Hart v. Lauman

By the Court, Johnsoh, J. The referees have found, upon the new trial, that 6100 cubic yards of hard pan were excavated, under a new and separate agreement, by which ther plaintiff was to receive a reasonable compensation for his services in making such excavation, which they find to he forty cents per cubic yard. This agreement, upon the new finding, was a valid one. The plaintiff, according to this finding, after unexpectedly encountering this hard material, gave notice to one of the defendants that he could not go on and excavate this material at the price named in the contract, and must abandon the work, unless the defendants would allow more than the contract price for such material. The defendant Lauman, to whom this notice was given, then told the plaintiff to quit that portion of the work until some arrangement could be made in regard to it; and the plaintiff did quit it for about two weeks, when it was resumed under the new [416] agreement. It is plain, I think, that what took place between the parties, followed as it' was by the plaintiff’s quitting the work, was such a rescission of the original contract in respect to that portion of the work, as would have precluded the defendants from maintaining an action to recover damages for its non-performance, afterwards. The parties were then in a situation to make a new agreement, for that part of the work, which would be binding, and would control, instead of the first agreement. It is claimed on the part of the defendants, that the evidence does not warrant this finding of the referees. But there is certainly evidence tending to this conclusion of fact, and indeed the whole evidence shows, quite conclusively, that the defendants did not expect the plaintiff to take out this hard material, at the price specified in the contract for common earth. I do not think we would be justified in setting aside the report of the referees, upon this branch of the case, on the ground that it is without evidence to support it. The question of the right of the defendants to pay ten per cent of the contract price of the work in the stock of the rail road company, is now presented in an aspect materially different from that in which it was presented by the former report. We then held that inasmuch as the defendants had not refused to transfer the stock, but had, on the contrary, offered to do so in a manner not objected to by the plaintiff, they had not forfeited, the right to pay the amount specified in such stock. Ho question as to the value of the stock arose on the former trial; the only question then being, whether the defendants had offered a sufficient amount in stock at its nominal or par value. It now appears, from the report of the referees, that at the time the offer, such as it was, to pay in stock was made, such stock was worth only ninety cents on the dollar, of nominal value; and that at the time of the last trial it was utterly worthless, having no value whatever. The defendants, on that occasion, offered the plaintiff $18.93 • in money, and an order on the treasurer of the company, at [417] Buffalo, for a certificate of $500 of the capital stock of the company, as payment in full of the amount due him. This was refused by the defendant, on the sole ground as found by the referees, that it was not sufficient to pay the amount due. The referees find that there was at least $800 due from, the defendants to the plaintiff, upon the grounds assumed and' claimed by them, and upwards of $5000, in point of fact. The plaintiff, of course, was not bound to take the two amounts, or either of them, as it was offered. Ho question seems to have been raised between the parties as to the value of the stock, or whether it was to be received at its nominal, or at its market value, by the plaintiff; as a sufficient amount was not offered in either case; and all the plaintiff was called upon to do was to decline accepting it as offered. The question now arises whether the defendants can now pay the ten per cent in stock, and whether their right to do so is not necessarily forfeited in consequence of the stock having become utterly valueless in their hands, before they have performed or offered to perform according to the agreement. It is to be inferred, I think, that the defendants were the owners of the stock, or of a sufficient amount thereof to have satisfied the first demands of the plaintiff; and it was in their power at any time to have discharged their obligation by tendering the amount in stock actually due, which they have failed to do. The question whether they should have tendered the amount due, at its current market value, or at the nominal value of the shares, does not necessarily arise here, as they made no sufficient tender, or offer of payment, while the stock had any real or market value, and it has now passed beyond all valuation, for any purpose. I am inclined to the opinion, however, that the plaintiff, under the contract in question, was entitled to the ten per cent in stock at its current market value at the time payment should have been made or offered. Stock in a corporation is not money; nor is the certificate by which the ownership of it is evidenced, in any sense the representative of money; nor is it an obligation or security for the [418] payment of money. It is personal property merely, of a peculiar kind, it is true, but still a personal and marketable commodity, having a market value the same as any other commodity, which is the subject of bargain and sale in the market. (Mechanics’ Bank v. New York and New Haven R. R. Co., 3 Kern. 627. Bouv. Law Dic. Stock.) By the terms of the agreement the defendants undertook to pay ten per cent of the amount earned under the contract, in the capital stock of the corporation, without any price per share, or otherwise, named in the agreement. This was, I.think, an agreement to pay stock to that amount in value, according to its market price at the time, the same as though payment was to be made in any other kind of personal property which has no uniform and fixed price. This being so, payment in stock is rendered impossible, and the defendants, by their own neglect, have forfeited and lost all right to pay the ten per cent in the stock of this corporation. At the time the agreement was entered into, the- stock had a money value, and it was this value which the parties had in contemplation, and which was to extinguish the indebtedness. The contract would not, therefore, be performed according to the meaning and intent of the parties, by the transfer of any amount of capital stock, however large, nominally, without any money value whatever. It is obvious that an obligation to pay a definite sum in grain or any other personal property would not be performed by a tender of property of that description, so injured or decayed as to be utterly valueless. It seems to me, therefore, as the obligation cannot now be performed by the transfer of the stock specified, the amount is necessarily recoverable in money. It was no part of the intention, in making the agreement, that the plaintiff should lose the ten per cent, and the law will provide a remedy to prevent such a loss. In the case of Moore v. Hudson River R. R. Co., (12 Barb. 156,) the plaintiff agreed to take the stock at par. The stipulation in. the agreement, that all matters in dispute, as to any matter connected with, or growing out of, the [419] contract, should be submitted to and decided upon by the chief engineer and consulting engineers of the company, was no bar to the action. (Haggart v. Morgan, 1 Seld. 422.) [Cayuga General Term, June 6, 1859. T. R. Strong, Smith and Johnson, Justices.] The engineers’ estimate of twenty-five cents per cubic yard, for the hard material, is not conclusive upon the plaintiff, as to value or price. If there was no agreement as to price, he was entitled to what it was reasonably worth to make the excavation. The estimate may afford some evidence of a price fixed, but it is not conclusive; and the referees have found that no price was agreed upon, but that the plaintiff was to have what it was worth. The monthly estimates were not conclusive as to the amount of work done, and the receipt of payment thereon did not operate as a final settlement and adjustment of the work from month to month. Several other questions were raised, though not much pressed upon the argument; but it seems to me there is nothing in any of them which would warrant a reversal of the judgment. On the whole, I am of the opinion that the judgment must be affirmed.