J. H. Sullivan Co. v. Wingerath

NOYES, Circuit Judge (after stating the facts as above). [1] The trial court, in charging in accordance with the request of the plaintiff, correctly stated the law. The case was not one in which the necessity for, or finality of, an architect’s certificate was involved. It was simply a case in which the parties had agreed that the work should be done “to the satisfaction of the architects.” But in such a case the agreement as made must be lived up to. The question is not whether the work ought to be satisfactory but whether it is satisfactory. When parties agree that the question of the performance of a contract shall be left to the determination of a third person, his decision is final in the absence of mistake, fraud or arbitrary action amounting to legal fraud. To say in such a case that the question is one of substantial performance is to make a new contract for the parties and to substitute the judgment of the jury for that of the person they have agreed upon. [2] The difficulty in this case is that although one part of the charge correctly stated the law, other parts in effect left the question to the jury as one of substantial performance. Thus in the first place they were specifically instructed that it was for them to determine whether the work as done measured up to what the architects should reasonably [462] have required, and we are unable to construe the last words of the court otherwise than as saying in substance that if the jury thought that the defendant had “fairly” performed his contract, they were justified in giving him a verdict.. Portions of the charge upon the subject were clearly erroneous and we are not convinced that the correct portion cured the error. As the judgment must be reversed on account of this prejudicial error and as the other questions raised upon the assignments of error may not arise upon the new trial, we think it unnecessary to consider them. The judgment of the District Court is reversed.