Case Name: The Capitol City Lumber Company vs. Charles Sudarsky et als.
Court: Connecticut Supreme Court
Jurisdiction: Connecticut
Decision Date: 1920-08-05
Citations: 95 Conn. 336
Docket Number: 
Parties: The Capitol City Lumber Company vs. Charles Sudarsky et als.
Judges: 
Reporter: Connecticut Reports
Volume: 95
Pages: 336–350

Head Matter:
The Capitol City Lumber Company vs. Charles Sudarsky et als.
First Judicial District, Hartford,
May Term, 1920.
Prentice, C. J., Wheeler, Beach, Gager and Case, Js.
A builder having agreed to erect an apartment house for $33,000, sublet all the work, and the building was put up by the subcontractors who filed liens upon the property aggregating $27,000. Upon a suit brought by one of these subcontractors to foreclose its lien for lumber furnished, to which the other subcontractors, the general contractor and the owners were parties, it was held:—
1. That while the general contractor was responsible to the owners for the defective work and material of his subcontractors, the latter were in turn liable to him, and therefore the damages or loss so caused, which was found to be $3,300, should have been apportioned among the several delinquent subcontractors and applied in reduction of their respective claims, provided evidence had been offered which would have enabled the trier to make such apportionment.
2. That no formal pleading by the general contractor disputing the amounts claimed by the delinquent subcontractors, was essential to making such an apportionment, since the subcontractors by asserting their respective claims necessarily put their merits in issue.
3. That inasmuch as it did not appear that the committee, who heard the parties and reported the facts, had any evidence before him upon which he could have made such an apportionment, the tiial court properly sustained a demurrer to a remonstrance of the general contractor which urged such omission by the committee as a ground for rejecting his report.
4. That the general contractor was not entitled to interest on the balance due him upon the face of his contract (about $21,000), since the contract expressly authorized the owners to retain such an amount as might be sufficient to fullj indemnify them against the liens of subcontractors ($27,000); nor even to interest upon the balance found to be due him after deducting the liens of the subcontractors, since that amount was unliquidated, that is, it was uncertain whether anything at all would ultimately be found to be due him.
The trial court rendered a personal judgment in favor of the plaintiff, one of the subcontractors, against the owners, but as to the other subcontractors and the general contractor merely adjudicated the amount and validity of their respective liens, without granting any relief. Held that in the exercise of its equitable powers the trial court might carry its decree into effect by entering up judgments in favor of the respective lienors, and thus avoid the possibility of further litigation.
The proper remedy for the failure of a committee to make a finding upon a material matter in evidence before him is by a motion to recommit, and not by remonstrance to the acceptance of his report.
The rule that interest will not be allowed on unliquidated claims no technical significance. It is applied in each case according as the detention of money is or is not wrongful under the circumstances.
(Two judges dissenting.)
Argued May 6th
decided August 5th, 1920.
Suit to foreclose a mechanic’s lien, brought to the Superior Court in Hartford County, where a bond of '$30,000 with surety, given by the owners of the property, was by order of court (Greene, J.) substituted for the claimed liens, and the cause was subsequently referred to and heard by a committee who reported the facts; the court, Warner, J., overruled, in the main, a remonstrance to the committee’s report, and judgment was afterward rendered in accordance therewith, from which the general contractor, Selitzky, and Charles and John Sudarsky, the owners of the premises, appealed.
Error and cause remanded.
The defendants Sudarsky, as owners, contracted with Isaac Selitzky for the construction of an apartment building for the price of $33,000 payable in instalments. Selitzky sublet ail the work to subcontractors, some of whom are defendants in this action. Others have either abandoned their claims or been dropped as defendants. The building was to be completed, ready for occupancy, November 1st, 1915, and was not completed until June 20th, 1916. The owners took possession August 1st, 1916. At that time there was due the contractor on the face of the contract a balance of about $21,000, the subcontractors had given notice of liens aggregating about $27,000, Selitzky was claiming over $2,000 for extra work and materials in addition to the unpaid balance of the contract price, and the owners were claiming damages from Selitzky amounting, as alleged in their answer, to $7,500, for failure to complete the work according to contract, for defective work, and for loss of rentals caused by delay.
The cause was referred to a committee .who reported the amounts due the several subcontractors remaining parties to this action, disallowed all of Selitzky’s claims for extras,- and awarded the owners $3,300 damages for defective work and materials. The committee allowed interest on the amounts due the subcontractors-from the date of the .notice of hen in each case; but refused to allow Selitzky interest on the balance found due to him. Selitzky filed a remonstrance to the report of the committee, to which the owners Sudarsky demurred. The Superior Court sustained the demurrer and accepted the report except as to the ruling of the committee in disallowing interest on the balance found due to Selitzky, and rendered judgment accordingly, allowing Selitzky interest on the balance found due from the date of the completion of the building. Both the owners and the general contractor appealed.
