Case Name: The Degnon-McLean Construction Company, Respondent, v. The City Trust, Safe Deposit and Surety Company of Philadelphia, Appellant
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1904
Citations: 99 A.D. 195
Docket Number: 
Parties: The Degnon-McLean Construction Company, Respondent, v. The City Trust, Safe Deposit and Surety Company of Philadelphia, Appellant.
Judges: 
Reporter: Appellate Division Reports
Volume: 99
Pages: 195–201

Head Matter:
The Degnon-McLean Construction Company, Respondent, v. The City Trust, Safe Deposit and Surety Company of Philadelphia, Appellant.
Action on a bond given to secure the faithful performance of a contract — construction of a provision therein giving the contractor the right to use a certain piece of land — the surety is not relieved from liability because the employer, instead of paying the contractor in cash, satisfied debts due from, the contractor, nor because the employer, when reletting the work, after the contracts default, elected to do a portion of the work involved in the contract—when interest is allowable where the damages are unliquidated.
Upon the trial of an action, it appeared that the plaintiff made a contract with the firm of Price & Garrison by which that firm agreed to furnish 9,941 cubic yards of cut granite and that the defendant became surety upon an undertaking given to the plaintiff to secure the faithful performance of the contract by Price & Garrison; that Price & Garrison furnished only 110 cubic yards of the granite and that the plaintiff, after affording the defendant an opportunity to complete the contract, solicited bids for the performance of the work; that it submitted such bids to the defendant and invited suggestions from it in regard thereto, but that the defendant declined to make any suggestions; that the plaintiff thereupon let the contract to one Foster, who was the lowest bidder, and thereafter requested the defendant to pay the difference between the amount paid to Foster and the amount which it would have had to pay to Price & Garrison had the latter performed the contract.
The contract with Foster contained a provision that, if the plaintiff would pay certain expenses and perform certain work which Price & Garrison had agreed to do, he would deduct two dollars per cubic yard from the contract price; that the plaintiff paid the expenses and did the work at an expense exceeding two dollars a yard and obtained the rebate.
It further appeared that the contract with Price & Garrison provided that the plaintiff should allow them for storage purposes the use of certain premises during the performance of the contract, and that Price & Garrison did not use all of such premises, although it did appear that they never had occasion to use all of the premises or any more of the premises than they did use. It also appeared that the contract provided that payments for the stone delivered by Price & Garrison under the contract should be made on the twentieth of each month for all stone accepted up to the seventh of that month; that the plaintiff did not pay Price & Garrison in cash for the stone delivered under the contract, but, at their request, paid certain bills owed by them aggregating more than the contract price of the stone delivered.
Held, that the surety was not relieved from liability by the fact that Price & Garrison did not use all of the premises specified in the contract, as they were not entitled to use all of such premises unless it was necessary for them to do so;
That the failure of the plaintiff to pay Price & Garrison in cash did not constitute a defense to the action, it appearing that the method of payment adopted did not operate to the injury or prejudice of the defendant;
That the plaintiff having incurred, under the contract with Foster, an expense in excess of two dollars per cubic yard in doing work which Price & Garrison were required to do under the contract, it was entitled to have such expense considered in determining the damages which it had sustained from the breach of Price & Garrison’s contract;
That as the defendant knew the terms of the contract with Price & Garrison • and knew, or could have ascertained, the terms of the Foster contract, and could, consequently, by a simple computation, have determined the amount to which the plaintiff was entitled at the time the latter made its demand upon the defendant, the plaintiff was entitled to interest upon the amount of the damages recovered by it, even though such damages were, in a sense, unliquidated.
Appeal by the defendant, The City Trust, Safe Deposit and Surety Company of Philadelphia, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Mew York on the 5th day of May, 1903, upon the verdict of a jury, and also from an order entered in said clerk’s office on the 1st day of May, 1903, allowing the plaintiff interest upon the verdict from the 8th day of February, 1900, to the date of said verdict, and also from an order entered in said clerk’s office on the 4th day of May, 1903, denying the defendant’s motion for a new trial made upon the minutes.
Frederic J. Swift, for the appellant.
Herman Aaron, for the respondent.

