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City of New York v. Seely-Taylor Co.

Supreme Court of New York, Appellate Division

February 16, 1912

THE CITY OF NEW YORK, Appellant, Respondent,
v.
SEELY-TAYLOR COMPANY, Respondent, Appellant, Impleaded with THE EMPIRE STATE SURETY COMPANY, Respondent.

Page 99

APPEAL by the plaintiff, The City of New York, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of the county of New York on the 21st day of June, 1910, upon the dismissal of the complaint by direction of the court at the close of plaintiff's case on a trial at the New York Trial Term, and also from an order entered in said clerk's office on the 23d day of June, 1910, denying the plaintiff's motion to set aside the dismissal of the complaint.

Also, an appeal by the defendant, the Seely-Taylor Company, from an order of the Supreme Court, entered in the office of

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the clerk of the county of New York on the 28th day of November, 1910, denying the said defendant's motion for an extra allowance.

COUNSEL

Terence Farley, for the plaintiff.

Edward W. Norris, for the defendant Seely-Taylor Company.

Benjamin Reass, for the respondent Empire State Surety Company.

MCLAUGHLIN, J.:

The plaintiff, acting through its commissioner of docks, on or about the 1st of March, 1905, advertised for proposals or estimates for performing labor and furnishing materials required for removing a ferry structure and building in place thereof a new one. The advertisement notified prospective bidders that sealed proposals or estimates would be received by the commissioner of docks until two o'clock P. M., March 13, 1905, and that security would be required in the sum of $90,000; that each bid or estimate 'shall be accompanied by the consent in writing * * * of a guaranty or surety company duly authorized by law to act as surety, and shall contain the matters set forth in the blank forms mentioned below; ' and that no bid or estimate would be considered unless, as a condition precedent to the reception or consideration of any proposal it was accompanied by a certified check upon one of the State or National banks of the city of New York, drawn to the order of the comptroller, or money to the amount of five per cent of the amount of the bond required as provided in section 420 of the Greater New York charter. In answer to the advertisement the defendant Seely-Taylor Company submitted a bid, accompanying which was a bond executed in the form required, by the respondent surety company. This bond recited that in consideration of one dollar paid by the city, the receipt of which was acknowledged, the surety company agreed if a contract were awarded to the Seely-Taylor Company it would become bound as its surety for the faithful performance of the same; and 'if the said person or persons shall omit or refuse to execute such contract and give the

Page 101

proper security within five days after written notice that the same is ready for execution, if so awarded, we will pay, without proof of notice or demand, to the said The City of New York, or its successors, any difference between the sum to which such person or persons would be entitled upon the completion of such contract and the sum which The City of New York may be obliged to pay to the person or persons to whom the contract shall be awarded at any subsequent letting.'

At the time the bid and bond were submitted, and accompanying the same, the Seely-Taylor Company delivered a certified check drawn on a National bank of the city of New York, payable to the order of the comptroller, for $4,500. There were several other bidders, and when all of the proposals were opened it was found that the Seely-Taylor Company's bid was the lowest by upwards of $100,000. On the fourteenth of March, the day following when the bids were opened, the Seely-Taylor Company notified the commissioner of docks and the comptroller of the city, in writing, that it withdrew its bid. On the following day the commissioner of docks acknowledged, in writing, the receipt of the notice, and at the same time notified the Seely-Taylor Company that it had no right to withdraw its bid, and 'that if the contract be hereafter awarded to you, the Department will look to you and to your surety to carry out the terms of your bid and to execute the contract accordingly.' Some time thereafter the contract was awarded to the Seely-Taylor Company, which it refused to execute, though requested to do so. The city then readvertised for bids, and subsequently let a contract to the lowest bidder on such readvertisement, which was about $144,000 in excess of the bid made by the Seely-Taylor Company. Some two years thereafter this action was brought to recover this difference from the Seely-Taylor Company and its surety, the city in the meantime having, on demand of the Seely-Taylor Company, returned to it the check for $4,500.

There was no dispute at the trial between the parties as to the facts above stated, and in addition thereto it appeared from the testimony of the president of the Seely-Taylor Company, which was uncontradicted, that he submitted the bid for his ...


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