Opinion
October 22, 1924.
APPEAL from the District Court of the Eighth Judicial District, for Kootenai County. Hon. John M. Flynn, Judge.
Action on contract. From judgment for plaintiff, defendants appeal. Reversed and remanded.
W.B. McFarland, for Appellants.
"For plaintiff's failure to finish its contract defendant can offset the amount he paid another to complete it, this being a reasonable amount, though this price was agreed on only after such person threatened to abandon his first contract as a losing proposition." ( Smith Sand Gravel Co. v. Corbin, 102 Wn. 306, 173 P. 16; 9 C. J. 812, 815.)
Cameron McEachern and Robt. H. Elder, for Respondent.
"Though one's failure to fully perform the contract for his services is inexcusable, he may recover the reasonable value of services rendered, less any damage to the employer on account of the breach." ( Stolle v. Stuart, 21 S.D. 643, 114 N.W. 1007; Huber v. Blackwell Lumber Co., 27 Idaho 373, 148 P. 903; Saunders v. Short, 86 Fed. 225, 30 C.C.A. 462; McDonough v. Evans Marble Co., 112 Fed. 634, 50 C.C.A. 403; Goodwin v. Merrill, 13 Wis. 658; Gomer v. McPhee, 2 Colo. App. 287, 31 Pac. 119; Gill v. Johnstown Lumber Co., 151 Pa. 534, 25 Atl. 120; Williston on Contracts, sec. 1363.)
This action is for a sum alleged to be due upon a contract between Lee Paus, copartners, and Fiorito Brothers, also copartners, who had taken a contract to construct a part of a highway in Idaho between Coeur D'Alene and the Washington state line and had employed Lee Paus to haul the sand and gravel required for this work at an agreed price of sixty cents per cubic yard for deliveries from what was known as Kennedy's pit, and if sand and gravel was obtained from a different place appellants agreed to pay a flat price of thirty-five cents per cubic yard based upon a two-mile haul. The contract required Lee Paus to give a surety bond in the sum of $10,000 for the performance of their part of the agreement, and they assigned to respondent all sums due or to become due them under the contract, and their assignee brings this action to recover $3,094.80 alleged to be due for the delivery of 5,158 yards of sand and gravel on the basis of sixty cents per yard. Appellants answered and denied that there was anything due respondent and alleged that Lee Paus, his assignors, had defaulted in the performance of their contract and abandoned the same; that by reason thereof appellants were compelled to procure other persons to complete the contract, and in so doing were required to pay a greater amount than they would have been required to pay Lee Paus had they delivered the yardage necessary to complete the pavement, which their contract required them to do. The cause was tried to the court with a jury, which returned a verdict for respondent in the sum of $3,094.20. From the judgment on the verdict this appeal is taken.
We think a proper construction of the contract required Lee Paus to haul the entire amount of sand and gravel required to complete the work undertaken by appellants.
The undisputed evidence shows that for the completion of the work undertaken by appellants in constructing this highway there was hauled 34,741 cubic yards of sand and gravel. Of this Lee Paus delivered or caused to be delivered the first 5,157 yards before they abandoned the work, and thereafter appellants contracted with the Cascade Investment Company to haul the remaining amount of sand and gravel required, which was 29,584 yards, and were required to pay, or did pay, this latter company on a basis of ninety cents per cubic yard. Respondent contends that this price was in excess of the reasonable value of the work, but this question was submitted to the jury under proper instructions.
The court in effect instructed the jury that defendants were entitled to offset against any amount that might be due Lee Paus for their work in hauling sand and gravel any amount paid by defendants for labor or material bills incurred by Lee Paus and any sum paid for hauling sand and gravel in the construction of said highway in excess of the amount they were to receive for said hauling, provided the sum paid for finishing the hauling was under the circumstances reasonable, which is a correct statement of the law applicable to the facts of this case, and although the verdict is a general verdict for the exact amount that would have been due Lee Paus for the actual yardage they caused to be delivered upon their contract had there been no offsets, there is no reason to suppose the jury did not find the additional amount which appellants were required to pay the Cascade Investment Company to complete the Lee Paus contract a reasonable price for doing this work in accordance with the instructions of the court.