Opinion:
McLaughlin, J.:
The plaintiff having a contract with the city of Mew York for the construction of a portion of the foundation of the new East River bridge, made a contract with a firm by the name of Price & Garrison to furnish 9,941 cubic yards of cut granite -of certain descriptions and at specified prices, and to secure the faithful performance thereof they gave to the plaintiff an undertaking in the penal sum of $50,000 with the defendant in this action as surety. Price & Garrison furnished only 110 cubic yards of the granite contracted for, and the plaintiff, claiming there had been a breach of the contract, brought this action to recover from the surety the damages alleged to have been sustained by reason thereof. It had a verdict for $31,658.26, upon which interest was allowed from the date when the plaintiff demanded payment from the defendant, amounting to $6,041.44. The defendant appeals from the judgment entered on the verdict, from the order allowing interest, and from the order denying a motion for a new trial.
The validity of the judgment is challenged principally upon four grounds, which will be considered in the order named. First. That Price & Garrison were justified in breaking their contract, inasmuch as the plaintiff failed to perform on its part. Second. That the plaintiff varied its contract with Price & Garrison after the undertaking had been given and thereby the defendant was discharged. Third. That improper items of damage were allowed. Fourth That interest was erroneously granted on the amount of the verdict.
First. The contract between the plaintiff and Price & Garrison provided that the plaintiff would permit them to have piled up or stored upon certain specified premises (consisting of upwards of 40,000 square feet), preparatory to cutting, a quantity of stone to the extent of 500 cubic yards in excess of the deliveries provided for in the contract and that they would " be permitted, without charge, for the purposes of landing, cutting and delivering said granite, to use the premises " referred to. It is contended that Price & Garrison were not permitted to use all of such premises. It is true they did not use all of the premises, nor was there any occasion for their so doing. This provision of the contract must receive a reasonable construction. All it means is that the plaintiff would permit Price & Garrison to use all of that space if it became necessary for them to do so in carrying out their contract. They could not use it for any other purpose and they were not entitled to all of it unless it was necessary for them to have it. That they never had occasion to use it all, or any more of it than they did use, is perfectly evident from a slight consideration of the testimony bearing on that subject. Plaintiff's manager, who had charge of the work, testified that no request for additional space was ever made by Price & Garrison and that it was without incumbrance e< other than possibly a little rubbish that might have accumulated, as it does accumulate on any large work." The foreman of Price & Garrison, a witness sworn on behalf of the defendant, testified there was only one derrick for use in the work and it was necessary, in order to handle the granite, that it should be within the radius of its arm; that the stonecutters could not do work outside of such radius. He also testified that in the absence of another derrick, Price & Garrison did not need any more room, and Price himself testified that " to have used additional space it would have been necessary to get another derrick. I could not have used any additional space without having another derrick." As already said, Price & Garrison only delivered 110 cubic yards of granite. They had all the space which they required to properly handle and store this amount and their failure to perform was in no way due to the fact that they did not have additional space. The defense based upon the claim that they did not have all of the space was not established.
Second. The proofs adduced at the trial would not have justified a finding that the contract between the plaintiff and Price & Garrison was changed. What is claimed in this respect is that the plaintiff failed to pay for the granite which was actually delivered at the time and in the manner provided in the contract. The contract provided that payments should be made on the twentieth of each month for all stone inspected and accepted up to the seventh of that month. The granite delivered at the contract price amounted to $1,326.33. This sum, it is insisted, could only be p>aid in one way, and that is in cash, and inasmuch as this amount in actual cash was not paid to Price & Garrison, the surety was thereby relieved. It is true that this amount in cash wras not actually paid into the hands of Price & Garrison, but it is not true that the plaintiff did not pay it for them ; on the contrary, it appears that it paid to or for them, at. their request, certain bills for freight, for a derrick, for the use of an engine and for labor — all incurred in prosecuting the work under the contract — amounts which, with the cash paid, aggregated upwards of $1,800. The payment of these bills was just as much a payment within the contract as though the amount of them had actually been paid to Price & Garrison in cash. The contract was not changed. The plaintiff had paid what it had agreed to and Price & Garrison had received all to which they were entitled. As said in Smith v. Molleson (148 N. Y. 241): "We are not dealing now with any actual change in the terms of the contract, but with acts or omissions of the plaintiff in the performance, which, in order to operate to release the surety, must be of such a character that it can be said that her position was changed to her prejudice." It made no difference to the defendant whether Price & Garrison paid the bills it had incurred in prosecuting the work under the contract, or the plaintiff, at their request, did it for them. The result was the same, and the defendant as surety upon the undertaking of Price & Garrison was not injured or prejudiced by it in any way.
