NATHAN HAYWARD vs. ARZA LEONARD

THIS was an action of assumpsit. The first count was on a conditional promissory note, to be void if the plaintiff failed to perform an agreement of the same date with the note, by which the plaintiff, for the sum named in the note, contracted to erect for the defendant on his land, by a certain day, a house of a certain size, and to be built in a specified manner; this count averred that the house was built pursuant to the contract. Another count was for work done and materials found, and upon a quantum meruit for building a house on the defendant's land at his request. The declaration also contained the common money counts, and counts upon two other promissory notes.

On the trial, before Morton J., on the general issue, it appeared that the plaintiff erected a house upon the defendant's land, within the time and of the dimensions stated in the contract, but that in workmanship and in materials it was not according to the terms of the agreement.

It appeared that the defendant, who lived near the place where the house was erected, after the date of the contract, had requested the plaintiff to begin the house which he had

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agreed to build; that during the progress of the work the defendant visited the place almost every day, and sometimes oftener, and had an opportunity to see all the materials as they were used, and all the work as it was done; that he objected to parts of the work as it was done, and especially to the clapboards, as not being according to the contract; that after this he continued to give directions about the house, and particularly directed some variations from the contract. With much of the work he, from time to time, expressed himself to be satisfied, but almost always declaring at the same time that he was unacquainted with, and no judge of such work. Soon after the house was done the defendant refused to accept it. But there was no evidence tending to show that the defendant, in any way, informed the plaintiff, or that the plaintiff had any knowledge, that the defendant did not intend to accept the house, till after it was finished.

The plaintiff's counsel admitted that he had not fulfilled his contract. But they offered evidence of the value of the house when completed; and contended, that the defendant having become the owner of the house, and having permitted and encouraged the plaintiff to proceed in finishing the house after he (the defendant) had discovered that it was not according to contract, the plaintiff might waive the first count, and recover upon the others the value of the house. This evidence was objected to by the defendant's counsel, but admitted.

The defendant afterwards gave in evidence three receipts for money paid by him to the plaintiff, one being towards the payment of the conditional note, before the commencement of the house; the others, on account of the two other notes, which they exceeded by twenty-three dollars.

In order to reserve the question of law for the whole Court, the judge instructed the jury to find a verdict for the plaintiff for the sum which in their opinion the house was worth to the defendant when it was completed, deducting the twenty-three dollars and the other payments made by the defendant.

The jury returned a verdict for 644 dollars 76 cents.

To the above orders and instructions the defendant excepted. If they were right, judgment was to be entered according

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to the verdict; if wrong, a new trial was to be granted, and such other orders made as the Court should think right.

W. Baylies, for the defendant. It cannot be contended by the other side, that independent of any waiver or rescinding of the contract, or any evidence of the defendant's acts, the plaintiff could sue on the note, or that he could recover on the special agreement, since he has not complied with the agreement. But this is an attempt to recover, notwithstanding it is admitted that he did not fulfil his contract. Where a contract is open and unrescinded, a quantum meruit cannot be maintained. Indebitatus assumpsit may indeed sometimes be supported where there is a special contract, but that is where the contract has been fulfilled. Ellis v. Hamlen, 3 Taunt. 52; Jennings v. Camp, 13 Johns. R. 94; Clark v. Smith, 14 Johns. R. 326; Champlin v. Butler, 18 Johns. R. 169; 1 Selw. N. P. 86; Faxon v. Mansfield, 2 Mass. 147; Whiting v. Sullivan, 7 Mass. 107; Stark v. Parker, 2 Pick. 267; Taft v. Montague, 14 Mass. 282; 2 Phil. Ev. 83, (Boston ed.) note a; Hulle v. Heightman, 2 East, 145; Damer v. Langton, 1 Carr. & Payne, 168. In the present case, though there were some alterations and extra work paid for as such, yet there was no evidence that the special contract had been abandoned, waived or rescinded. The question as to waiver or abandonment of the contract should have been left to the jury.

