Court Opinion

ID: 3560646
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:11:02.997676+00
Date Added: 2024-06-11T13:47:52.895289
License: Public Domain

The building contract fixed a lump sum as the contract price, payments to be made from time to time as the work progressed, on certificates of the architect, as to which certificates it is provided, "no payments to be made for more than eighty-five per cent. of the work completed, materials furnished and actually installed in the building."
I think the eighty-five per cent. so specified refers, exactly as it says, to the amount or proportion of the completed work done which is to be paid for, and has nothing to do with the rate or price at which the payment shall be made. That rate or price obviously is fixed by the agreed contract price for the entire job. If the work is half completed the contractor is entitled to be paid for eighty-five per cent. of the completed half, that is, eighty-five per cent. of one-half the contract price for the whole job. If there had been no eighty-five per cent. provision and the contract had simply provided for payments from time to time as the work progressed on certificates of the architect of the amount of work done, clearly upon an architect's certificate that half the entire job was completed, the contractor would have been entitled to payment of exactly one-half such entire contract price. The only effect of the eighty-five per cent. clause is to limit the portion of the work which shall be paid for to that percentage of the work done. The rate at which it shall be paid for is, of course, the rate at which the contract provides that the entire work and consequently every part of it shall be done.
If there shall be read into the contract the provision (which I think it clearly does not contain) that the portions of completed work certified to by the architect as the job progresses shall be paid for at a different price (viz., as its *Page 374 
then current value) than that fixed by the contract, it might easily happen that the owner might be compelled to pay out to the contractor on architects' certificates the entire contract price for the whole job before it was three-quarters finished, or twenty-five per cent. more than the entire contract price by the time the job was entirely completed. This, of course, is absurd, and a construction which would lead to such a result should, I think, be avoided, even if the language used were ambiguous, which, in this case, I think it is not. The language seems to me to say exactly what it clearly was intended to say, viz., that the stipulated contract price for the entire job should be paid as the work progresses to the extent of eighty-five per cent. of the amount performed from time to time as fixed by the certificates of the architect.
I also disagree with the prevailing opinion upon the other point involved. The fact that the owner has the right to step in where a contractor falls down and use the remainder of the contract money to finish the job does not, in my judgment, give the owner under such circumstances the right to retain the unexpended portion of the contract price without completing the job (or showing that the remaining funds are insufficient to complete it), and at the same time deny payment out of such fund to the materialmen who had supplied materials upon the faith of the entire contract price being available for their protection. If it appeared that there had been no anticipation of payments and that nevertheless there remained insufficient funds to complete, a different situation might arise, but there is no such proof here.
For affirmance — THE CHANCELLOR, CHIEF JUSTICE, TRENCHARD, PARKER, KALISCH, BLACK, CAMPBELL, LLOYD, HETFIELD, DEAR, JJ. 10.
For reversal — WHITE, VAN BUSKIRK, JJ. 2. *Page 375