368 .•,QuAIRLES V. LITTLE CYPRESS: DRAINAGE DIST. [168 .;QKAB...T„As ; v., LITTLE CYPRESS DRAINAGE ,DISTRICT. • Opinica Marcli 30,1.925. 1., ,..1)EAINS—CONTRAC1 poa. ' CONSTMJCTION.—Where the engineer ,of a drainage district severed his connection as engineei for • 'the “diatrict,' openlk and with the district's consent, ! after' all ' • the ' preliniinary work had been coinpleted, and thereafter made • • the leWeet bid for the donstructiOn ,work, 'held that he violated • no principlp . of Jaw' in; doing . so , and , his contract of ,construction , PRAINS-77RIGHTS OF _SUBCONTRACTOR.:—A subcontractor who has partly constructed a ditch, and the work , being stopped by the district, is entitled to recover ex caritricetu, and hot on quaneum meruit,iar - the Wei* dohe 'pursuant to the , ' 'Contract of the 'inineipar ' c . o at , • . iactor with the 'district: • • • • • -VRAINS-., -RtGHTS. 'OF `suncoNTRAcTou.t-;-, Wbere - a- 'Contractor • sued •:- ' 'district, for •the g mOunt • dne , him for,' wOrk; done , under ins,contract and for breach , .of i his, contract, .and sub,- • contractor 1;rought a , similar suit. against the contractor and the district, and the cases were fried together, in order to circiiity Of actions the subcontractor ' Will be .all'oNyed' to reiover' direct from the' distriet • the piirtion of the amount' due :the !contraCtoi Vhich• belonged ' to . the . subcontracter. • • • • I • • 4..• DitiuNs—athIIT TO 'STOP Nicifix.-,-Where a 'drainage district , in,. a 'construction contract reserved , the right to. stop work and ; com-• plete it itsef, , and a subcontract provided . for the same contingency, the ,distric't is net . liable to , the subcOntractor fOr ' s • topPi • n , g' the' Work... • • . DleAIN§—sTOPPAGE OP tiVORK-L. RiGHT' TO 'DEDUCT' AIWANdE PAY%. MENT.--,Where a constrticiion . contract with a drainate district provided ;fOr . adyance payment' by. the distriet for purchase of •the , . equipment,,abd for repayment .by deduction of part of the a,greed priee per kard,- the -diStridt upon stopping the work under aq • option ih_the contl'aCt s Was' 'not entitled to deduet the unia4id reinainder a the ;d y nnc . e p . ayni . ent as:against a' subcontractor. 6. DsAiNS- STOPPAGE OF WORK—RIGIIT ' TO DEDUCT ' ADVANCE PAYMENT.—Where a construction contract with a drainage district provided for advance payment by the district for purchase of the equipment, and for repayment by deduction of part of the agreed price per yard and further provided that this district should have the option to stop the work and complete it on the cost basis, and to employ the contractor at a fixed per centum of the cost, the district is entitled, in settling with the contractor, to charge him with the cost of the advance payment for the equipmebt.
Ams ], QVAaLas v-.I147-rI., .c.on., .E.-s•DmIT,TAqx. DIST. ■ 369 PItegrrs, T Rou;rs, 'or cor.m . t.f.croyt.t-,Where. a ! principal 'contractor ....'''..agreed to COnStruct a d' rainage . dit;chat ihe . rate of 35 .Cent....Per "-. karcr,'I ;GI turn' SOContraCted te 'afietiier t‘t 'Cilits1 per q ubiC , Yiird; he Wa'S 'entitled 4tOrecOver the difference • betveenj.the two! amouno:iwhefe :the 'district' exercised, its*.option to stop,; 7 9-prjc „bef orp completion... , 8;t ..;.DAAngs-,--,--Baaibi,.., "OF cONTRAdTDADIAGi.—,-Where a drainage ;district,_ haying ,the ;right' :to . stop the. :wiorkl under. ,a...sontract : t an t •_ d ' .te e "■.; . mploy ' t ,• h e contr • a • ctor .on ' a cost-plus ,ba • sis ex ercised its ,oritiOri to , stoja th work, but . failed to CoMPlete :under the .chst- 'it' % f oil be 'liable t.:o . 'the cbritiSktOr for 4.''inideillh : the vbrk dorie . e-COntradt : andlor • dithiageS tanSed , by2faihire ttecOmplete ,.:Abe•;dit40 . 4nder ,..the . coitvlwS'kasis. : -.:• • ; " • ;!.•!;!-", ":!1!! ; '•,:, .,.; • Appeat,froni Ihu11ips Qhancery Qourt , ; A L. kti tch- q bancellor • ,reversed. . . Gi Góing i.Coleinart,.Robinson:& Dinni .ri:g, for. apPellants. ,. I • :• • • • • . • A.Y ' : M ' Odre, • alker &.• Moore, for appelkes. 7' )•'. t i.■'■ ;!., MoCuLLooH, C. J. Appellee is a drain ..1, , age . district -in Phillips . _County, ;organized under. ; a . special statute, andiappellant, john 111.,Quar1es,, together with )2is , part:- -the.. engineering., professioni, Unrlbutt,.were *employed by. the ,commissioners to .do :the engineering work for, theidistrict ;. The engineers ;made the JieceSsary ! surveys -upon, plans and . : specificationg which werwadopted by,.the commissioners; and -an, advert-tiseinentyfor.-, published:: , The nonimis, sioners, received-one, on more.bids; . but .they were unsatik, factory .> and, were-..rejeCted....:At . this: Point .Of, the pro, eeedings appellant . Quarles 'applied . to. the 'comMissioners for " Permission AO: resign his- position ai > engineer and !Takes'. tO dtr the construction work. After :consul :. - tition;: • with 'the .sttorney. for . the district, , who adviged thlit-there' Was no • impropriety iii QtarleS resigning big picsiii.On and laidding .. kOr the' ivOilt; '4116' 'Cominissioneri P'érinitted binf te -do. :so; and' hik 'bid . waS accepted ::fand a contract was entered into with him lav the cOMMis-SitinerS. -The bid : Was to reinove'• the' • esiiinated aniount