Josiah H. Peck, with whom, on the brief, was Edward W. Broder, for the appellant (defendant Selitzky).
Henry J. Marks, for the appellants (defendants Charles and John Sudarsky).

Opinion:
Beach, J.
The remonstrance of the general contractor, Selitzky, is based on the failure of the committee to apportion the damages for defective work and materials among the several subcontractors whose work was found to be improperly done; and on the refusal of the committee to allow the general contractor interest on the balance found due to him. So far as the remonstrance is based on the ground first mentioned, it is demurred to because there was no issue raised between the general contractor and the subcontractors as to the amounts due the latter. As. a matter of pleading that is true, but it is not in itself a good reason why the committee should not have determined the amounts due the several subcontractor lienors according to their deserts, for they put the merits of their respective claims in issue by asserting them. Nevertheless, the demurrer to this ground of remonstrance was properly sustained, for it does not appear that any evidence was offered on which the committee could have apportioned the damages for defective work among the defaulting subcontractors; and if it had so appeared, the general contractor's remedy for the omission of the committee to make any finding upon this evidence, would have been by motion to recommit.
As to the allowance of interest, the general contractor complains because he says that the owners have, since August 1st, 1916, been in receipt of the rents and profits of the budding and ought equitably to be required to pay interest on the entire balance due to him, without deducting therefrom the amount due subcontractors. On the other hand, the owners claim that no interest at all should have been allowed to Selitzky, because the amount, if any, due him, was unliquidated until ascertainment by the report of the committee.
The contract, which is the uniform building contract, provides that "if at any time there shall be evidence of any lien or claim for which, if established, the owner of said premises might become hable, and which is chargeable to the contractor, the owner shall have the right to retain out of any payment then due or thereafter to become due an amount sufficient to completely indemnify against such lien or claim." This authorized the owners to retain the aggregate amount of all liens of which the subcontractors had given notice; and, since interest is allowed by way of damages for the unlawful detention of money, none can be charged against the owners for a detention expressly agreed upon in the contract. It follows that the general contractor has no claim for interest upon the amounts rightfully detained by the owners to indemnify against the liens of subcontractors.
The remaining question is whether the court erred in allowing interest from the date of the completion of the building, on the balance found by the committee to be due the general contractor, after paying the liens of subcontractors. That depends on whether the general contractor's claim was unliquidated within the meaning of the rule that interest is not allowed on unliquidated claims. The rule has no technical significance. It is applied in each case according as the detention of money is or is not wrongful under the circumstances. Loomis v. Gillett, 75 Conn. 298, 53 Atl. 581; Tucker v. Jewett, 32 Conn. 563. In Healy v. Fallon, 69 Conn. 228, 37 Atl. 495, a balance of $1,525 was held back because the owner claimed damages which were finally allowed in the sum of $50, and interest was allowed on the balance found due. In that case the claim for damages was within such narrow limits and its amount was so easily calculable, that it did not reasonably excuse the detention of the entire unpaid balance of the contract price.
In this case, however, there was due the contractor on the face of the contract when this suit was brought something over $20,000, and the complaint enumerates subcontractors' claims evidenced by mechanics' liens aggregating $27,955.62. By the terms of the contract the owners were expressly authorized to withhold this amount. And although some of these lienors have either abandoned their claims or been dropped as defendants since the action was brought, we think the amount due the contractor was unliquidated in the sense that the owners could not know how much, if anything, would ultimately be found due to the general contractor. Besides, that question was further complicated by the contractor's claim for extra compensation, which was disallowed, and by the owners' claim for damages, which was allowed in the sum of $3,300.
The judgment rendered in the court below is a personal judgment in favor of the plaintiff, the Capitol City Lumber Company, against the defendants Sudarsky. But no judgment is rendered in favor of the other subcontractors or in favor of the general contractor. As to them the validity and amount of each lien is adjudged, but no relief granted. We think the Superior Court may, in the exercise of its equitable' powers, carry its decree into effect by judgments in favor of the respective lienors, and thus avoid the possibility of other litigations.
There is error on Sudarskys' appeal and the cause is remanded with direction to enter judgment against the defendants Sudarsky and in favor of each of the subcontractor lienors for the amount of principal and interest adjudged to be secured by his lien; and to enter judgment against the defendants Sudarsky in favor of the defendant Selitzky for the balance of the principal amount, without interest, remaining due to Selitzky under the contract, Exhibit 1.
In this opinion Prentice, C. J., and Case, J., concurred.