Mayor of Baltimore v. Ault

Thomas, J., delivered the opinion of the Court. In June, 1910, the Mayor and City Council of Baltimore passed an ordinance for the widening of Pratt street from East Falls avenue to President street, the next street east, by establishing the southern building line of Pratt street about seventy feet further south. East Falls avenue runs along the east side of Jones’ Falls, and was from thirty to thirty-four feet wide. Pratt street, which was a much used thoroughfare about sixty-five feet wide, crossed the Falls by a bridge on which there were two tracks of the United Kailways and one track of the B. & O. Kailroad.

The space between East Falls avenue and President street, which.was to be acquired by the City and included in the bed of Pratt street, was covered by buildings occupied by William G. Scarlett and others, and on the opposite or west side of the Falls the City had constructed a pier known as Pier ’6, which extended from Pratt street into the harbor. The proposed improvement involved the acquisition by the City of the strip of land referred to to be added to the bed of Pratt street east of the Falls; the removal of the buildings thereon; ihe erection of a new steel and concrete bridge, about one hundred and twenty-eight feet wide, over the Falls; the removal of the old bridge and two large gas mains which spanned the Falls just south of the old bridge; the paving of the new portion of Pratt street, and the repaving or paving of the approaches to the new bridge, etc. After the ordinance was passed the Commissioners for Opening Streets, as required by the Baltimore City Code, published a notice that ⁴¹⁴ they would meet to assess damages and benefits for the widening of Pratt street, and that tbeir first meeting would be held on August 1st, 1910. Bids for the work of constructing the new bridge, removing the old bridge, paving and repaving, etc., were received until August 17th, 1910, and on the 31st of August, 1910, the contract for the work was awarded by the Board of Awards to the appellees, David V. Ault and Martin J. Beach, co-partners trading as D. Y. Ault & Co., who on the 7th of September, 1910, entered into a contract with the City to furnish the labor and materials, etc., and to do the work in accordance with the specifications thereto attached and made a part thereof, at and for the rates and prices in the schedule attached to the contract, and to complete the “whole contract * * * within 150 working days after August 31, 1910.” Persons proposing to bid for the work were notified that the specifications and plans for the work could be obtained at the Harbor Engineer’s office, and the specifications required bidders to make a “personal •examination of the plans, the site and surroundings thereof, and of the nature and character of the work required.” The specifications also contained the following provisions: “Disputes and Litigation—To prevent disputes and litigations, the Harbor Engineer shall in all cases determine the amount, quality and acceptability of the work which is to be paid for under the contract; shall determine all questions in relation to said work, and the performance thereof, and shall in all cases decide every question which may arise relative to the fulfillment of the contract on the part of the contractor. His estimate and decision shall be final and conclusive, and in case any questions shall arise between the parties touching the contract, such estimate and decision shall be a condition precedent to the right of the ■contractor to receive any monies under the contract. “Time Required—Bidders must state the number of consecutive working days required to complete the work.

A working day shall consist of eight hours of each and every day except Sundays and holidays as ⁴¹⁵ set aside by the National Government, the Governor of Maryland, or the Mayor of Baltimore. If it is raining too hard at 8 A. M., in the judgment of the Engineer, to permit work, such day shall not constitute a working day. In computing the lapsed number of working days, no allowance for bad weather or other delays not covered by the preceding'clause, will be made unless claim for exemption has been made within 48 hours of the time the delay occurs. The Contractor must begin the work within 15 days after notice to do so, and must complete the work within the time specified.