The rule of damages was wrong. The true rule is, that the sum specified in the contract (1150 dollars) should be given, deducting what in the opinion of the jury it would cost to complete the house according to the contract.

Eddy and Beal, for the plaintiff, contended that the action might be maintained for the work actually done, without any evidence of a waiver of the contract. Cook v. Munstone, 4 Bos. & Pul. 355; Bull. N. P. 139; Payne v. Bacombe, 2 Doug. 651; Keyes v. Stone, 5 Mass. 391; Tuttle v. Mayo, 7 Johns. R. 132; Limingdale v. Livingston, 10 Johns. R. 36; Jewell v. Schroeppel, 4 Cowen, 564; 1 Chit. Plead. 333, 334; 2 Stark. Ev. 97. The plaintiff in this case built on the defendant's land with the knowledge of the defendant, who directed what was to be done from day to day, and knew what materials were furnished. Chit. Contr. 169. In all the

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cases cited on the other side, except that from Taunton, either the work was left unfinished, or the party derived no benefit from it. The case of Ellis v. Hamlen, 3 Taunt. 52, was a nisi prius decision, not fully reported, and has been so qualified by subsequent cases as to be of no authority. It does not appear that the defendant in that case knew any thing of the defects. In Burn v. Miller, 4 Taunt. 745, it is cited as a case in which there was no acquiescence. The principles contended for by the plaintiff are recognised in 2 Phil. Ev. 83. The acquiescence of the defendant in the work as performed, gives the plaintiff a right of action. If the defendant did not intend to accept the work, he was bound, so soon as he discovered the defect, to direct the plaintiff to desist and take the house away. 3 Stark. Ev. 1769, 1770; 2 Stark. Ev. 642; Chit. Contr. 275; Farnsworth v. Garrard, 1 Cambp. 38; Okell v. Smith, 1 Stark. R. 107; Fisher v. Samuda, 1 Campb. 190; Grimaldi v. White, 4 Esp. R. 95; Kimball v. Cunningham, 4 Mass. 502; Conner v. Henderson, 15 Mass. 319.

An agreement even under seal may be waived by a parol agreement. Fleming v. Gilbert, 3 Johns. R. 528; Jewell v. Schroeppel, 4 Cowen, 564.

The rule of damages adopted at the trial was right. Even Mr. Dane cites Keck's Case, in Buller's N. P. 139, and says it may be sustained. 2 Dane's Abr. 45.

W. Baylies, in reply, said that as the defendant was no judge of the work, the proper time for him to object was, when the house was finished. This he did, and the plaintiff can take off his house whenever he pleases. 1 Dane's Abr. 223, 225. He admitted there was a confusion in the books, but thought that the principle to be extracted from them, was, that no action could be maintained, either on the special contract or quantum meruit, if the contract was not performed.

The opinion of the Court was afterward drawn up by

PARKER, C. J. In this case there is a great array of authorities on both sides, from which it appears very clearly that different judges and different courts have held different doctrines, and sometimes the same court at different times. The point in controversy seems to be this; whether when a party

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has entered into a special contract to perform work for another, and to furnish materials, and the work is done and the materials furnished, but not in the manner stipulated for in the contract, so that he cannot recover the price agreed by an action on that contract, yet nevertheless the work and materials are of some value and benefit to the other contracting party, he may recover on a quantum meruit for the work and labor done, and on a quantum valebant for the materials. We think the weight of modern authority is in favor of the action, and that upon the whole it is conformable to justice, that the party who has the possession and enjoyment of the materials and labor of another, shall be held to pay for them, so as in all events he shall lose nothing by the breach of contract. If the materials are of a nature to be removed and liberty is granted to remove them, and notice to that effect is given, it may be otherwise. But take the case of a house or other building fixed to the soil, not built strictly according to contract, but still valuable and capable of being advantageously used, or profitably rented, -- there having been no prohibition to proceed in the work after a deviation from the contract has taken place, -- no absolute rejection of the building, with notice to remove it from the ground; it would be a hard case indeed if the builder could recover nothing.

