Opinion
Submitted October 28, 1927 —
Decided February 6, 1928.
On appeal from the Somerset County Circuit Court, in which Circuit Court Judge Lawrence filed the following opinion:
"This action was tried before the court, without a jury, by consent of the parties, on an agreed state of facts filed, and is decided on the facts and the law applicable thereto.
"The following are the facts:
"1. On January 8th, 1923, plaintiff entered into a contract in writing with defendant to provide the materials and perform the work necessary for certain alterations and additions to the latter's residence at Gladstone, New Jersey, according to the plans and specifications prepared therefor by defendant's architects.
"2. The contract provided for the payment of $28,079 for complete construction and interior finish, plus a flat profit fee of $3,000, subject to additions and deductions as provided in the conditions of the contract. If the work covered by the contract should be done for less than the total contract price, the saving was to be divided equally between the owner and contractor.
"3. The plans and specifications for such alterations and additions, which included the building or rebuilding and alteration of a private chapel attached to the residence property or to be so attached, required a large amount of mill and cabinet work, some of which to be placed in the interior of the chapel, especially at and around the altar, was to be of special design, and because of the necessity of having it ready for prompt delivery, plaintiff on January 12th, 1923, ordered it with the other mill and cabinet work of the Butler-Howell Company, of New Brunswick, New Jersey, where it conducts a mill and woodworking establishment for the manufacture of materials of the character usual in building operations. Such sub-contract provided for the payment of not more than $8,000, the Butler-Howell Company agreeing, however, to bill the work to plaintiff at net cost plus overhead and at ten per cent. commission, with the understanding that if the gross cost should be less than the guaranteed estimate, the saving would be split on a fifty-fifty basis between them. Subsequently some additional work or materials were contracted for, for which the Butler-Howell Company was to receive from plaintiff an agreed price of approximately $480. This additional work was made necessary to enable plaintiff to carry out its contract with defendant.
"4. After the agreement between plaintiff and the Butler-Howell Company, and the rough studding and plastering for the additions and alterations required by the general contract had been done by plaintiff, defendant decided to have the alcove at the end of the chapel where the altar was to be located made deeper than originally contemplated and upon certain changes to the altar. These changes required the tearing out of that part of the partition affected by such alteration, and the Butler-Howell Company was obliged to discontinue work in its mill on the manufacture of the part of the materials until revised drawings could be prepared and submitted by defendant's architects. These revised drawings were received by plaintiff between March 3d and March 7th, 1923, and the order for the necessary materials was transmitted by it to the Butler-Howell Company and the work of manufacture of materials on the changed designs was immediately commenced by the latter.
"5. Plaintiff's work on the alterations and additions to the residence as provided by the general contract and the accompanying plans and specifications had progressed to seventy per cent. of final completion when, on March 15th, 1923, the residence building was destroyed by fire without fault of either plaintiff or defendant.
"6. At the time of the fire plaintiff had furnished, provided and placed in the alterations and additions to the dwelling work and materials under the general contract to the amount of $19,986.65, and the reasonable value of its services under the terms of the contract was $2,500, making an aggregate sum of $22,486.65, of which $7,556.73 had been paid by defendant, leaving a balance of $14,929.92, in which plaintiff had included, however, $4,407.84 due from it to the Butler-Howell Company for labor and materials completed in accordance with their sub-contract and required by the drawings and specifications prepared by the architects of defendant and necessary for the completion of the work under the terms of the general contract. Plaintiff claimed the right to include this sum for the reasons stated in the succeeding paragraph.
"7. This mill work had been performed and the materials completed by the Butler-Howell Company before the destruction of the residence by fire, but had not been delivered or accepted and approved by the architects. It remained in the Butler-Howell Company's mill in fact, and it is plaintiff's claim that but for the delay caused by the decision of defendant to change the designs for the woodwork in the chapel would have been delivered to the premises before the fire. The materials in question consisted for the most part of panel work for the chapel hall and porch room; was made specially for the job and in accordance with the specifications and detailed drawings and because of its peculiar character, shape and design was unfitted for any other purpose and without value except for the particular addition and alteration shown in the drawings and specifications and required thereby. This mill work was contracted for under the terms of the agreement between plaintiff and the Butler-Howell Company for use in defendant's residence under the general contract, and its manufacture was necessary in order to enable plaintiff to carry out and fulfill such contract. Because of its special character it had to be ordered long in advance so that it could be prepared and ready in time to be installed when the work under the general contract had proceeded sufficiently to require it so that there might be no delay in the completion of the contract. This time had not arrived, however, at the time of the fire on March 15th, 1923, which defendant claims accounted for the fact that the materials remained undelivered in the mill of the Butler-Howell Company.
