Vulcan Iron Works v. Cook

KERRIGAN, J.

This is an appeal from a judgment in favor of the plaintiff and against the defendant for goods sold and delivered.

The action arose out of a contract entered into by the parties, whereby the plaintiff agreed to furnish and erect all the cast-iron columns and bases and steel beam girders for the interior and other parts of a six-story and basement brick building to be erected by the defendant on his property at the corner of Minna and Second streets in San Francisco.

Paragraph V of the contract provides that the defendant was to pay the plaintiff $75 per ton for the cast-iron, and $85 for the steel “at times and in the manner following, to wit, ninety per cent (90%) of the work at delivery and the balance thirty-five days after the entire completion of the work. Provided that when each payment or installment shall become due, and at the final completion of the work certificates in writing shall be obtained from said architect, stating that the payment or installment is due or work completed, as the case may be, and the amount then due; . . .”

Materials were delivered and set in place, according to the terms of the contract, for a period of three months and until two stories of the building were completed, when a dispute arose between the parties. At the expiration of the first month’s work the estimate of plaintiff as to the amount due it from the defendant was approved by the architect and paid by the defendant. The second month’s work was also approved and paid except for $207.64 of the amount claimed, and this arose from an error of the architect in withholding

[412]

fifteen per cent instead of ten per cent of the contract price of the material furnished. Subsequently a certificate was issued by the architect rectifying this error and also for the third month’s work. Defendant failed to pay plaintiff either of these sums; and it is not seriously disputed, and could not be, that this is the reason plaintiff refused to proceed with the work.

The only real point urged in the case is as to when payments were due. Defendant in effect concedes that if payments were to be made as the work progressed, the usual custom in San Francisco is that they should be made monthly; but he contends that under the terms of the contract in this case the plaintiff was not entitled to receive any payment until all the materials provided for in the contract were delivered. In support of this contention defendant argues that the words of the contract above quoted, “ninety per cent (90%) of the work at delivery,” mean that all of the materials were to be furnished before the plaintiff was entitled to ninety per cent of the amount due or to any payment. But we think, when the whole of paragraph V is read, that it is clear that the contract contemplated installments as the work progressed, the period of such installments to be left probably to the general custom. Indeed, the defendant himself testified that the ninety per cent clause was stipulated instead of the usual seventy-five per cent clause, in order to enable the plaintiff to finish the contract on time. However, any possible doubt or ambiguity in the contract as to when payments were due was settled by the contemporaneous acts and conduct of the parties, for the usual custom was followed, and during several months certificates were issued by the architect and payments made by the defendant.