370 QuAniets •v. LITTLE CYPEE gs DEAINAGE DIk'. [168 of 364,273 Cubic 'yards . of earth at thirty : five Cents per cubie.yard. There was aIso a . speCification of the Price .and viantity of clearing and grubbing, ,but there is no controversy in the present litigation over that- feature of the work, hence it is unnecessary to mention it. The contract between Quarles and the commissionerS Was dated October 12, 1920, and contained a stipulation the • effect that the diStrict should advance to the contractor the suM of $25,000 in money, one-half of which was to .be-paid over when the dredging machinery should arrive at a certain railroad station near the work, and the other one-half when the machinery was installed and ready for Operation at the place Where the system of canals was to begin, and it wa g ' further' stip-nlated' that the • amount so advanced • should' be repaid by a deduction of ten cents per cubic . yard for the removal of the,dirt as the work progressed. A . supplemental contract between the parties contained , the fol-lewing provision "NoW, , I hereby agree with •, the . cOmmissioners of said drainage diStrict that, at any title 'aitbseguent•tO •the date of which shall begin work On said systeni of drainage and -canals, and upon five days' nOtice in Writing given • nie by the said board of coMmissioners of said drainage distriet• to turn over to the said board of coin:- misSioners Of said-district the uncompleted -work, tclhe eiid that said bo r ard have comPlete charge thereof froth that date ; and Ifürther agree to goron with the perforria-ance of mid work, to Superintend the same, and to cause said work to be :completed :under the management ;and direction of the said board of commissioners at their • qcpense; and as compensation for my servicek•frora the date that. 'said ,hoard of ,cornmissioners lake Over said work, lam receive . 15 -per cent. of the cost of construe:, tion.-.of said ,uncompleted work, the same to be paid me on.monthly estimates by the said board until said,work is completed." • • bfl .Q4arles. , subcontracted the work to R. L. Cheshire under written contract dated December 1, 1920, at the
t i ARK.] QUARLES v. LITTLE CYPRESS DRAINAGE DIST. 371 price Of thirty cents per cubic yard for moving earth, and the contract, after specifying all of .the other items, contains a stipulation : for an advancement of .$25,000 for •the cost of installation of the machinery, ,and also the folT lowing stipulation: " The party of the first part agrees that, in event the board of commissioners of the Little Cypress Drainage District takes over the contract ,011 Ost-plus basis (as provided in contract executed between the commissioners and the. party of the first part); that -the :party of the first part agrees to pay to the party of- the second part an amount to equal all expenses that the party: of the second part . has paid out for securing equipment, which covers cost of plant, dismantling, transportation, erect7 ing, and all other expenses by installation of. equipment. Should the commissioners take , over contract before equipment shall have excayated 50,600 cubic yards of excavation, the party , of the first part agrees to pay , the cost of operation, shall pay for all material on hand, such as . supPlies, and shall pay the party of the second part the amount of two thousand dollars ($2,000), which is to compensate the said party : of the second part for installing equipment and starting the organization. The party • of the first part shall be entitled tO receive all pay on work completed, if sarne' ' is taken over before machine has excavated the stiPillated yardaie.“ On December 6, 1920, Cheshire subeontraCted the work to appellant T. D. Hunt at twenty-five cents per cubic yard for the removal of earth, and the written contract between them contains the same stipulations' , as thoSe -referred to abOve in the cOntract between Quarles and Cheshire. The district advanced $25,000 in accordance with the contract, which Was Used in the purchase of machinery and other equipment, and the additional cost of installation of the Machinery at the' place Of work ran the initial cost up . to $32;881:63. After inatalling'the equipment, appellant Hunt prOceeded with , the' construe-- tion work, and, in addition to a certain-amount 'of 'grubbing and clearing, he excavated and removed -.7.3,850.70
