Clemente Construction Corp. v. P. T. Cox Contracting Co.

172 Misc. 904, 16 N.Y.S.2d 483, 1939 N.Y. Misc. LEXIS 2566
CourtNew York Supreme Court
DecidedDecember 27, 1939
StatusPublished
Cited by6 cases

This text of 172 Misc. 904 (Clemente Construction Corp. v. P. T. Cox Contracting Co.) is published on Counsel Stack Legal Research, covering New York Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Clemente Construction Corp. v. P. T. Cox Contracting Co., 172 Misc. 904, 16 N.Y.S.2d 483, 1939 N.Y. Misc. LEXIS 2566 (N.Y. Super. Ct. 1939).

Opinion

Pecora, J.

On January 24, 1935, a contract was entered into between defendant P. T. Cox Contracting Company, Inc. (herein called the “ Cox Company ”), and the New York Central Railroad Company for the construction of the depressed tracks between West Forty-second street and West Fifty-third street, borough of Manhattan. On March 1, 1935, the Clemente Construction Corporation (herein called the “ Clemente Company ”) entered into a subcontract with the Cox Company for the performance of some of the work under the railroad company contract. The Clemente Company began work on or about February 20, 1935, and continued operations until December 31, 1935, when it ceased all performance of the contract. On January 3, 1936, the Cox Company notified the Clemente Company that it declared the contract terminated pursuant to the terms of paragraph “ Twenty-ninth ” of the subcontract, and that it would proceed toward completion of the remaining work. Thereupon the Cox Company started the completion of the work, and on January 4, 1936, the Clemente Company filed a notice of lien for $150,000.

Subsequently the Clemente Company’s hen and any other claim it had against the Cox Company were assigned to trustees for the benefit of certain creditors of the Clemente Company.

In June, 1936, plaintiffs commenced an action at law in the Supreme Court, Bronx county, to recover damages for breach of [906]*906the subcontract. Another action was started in New York county in July, 1936, to foreclose the mechanic’s lien, notice of which had been filed in January of that year.

Both actions were consolidated by an order of the Appellate Division, First Department, which provided that the consolidated action should continue as an issue at law in the Supreme Court, New York county. The case came on for trial before this court and a jury, but after the trial had proceeded a few days, the parties stipulated to waive the jury.

At the opening of the trial, plaintiffs withdrew the first cause of action in each of the complaints, and proceeded upon the second cause of action to recover damages for the work which the Clemente Company had completed up to December 31, 1935.

The answers of the Cox Company set up various defenses and counterclaims. Pursuant to an order dated February 17, 1937, the Cox Company served supplemental answers which alleged that the Cox Company had on November 9, 1936, completed the work remaining to be done; that the cost of completion, plus ten per cent thereof, was the sum of $146,252.98; and that the cost to the Cox Company exceeded by the sum of $49,220.45 the amount which the Clemente Company would have been entitled to receive if the Clemente Company had completed the work under the contract. Jn addition the Cox Company claimed it was entitled to recover liquidated damages for 178 days’ delay at $150 a day.

At the conclusion of plaintiffs’ case, it was stipulated that if the Clemente Company had completed the work called for in the subcontract, it would have received $479,201.82; and further that, the Cox Company had already paid to the Clemente Company $378,298.15 on account of work done.

The subcontract provided Hi “ Twenty-ninth ”) that if the Clemente Company in any way failed to comply with any of the requirements of the agreement in performing or completing the work, the Cox Company could “ declare this contract terminated; and upon written notice thereof to the subcontractor, may enter upon and take possession of the work, employ persons and purchase materials, tools and equipment suitable for the completion thereof, or contract with any other person or persons for its completion; and, upon completion thereof, if the cost of such completion, plus ten per centum thereon, shall aggregate less than the unpaid balance of the price named or compensation designated in this agreement, the difference shall be paid by the Contractor to the subcontractor, and if such aggregate shall exceed such unpaid balance, such difference shall be paid by the subcontractor to the Contractor.”-

It, therefore, became necessary to determine the reasonable cost of completion. The Cox Company claimed that such cost, neces[907]*907sarily incurred, was $128,006.95, which it contends was a fair and reasonable sum. Plaintiffs contended that such reasonable cost should not have exceeded $26,368.50.

By stipulation, in the course of defendants’ case, the parties agreed to refer certain questions of fact to an arbitrator familiar with the engineering problems involved. Thus the following four matters were referred to Mr. James E. Gibbons, as arbitrator, for determination:

1. (a) What quantities of certain work remained to be done after December 31, 1935?

(b) What other work remained to be done after December 31, 1935, under the subcontract?

2. (a) Was the cost of $128,006.85 claimed by the Cox Company as necessarily incurred by it in the completion of the work required under the subcontract the fair and reasonable cost?

(b) If not, what should have been the fair and reasonable cost to the Cox Company for completing the work?

Mr. Gibbons filed a report wherein he found the quantities of work which remained to be done after December 31, 1935, and he determined that the fair and reasonable cost of completion was $112,909.60. On motion by plaintiffs, for reasons not important here, the court set that report aside. The same questions were thereafter, by stipulation, referred to Mr. Thomas Crimmins, as arbitrator. He determined that the cost claimed by the Cox Company as necessarily incurred by it in the completion of the work was not the fair and reasonable cost, and that such fair and reasonable cost was $64,000. That finding was confirmed by the court, and by stipulation was binding on the parties.

Thus, under paragraph twenty-ninth of the subcontract, the cost of completion, plus ten per centum, would be $64,000, plus $6,400, or $70,400. This sum must be deducted from any amount due to plaintiffs. In addition, it was conceded that defendant’s claim for certain “ back charges,’’ totaling $1,400, was a correct deduction. The balance, after making these deductions, would be $29,103.67, for which plaintiffs demand judgment.

Defendant contends that the notice of lien filed by the Clemente Company was willfully exaggerated; that, therefore, the lien should be declared void; and that the Cox Company is entitled to damages by reason of such willful exaggeration. Section 39 of the Lien Law provides that if the court find that a lienor has willfully exaggerated the amount for which he claims a lien, as stated in his notice of lien, his lien shall be declared void and no recovery shall be had thereon. Section 39-a provides that where the court shall have declared a hen void on account of willful exaggeration, the person [908]*908filing such notice of lien shall be liable in damages to the owner or contractor.

In order to vitiate a lien there must be willful exaggeration. (See Roshirt, Inc., v. Rosenstock, 138 Misc. 515; Sullivan v. O’Day Realty Corp., 153 id. 634.) In Yonkers Builders Supply Co. v. Luciano (269 N. Y. 171) the court by Finch, J., said (at p. 176): Inaccuracy in amount of lien, if no exaggeration is intended, does not void a mechanic’s lien; willfulness also must be shown.”

From the proof before me I cannot find any willful exaggeration.

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Bluebook (online)
172 Misc. 904, 16 N.Y.S.2d 483, 1939 N.Y. Misc. LEXIS 2566, Counsel Stack Legal Research, https://law.counselstack.com/opinion/clemente-construction-corp-v-p-t-cox-contracting-co-nysupct-1939.