"8. After the fire and on June 26th, 1923, defendant paid to plaintiff $10,522.08 for work done and materials furnished and installed in the residence or incorporated in the alterations and additions under the general contract to the date of the fire, but refused to pay the said sum of $4,407.84 claimed by plaintiff for the mill and cabinet work and labor performed thereon by the Butler-Howell Company, which, as stated, remained in the latter's mill undelivered at the time of the fire; such materials being specifically excepted and the cost thereof being left to future adjustment and settlement either by amicable arrangement or through litigation should that be found necessary. The payment of $10,522.08 was made by defendant and received by plaintiff without prejudice to the rights of the parties concerned.
"Defendant refused to pay for the mill and cabinet work in question because it had not been delivered to his premises at the time of the fire, approved by his architect or accepted by him.
"9. Plaintiff became and was at the time of the fire indebted to the Butler-Howell Company for the said sum of $4,407.84, the cost to it of the mill and cabinet work in dispute, a large part of which sum it had paid at the time of the institution of this suit. It is admitted that plaintiff has been at all times since the fire and is now ready to deliver the materials to defendant, but the latter declined and still declines to receive and pay for them because of the destruction of the residence property, and for this reason has no use for them.
"10. Plaintiff brings this suit to recover the said sum representing the cost of the materials, alleging his right to recover even though they had not been delivered to defendant's premises, incorporated in the work or accepted prior to the fire, and for the further reason that they had been provided specially for the building operations under the general contract, have no market value of their peculiar character and design, in part, at least; that defendant's act in causing the designs to be changed caused delay, but for which the materials would have been delivered before the fire; and that, if not paid for, they will be a total loss.
"CONCLUSION."Plaintiff is not entitled to recover of defendant the sum in question. The materials had not been delivered and accepted by defendant or incorporated in the alterations and additions to his residence. The continued existence of the building to which the alterations and additions were to be made under the general contract was an implied condition of its performance and its destruction without fault of either party before completion of the contract released both from further liability, excepting that defendant was obliged to pay plaintiff for the work done and materials provided and delivered and accepted to the date of the fire. This he did. Considering the circumstances here presented, it is of no consequence that the materials in questions were in part peculiar in design and of special character to adapt them to the building operation contemplated by the general contract.
"RULINGS."(a) When a builder is to furnish the materials and labor for the performance of a contract requiring the erection of structures on the land of the owner, the materials generally remain the property of the former until they are affixed to the land or are delivered and accepted by the latter, and this rule is not altered by the fact that the materials are purchased by the builder with the intention of working them into such structures and that preliminary work has been done on them so as to fit them for annexation. 9 Corp. Jur. 732, ¶ 71; Johnson v. Hunt, 11 Wend. (N.Y.) 135.
"(b) Where under a contract for alterations and additions to an existing building performance depends on the continued existence of the structure, a condition is implied that impossibility of complete performance arising from its destruction without fault of the parties will absolve them from further liability, with the exception that the owner remains liable and the builder may recover for the value of the work done and materials delivered and accepted prior to such destruction. Perlee v. Jeffcott, 89 N.J.L. 34; Gouled v. Holwitz, 95 Id. 277; Scialli v. Correale, 97 Id. 165, 167; Boehm v. Rieder, 96 N.J. Eq. 167 , 173; 6 R.C.L. 981, 1005.
"(c) There is a distinction as to continuing liability under a building contract involving the erection of a new structure on land of the owner and that which relates to the making of additions and alterations to an existing building [the continuance of which is necessary to complete the contract] in the event of destruction without fault before completion. In the former case the builder remains liable for failure to complete, while in the latter both parties are relieved and the contract is at an end in that respect. Middlesex Water Co. v. Knappman-Whiting Co., 64 N.J.L. 240; Gouled v. Holwitz, supra; Scialli v. Correale, supra; Boehm v. Rieder, supra; 6 R.C.L. 980. ¶¶ 349, 350; School Trustees v. Bennett, 27 N.J.L. 513.
For the appellant, William C. Vandewater.
For the respondent, Beekman Schwed.
The judgment under review herein should be affirmed, for the reasons expressed in the opinion delivered by Judge Lawrence in the Circuit Court.
For affirmance — THE CHIEF JUSTICE, TRENCHARD, PARKER, MINTURN, KALISCH, BLACK, KATZENBACH, CAMPBELL, LLOYD, WHITE, VAN BUSKIRK, McGLENNON, KAYS. HETFIELD, DEAR, JJ. 15.
For reversal — None.