372 QUARLES'Ve LITTLE CYPRESS DRAINAGE DIST. [168 cubic , yards' of earth. H'e was paid $8,44710 ; on eitimates, and nothing . mbre has -been paid to him oi% to Quarles. The , . conunissioners then; , under date -ofJtily,;29i:-1921; gave ilotiee to , Quarles; as principal ;cOntractor,/-of the election of the district to exercise the •oPtion'in the, contract 'fork stopping the work and, taking , ,Over -the 'construction of. the , ditch. The work Was' aceordingly stopped1 and nothing further has been' donertoward the completions of the improvement. Assessments Lof , b'ene-fits Were made, and taxesilevied and . bOnds were, sold, and part of. the Money for the purchase price , of; the-bonds was paid'over to the commissioners. • Quarles 'subsequently ,brought Suit againSt the' dia-tfict;'alleging breaCh of the . COntract by the' cOnnniSsidn= erg , 'and also alleging that he had 'held hiingelf to coMply With the' Contraet, 'bah' aS ., -Ed :the"..c6ii- Strhetion. df 'the worii - on the Original:61'ms sPeCified' Of oh the cdst-PlUS' basiS -speCified in the 'snPPlem6tal tract, and' &aye& for the 1. 66C:welt' or cort4:enSatiOn; kir the:arnohnt of 'wOrk *dene'as . Well asr,dainageS'foilbeing PreVented froM doing' the rernainder:'Of ' APpellant Hnnt also institnted , a separatg -action against tbe diStrict ankagainst Quarlea*.to s reboyer, the arnohnt Of , earned compensation under his.cOntract and for dain, es 'for breach Of the cOntract '‘• These actions were instituted in the-circuit court, hut, on , motion of. the-district, .were trosferred to...the chancery court, and proceeded there to .finaLtrial:nnd decree. The district answeredi pleading the in-Validity of. Quarles ' contract with the district- on account , of -his hay ing been engineer:of the district in'the fOrmation . of the plans,, .and also pleading,that the .contract ;was an improvident one . and should. be set aside., :There;;Were other denials ,with Tespect.to:, theL amount . -,Of outlay claimed; by,_ each ,of the; appellants .,; and it was , alao,denied that, -there. were any, damages sustained., Th,e chancery court Tendered.n :final decree dismissing ;Quarles complaint for want:of equity on the ,ground that the contract
QUARLES V. LITTLE CYPRESS . DRAINAGE:DIST 373 with the district. was, void by reason:of 'his foimer relation to , the district as 'engineer. The court ;held that.Hunt mild recover from the. district 'only , on, the4licintumfmer-, iit'basis, and; . after stating_hiS aCcOnnt ! with the&strict; brought-..laini ,out in debt :to . 'the:district q n , ':the..isuin , of $14;288.22. : • The account , between' , Hunt :and' the : district
was stated by the court in its decree , as folloWS :'ii • ! 11 . CREDIT. " " • • • S" • • • . • . • I • • 1 73,850.70, cubic YardS ..reMoVed. at • ; ; 81/ • 2 • • ••'• • • ..• , , per yard • • :$ ,6 :t i 2 77 • , . i 2 5 '4 . R , ental On drainage bOat at '$30' per day: . —2;100.00, Grubbing , right-of-way 1, 800.00 Additional ' cost ' Of installation 7 881.63, Mnintenance of O . rganization dUring ' • •1' It'. ,I,'4 de107 1, 100 • 0 Total $19 158 88 0. , DP3T. 'Amoinit adVanced •: • • •:! hfo! .. for..purchase, 4,n4 . , i• . • stallation, of equipment , • , -$25,000.00 Amount paid on estimates 8,44 ,.10 TOtal,.. • .• • .! Balance due from ;Hunt .....1! • I I l' t: • . to. 4., district • $14,288.22 The• court . also in its decree -declared p„.lien..in:Saycg of. the 'district :on. the drainage . boat,: which was part ,ctf the.: equipment. and , on • which .advances . :were,,raade„. and held .that appellant Hunt: and. his , , stirety were,Pable 011 his :bond executed , during the. pendency of v the action Epy the return of the equipment if. , ordered; brthe;.-court., hearned .counsel for appelleef •defenCt the *:cOurts decree on the ground, that the ,cOntract of Quarles.with thei district wa.s illegal and void,. and; ,that; Hunti.‘was entitled. to • recover only. .on quantwin ;Merwit k, and :that: the. Court allowed him the nmount-tO which the.,Was' Counsel . baSe • their . .COntention on the .idecision::of.th ig court in the' case of , Cart& Bradley,. CoimIty.flto.a. ,:d Improvement District i, 155::Arlc, 288,' , hut Ave..are iof ;the 0
