WILLIAMS ET AL.
CITY OF NEW YORK.
Appeal from Trial Term, New York County.
Action by John Williams and another against the City of New York for breach of contract. From a judgment for plaintiffs, defendant appeals. Reversed.
Terence Farley, for appellant.
L. Laflin Kellogg, for respondents.
Argued before PATTERSON, P. J., and INGRAHAM, CLARKE, McLAUGHLIN, and HOUGHTON, JJ.
[114 N.Y.S. 653] INGRAHAM, J.
In the year 1901 the aqueduct commissioners, acting under the authority conferred upon them by chapter 490, p. 666 of the Laws of 1883 (and acts amendatory thereto) in connection with the water supply of the city of New York, determined to construct a dam on the Croton river which was known as the " Muscott dam." They issued proposals for bids to do the work required by certain specifications which were annexed to the proposals for bids. The plaintiffs submitted a bid which was accepted, and a formal contract was executed on the 10th day of May, 1901. The contract in form is between:
" The city of New York, acting by and through the aqueduct commissioners, by virtue of the power vested in them by chapter 490, p. 666 of the Laws of 1883, of the state of New York, and the amendments thereto, parties of the first part, and John Williams and Robert J. Gerstle, composing the firm of Williams & Gerstle, of 347 East Forty-Fourth St., New York City, parties of the second part."
By the contract the plaintiffs agreed that they would commence the work within 20 days from the date of the contract, " that the rate of progress of their work shall be such, in the opinion of the engineer, and that they will so conduct the said work that on or before July 1, 1902, the whole work covered by this contract and specification shall be entirely completed," with a penalty of $250 for each day that the contractors should be behind in the performance and completion of the work, and with a further provision that neither an extension of time for any reason beyond that fixed herein for the completion of the work, nor for the doing and acceptance of any part of the work called for by this contract, shall be deemed to be a waiver by the said aqueduct commissioners of the right to abrogate this contract for abandonment or delay, in the manner provided for in the paragraph marked " P" of this agreement. Paragraph P of the contract provided that:
" The contractors agree that if the work to be done under this agreement shall be abandoned, or if the conditions as to the rate of progress hereinbefore specified are not fulfilled, or if this contract shall be assigned by the parties of the second part otherwise than as in hereinbefore specified, or if at any time the engineer shall be of opinion, and shall so certify in writing to the said aqueduct commissioners, that the said work or any part thereof is unnecessarily or unreasonably delayed, or that the said contractor is violating any of the conditions or covenants of the contract or executing said contract in bad faith, or if the work to be done under the contract be not fully and entirely completed within the time therein stipulated for its completion, the said aqueduct commissioners shall have the power to notify the aforesaid contractor to discontinue all work or any part thereof under his contract by a written notice to be served upon the contractor either personally or by leaving said notice at his residence or with his agent in charge of the work, and thereupon the said contractor shall discontinue said work or such part thereof as said aqueduct commissioners may designate, and the said aqueduct commissioners shall thereupon have the power to place such and so many persons, and obtain by hire such materials, etc., and by contract, as said aqueduct commissioners deem necessary to complete the work herein described, *** and the expense so charged shall be deducted and paid by the parties of the first part out of such moneys as either may be due, or may at any time thereafter become due to the said contractor under and by virtue of this agreement, or any part thereof."
[114 N.Y.S. 654] And it was further agreed that:
" If the work under the contract is not, in the opinion of the aqueduct commissioners, practically completed as hereinbefore provided (clause L), on or before the first day of July, 1902, that one-half of the moneys retained by the city of New York, under clause T, shall be and is hereby forfeited by the said parties of the second part to the said the city of New York, and the aqueduct commissioners shall have the right to take possession of the work."
The contract also contains the further provision: That in order to enable the said contractor to prosecute the work advantageously the engineer shall, once a month, make an estimate in writing of the amount of work done and materials delivered to be used in the work and the value thereof according to the terms of the contract; that the first such estimate shall be of the amount or quantity and value of the work done since the parties of the second part commenced the performance of this contract, on their part, and every subsequent estimate (except the final one) shall be of the amount or quantity and value of the work done since the last preceding estimate was made; that such estimates of amount and quantity shall not be required to be made by strict measurement or exactness, but they may at the option of said engineer be approximate only; and that, upon each such estimate being made, the parties of the first part will pay to the parties of the second part 90 per cent. of such estimated value.
The plaintiffs commenced work under this contract and proceeded thereunder until January, 1904. The work was not then completed, although according to the terms of the contract it was to have been completed on or before July 1, 1902; but the time for the completion of the work appears to have been extended from time to time by the aqueduct commissioners. On February 18, 1904, the engineers of the aqueduct commissioners certified: That the contract between the city of New York, acting by and through the aqueduct commissioners, and John Williams and Robert J. Gerstle, dated May 10, 1901, for the building of the Muscoot dam on the Croton river at Muscoot Mountain, and the work thereunder, is unnecessarily and unreasonably delayed, and the contractors are violating the conditions or covenants of the contract and executing the same in bad faith, and that the work done under the contract is not fully and entirely completed within the time therein specified in the said contract for its completion. Whereupon and on February 29, 1904, the aqueduct commissioners served a notice on the plaintiffs to discontinue all work under their contract, stating that the notice was served pursuant to the terms and conditions of the contract and because of their failure to comply therewith. That the aqueduct commissioners would proceed to complete the work under the provisions of the contract and discharge the cost thereof as therein provided, and take such other steps as may be legal and proper under the provisions of chapter 490, p. 666, of the Laws of 1883, and the amendments thereto.
Subsequently and in May, 1904, the plaintiffs commenced this action, alleging the making of the contract; that as soon as permitted the plaintiffs proceeded to execute, perform, and carry out the said contract [114 N.Y.S. 655] in all respects as therein required, and have performed, executed, and carried out the said contract in all respects as far as permitted by the defendant; that while the plaintiffs were proceeding in good faith to perform, execute, and carry out the terms of the said contract as aforesaid, the defendant wholly failed to perform and carry out the conditions and covenants of the said contract to be kept by them, in that it obstructed, hindered, and delayed the proper performance thereof, in that it wrongfully interfered with the workmen employed by the plaintiffs and refused to allow them to work as ordered by the plaintiffs, in that it compelled the plaintiffs to work under obstructions and difficulties interposed by the defendant and at an increased price, in that it forced the plaintiffs to comply with the provisions of the labor law which have been declared unconstitutional and void by the courts of this state, in that it compelled the plaintiff to do other and additional work to that specified in the contract, in that it failed and refused to make the payments provided in the said contract at the times provided therein, and failed and refused on demand to make the said payments due and payable December 1903, of two monthly payments earned and due according to the estimates duly made covering moneys earned by the plaintiffs and due under the contract, in that it wrongfully and against the terms, conditions, and covenants of the said contract wholly refused to permit the plaintiffs to perform the same, and that on or about the 24th of February, 1904, forcibly took possession thereof, and have since refused to permit the plaintiffs to proceed further thereunder. It was further alleged that the total amount of work done ...