Should the Contractor fail to complete the work within the time specified, he shall forfeit to the City as liquidated damages, and not as a penalty, the sum of $25.00 for each, and every day which may elapse between the limiting date and the completion of the work. “Payments—Monthly estimates will be made on 80 per cent, of the work done, and 40 days after the completion and acceptance of the work by the Engineer all sums then remaining due will be paid to the Contractor. Payments may at any time be withheld if the work is not proceeding in accordance with the contract, or if, in the judgment of the Engineer, the Contractor is not complying with the requirements of the contract and specifications. Whenever, in the opinion of the Engineer, the Contractor shall have completely performed the contract on his part, the Engineer shall so certify in writing to the Harbor Board, and in his certificate shall state, from actual measurements, the whole amount of the work done by the Contractor and also the value of such work under and according to the terms of the contract. On the expiration of 40 days after the completion of the work herein to be done by the Contractor, and the filing by the Contractor in the office of the Comptroller of a certificate of the completion and acceptance of the work, made by the Engineer and the Harbor Board, the City shall pay to the Contractor the amount or value stated in the above-mentioned certificate, after ⁴¹⁶ deducting therefrom all such sums as shall theretofore have been paid to the Contractor under any of the provisions of this contract, and also all sums of money which by the terms hereof the City is or may be authorized to reserve or retain, * * * All monthly estimates upon which partial payments have been made, being merely estimates, shall be subject to correction at any time without notice to the Contractor. “General Method of Procedure—The bridge will probably have to be constructed in three sections.

The first section will extend from the south end up to the gas mains of the Consolidated Gas Company. When the first two or three ribs aré completed, with the necessary beams, etc., the Gas Company will change their mains over to this new portion and remove the old mains, and the Contractor will remove the south sidewalk of the present bridge, or perhaps the entire south half of it, after which another section of the new bridge may be completed. This latter section will include at least two of the ribs designed to carry the railway tracks, and upon its completion the railway tracks will be laid thereon and permanent or temporary paving will be laid on the completed portion of the bridge. Traffic will then be turned on this part of the new bridge, when the rest of the old bridge may be removed and the new one completed. * * * There are a number of pipes, conduits, etc., within the lines of the excavation which will be abandoned or removed by the City, as the work progresses.

All abandoned conduits, pipes, etc., shall be removed by the Contractor, as excavation. “Special Items to he Included in Unit Prices Pro vided—The Contractor will be furnished with a pipe to carry a 24-ineh sewer through the east abutment, and with other pipes, etc., that may be required for openings through the new work, but the labor of placing and caring for these openings must be borne by the Contractor without expense to the City. * * * Attention is called to the location of the 76-ineh interceptor sewer adjacent to the bridge. The new abutments ⁴¹⁷ will be built up against tbe walls of this sewer, but excavation will not extend under tbe sewer foundations, etc. “Suspending Work—Tbe Harbor Board reserves tbe right to suspend tbe whole or any part of tbe work to be done hereunder, if it shall deem it for the interest of tbe City to do so* without compensation to tbe Contractor for such suspension, other than extending tbe time for completing tbe work as much as it may have been delayed by such suspension.” Tbe work under the contract was, according to the testimony of Mr. Ault, begun between the 10th and 15th of September, 1910, and was not completed until the 15th or 20th of April, 1913. In the meantime monthly estimates and certificates of the work-and material and the value of same were made by the Harbor Engineer, and Ault & Co. were paid the amounts shown to be due, less the “percentage’7 retained under the terms of the contract and specifications. In April, 1913, Ault & Co. received from the Harbor Engineer an estimate designated “Estimate No. 29,” showing that tbe value of the work done and material furnished by them from March 15 to April 15 was $5,070.13; that the total value of work and material to date was $98,356.70; that tbe amount previously paid was $74,629.28; that tbe amount due under that estimate, after deducting the 20 per cent., was $4,056.10; that the total percentage retained was $19,671.32, and, as appears from the estimate and certificate offered in evidence, that the $4,056.10, due under that estimate, was paid to'them April 29th, 1913.

