United States Fidelity & Guaranty Co. v. Damskibsaktieselskabet Habil

TYSON, J.- The complaint in this case seeks to recover damages for an alleged breach of a bond executed by defendant as surety for certain named contractors guaranteeing the faithful performance of-all-obligations growing out of a contract made by them to repair the boiler of the steamship Hábil, belonging to the plaintiff, according to specifications embodied in said contract. It contains two counts, (the second added by way of amendment), each of which set out the contract relied upon in haeo verba. The contract as set forth in the first count shows a guaranty of the work to be done for six months; while in the second no such guaranty is shown. In all other respects, the contracts exhibited in each count are the same. And the breaches of the ■ contracts are identical except that in the first a breach of this guaranty is assigned, while in the second it- is not. The undertaking's-on-the-part-of the contractors common to both contracts alleged in each-of the counts are-: First, that the work to be done is -guaranteed to be free from leaks, etc.; Second, that -the work is to-be completed in twenty-three (23) running days, not including Sundays and legal holidays, and if not,-completed within that time, the contractors- forfeit one hundred dollars- for each day (Sundays -and -legal holidays excepted) after the time specified-: Third-; -that all material and workmanship are to be first-class in every respect, etc., etc. — 364 — The breach of the contracts assigned, common to both counts is, that the work was not done within the number of days as specified in the contracts, but that forty (40) and 1-8 days were consumed in doing said work in excess of the twenty-three (23) days. The first count assigned, in addition to this one, a breach, of the guaranty against leaks, alleging the cause of the leaks, an effort on the part of contractors to remedy them, and their reappearance in less than six months from the date of the bond, etc., etc.; also, that the workmanship was not first-class, averring in what respect it was not, and that the defects had to be remedied by plaintiff at its own cost within six months after the date of the bond, etc., etc. It contained other assignments of breaches, but it is unnecessary to notice them since they were eliminated by demurrers and otherwise. The second count, in addition to the one common to both, relied for recovery upon breaches of the guaranty against leaks and of the unskillful workmanship, omitting all reference to the six months guaranty. Besides the general issue, a large number of special pleas were filed to each count. To many of these special'pleas demurrers were sustained. One of the defenses interposed to the first count was that the contract alleged in it had been materially altered after its execution without the knowledge or consent or ratification of the defendant. The pleas making this defense contained no averment that the alteration was made in the contract while it was in the possession or control of the plaintiff, and this was the ground of objection taken to them by demurrer, which was sustained. The theory upon which the sufficiency of the pleas are attempted to be sustained in, that the averment of material alteration after execution imports that it was done after delivery, and consequently while the contract was in the custody and possession of plaintiff. In other words, the averment of material alteration of the contract after its execution is the equivalent of an aver — 365 — ment that the alteration was made while the contract was in the plaintiff’s possession or custody. — Hill v. Nelms, 86 Ala. 442. Had the pleas averred, as was done in plea number 20, upon which issue Avas taken, that the contract Avas altered subsequent to its execution, Avhile in the possession or under the control of plaintiff, Avithout the knowledge, consent or ratification of defendant, the burden of proof would have been the same. Under all of these pleas if a suspicious material alteration appeared on the contract it is incumbent on the plaintiff to furnish a satisfactory explanation; but, if it is not apparent, the onus is on the defendant to shoAV that it was altered, (Barclift v. Treece, 77 Ala. 528; Montgomery v. Crossthwait, 90 Ala. 553,) ; and upon proof of this fact by defendant the burden is then cast upon the plaintiff to overcome the presumed invalidity of the paper. — Winter v. Pool, 100 Ala. 503; Hill v. Nelms, supra; 2 Am. & Eng. Ency. of Law, (2d ed.), 279. Again, the identical issue attempted to be raised and presented by these pleas was raised by plea number four (4) upon Avhich issue Avas also joined. So then, Ave have íavo pleas upon Avhich the case was tried of the same legal import as these we are considering, under each of which the defendant could have, availed himself of all the benefits he could have possibly been entitled to, had the demurrers been overruled and issue been joined on them. — L. & N. R. R. Co. v. Hall, 131 Ala. 161. And as matter of fact, upon looking into the evidence, Ave find that the defendant did actually have the benefit of all evidence under pleas four (4) and twenty (20) that it Avould have been entitled to had the pleas under consideration remained in the record. The ruling of the court, if erroneous, Avas without injury. Plea ten (10) to the second and third assignment as laid in the second count and plea seventeen (17) to the third assignment in the same cout are, at least, no more than the general issue, and the ruling on the demurrers to each of them' are disposed of by the principle just above announced. The eighth (8) plea to the fourth assignment of the first count proceeds on the theory that an acceptance — 366 — of the work was a waiver of the guaranty against leakage, and. to sustain its sufficiency, of necessity, a waiver of the six months guaranty. To so hold; would in effect destroy two of the essential terms of the contract, and, doubtless defeat the very purpose for which the six months guaranty was intended. — Milton v. Rowland, 11 Ala. 732; Sheppard