Case ID: ny-st-rep_16/html/0668-01.html
Source: Caselaw Access Project
Author: {"author": "Bookstaver, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Michael Lennon, App’It, v. Mary C. Smith, Impl’d, Resp’t.
    
      (New York Court of Common Pleas, General Term,
    
    
      Filed May 18, 1888.)
    
    1. Practice — Case — Should contain all the evidence in order to REVIEW FINDINGS OF FACT.
    A party wishing to review findings of facts made hy a court or referee must prepare a case containing all the evidence and have it so certified by the judge or referee settling it, otherwise the findings below are conclusive.
    2. Contracts—Performance prerequisite to payment.
    Substantial performance of a contract is a prerequisite to the right of action for compensation thereunder.
    3 Same—Refusal to perform— right to payment.
    A party to .a contract who wilfully refuses to perform a part of the work required by it, cannot recover thereunder
    4. Same—Condition precedent.
    Where a building contract provides that payment for work shall be made on presentation of certificates of an architect therein designated, the presentation of such certificates is a prerequisite to the right to payment unless they are withheld through fraud.
    5. Error—When not ground for reversal of judgment.
    A judgment will not be reversed and new trial ordered because of the erroneous admission or rejection of evidence if substantial justice is done by the judgment. Code Civil Pro., § 1003.
    6. Same—Liquidated damages—What are.
    Where a clause in a contract provides for the payment of a sum for non-fulfillment at the appointed time and for every day thereafter, and the damages resulting from such a breach are uncertain and hard to prove, the penalty is to be treated as liquidated damages unless the language of the contract clearly shows that such was not the intention. The fadl that such sum is termed a penalty by the parties is immaterial, if the intention is apparent that it should be liquidated damages.
    Appeal from a judgment entered upon the report of a referee dismissing plaintiff’s complaint, cancelling a lien, and awarding the defendant a money judgment upon a counter-claim.
   Bookstaver, J.

The action was brought to foreclose a mechanic’s lien on property owned by defendant.

In May, 1886, the parties entered into a written contract, whereby plaintiff undertook to excavate a cellar, build a cellar wall, and do certain other work for defendant, at a fixed compensation. This work was to be done by a given day.

The contract provided that the work was to be done by a given day.

The contract provided that the work was to be done in accordance with specifications “verified by the signatures of the parties,” which was to be “ taken as part of the contract.”

The specifications were not, in fact, signed by either party. The contract further provided that the work was to be done “to the full satisfaction of the architect,” and the money was payable “upon the order of the architect, on completion of the work.”

The architect refused to give any order or certificate that the work had been performed.

It is well settled that a party wishing to review findings of fact made by a court or referee, must prepare a case containing all the evidence, and have it so certified by the judge or referee settling it.' If he omits to do this, the findings below are conclusive. Wilkinson v. Herbert, 13 N. Y. State Rep., 436; Porter et al. v. Smith et al., 107 N. Y., 531; 12 N. Y. State Rep., 479; Spence v. Chambers, 39 Hun, 193; Hagadorn v. Dodge, 2 N. Y. State Rep., 335.

There is no such certificate in this case, and the report of the referee must be taken as final on this appeal as to the facts found by him.

But if this were not so, we think there was abundant testimony upon the case presented to justify the findings of the referee. The principal questions litigated were:

First. Did the specifications set forth in the answer form a part of the agreement between the parties.

Second. If the specifications formed no part of the contract, then had the work mentioned in the body of the contract been substantially performed.

Third. Was the architect justified in withholding his certificate.

From the evidence it appears by the testimony of the defendant’s witnesses, Cochen and Pollard, that the specifications were prepared at the same time with the contract, and were read over to the plaintiff at the time it was signed, and that the reason why they were not signed, was because the plaintiff or his son, who was present and who signed the contract in his father’s name, said it was not necessary.

The testimony also shows that plaintiff deliberately refused to perform the work described in the specifications, saying “he did not care a damn about the specifications; that they were not signed; that his counsel told him they were no good.”

It is true this is denied by plaintiff, but there is certainly evidence enough to justify the findings of the referee, that the specifications were adopted by the parties as a part of the contract, when the agreement was executed; that the plaintiff never substantially performed the agreement; that he abandoned the work before such performance, and that the action of the architect in refusing to give plaintiff the order required by the agreement, before the money become due and payable to the plaintiff, was not fraudulent, but based upon an honest dissatisfaction on his part with the work done.

Under this state of facts, plaintiff was not entitled to maintain his action, and the complaint was properly dismissed, because:

First. There was not a substantial performance of the contract. Smith v. Brady, 17 N. Y., 173; Glacius v. Black, 50 N. Y., 145; Woodward v. Fuller, 80 N. Y., 312; Nolan v. Whitney, 88 N. Y., 648.

Second. Because the plaintiff wilfully refused to perform a part of the work required by the contract. Crane v. Knubel, 61 N. Y., 645.

Third. Because of these two facts, he failed to obtain the architect’s certificate. Byron v. Low, 14 N. Y. State Rep., 823; Barton v. Hermann, 11 Abb., N. S., 378; Smith v. Wright, 6 T. & C., 694; Guidet v. The Mayor, 36 N. Y., Supr. (J. & S.), 557; Cross v. Belknap, 24 Week. Dig., 256; Doe v. Noble, 24 id., 257.

There being no exceptions to the referee’s refusal to find as requested by plaintiff, we cannot here review such refusals.

A large number of exceptions were taken to the admission and rejection of testimony.

We have examined all of these, to which our attention was particularly called on the argument and in defendant’s brief; and while a number of them were undoubtedly well taken; yet it is'Clear that none of the testimony received or rejected under these objections could have influenced the referee in coming to the conclusion he did on the questions before referred to; and the judgment will not, therefore be reversed for these errors. N. Y. Code, sec. 1003.

The only question remaining, is in regard to the counterclaim.

The right to recover this, is based upon a clause in the contract, providing for a penalty of twenty dollars to be enforced, for each and every day the work remained unfinished beyond the time specified in the contract.

This, the referee construed as meaning that that amount had been agreed upon as liquidated damages for each day’s delay.

The rule seems to be that such a clause in a contract where the damages resulting from a breach of it would be uncertain, and hard to prove, is to be treated as liquidated damages, unless the language of the contract shows clearly that such was not the intention. Sutherland on Damages, vol. 1, 512, 520; Cotheal v. Talmage, 9 N. Y., 551; O’Donnell v. Rosenberg, 14 Abb., N. S., 59; Pettis v. Bloomer, 21 How., 317; Farnham v. Ross, 2 Hall, 167.

What the parties call a “penalty” or a forfeiture,” may be held to be liquidated damages if, under all the circumstances, such appears to have been the intention; and on the other hand, a real penalty cannot be successfully concealed behind the words “liquidated damages.” Pollock on Contracts, 467; Noyes v. Phillips, 60 N. Y., 408; Sainter v. Ferguson, 7 C. B., 716.

In this case the fact of damage, is apparent enough— other contractors were delayed, time was lost by defendant, other workmen had to be employed and materials purchased by defendant. It is also apparent that the precise quantum of this damage could not be easily ascertained or readily proven. At the time the contract was signed, the attention of the plaintiff was directed to the importance of having the work done at the stipulated day; and it is reasonable to suppose it was intended as liquidated damages.

The judgment must, therefore, be affirmed with costs.

Labremore, Ch. J., and Allen, J., concur.