City of Chester v. National Surety Co.
City of Chester v. National Surety Co.
Opinion of the Court
The opinioni of the Court was deliv' ered; -by
Th'i-s action wa's brought on the bond given by defendant as -surety for the performance of a contract -made by 'the Greer Filter Manufacturing 'Company *18 with the plaintiff to install a filter plant in connection with the plaintiff’s system, of waterworks. The contract provides ■that the filter plant shall “'be built in strict accordance with the city engineer’s 'Specifications hereto attached * * * and according to all the conditions and guarantee's as set forth ini said specifications.” The specification® provide that the successful bidder “roust agree to complete the work within ■six weeks after the date when he ha® been notified by the city that the filter building is complete and the foundations are ready.” The bond provides that if the principal shall default in the performance of the contract according to its terms, or s'hail abandon the work, “the obligee shall immediately notify the company,” and thereafter the company, shall have the right to assume and sublet the contract. The contract and bond were executed in August, 1909. On March 1; 1910, 'the filter manufacturing company wrote the city engineer asking for some definite information as to when they could go to work, saying that it would take “about three weeks to complete the plant and get it ready to' run.” On March 3d, the city engineer replied, “we will he ready for you to start the filter installation on March 15th.” On March 17th, he telegraphed the manufacturing company: “Filter building ready. When can you1 start installation? Answer mail.” On March 18th, the company answered: “We will not be ready to start work at the city of Chester before April 1st. We have been: delayed so many times in the delivery of our material that we stopped all our orders-, until we had definite information that you would he ready for u®. -It will probably require another week for the material to all be assembled in -tíre stop®, and a week for delivery. We trust this will not inconvenience you whatever, and assure you that we will be on hand' at that time.” On March 21s't, the city- engineer wrote the company: “We note that you will commence' the installation of the filters1 on April 1st, and beg to advise that same will be satisfactory to us1.” 'On April 5th, the company wrote the city engineer *19 that it had discovered that it would be nearly May 1st before the material for the work could be gotten ready. On April 7th, the city engineer replied: “Filter plant must be completed according to contract, which is six weeks after notification that building- is ready. April 1st is date set by you, and agreed to by this city, as date of notification.” On April 13th, the company replied1: “We will endeavor to ship tine remainder of the material necessary to complete your work promptly, and will try to have the work completed by May loth.” On April 28'th, the company wrote that it would be between May 15th and June 1st before the material could be assembled at Chester, and' asked that 'the time for comple’tion of the contract be extended thirty days from June 1st. On April 30th, the mayor of Chester replied,' declining to grant the. extension, and saying that the city would expect the contract to be completed on May 15th. On the same day (April 30'tJb), thie city attorney notified defendant of the “impending default,” stating the facts, and that the city would look to defendant for the completion of the contract according to its terms, and hold defendant responsible for all damages resulting from the failure to so complete it. On May 14th, the city attorney gave defendant formal notice that the manufacturing company had' defaulted in the performance of the contract, that the time limit had expired, and the company bad done n'o work at all on the filter plant, and asked whether defendant intended to assume the contract and carry it out. After some further correspondence, both sides reserving their rights, the defendant declined 1» assume the contract. The Court directed a verdict for plaintiff for the damages proved, about which there was no dispute.
Appellant correctly states the issues' raised by the appeal as follows: “1. Whether the surety is discharged by extension of time of performance of the contract without its knowledge or consent; 2. Whether time was of the essence of the contract; -and if so, was there a waiver of same; 3. *20 Whether immediate notice was given to the surety of the default of the principal obligor, as provided in the contract; and, from these considerations-; 4. Whether the Circuit Judge erred -ini refusing -to grant a nonsuit and in directing a verdict, taking' from the jury the questions1 of fact involved.”
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Reference
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- 1. Contracts—Surety.—From the correspondence here the Court finds the obligee of the surety bond did not extend the time within which the contract was to have been completed-. 2. Ibid.—Time.—Whether time is of the essence of a contract is ordinarily determined -by the construction of .the contract according to the law applicable. Here it is held that time is of the essence of the contract, to the extent that the work should be completed in the time specified. 3. Ibid.—Ibid.—Waiver.—There was no evidence in this case tending to show waiver of the time limit in the contract. The -appearance of the time within which the contract should be completed in the specifications alone is sufficient, where the specifications are adopted as a part of the contract by its terms. 4. Ibid.-—-Surety.—The obligee of a surety bond is not required to notify the obligor of the default of its principal in performing a work -within the contract time until the expiration of the time for performance. 5. Verdict.—The Court should! direct a verdict where there is hut one reasonable inference to he drawn from the evidence.