v. Dowling, 103 Ala. 563. Plea nine (9) purports to answer the 4th, 5th and 6th assignments as laid in the first count. Confessedly it is no answer to the sixth, and the demurrer to it was properly sustained. The subsequent Avithdrawal or striking out of the assignment could not and did not have the effect of putting the court in error. The court could not, at the time it Avas called on to rule upon the demurrer, knoAV or be required to anticipate that the assignment Avould be stricken. If the defendant desired to interpose it as an answer to the 4th and 5th assignments, it should have obviated the demurrer by the proper amendment, or refiled the plea after the 6th had been stricken. Pleas twenty-two and tAventy-nine or identical. The averment in each of them is that the defendant “did not in any manner guarantee that any of the Avork done on said vessel by Thompson & Bailey Avould remain effective for six months.” If they be construed as averring that the legal 'effect of the bond Avas not a guaranty of the six months clause in the contract, this is a mere conclusion of the pleader, and they were subject to the demurrer. On the other hand, if they be construed as averring that the contract contained no such clause when'executed, then the defendant can not complain of the rulings for the reason that he had the benefit of this issue under other pleas. It is not insisted, as we understand, that they were intended to deny the execution of the bond by defendant. The fifth plea to the first assignment of breach óf the contract in the first count Avas clearly one in confession and avoidance. It express^ admitted the breach of the contract as alleged, but undertook to avoid liability by reason of the fact that the contractors were — 367 — employed by plaintiff to do extra work on the steamship in connection Avith the work specified in the contract, averring that it was “by reason of such extra work the work stipulated in said contract was necessarily delayed beyond said 23 days.” The plea is subject to tAvo constructions: First, that the extra work was of such character as to necessarily interfere Avith the performance of the original contract, in which event the contractors Avould doubtless haAre been entitled to an extension of time for the period occupied by the extra Avorlc and no more, (Texas & St. Louis Ry. Co. v. Rush, 19 Fed. Rep. 239) ; and second, that the tAvo jobs might Avell have been done simultaneously without the one interfering Avith the other, except that the contractors did not liaA’e employes enough to do the work under both contracts at the same time, and, therefore, in order to perform the contract for the extra work, they had to desert the Avork they were to do under the contract sued on. Clearly if the last construction should be adopted, the plea simply means that the contractors Avere unable to perform both of their promises, not by réason of any inherent difficulty in the performance of the contract, but by reason of their oavu shortage in facilities to perform both at the same time. But whether the one or the'Other of the constructions be adopted, the 'plea is bad. ■. The case of Davis v. Badders et al., 95 Ala. 349, relied. upon by appellants as sustaining the sufficiency of the plea rather supports our conclusion. The case of Hutchinson v. Cullum, 23 Ala. 625 and Cornish, et al. v. Suydan, 99 Ala. 620, cited by appellant have no application. In each of those cases there Avas a novation of the original contract. The 6th and 7th pleas to the same assignment, Avere also in confession and avoidance. The 6th plea set up that the work Avas not completed within the time specified in the contract by reason of the time spent by the contractors in waiting for the arrival of the Norwegian Veritas inspector Avhom the plaintiff had employed to come from NeAV Orleans to. examine the work. The — 368 — 7th plea alleged that the work was wrongfully stopped nine different times by the engineer of the steamship acting for the plaintiff in the scope of his employment, thereby preventing the contractors from completing the work within the time specified in the contract. It will be noted that the pleas do not show how much time was consumed by the delay complained of. Non constat, the delays complained of did not cause a period longer than one day. They assert the broad proposition that because there were delays occasioned by plaintiff’s conduct during the period fixed by the contract, by which the contractors were unable to complete the work within the twenty-three days, that the plaintiff cannot recover for a violation of that stipulation, notwithstanding the contractors claimed no breach of the contract by abandoning the work, but proceeded to do the work under it. The contractors by a continued performance of the contract must be held to have consented to the delays; and the plaintiff to an extension of the time occasioned by them. The pleas failing to aver that the delays occasioned by plaintiff prolonged the doing of the work for forty and 1-8 days, as averred in the complaint, are clearly no answer to it. If the work could have been completed within the period fixed by the contract plus the additional time occasioned by the delays, it was the duty of the contractors to have completed it within that time; and if they delayed its completion beyond that period they are liable for each day in excess of it. — McGowan v. Amer. Tan Bark Co., 121 U. S. 600. There is no merit in the contention that the court erred in refusing the defendant’s motion for a continuance after the amendment of the complaint by the addition of the second count, nor overruling its request to he allowed the statutory period within which to file pleas to this added count. This count introduced no new cause of action, and the record shows that the defendant was permitted to file and did file to its nineteen pleas, and doubtless the court would have permitted it to have filed more, had the request to do so been made, — 369 — and its counsel had thought it advisable. Presumably every defense that it had was presented, nothing to the contrary appearing in