The work and material referred to in that certificate included all the work done and material furnished by Ault & Co. under the contract, and to the amount there shown to have been paid them there should be added $1,833.60 paid by the City “on account of piling” and $100.00 which Ault & Co. agreed to pay for the old bridge.' On the 12th of April, 1913, the Mayor of Baltimore wrote the Harbor Engineer that there would be no waiver of penalties chargeable under the con ⁴¹⁸ tract until the question had been passed upon by the Board of Awards, and requesting the Engineer to let him know the status of Ault & Company’s account before any further payments were made, and the Harbor Engineer notified Ault & Co., by letter of April 15th, 1913, that he had been directed to withhold further payments until matters pertaining to the delay in the construction of the bridge had been presented to the Board of Awards. On June 12th, 1913, the Harbor Engineer wrote to Ault & Co. enclosing them “a final statement for work done” under the contract, in which he deducted from the total value of the work and material shown by “Estimate No. 29” $12,400.00 Jjor a delay in the completion of the work of 496 working days, at $25.00 per day, and later the Board of Estimates wrote Ault & Co., offering to pay them the balance due them after deducting $12,050.00 for 482 working days’ delay and certain claims against them. Ault & Co. refused to accept the amount so offered, and in March,. 1914, brought this suit in the Superior Court of Baltimore City against the City to recover $17,837.72, balance due for work done, etc., under the contract; $1,277.15 for extra work, and $19,382.34 as damages resulting from delays in the work caused by the City, less $100.00, the purchase price of the old bridge. This appeal is by the City from the judgment recovered' against it for $17,310.46.

The record contains nearly one thousand pages of testimony and twenty-one exceptions to the rulings of the lower Court on the evidence and prayers. The evidence offered in support of the plaintiffs’ claim for damages was excluded by the Court below and is not in the record, and the’ lower Court having instructed the jury that the plaintiffs were not entitled to recover the amounts claimed by them for extra work and materials, we are only concerned on this appeal1 with the claim of the City to' liquidated damages for the failure of the plaintiffs to complete the work within the time limited in the contract. As in our view of the case the judgment will have to be reversed and the case remanded for a new trial, we will ⁴¹⁹ refrain from referring to or discussing the evidence further than is necessary in order to pass upon the questions raised by the exceptions, the most important of which are presented by the prayers. The work done by the plaintiffs consisted mainly of constructing the new bridge, removing the old bridge, paving the addition to the bed of Pratt street, and paving or repaving the approaches to the new bridge.

In order not to stop the travel on Pratt street, the specifications provided that the new bridge would have to be constructed in three sections. The evidence adduced by the plaintiffs is to the effect that when they began the work in the fall of 1910, and undertook to erect a derrick on East Falls avenue to be used in excavating for the foundation of the east abutment of the first section of the bridge, they were prevented from doing so by Mr. Scarlett, who occupied the building on a part of the land that was to be acquired by the City for the widening of Pratt street, and who, claiming that it would interfere with the use of the side entrances of the building in receiving and shipping produce, threatened to apply for an injunction against them. Mr. Ault reported the matter to the Harbor Engineer, who said that he would see the Commissioners for Opening Streets about it and let him know. The title to the land to be included in the bed of Pratt street was obtained by the City during the spring and summer of 1911, and the Scarlett building and other buildings were not removed until about the first of December, 1911.

In the meantime the plaintiffs completed The first section of the bridge, which was fifty-five feet wide, but Mr. Ault stated that owing to the fact that the proximity of the building did not leave them sufficient room for the full use of their appliances, and they did not have the use of the land covered by the buildings as a place to deposit the “excavation,” it took them five times as long to do the work as it would have taken if the building had been out of their way, and that the plaintiffs claim that the 150 working days in which they contracted to do the work should therefore be “accounted ⁴²⁰ from” the first of December, 1911, when the buildings were remoyed. Other evidence was offered by the plaintiffs that their work was further delayed by the moving’ of gas mains, etc., by the Gas Company; by the transfer of the tracks from the old bridge to the new bridge by the Railways .and Railroad Companies; by work done by the Electric Commission, Sewerage Commission and Water Board, and that they were also delayed because the Gas Company, which, by reason of the fact that the Scarlett and other buildings were not removed from the land referred to, had to extend its mains down East Falls avenue in order to connect with its mains on President street, instead of following the bed of Pratt street. The claim of the plaintiffs is that the time lost by the delays referred to, when added to the number of Sundays, holidays and rainy days on which they could not work, accounts for their failure to complete the work within the 150 days allowed by the contract. They also offered evidence for the purpose of showing that the statement or estimate of the Harbor Engineer of the number of days delay for which they were responsible, and for which they weré liable, under the terms of the contract, to be charged $25.00 per day as liquidated damages, was not his decision, but that his judgment in the matter was influenced and controlled by the conduct and views of the Mayor and other City officials.