The evidence shows that the Cascade Investment Company hauled 29,584 yards at an agreed price of ninety cents per yard, making $26,625.60 which appellants were required to pay in order to complete the hauling of the total yardage needed. It is also shown that appellants paid Materne Brothers, who had worked for Lee Paus before they abandoned their contract, $4,000, for work which they had done in hauling the yardage credited to Lee Paus. This amount exceeds the contract price of sixty cents per yard which Lee Paus were to receive under their contract, but may be accounted for by the fact that the hauling done by Materne Brothers for Lee Paus was upon a mileage basis and greatly in excess of the average mileage haul for the entire yardage Lee Paus were required to deliver. It also appears that appellants paid other truck drivers in the employment of Lee Paus while they were engaged on their contract, $1,630.50, and also $650 for gasoline purchased on account of Lee Paus, all of which expenditures were incurred in the delivery of the yardage on account of Lee Paus, for which respondent seeks to recover in this action. These three items make a total of $6,280.50 paid by appellants on account of the hauling done by Lee Paus, which appellants were required to pay in order to protect themselves against labor and materialmen's claims for which the contractors were liable, under the laws of this state. If to the total of the above items there is added the excess which appellants paid to the Cascade Investment Company to complete the contract of Lee Paus after they had abandoned the same, over and above the sum that would have been due Lee Pans, it makes a total of $12,320.70 that appellants were required to pay by reason of Lee Paus not having completed their contract according to its terms, against which Lee Paus are entitled to the credit of $10,000 by reason of the payment on account of their guaranty bond, leaving a net excess paid by appellants on account of Lee Paus not having performed their contract according to its terms, of $2,320.70. That is to say, had Lee Paus completed their contract for the delivery of the yardage that the Cascade Investment Company hauled they would have been entitled to receive $20,585.40, on the basis of sixty cents per cubic yard for 23,284 yards hauled from the Kennedy pits and $1.05 per cubic yard for 6,300 yards which the evidence shows was hauled from the Callis pit, the contract providing that if sand and gravel were obtained from any other source than the Kennedy pit appellants would pay a flat price of thirty-five cents per cubic yard based on a two mile haul. The average haul from the Callis pit was shown to be six miles, thus making $1.05 a yard for sand and gravel hauled from such point to place of delivery. The best terms upon which appellants could procure this work to be completed was ninety cents per cubic yard, or $26,625.60 for the hauling of the required amount of 29,584 yards to complete the paving. It is apparent that when Lee Paus abandoned their contract, if they left unpaid for labor employed by them and material used for the yardage which they delivered, the cost of such labor and material when paid by appellants was properly offset against the amount due Lee Paus for the hauling of 5,157 cubic yards which they caused to be delivered upon their contract before they abandoned the same.
In its seventh instruction the court instructed the jury that there was no evidence to support the claim of appellants that they had paid Materne Brothers $4,000 on account of work performed for Lee Paus in said hauling and that they should disallow this item to appellants. In this we think the court was in error. There is very substantial evidence to support appellants' claim of this payment; one of the Materne Brothers testified positively to this fact, in which testimony he is corroborated by Lee, one of the contractors for whom the work was performed, and also by one of the Fiorito brothers who testified that this amount was paid, and there being no evidence contrary to the testimony of these three witnesses, the instruction that the jury should disallow this claim was error.
With regard to the items aggregating $3,708.10, claimed by appellants to have been paid on account of yardage hauled independently of that delivered either by Lee Paus or the Cascade Investment Company, it is clear that these items cannot be allowed, because the entire yardage hauled is accounted for by the amount delivered by Lee Paus prior to the abandonment of their contract and the yardage subsequently delivered by the Cascade Investment Company to complete the same. Hence it must follow that this sum was not paid for the hauling of sand and gravel on this contract, and the court properly instructed the jury to disregard it.
It is apparent from the foregoing consideration of these various items of account that the jury in arriving at their verdict omitted to take into account the $2,320.70 paid by appellants in excess of what they would have been required to pay Lee Paus had the original contract for hauling this material been carried out according to its terms.
For the reasons herein stated the cause is reversed, with directions to set aside the judgment and award a new trial, appellants to recover costs of this appeal.
McCarthy, C.J., and McNaughton, District Judge, concur.