the record. This brings us to a consideration of the exceptions reserved to the rulings of the court, insisted upon in argument, upon the admission and exclusion of testimony. There hre only two of them. The first relates to an objection interposed by defendant to a question propounded by plaintiff, on cross examination, to witness Bailey, who was one of the contractors and who testitified, that he |made the contractfin controversy, for his firm. The question asked him was :* “If he guaranteed that the work to be done by his firm should not leak?” The objection interposed was that the contract was the best evidence. Before the court ruled on the question, the witness answered “that he did not guarantee it.” The defendant, however, moved to exclude this answer upon the ground assigned in the objection to the question. It is doubtless true that the contract was the best evidence as to whether Thompson & Bailey guaranteed that the worlc would not leak, and if the purpose of the question had been to establish the contents of the contract, the objection would have been good. But this was clearly pot the purpose cr scope of the examination. One of the chief matters in controversy between the parties was, whether the “six months’ guarantee,” which appeared in the copies of the contract delivered to the plaintiff’s agent, was inserted in them before their delivery or subsequently thereto. The witness had testified that he had positively refused to make any such guarantee at the time of entering into the con tract. He says that he was requested to make it, hut .declined to do so and that the contract was signed without the guarantee clause being filled in. The witnesses for the plaintiff deny this and assert- that the words “six months” were inserted by his consent. Witness Bailey in testifying upon the .subject undertook to show that he was familiar with the contract sued upon, and it was, of' course, permissible to test the accuracy of his knowledge and recollection of it. Would it not have been permissible to ask him for a — 370 — description of fclie paper that he admitted he signed and delivered, which he claimed to deliver? And would it not have been a circumstance against the accuracy of his observation and. recollection-if he had testified that the entire paper was writen with a pen, while as matter of fact the greater portion of it was typewritten? We think so. The question here presented is upon principle the same. . The other exception is based on the ruling of the court in sustaining an objection by plaintiff to the question propounded by defendant to the witness McCartney: “Wha,t knowledge did the defendant have, if any, of any alterations which may have been made in the contract after it was executed?” This witness, who is shown to have represented the defendant corporation in the matter of the execution of the bond sued on, was permitted to testify that he had no knowledge or notice of any alteration in the contract after it was signed, and that no one had any thing to do with that part of the business of the defendant company -relating to the exceution of the bond except himself. What other agents or officers of the corporation may or may not have known about the alteration, had they told the witness of their knowledge or want of knowledge, his testimony as to what they knew or did not know would have been the barest hearsay. And confessedly the witness could not testify that a person does or does not know of the existence of a fact, without being told, when the witness himself has no knowledge of the fact. A number of written charges were refused to the clefendant, but only two of them, numbers 1J4 and 2 are insisted upon. The insistence that charge numbered V/¿ should have been given is based solely upon the contention that the evidence, established the averments of the plea numbered U/t without dispute and beyond any adverse inferences. That plea reads: that “the contract set out. in said complaint is not the contract which was exhibited to this defendant and for the faithful performance of which said bond was given.” The evidence is without dispute that there was only one contract be — 371 — tween tlie parties. What that contract was is a matter oí serions controversy. The writings evincing it consisted of three (3) papers signed by each of the parties, supposed at the time to be exact copies of each other. On the face of two of the copies, delivered to the plaintiff’s agent, there appeared a “six months guarantee,” while on the face of the third, which was delivered to the contractors, there is no such “guarantee,” but a blank space appeared instead. It cannot be seriously doubted that if the “six months guarantee” was agreed upon as a term of the contract and was properly inserted in the two copies delivered to plaintiff, one of which is exhibited and relied upon in the count of the complaint as to which the charge under consideration urns "requested, that these writings constitute the contract between the parties, and that the copi^ held by the contractors, not containing the essential term of the contract on account of an omission to fill the blank space left in it, was not a contract at all. It ivas this latter paper that was exhibited to the defendant’s agent. If, as we have said, it did not embody the “six months guarantee” when it should have done so and the other copies properly did, it was no more than a blank piece of paper so far as the contracting parties were concerned, and the bond, confessedly, was not given for its faithful performance. Under the evidence, which of the copies evinced truly the contract that was made, was clearly for the jury. This being true, the facts alleged in tlie plea were not affirmatively and undisputedly .proven and, therefore, the charge requested was properly refused.. The court was under no duty to give the other charge on the principles'declared in Dorsey v. State, 134 Ala. 553, and cases there cited. We have considered every assignment of error insisted upon in argument of appellant’s counsel, and find no error in the record. The judgment must be affirmed. Affirmed.