This evidence will be more particularly referred to when we come to consider the prayers. The defendant offered evidence tending to show that in the summer of 1910 the plaintiffs were paving Pier 6, which is on the west side of the Falls and opposite the Scarlett building, under a contract with the City, and that at the time the ordinance for the widening of Pratt street was being passed and they were bidding for the contract for the construction of the new bridge, and at the time the contract was awarded to them, they knew that the City had just begun proceedings for the acquisition of the Scarlett and other properties to be included in the proposed addition to Pratt street east of the Falls; that the Scarlett building did not prevent the build ⁴²¹ ing of the bridge, the first section of which was completed before the building was removed, and did not delay the work; that the east abutment of the first section of the bridge, which was about thirty feet from the building, was built in a shorter time than the west abutment of that section, where there were no buildings to interfere with the work; that the only use the plaintiffs could have made of the land covered by the Scarlett building and the other buildings was as a place to store their materials, and that the City had at the beginning of. the work given them permission to- use Pier 6, the area of which was greater than the space occupied by those buildings. The testimony of the Harbor Engineer, the inspectors on the work, the timekeeper of the Harbor Board, who kept the record of the number of men at work on the bridge, etc., and other witnesses for the defendant, was to the effect that the work done by the Railroad and Railways Companies, the Sewerage Commission, Water Board, Electric Commission and Gas Company did not cause the delays testified to by Mr. Ault; that the plaintiff did not commence the work until October, 1930, and did not complete it until May 9th, 1913, and that the real causes of the delay in the completion of the bridge were the failure of the plaintiffs to employ sufficient force and equipment and the lack of competent direction and supervision of the work. Repeated complaints were made to the Mayor and Harbor Engineer about the delay in the construction of the bridge, and the plaintiffs were advised of these complaints.

In September, 1912, the City authorities threatened to “annul” the contract, and Mr. Ault appeared before the Board of Estimates and promised that if he was allowed to finish the work he would put on an extra force and complete it by the following November. According to a strict interpretation of the specifications the bridge was not completed until the 9th of May, 1913, but as the “traffic had used the bridge on April 5th, 1913,” the plaintiffs were allowed the twenty-four days between the 5th of April and the 9th of May, 1913. Between the 31st of August, 1910, and the 9th of May, 1913, ⁴²² there were thirty-two holidays, one hundred and thirty-nine Sundays and one hundred and eight rainy days, and after deducting the number of holidays, Sundays, rainy days, the 150 days in which he was allowed to do the work, the 24 days between April 5th and May 9th, 1913, and 46 days for such other delays as the plaintiffs were entitled to claim credit for, there remained a delay of 482 working days for which the plaintiffs were responsible. The defendant also offered evidence for the purpose of showing that the Harbor Engineer, in determining the number of days for which the plaintiffs were entitled to credit, relied upon his personal knowledge of the manner in which the work was performed and the records kept during the progress of the work, and that he was not influenced or embarrassed in his decision by the conduct or views of other City officials.

At the conclusion of the testimony the plaintiffs offered eleven prayers and the defendant seven. The Court below rejected all of the plaintiffs’ prayers except the ninth and all of the defendant’s except its seventh, and granted an instruction of its own. The correctness of this ruling is challenged in the twenty-first exception. The Reporter is requested to set out, the plaintiffs’ ninth prayer, the defendant’s rejected prayers and the Court’s instruction in his report of the case.

