Penn Plastering Corp. v. O'Boyle

253 A.2d 862, 254 Md. 16, 1969 Md. LEXIS 843
CourtCourt of Appeals of Maryland
DecidedJune 2, 1969
DocketNo. 280
StatusPublished

This text of 253 A.2d 862 (Penn Plastering Corp. v. O'Boyle) is published on Counsel Stack Legal Research, covering Court of Appeals of Maryland primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Penn Plastering Corp. v. O'Boyle, 253 A.2d 862, 254 Md. 16, 1969 Md. LEXIS 843 (Md. 1969).

Opinion

Hammond, C. J.,

delivered the opinion of the Court.

Penn Plastering Corporation, a plastering subcontractor, sued Three Crowns Enterprises, Inc., the prime contractor for the building of the Villa Rosa rest home in Mitchellville, and because it would be judgment-proof, also sued the surety, Glens Falls Insurance Company, in the same suit on its bond covering performance and payment of labor and material claims and the owner, obligee under the bond, the Most Reverend Patrick A. O’Boyle, Archbishop of Washington, a corporation sole, on the claim that it had independently promised payment if Penn completed its subcontract. At the end of the plaintiff’s case, Judge Parker, sitting without a jury, gave judgment for Penn against Three Crowns “inasmuch as it has been in default * * * and the proof indicates there was $10,000 due,” but found for the Archbishop because “there has been a complete failure of proof that there was any contact [or contract] with him,” and for Glens Falls “there has just been a lack of proof * * * that the corporate entity [known as Penn Plastering Corporation] existed at the time of suit” and a lack of proof of the details of the plans and specifications and the extent of Penn’s performance in accordance with them.

We agree that there was no legally sufficient proof of an independent promise by the Archbishop but we find [18]*18that there was proper proof of performance by Penn sufficient to entitle it to the same judgment against Glens Falls, the surety on the bond, as was rendered against Three Crowns, the principal.

Glens Falls says in its brief that the main question presented is whether “in a case where recovery is sought on the basis of a building subcontract the plans, specifications, and the prime contract, are essential elements of the proof” and that a subsidiary question presented is whether a corporate plaintiff may maintain a suit where “it appears the corporation'has been liquidated, and is no longer in existence; especially where there is no proof that it was ever licensed to do business in Maryland,” and a second subsidiary question whether secondary evidence and records kept in the regular course of business should have been received and used as proof. There was not below and there is not before us any contention that the bond does not cover Penn, that Penn could not sue Glens Falls directly, or that notice and filing of suit were not timely.

We treat the first subsidiary question as a threshold matter and deal with it first. Glens Falls’ somewhat casual suggestion in the course of the trial that Penn had not proven it was a viable corporate entity when suit was filed, must die aborning. Maryland Rule 342 c 1 (i) provides that the defense of a denial of the incorporation of the corporation must be specially pleaded. Rule 311 provides that: “Whenever * * * the incorporation of any alleged corporation * * * is alleged in the pleadings in any action, such fact shall be deemed to be admitted in so far as such action is concerned, unless it shall be denied by the next succeeding pleading of the opposite party to the merits.” Penn alleged in its declaration against Glens Falls that Penn was “a body corporate, duly qualified to do business in the State of Maryland.” Glens Falls filed the general issue plea, and therefore admitted as a fact for the purposes of the case the full incorporation of Penn in Maryland. There was no testimony that Penn had not continued as an existing corporation, merely that it was [19]*19selling its equipment, collecting the debts due it and paying its bills. Judge Parker should not have relied on the ground that Penn had not proved itself to be a corporate entity in ruling in favor of Glens Falls.

The main question and the second subsidiary question can be discussed together. From the very beginning until the end, the trial judge indicated that the only proof that would convince him of Penn’s right to recover against the surety would be that based on the plans and specifications being in evidence. Penn’s witnesses testified that the firm was being liquidated because of the long illness and consequent death of one of its owners and the retirement of another, and that the copies of the plans and specifications it had been furnished had not been found; and although the court said “apparently they are missing,” he attempted not to allow secondary evidence. Nevertheless, considerable probative secondary evidence came in without objection, as did the contract under which Penn agreed to do the plastering and dry wall work for $33,000.00.1 Also much secondary probative evidence [20]*20was allowed against Three Crowns only, which we think was admissible against the other defendants.

The principal witness for Penn was Mitchell Laiken, now otherwise employed, who had served as its accountant-comptroller for the five years preceding its decision no longer to accept contracts. His regular duties had included the figuring of the costs of all of Penn’s jobs, the checking of all estimates of its work and the checking of the work in the field to see that it was properly completed. His college courses had included three years of estimating and he knew “exactly how much work was done by our company.” He checked the estimates on the Villa Rosa job which Penn’s engineers had prepared, “checked the mathematics and went over it with the engineers to see that the job was taken off [the plans and specifications] correctly.” Penn had been furnished those plans and specifications and he went over them. There was a set on the job site and when he went there, which he did as often as once a week, to see how much work had been done, he would check the work done against the plans and specifications. He did this with an estimator or an engineer, “and we would take off the exact amount of work done so we would know how the job was progressing.” Judge Parker ruled that Mr. Laiken could testify as to how much work Penn had done if he had personal knowledge thereof. In response, the witness said he did have personal knowledge and that “ninety per cent of the work was completed.” He said: “I went through the building from top to bottom. I examined every piece of work that was done,” and when asked whether this was in comparison with the plans and specifications, he replied, “Absolutely.” He said he could say from his own knowledge and from Penn’s records kept in the regular course of business the exact amount of money Penn was entitled to be paid for work done at Villa Rosa under the contract and according to the plans and specifications but the court would not allow him to set a figure. He was allowed to testify as to the monthly statements of the money due for work done that he had prepared and sent to [21]*21Three Crowns. He never received any complaint or claim of inaccuracy, although he would have been the person who would have. Counsel for the Archbishop and Glens Falls agreed the statements would be admissible against Three Crowns but objected to their admission against the Archbishop and Glens Falls, and Judge Parker refused to admit them except as against Three Crowns.

They appear in the record as “Agreed Exhibit No. 5” (the contract which came in without objection against all three defendants appears as “Agreed Exhibit No. 1”). The first item in Exhibit No. 5 is a letter of June 23, 1965, from Penn to Three Crowns, in which it is said:

“The following is our breakdown for purpose of billing on the above mentioned job.

Dry Wall Material $12,000.00

Lath & Plaster Material 2,000.00

Dry Wall Labor 14,000.00

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Bluebook (online)
253 A.2d 862, 254 Md. 16, 1969 Md. LEXIS 843, Counsel Stack Legal Research, https://law.counselstack.com/opinion/penn-plastering-corp-v-oboyle-md-1969.