374 QUARLES V. LITTLE 'CYPRESS DRAINAGE DIST. [168 opinion that the rule announced in that case is not applicable to the present .case. In the Carter case the engineer of the improvement district had, while serving as .engineer for the State Highway Commission, entered into a contract with the road improvement district to do the engineering work, and this court held that he was not entitled to recover either on the contract or on the quantum meruit, notwithstanding the fact . that the work was done after the claimant had severed his connection with the State HighWay Commission. In' the present case Quarles severed his connection with appellee , district as engineer before he bid for the construction work, and this was done without any concealment, openly and With the approval of the attorney for the district as well as the commissioners. He resigned as engineer after all preliminary work had been done and the 'plans had been completed and approved. It was even . after bids had been advertised for and received and no satisfactory bids had been made. There is nothing in the proof to justify the conclusiOn that there was any, 'collusion between Quarles and the commissioners whereby he was to take advantage of his position as engineer for the . pur-poke of securing an advantageous contract with the district. There is nothing to show that the resignation was a mere evasion of duties devolving upon .Quarles as engineer.. On the contrary; he had, As before stated, completed all of the engineering work to be done up to that time, and when the bid was made there were no -official or confidential relations existing between Quarles and the district. He was perfectly free then • to enter into a contract with the district, and we can perceive no principle of law that would forbid his doing so. Nor is the proof sufficient to justify the conclusion that the contract was an improvident one. The bid was much less than the bids received by the commissioners from other persons. There is testimony in the record Of other work being done cheaper, and other testimony tending to show that the price stiptlated for in Quarles' contract was too high, but we are of the opinion that the testimony as ,a 0
ARK.] QUARLES V. LITTLE CYPRESS DRAINAGE DIST. 375 *hole does got justify a finding that the contract was iraprovident or that the commissioners could, by the exerciie of diligence, have secured a contract at a lower price: The Contract entered into was free from fraud or collusion, and we can see no reason why it should not be Upheld. Our conclusion therefore is that Quarles' contract *as valid and that heis entitled to recover earned corn-pensatidn and for damages which arose, for which he should be 'allowed compensation as in other cases under settled principles of law. Whatever appellant Hunt is entitled to recover, it must be under the' contract and hot . iin the quantum mer uit." He had no contract with the district, for his contract Was with -Quarles, but, since Quarles arid Hunt are both parties to this 'suit; Hunt ShOuld be allowed, in order to prevent circuitous actions, to recover directly from: the district the amount he is entitled to 'under the contract and fOr which the district is liable under its contract with Quarles. Hunt is, of course, entitled to recover for the amount of excavation and removal of dirt At the stipnlated Price Under his own contract With Quarles, and also for the price of the grubbing, which is undisputed. He is not entitled to recover anything from the district by way of damages for breach of contract, for. the simple reason that the district did not break the contract so far as allorwing the construction of the improvement to be made under the terrns of the contract. The .district in its contract expressly reserved the right and option of stopping the work at ; any tirne and completing the job. Hunt is bound, so far as any, liability of the_district to him is concerned, by the stipu- lations . in- the , contract between Quarles ami the district It is . a hard feature of the contract; birt h Can obtain no • relief froni it, for the reason that it-became a 'part of his own contract. tor the sante reaSon'he not entitled to recoyer anything as reimburSemerit the additional cost of the installation of equipMent.'Nor. is. he entitled to recover for the ekpense of maintaininea'
