Page images

App. Div.]


timbers must be used, the ditch was necessarily enlarged two feet. This, of course, required additional excavation and an additional amount of concrete with which the plaintiffs were required to fill up the ditch to a point above the line of the pipe as laid. Claim for this extra excavation and extra concrete was disallowed by the engineer on the ground that the contract required that the trench shonld be six feet wide and all excavation should be made in accordance with the lines and grades given by the engineer, and the engineer states that “the contract is perfectly clear and leaves me no option in computing the quantities.” By section 89 of the contract the contractor agreed to “perform all the work contracted for as specified in this contract, but any alteration in the form, dimensions, location or manner of doing the work ordered in writing by the engineer shall be made as directed, and when the several quantities of work or any of them, from this or any other cause that may enhance the cost of the work, shall be increased beyond the amount or amounts exhibited at the time of letting this contract, such increase shall be paid for at the rates herein provided for the same class of work

After abont 2,200 feet of this ditch had been dug, the engineer in writing ordered the ditch thereafter to be sheathed. Because the ditch could not be sheathed without the increased width claimed to have been made by the contractor, the direction to the contractor to increase the width of the trench, so far as might be necessary to place that sheathing, was necessarily implied in the order for the sheathing. This was increased work made necessary by an alteration directed by the order of the engineer in writing, and within the explicit terms of the contract the contractor was entitled to extra compensation therefor, as well as for the extra concrete which he was reqnired to place therein by reason of the increased width of the ditch. It is cer tainly just that the city should pay for the work actually done at the rate stipulated. It is claimed by some that iron supports might have been put in against the sheathing and thus a part of the extra excavation have been prevented. But upon the proof the method adopted was the ordinary method of sheathing. Just how much extra excavation or extra concrete was required by reason of the alteration made by this order of the engineer we are unable to determine. That must remain a question of fact to be determined

THIRD DEPARTMENT, SEPTEMBER TERM, 1903. (Vol. 86. upon the proofs by the trial court, subject to modification if determined against a preponderance of evidence.

In the plaintiffs' claim for extra excavation is included a claim for excavation of a foot and one-tenth greater than is specified in the contract. This is claimed, in the first place, to have been necessary by reason of the nature of the soil in the bottom of the canal; that there was there accumulated some soft material which is called silt, which was in fact excavated, but that the engineer required the excavation of the full amount as called for by the contract below the hard bottom of the canal, not including this so-called silt, which was a part of the surface and which had to be excavated. This claim, extra excavation for extra depth, seems, however, to be made for excavating the entire length of the conduit, which included excavation in Montgomery street and where this silt could not have accumulated. For this excavation the referee seems to have allowed a substantial sum in the recovery.

I am unable to see under what clause of the contract this can be allowed. There is a material dispute as to whether the pipe was laid at all below the level named in the contract. Upon this question of fact it is possible that the finding of the referee would be conclusive. Under the contract, however, the plaintiffs were not authorized to vary from the terms thereof except upon the written order of the engineer. This provision in the contract was undoubtedly inserted in part to meet just such contingencies. The plaintiffs were not bound to dig the ditch one inch deeper than called for by the contract except upon the written order of the engineer. The contract was itself notice to the plaintiffs that the engineer could only alter the provisions thereof or the specifications under which the conduit was placed by a written order. In the absence of such a written order, we are unable to discover any legal justification for the allowance of the plaintiffs' claim in this respect. Just how much was included in the allowance made by the referee for extra depth of this ditch does not appear. There is no basis from which we can correct the error by deducting from the judgment any specific amount and affirm it as modified.

By paragraph 104 of the contract it is stipulated that no extra work shall be allowed or paid for except such work be done upon the written order of the engineer, countersigned by the superin

App. Div.]


tendent, and that no claim for extra work shall be made except under these conditions. It is further provided by paragraph 105 that the contractor shall, before the fifteenth day of the month succeeding that in which any extra work is done or material furnished, file with the engineer and with the board a claim for such damage or extra work or materials with the order or a copy thereof on which such work or materials were furnished. It is further provided, "in case the contractor fails to file such claim for such extra work done or materials furnished, he shall have no claim for compensation for the same against said board.” It is conceded that no claim for extra compensation was filed for any extra work done before the fifteenth day of the month succeeding that in which the work was done. It is difficult to see how, in the absence of such action on the part of the plaintiffs, their claim therefor can now be allowed under the contract. It is possible that for such extra work as the engineer has specifically allowed, the city may be deemed to have waived this provision of the contract. Inasmnch, however, as there must be a new trial, we will not further discuss the merits of the various claims for extra work which seem to have been allowed by the referee. Upon such new trial the defendant may ask for such specific findings upon the several claims of the plaintiffs, so that upon appeal, if one should be necessary, the question may be directly presented as to what claims for extra work have been allowed and as to the grounds upon which their allowance has been made.

