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completed, but when he is of opinion that it has been completed by the "party of the second part,” the final estimate shall issue. Moreover, section J of the contract, under which the plaintiff was put off the work, completely provides for that contingency, and secures to the plaintiff when thus dispossessed what is justly due it for its materials and work, subject to the specified charges and deductions on account of actual expense incurred by the city. The difference after such deduction the plaintiff is expressly declared entitled to receive. Instead of and wholly without any reference to a final estimate or certificate by the director, provision J stipulates for a distinct method by deductions and charges for fixing the amount due the plaintiff. What is honestly due the plaintiff ought to be paid, and clause J within itself prescribes the principles of ascertaining the indebtedness based upon no mere estimate by the director of the dispossessing party, but based upon facts susceptible of actual proof. A stipulation to prevent the liquidation of that indebtedness by the courts, if sustainable at all, ought to be clear and free from any doubt, and in my judgment such is not the case here. In a word, in this contract two totally different contingencies were clearly provided for: If the party of the second part completed the work, then payment was to be through the medium of a final estimate by the director; but if the city took the work out of the plaintiff's hands, and placed its completion with another, then, while perhaps such completing party might have to secure his final estimate, no such restriction was imposed upon the plaintiff as respects payment of the amount due it. Furthermore, all the time provisions and other provisions in the sections last quoted expressly date from or depend upon the precedent final estimate and hence fall with it so far as respects payment of what is due the plaintiff.
The arbitration clause is in the words following: “(D) In case any question or dispute shall arise between the party of the second part hereto and the said city of Pittsburgh, party of the first part hereto, under the said plans, specifications or terms of this contract, respecting the quality, quantity or value of the work or labor done or materials furnished, or to be done or to be furnished, or any of the terms, stipulations, covenants or agreements herein contained, or respecting any pay for extra work, or respecting any matter pertaining to this contract, or any part of the same, said question shall be referred to the director of the department of public works of the city of Pittsburgh, whose decision thereon shall be final, conclusive and binding upon all parties without exception or appeal, and all right or rights of any action at law or in equity under and by virtue of this contract, and all matters connected with and relative to the same are hereby expressly waived by the party of the second part.”
Much that has been said in the discussion of the final estimate provision applies equally to this arbitration clause. . Paragraph J is independent of each of the other two cited provisions. That paragraph, complete within itself, and without reference either to an arbitration or an estimate, provides for the peculiar contingency of the city's putting the plaintiff off the work, thereby preventing the plaintiff from proceeding further under the contract and from further benefits thereunder. The director having reached the opinion expressed in his letter of notification to the plaintiff, two alternative courses were open to the city. A dispute had arisen between the
plaintiff and defendant under the contract. The work had undoubtedly been delayed, and the time fixed for its completion was passed. The city's representative, the director, entertained the opinion that the fault of the delay rested with the plaintiff, while the latter contended (and under the proofs, I think, justifiably) that the delay was due to the city's belated furnishment of plans and staking out and to changes by the city in the plans. Now, it is clear to me that the election by the city to proceed under the dismissal clause (J) necessarily excluded and was a substitute for action under the arbitration clause, and this for several reasons. In each course of procedure, the director was to act, but in totally different capacities. As arbitrator, he would act judicially and hear both sides, and the opinion he would reach would be judicial. Under clause J, the opinion of the director might be justifiably arbitrary and purely ex parte. Nothing short of positive bad faith would invalidate it. Moreover, to the extent that the arbitration clause was operative, it was imperative, and just as binding upon the city as upon the plaintiff. But clearly the city was not bound to submit to arbitration the situation which confronted the parties to this contract on April 16, 1900, but had a perfect right to oust the plaintiff under section J, pursuant to the director's opinion. Not being bound to resort to an arbitration clause, which, so far as applicable
to a given situation, was imperative, it follows that the city's election to act under clause I was a waiver of any right to arbitration. Furthermore, clause J of itself afforded the city complete protection, and, as we have seen, fixed the principles upon which the balance due the plaintiff was to be ascertained, and implied the des termination of the rights of the parties by regular judicial proceedings. Section J does not in terms call for arbitration, and an intention to oust the courts is not to be presumed. Finally, in holding, as we do, that the ascertainment of the balance due the plaintiff under the provisions of section J is within the cognizance of the court in the ordinary course of judicial proceedings, we follow the principles enunciated in the cases of Guaranty Trust Company v. Green Cove Railroad, 139 U. S. 137, 143, 11 Sup. Ct. 512, 35 L. Ed. 116; Mitchell v. Dougherty', 62 U. S. App. 443, 90 Fed. 639, 33 C. C. A. 205.
To the suggestion of the defendant that it was incumbent upon the plaintiff to show what it cost the city to complete the work, in order to fix any balance due the plaintiff, I am unable to assent. There is no presumption of any increased cost. Were there any increase, that was a matter of affirmative defense, and any evidence thereof, moreover, was peculiarly within the knowledge of the city. No evidence on this point was adduced. As to the defense under the liquidated damage clause for delay, I find under the proofs that the city was responsible for that delay, and not the plaintiff.