\ ns . QuAnLy,s , p.. LITTLE 'CYPRESS DRAINAGE DIST. PO S 1 crew .while, the ; equipment :was . idle. These, are items purety 6i:damages . for 'breach of' the contract, and,, as ( •e . 'have already seen, there was no breach of the con- ; tract by the district , so far as conCerned Hunt, for the t reason - that, • thp distric,t reserved its right to stop, the ) ( work ai any time; and the stoppage of the work was . not a,breach but w,as within : the. reserved rights of the 'dis-i 4 trio.. On . the other hand,, the district should not be per-mittecl to .dednet frora . its liability to Hunt for , :earned ?, 1 compensation the ,full amount advanced. for ,the pur; chase of equipment. This is . s6 : because ' , the district expressly_ agreed in its, contract to claim the right of , 1 deduction , only . to the extent of ten cents , per cubic yard 1 ok,,qx . cqya.tion . and removal of dirt during th . e. progress of : the,. work. : .: Haying . contracted to accept -.,the : return of ihe.money,in that:way pnly, the district cannot, -,,fter having made. an . election to stop , the work, insist uon tfie , 14 . 1contraciqr, T eturning the...money: advanced, fc,' the equipinent.:• The, account between Hunt •and the di.s\. trict ,. should be. : itated as follows: . • , . :• : .. CREDIT. - , . • . . 73;850,70, cm.,yds..removed . at : 2,5c per yd $18,462.67 Amount allowed on grubbing .1,800.00 Taal ; $20;262.67. DEBIT. Amount p t ain o n estimates $ 8;447.10 Amount . 'of d'e quction k 10c per cubic • yard for adVancement on equip-. ment 7,358.70 "Tbtaf ' $15,805.80 B i , alance ,due. Hunt $ 4,456.87 t , The decree in favor of Hunt should be for the balance stated above. Turning to the claim of Quarles, we . 'are of the opinion that he is entitled to recover from the district the balance of-ten cents per cubic yard on the removal of earth by . Hunt, which is the difference between the amount he is entitled to under his contract- and the
ARK.] QUARLES V. LITTLE CA:PRESS 'DRAINAGE ThST. 377 amount to be recovered by Hunt under his contract. Quarles is entitled,:under his supplemental : contract *44 the district to, .fifteen per centum of , Ow cost , of , the improvement made under his supervision. According to, the undisputed evidence, it would;hayo cost $14Q,000 to complete the work, and Quarles held himself in readiness , to do the work when called oncby the, district, and was not able to obtain , any , other employment,7during the period which would have been covered by the cora,- pletion' of the work. He is therefore:entitled to recover the compensation which he would ,have. , earned under; t the. contract if. performed..,. Quarles is.,also,. chargeable 1 with the balance of the sum. advanced by the -district on equipment after deducting ,the. amount charged to Hunt. Notwithstanding the . stipulation :in .the contract. r, for the deduction of the advancementon the estimates of work done; Quarles is responsible for the :full amount,, \ inasmuch as he is allowed under, the.;contract to.recov,er Ififteen per centum of. the total cost of the ponipletion,of, the improvement. He stands in ,a different attitude' from Hunt in this respect, for, under his,contract, he was not cut off from earning additional compensation by the 1 election of the district to complete the work itself. A fair interpretation of the contract is that the district had the right to stop the progress of the work under the 1 contract and change to the cost-0ns basis,: ancb it,Should not be denied the return of the amount . of money advanced merely becanse it made thiS . Cliarige. Quarles took his chances under the contract on„the Joss . of, his i 1 equipment, and, if he claims fire fifteen. per centum on the 'cost of completing the work,- he niust , return : the money advanced for the equipment . Q ' iiarleS' aceOunt With the distri , c t sho . ul . d 'therefore He stated t d§ Tollavs . ,t CREDIT \ ( I 73,850.70 cu. yds. removed. at;l0c:mer . yd : : $.,7,385.07 L . Amount allowed, 15 per cent of eost of cora- , i 1 'pleting the work ' '' Total ‘$'23;3'85.07
378 [168 Balance of amount advanced for equipment, after deducting amount charged to Aunt $17,641.36 `.. • . Balance due Quarles $10,743.77 It is conceded that Quarles is entitled to 'recover' this amount from the district. Both of the appellants are entitled to recover interest from the time of the coin-mencement of their respective actions; It is conceded by both Quarles and Hunt that there are items of account to be settled between •thera in this litigation, and that, on the remand of the cause,' those mat-1 ters will be either settled or litigated. We are not agked to decide any iSsue between them, but they . ask that fife. cause be remanded for that purpose. The decree of the . chancery court' is' therefere reversed, and the cause remanded with directions' : tothe' Court to enter a' decree in favor Of appellants Hunt ' and Quarles for the respectiVe amounts stated . above, with interest; and' for further proceedings not inconsistent with this opinion.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.