APPEAL by the defendant, Robert Goelet, from a judgment of the Supreme Court in favor of the plaintiff and certain of the defendants, entered in the office of the clerk of the county of New York on the 5th day of October, 1910, upon the report of a referee decreeing the sale of certain premises on the foreclosure of a mechanic's lien filed by the plaintiff, and also from an order entered in said clerk's office on the 1st day of
October, 1910, granting an allowance of $1,500 to the plaintiff and appointing a referee to sell the premises described in the complaint.
Frederick Hulse, for the appellant.
Benjamin G. Paskus [Louis S. Ehrich, Jr., with him on the brief], for the plaintiff, respondent.
Franklin Nevius [Arthur S. Van Buskirk with him on the brief], for the respondent Unit Concrete Steel Frame Company.
On the 22d day of August, 1906, the plaintiff, a domestic corporation engaged in building construction, and the appellant made a contract in writing by which plaintiff undertook to erect on premises owned by appellant situate at the northeast corner of Sixty-fourth street and Broadway, borough of Manhattan, New York, a six-story reinforced concrete building in accordance with specifications and drawings theretofore prepared by one F. M. Andrews, an architect, under whose direction the work was to be done. The main floor of the building was to consist of stores and the remainder of the building was to be used as a garage. The contract provided that the building was to be completely finished and ready for occupancy on or before the 1st day of July, 1907, and in default thereof the respondent was to pay the appellant as liquidated damages the sum of $200 for each day thereafter until the building was completed and ready for occupancy. The respondent failed to complete the building within the time specified in the contract, and in fact had not completed the excavation work at one corner of the plot at that time, although the excavation work had been finished and some of the concrete work done on other parts of the plot. The contract contained the usual provision that should the contractor at any time refuse or neglect to supply a sufficient number of skilled workmen, or sufficient materials of proper quality, or fail in any other respect to prosecute the work promptly and diligently or to perform its agreement, the
owner should be at liberty, on such neglect, refusal or failure being certified by the architect, after three days' notice in writing to the contractor, to provide the necessary labor or materials at the expense of the contractor; and it was further provided that the owner should be at liberty to terminate the employment of the contractor and to take possession of the work for the purpose of completing it for the account of the contractor as therein provided, should the architect certify that such refusal, neglect or failure on the part of the contractor constituted sufficient ground for such action. On the 2d day of July, 1907, Maynicke & Franke, architects, representing the owner, wrote respondent a letter setting out the status of the work on the day before, which was the day on which the work should have been completed, and demanding that the contractor display greater energy to the extent of working nights, and drawing attention to the fact that the owner would suffer heavy financial loss on account of the delay, and that the contract spoke for itself on that point. The contractor remained in charge of the work, making slow progress, however, without interruption until the 10th day of March, 1908, when Maynicke & Franke in behalf of the owner demanded of Andrews that he issue a certificate authorizing the owner to terminate the contract. This was refused, but on the day following the architect issued a certificate authorizing the owner to supply certain broken stone and gravel with which to prosecute the work and to charge the same to the contractor The next day, March 12, 1908, the appellant wrote respondent complaining that the work had not been completed within the time specified by the contract and that the contractor had not exercised proper diligence in prosecuting the work, and demanding that the respondent within three days supply a sufficient number of skilled workmen and sufficient material of proper quality to prosecute the work with promptness and diligence, and stating that on its failure so to do the appellant would furnish the labor and materials and terminate the respondent's employment and enter upon the premises and take possession for the purpose of completing the work, and would take possession of the materials, tools and appliances of the contractor thereon for that purpose. The appellant having failed to
obtain the architect's certificate, this notice was ineffectual for the purpose of affording a basis to enable the appellant to take charge of the work under the contract and complete it thereunder for the account of the respondent. On the twenty-first day of March thereafter, without further notice, the appellant forcibly ejected the respondent and took charge of the work, and on the same day the respondent wrote the appellant protesting against his action and claiming that it was not responsible for the delay and stating that it would insist upon its rights under the contract. On the third day of April thereafter appellant wrote respondent another letter in which he stated in substance that pursuant to his previous letter he had proceeded with the reinforced concrete work which respondent had abandoned; that other work had since been done by respondent's sub-contractors who desired their pay, and complaining that respondent had not applied for an installment payment under the contract on March twenty-fifth, as provided in the contract, and had permitted liens to be filed, and giving notice that unless the respondent applied for the installment payment within three days which would enable appellant pursuant to authority contained in letters from the respondent under date of October 14 and 15, 1907, to pay the sub-contractors and unless respondent took action to satisfy the liens and proceeded 'in an orderly and diligent manner,' appellant should consider that respondent had abandoned the entire work, and would complete the building and charge the expense to the respondent 'as provided for in our contract.' Respondent replied on the eighth of the same month claiming that appellant had previously ejected it and taken possession of the entire work, and, in effect, that respondent would rest on ...