Third. After Price & Garrison had failed to perform, and it became evident that they could not or would not make further attempts to go on with the work, the plaintiff, after notifying the defendant and affording it an opportunity to complete the contract if it desired to do so, obtained bids from various parties, which it submitted to the defendant, at the same time requesting any suggestions it might see fit to make with reference to them. The defendant declined to make any suggestions and thereupon the plaintiff let the contract to one Foster, he being the lowest bidder therefor, and thereafter the plaintiff requested the defendant to pay to it the difference between what it had to pay him and what it would have had to pay Price & Garrison had the contract been performed by them. In the Foster contract he agreed to furnish the granite, cut and ready for setting, at a specified price per cubic yard, and further agreed, if the plaintiff would pay the expense of unloading the granite from the vessels in which it was shipped, the dockage, the cost of delivering the rough stone on the site where it was to be cut, furnish the tools and appliances required for cutting, including the necessary steam power and place in which to do the work, he would deduct two dollars per cubic yard from the contract price. This the plaintiff did, and it is claimed it ought not to have had a. recovery for this rebate. The proof tended to show that the actual value of the work done and the materials furnished by the plaintiff, for which it was allowed the rebate of two dollars per cubic yard, exceeded the amount of the allowance. Plaintiff's manager testified that at the time the work was done and the materials furnished he made a careful computation of the expenses and they were accurate, and the actual cost of the same was between two dollars and forty cents and two dollars and fifty cents per cubic yard. The fact that the plaintiff saw fit to do part of the work which Price & Garrison had agreed to do did not deprive it of the right to recover from them or their surety the legal damage which it sustained by the breách of their contract. Some evidence was offered to the effect that Foster did not cut his stone on the premises that were to have been provided for Price & Garrison, but there was nothing to show that the cost of delivery was increased thereby or that there was included in the expense incurred by the plaintiff in getting the rebate of two dollars per cubic yard, anything for the space where the stone was cut. Plaintiff, therefore, having actually incurred an expense of two dollars per cubic yard in doing what it did with the granite furnished by Foster, it was entitled to have such expense considered in determining the actual damage which it had sustained by the breach of Price & Garrison's contract.
Finally, it is claimed that interest was improperly added to the verdict. During the course of the trial the question was presented as to whether the plaintiff, in case it had a recovery, was entitled to interest upon the damages sustained, and it was arranged between counsel that such question should be determined by the learned trial justice after a verdict had been rendered. He held that the plaintiff was entitled to interest, and the same was added to the verdict. The interest was properly allowed. It is true that the damages recovered in one sense were unliquidated, but this did not prevent the allowance of interest, inasmuch as means were accessible to the defendant, at the time the demand was made upon it to pay, to ascertain by computation the amount to which the plaintiff was entitled. The general rule is that even though damages are unliquidated, this does not deprive a party of interest if there are, at the time the demand is made for payment, means accessible to the party sought to be charged of ascertaining by computation or otherwise the amount to which the other party is entitled. (Sloan v. Baird, 162 N. Y. 327. See, also, Sweeny v. City of New York, 173 id. 414.) Defendant could have ascertained, at the time the demand was made upon it, precisely to what the plaintiff was entitled. It knew the terms of the contract with Price & Garrison, and it also had knowledge or could have ascertained the terms of the Foster contract. Being in possession of these facts, it could by a simple computation have determined how much more it cost the plaintiff under the Foster contract than it would have cost it had Price & Garrison performed. Other questions are raised by the appellant, but after an examination of them they do not seem to be of sufficient importance to be here considered.
It follows that the judgment and orders appealed from should be affirmed, with costs.
Van Brunt, P. J., Patterson, O'Brien and Laughlin, JJ., concurred.
Judgment and orders affirmed, with costs.