And yet he certainly ought not to gain by his fault in violating his contract, as he may, if he can recover the actual value; for he may have contracted to build at an under price, or the value of such property may have risen since the contract was entered into. The owner is entitled to the benefit of the contract, and therefore he should be held to pay in damages only so much as will make the price good, deducting the loss or damage occasioned by the variation from the contract. As in the case of Smith against the proprietors of a meetinghouse in Lowell, determined at March term 1829, in Suffolk. [Note p185]

The cases cited from our own books, which are supposed to militate against this doctrine, are not of that character.

In the case of Faxon v. Mansfield, and Holbrook his Trustee, 2 Mass. 147, it was decided that Holbrook owed Mansfield nothing, because Mansfield, having contracted to build a barn, voluntarily left it unfinished, and the sum remaining

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unpaid was not more than sufficient to pay for the labor necessary to finish it.

In the case of Taft v. The Inhabitants of Montague, 14 Mass. 282, the bridge was so built as to be useless, and there was no evidence that the materials came to the hands of the defendants.

In the case of Stark v. Parker, 2 Pick. 267, the plaintiff was not allowed to recover on a quantum meruit, because he had stipulated to labor for a year, and before the expiration of the time, voluntarily and without fault of Parker, left his service. [Note p186]

These are very different from cases like the present, where the contract is performed, but, without intention, some of the particulars of the contract are deviated from.

It is laid down as a general position in Buller's Nisi Prius, 139, that if a man declare upon a special contract and upon a quantum meruit, and prove the work done but not according to the contract, he may recover on the quantum meruit, for otherwise he would not be able to recover at all. Mr. Dane (vol. 1, p. 223,) disputes this doctrine, and thinks it cannot be law unless the imperfect work be accepted. Buller makes no such qualification; and yet it would seem to be reasonable that if the thing contracted for was a chattel, the party for whom it was made ought not to be held to take it and pay for it, unless it is made according to the contract, as a ship, a carriage, &c.; and this principle seems to be of common use in regard to articles of common dealing, such as wearing apparel, tools and implements of trade, ornamental articles, furniture, &c. There seems to be, however, ground for distinction in the case of buildings erected upon the soil of another, for in such case the owner of the land necessarily becomes owner of the building. The builder has no right to take down the building, or remove the materials; and though the owner may at first refuse to occupy, he or his heirs or assignees will eventually enjoy the property. And in such cases the doctrine of Buller is certainly not unreasonable. The case put by Buller to illustrate his position, is that of a house built on contract, but not according to it.

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Mr. Dane's reasoning is very strong in the place above cited, and subsequently in vol. 2, p. 45, to show that the position of Buller, in an unlimited sense, cannot be law; and some of the cases he puts are decisive in themselves. As if a man who had contracted to build a brick house, had built a wooden one, or instead of a house, the subject of the contract, had built a barn. In these cases, if such should ever happen, the plaintiff could recover nothing without showing an assent or acceptance, express or implied, by the party with whom he contracted. Indeed such gross violations of contract could not happen without fraud, or such gross folly as would be equal to fraud in its consequences. When we speak of the law allowing the party to recover on a quantum meruit or quantum valebant, where there is a special contract, we mean to confine ourselves to cases in which there is an honest intention to go by the contract, and a substantive execution of it, but some comparatively slight deviations as to some particulars provided for. Cases of fraud or gross negligence may be exceptions.

In looking at the evidence reported in this case, we see strong grounds for an inference that the defendant waived all exceptions to the manner in which the work was done. He seems to have known of the deviations from the contract, -- directed some of them himself, -- suffered the plaintiff to go on with his work, -- made no objection when it was finished, nor until he was called on to pay. But the case was not put to the jury on the ground of acceptance or waiver, but merely on the question, whether the house was built pursuant to the contract or not; and if not, the jury were directed to consider what the house was worth to the defendant, and to give that sum in damages. We think this is not the right rule of damages; for the house might have been worth the whole stipulated price, notwithstanding the departures from the contract. They should have been instructed to deduct so much from the contract price as the house was worth less on account of these departures. [Note p187]

And upon this ground only a new trial is granted.