By paragraph 16 of the referee's report there was included in this judgment the sum of $1,620.28 for recleaning and repainting a part of this pipe, made necessary by reason of a freshet in the Hudson river by which a bulkhead erected by the plaintiffs was removed and muddy water was forced into this conduit. Thereafter the plaintiffs were directed to reclean and repaint the conduit, for which it is found that the reasonable compensation is the sum named. By section 54 of the contract the plaintiffs were required to keep the excavation clear from water from whatever source while the pipe was being laid and surrounded by concrete, and until all danger of dam-. age from water was passed; and by paragraph 107 of the contract the contractor was held responsible for all materials or work and was required to make good, at his own cost, “any injury or damage which said materials or work may sustain from any sources or cause


[Vol. 86.

whatever before final acceptance thereof." Under the provisions of the contract cited, the damage caused by the freshet, although without fault on the part of the plaintiffs, was such damage as the plaintiffs undertook to prevent, and to repair which they have agreed, at their own expense. The labor performed in such repairs, therefore, cannot be made the basis of any claims against the city.

By section 55 of the contract the contractor was required to fur. nish and put in place suitable sheathing wherever necessary to support the sides of the excavation. These supports were required to be removed as the work progressed in such a manner as to prevent the caving in of the sides, and the voids left by their removal were to be filled in by ramming in fine material that was specially adapted to the purpose. “In places, however, where the engineer is of the opinion that the sheeting cannot be removed without injury to the work, he shall give written directions that it shall be left in place, and the contractor shall be paid for the lumber thus ordered left at the rate named in Item 12, namely, ten dollars ($10) per thousand feet, B. M., but no allowance shall be made for loss or waste." By a letter dated July 12, 1898, the resident engineer directed certain sheathing to be left in the trench. For the sheathing thus left in, the engineer himself allowed $2,210. The referee, however, has gone further than this, and has made an allowance for much more sheathing than was left in the trench by the order of the engineer. For such allowance we are unable to find any justification in the contract.

While we have pointed out certain items which we think were improperly allowed by the referee, we do not desire to be understood as assenting to the correctness of the allowance of other items not criticised. Upon a new trial, which seems to be necessary, there can perhaps be made more clearly to appear the exact elements of damage claimed and allowed.

For the reasons specified, we must direct a reversal of the judgment entered upon the law and facts, the discharge of the referee, and a new trial of the issues.

[ocr errors]

All concurred.

Judgment reversed upon the law and facts, referee discharged, and new trial granted, with costs to appellant to abide event.

App. Div.]



CABLE COMPANY, Relator, v. WILLIAM J. MORGAN, as Comptroller of the State of New York, Respondent.

Taxation of a corporation paying more than six per cent dividends basis of the

a88888ment money invested in stocks and bonds of other corporations, when it is and when it is not capital employed within the State of New York capital in ercess of the capital stock.

Under section 182 of the Tax Law (Laws of 1896, chap. 908), which provides that

a corporation paying more than six per cent dividends shall pay a tax, “to be computed upon the basis of the amount of its capital stock employed within this State,” the amount of capital stock employed within the State is not (as in the case of a corporation paying less than six per cent dividends) to be deemed such proportion of the capital stock as the amount of the capital employed within the State bears to the entire capital of the corporation, but the tax is to be assessed upon the basis of the capital employed within the State without

regard to such rule of proportion. Money invested by the corporation in securities which are, in their nature,

entirely distinct from any business transacted by the corporation, cannot be said to be capital of the corporation employed within the State of New York, but money invested by the corporation in the stocks and bonds of a kindred corporation, or of some corporation whose business would add profit to the investing corporation, is presumptively capital employed by the investing

corporation within the State of New York. Quære, whether the Legislature, when providing for the taxation of corpora

tions, intended to make any distinction between the use of the terms “capital

stock” and “capital.” Quære, whether, if the capital of a corporation employed within the State of

New York should exceed the amount of its capital stock, such excess would be taxable.

[ocr errors]

CERTIORARI issued out of the Supreme Court and attested on the 30th day of June, 1899, directed to William J. Morgan, as Comptroller of the State of New York, commanding him to certify and return to the office of the clerk of the county of Albany all and singular liis proceedings had in assessing a tax against the relator, a domestic corporation, for the year ending October 31, 1897.

Edmund L. Cole, for the relator.

John Cunneen, Attorney-General, and William H. Wood, for the respondent.

App. Div.-Vol. LXXXVI. 37

« PreviousContinue »