Newark evening star and Newark advertiser. [volume] (Newark, N.J.) 1909-1916, 1913-04-26
CASE is
DECIDED BY COURT
vice-chanceIIor Ends Famous
Suit Caused by Construction
of Pennsylvania Tunnels.

With the fling Of an opinion by
Vice Chancellor. Stevens. the now
famous case of John Shields against
the Shields Construction Company is
decided. Shlelds's creditors will profit
by a released fund of about SIS, 600,
and an eight-year-old litigation,
which had its beginning when the
Pennsylvania railroad sank its tun-
mel under the Hudson, is ended.
The suit came up in its latest phase
about three months ago on the petit
ton of the receiver of the John
Shields Construction Company for in
structions and his suit to have the
Pennsylvania, New York and New
Jersey Railroad Company pay GER
tain claims. The company resisted
payment of these claims and insisted
Iit had a claim against the receiver
for liquidated damages, because the
construction company quit in the
midst of a contract and delayed the
work.
The Shields company contracted
with the railroad company in 1905 for
the construction of the westerly Sec
ton of the Weehawken tunnel. and
after doing a portion of the work the
company became insolvent and a re-
ceiver was appointed. The receiver
continued the work until January p,
1906. and then stopped. About five
weeks later the railroad made new
contract with a william Bradley, who
completed it.
In its suit the railroad claimed
liquidated damages to the extent of
one fiftieth of l per cent. of the en-
tire contract price for every days
delay in the work. 1t was on this
clause that the vice-chancellor
knocked out the railroads claim for
damages. holding that the penalty
only covered his default in time. and
did not apply to delays for which the
second contractor was responsible.
even though the completion of the
entire work was held up. In other
words. he was liable only for the de-
lay up to the time the second con-
tractor began work
THE new contractor performed
the work at the same rates the
Shields Company had contracted for.
and as far as appears, no damage
in fact resulted from delay in con-
struction, inasmuch as the other sec
tons of the work had not been fin
ished.'' says the vice-chancellor in
his opinion.
On behalf of the receiver, Chaun-
eey G. Parker put in a claim for
SIPS for the removal of $500 cubic
yards of earth from the tunnel en-
trance which the company was later
to replace as covering on the con-
crete masonry of the tube. But be-
fore replacing it khe Shields Company
became inSolvent. In adjusting their
claim, the railroad paid Shields only
five cents cubic yard as against
eighty cents for the completed job,
although the railroad engineer later
testified the company could have
profited with a reduction of sixty in
stead of seventy-five cents. AS no
unfair dealing is pretended" says the
vice chancellor, "the contracts as
they stand must decide the matter"
The First National Bank, of Jersey
City. holds preferred claim against
the Shields company for about 500, 200,
through an assignment of claims,
which becomes payable under the
vice-chancellors ruling. There is
fund of about $4,000 in chancery and
another of $4,000 in the Fidelity
Trust Company which become avail
liable when the decree is signed.