The general rules and principles by which we are to be governed, in disposing of the questions thus presented are fully recognized in the decisions of this Court. In the case of Geiger v. The Western Md. R. R. Co., 41 Md. 4 , the contractor undertook to complete a certain division of the appellee’s railroad within eight months. The work was begun in June, 1871, but owing to the financial embarassment of the railroad company and its difficulty in securing the right of way, it was in a measure suspended and was not actively resumed until April, 1872. The contract provided that in case it should appear to the chief engineer that the work did not progress with sufficient speed he might annul the contract.

The work not having progressed as rapidly as the engineer thought it ought to have done, the contract ⁴²³ was annulled, and in disposing of the question of the right of the engineer to do so after the work had been resumed under the circumstances stated, the Court said: “There is no proof to show that the contractors were hindered or in any manner delayed in the progress of the work, by the company, after it was resumed in April, 1872. * * * Whatever may have been the delay in the progress of the work in 1871, resulting from the failure of the appellee to acquire the right of way, or whatever inconvenience and loss the contractors may have sustained by the non-payment of the monthly estimates, these facts in no manner affected or impaired the right of the engineer to annul the contract for the failure to prosecute the work with proper speed after it was begun in April, 1872. Owing to financial embarrassments of the appellee, the work was in a measure suspended in the latter part of 1871, and when by the aid of city’s subscription, it was enabled to resume the construction in 1872, the work was to be prosecuted according to the terms of the contract.” In the case of United Surety Co. v. Summers, 110 Md. 95 , the suit was on the contractor’s bond for breaches of the contract which contained a provision that the work was to be completed in seventy working days, and that the contractor should pay fifty dollars per day for each day the completion of the work was delayed beyond that time. There were cross-appeals, and one of the exceptions of the plaintiff was to the refusal of the lower Court to grant his second prayer, which was as follows: “Upon the prayer of the plaintiff the Court instructs the jury that if they shall find from the evidence that the said work was not completely finished within seventy working days, accounting from the day of the commencement thereof and adding to said seventy working days all working days during which the jury shall find from the evidence said work was delayed by the architects and builders of the plaintiff, then the plaintiff is also entitled to recover from the defendant by way of additional damages the sum of fifty dollars for every day in excess of said seventy working days occupied by said Lawrence and ⁴²⁴ the defendant upon said work, and said additional -days during which the jury shall find said work was delayed by the architects and builders of the plaintiff down to the time when they shall find the plaintiff took possession of said building.” This Court, after holding that the provision in the contract in regard to fifty dollars per day was a stipulation for liquidated damages, said that the plaintiff’s second prayer should have been granted. The same principle was followed in the case of Pittsburg Iron Co. v. Nat.

Tube Co., 184 Pa. 251 , 39 Atl. 76 . In the case at har the contract provided that the bridge was to be completed within 150 working days, and, according to the rule stated, the fact that the work was unnecessarily or unreasonably delayed by the City or its agents, or by the Railways Company, Railroad Company or Gras Company, would not deprive the City of the benefit of that provision or the stipulation in regard to liquicfated damages, but the contractors would be entitled to credit for such delays in arriving at the number of working days the work was extended beyond the 150 days’ period. It is said in 6 Cyc. 40: “Where the building contract expressly provides that a certificate, estimate, determination, or decision of an architect, engineer, or some third person shall be final and conclusive, it is a well settled rule that such certificate, estimate, determination, or decision is conclusive and binding in its legal operation and effect upon the owner, the builder, and the other parties, if any, to the contract, including those guaranteeing its faithful performance, * * * provided the decision concerns matters within the scope of the submission to him, and also provided the decision, determination, estimate, or certificate is made by such architect, engineer, or third person in the exercise of an honest judgment.” In the case of the Annapolis and Baltimore Short Line Co. v. Ross, 68 Md. 310 , Judge Robinson, speaking for the Court, said: “That alterations were made and that the cost of constructing the bridges was thereby largely increased is not denied; and the real question is whether the alterations were such as the defendant had the right under ⁴²⁵ the contract to make. If they were, then in the absence of bad faith or fraud on the part of the