than pay the debt for which the bonds were held. The circumstances connected with the sale also were entirely inconsistent with the idea of a purchase of commercial paper in good faith for a valuable consideration without notice. No one present at the time could have had any other understanding than that the sale was of bonds which had been commercially dishonored.
We are equally well satisfied that Coddington was never in any commercial sense a l)ona fide holder of the bonds. According to his own testimony he was originally the mere agent of those who were engaged in perpetrating the fraud upon the railroad company, and employed by them to get the bonds from Florida to London, so that they might be sold and a large part of the proceeds applied to the payment of the p. 518personal debts of one of the guilty parties. He undoubtedly did this because he had been told that it would enable “ the parties in interest” to pay him the cash for $24,465 of coupons of another company for which they were bound. He entered into no contract with the Florida Central Company, and it could never have been supposed by him that any part of the proceeds were to be paid into its treasury or for its use. He could not but have known that the whole purpose of his employment was to get the bonds to London, where they had been contracted to be sold at a price that would yield less than half their face value, and that he was himself to apply more than half of this to the payment of the individual debts of one of the large stockholders of the company, by whose influence and in whose interest the railroad bonds had been executed to be exchanged for the state bonds, which he was to take away. Under such circumstances, it is certain that he could have acquired no lien on the bonds as security for any services he might render in transferring them to London, or for any liability he had incurred to third parties in order to get the bonds away. His contract for the service, and for the compensation he was to receive, was not with the railroad company itself, but with the president of the Jacksonville, Pensacola and Mobile Railroad Company, who was engaged in appropriating the bonds issued to the Florida Central Company to his own use. This disposes of his claim of lien on account of his services and liabilities as agent. He was not the agent of the Florida Central Railroad Company, and as it must be conceded that those for whom he was acting had no title as against this company, there was nothing in his hands to which any lien could attach in his favor any more than in favor of his principals.
As to the contract made with the Jacksonville, Pensacola and Mobile Company on the 29th of August, 1872, by which the 192 bonds were given to Coddington as security for a debt owing to him by that company, little need be said. The Jacksonville, Pensacola and Mobile Company had no lega right to the bonds, and it could not, therefore, pledge them as security for its debts. All this Coddington knew or ought to p. 519have known. And besides, when this contract was made the fraud and illegality in the original issue of the bonds, both by the railroad company and the State, had become notorious, and it is impossible that Coddington, situated as he was, could have been ignorant of the facts. In order to get the bonds away from Florida he was compelled to arrange with certain stockholders of the Florida Central' Company, who had begun a suit to prevent their removal by the president of the Jacksonville, Pensacola and Mobile Company, on the ground that he had no right to use the road of the Florida Central Company “ and cover it with liens to raise money to pay private debts, notwithstanding he is the owner of a majority of the stock.” It is unnecessary to refer more particularly to the evidence. It is full and conclusive and leaves no doubt on our minds as to the knowledge of Coddington of such facts as would prevent him from acquiring any title to the bonds he took away by purchasing them from any of the parties engaged in the transaction, which he could enforce as a Iona fide holder against the Florida Central Company.
The decree of the Circuit Court is affirmed.