It is proper to say that the subjoined finding consists of the following items: (1) Retained percentages on work done by the plaintiff, as shown by partial estimates Nos. 1 to 29, inclusive, with interest from April 16, 1900. (2) Work done under contract but not included in above estimate. (3) 459 cubic yards of excess excavation pelow plane shown on plans. (4) 16,000 cubic yards hand tamping around the influent and effluent chambers, caused by the defendant's
defaults in furnishing plans, and 16,000 cubic yards hand tamping in embankment, caused by the defendant's change of plans whereby the embankment was pushed further out than originally intended.
Finding of the Court. And now, May 21, 1906, the court finds in favor of the plaintiff and against the defendant in the sum of $81,341.
Amendment to Opinion. And now, to wit, this 8th day of June, 1906, upon motion of counsel for the city of Pittsburgh, and with consent of counsel for Jonathan Clark & Sons Company, it is ordered that the opinion of the court be, and the same is, hereby, amended in respect to the items contained in the finding of the court, so that said items shall read as follows: (1) Retained percentages on work done by the plaintiff as shown by partial estimates No. 1 to No. 29 inclusive...
$24,879 87 Interest thereon as we compute it, from April 16, 1900 to May 21, 1906
9,106 03 (2) Amount due and not estimated nor paid by the city to Jonathan Clark & Son in final estimate No. 29.
4,201 20 With interest from November 20, 1899, to May 21, 1906.
1,638 46 (3) 459 cubic yards of excavation below plane 243.75....
331 18 With interest from March 20, 1899, to May 21, 1906..
142 41 (4) 16,000 cu. yds. hand tamping around influent and efluent chambers
12,000 00 With interest from July 20, 1899 to May 21, 1906....
4,920 00 (5) 16,000 cu. yds. hand tamping in embankment caused by pushing it out three feet further than the original plans..
16,000 00 With interest from August 20, 1897 to May 21, 1906.
Making a total of
PENNSYLVANIA CO. v. LAKE ERIE, B. G. & N. RY. CO.
No. 1,930. 1. INJUNCTION-INTERFERENCE WITH PROPERTY—SUIT BY LESSEE OF RAILROAD.
A lessee of a railroad has an interest therein which entitles it to prevent by legal process any illegal interference with its enjoyment of the leased property, and may maintain a suit in a federal court to enjoin an unauthorized crossing of the track by that of another company, a citizen of another state, although the lessor may be a citizen of the same
state as the defendant. 2. STREET RAILROADS—RIGHT TO CROSS TRACKS OF STEAM ROAD-LAWS OF
Where a company has obtained the right from the proper authorities of a village in Ohio to construct a street railroad upon a street it cannot be enjoined by a steam railroad company whose road crosses such street from crossing such road with its tracks at grade; the steam railroad company itself having no right in the street, except subject to such proper use of it for street purposes as may be authorized by the municipality in the exercise of the powers given by statute, and no proceedings being required or provided for by the statutes of the state with respect to such crossings.
[Ed. Note. For cases in point, see vol. 44, Cent. Dig. Street Railroads, 8 114.]
In Equity. On motion for preliminary injunction.
TAYLER, District Judge. The Pennsylvania Company, a corporation of the state of Pennsylvania, being the lessee of and operating a line of railroad through the village of Woodville, Sandusky county, Ohio, filed its bill, alleging that the defendant company was a corporation authorized to construct a railroad, operated by electricity or other motive power, through Wood and Sandusky counties; that the defendant company seeks to install a grade crossing over the line operated by complainant at Woodville; and that the defendant has no right to so install a grade crossing without resort to appropriation proceedings, where there has been a failure to agree with complainant as to the terms of such crossing. A restraining order was issued ex parte on the filing of the bill, and the case now comes up on the answer of the defendant and the affidavits filed by the parties on the question as to whether the restraining order should be continued.
A preliminary question of jurisdiction arises on the claim that, as the railroad is owned by an Ohio corporation, the complainant cannot prosecute this action. As the complainant is lessee of the road, its interest in the property is such as to give it the right to prevent by judicial process any illegal interference with its enjoyment of the leased property, and this right it may enforce by injunction.
It appears from the proof that the defendants have received from the council of the village of Woodville authority to construct a street railroad along Water street, which includes the point where the tracks of complainant cross that street; and the question now presented is whether the defendant, without resorting to appropriation proceedings, possesses the right to put in crossing frogs of the kind required by section 2503, Rev. St. Ohio, 1906. I think there can be no doubt that the defendant possesses this right, and I think that one would look in vain for any authority in the defendant to prosecute any proceeding looking to the appropriation of a right to cross the tracks of a steam railroad in a municipality. Indeed, until the passage of the law of April 7, 1904, street railroads did not possess the right of eminent domain at all, and without entering into a discussion as to the effect of that act of April 7, 1904, on proceedings of this character, it is sufficient to say that it does not in any respect enlarge the right of a street railroad to obtain a crossing within a municipal corporation over the tracks of a steam railroad company.
But it is contended that the defendant is not a street railroad company, and that the railroad which it is constructing in the village of Woodville is not a street railroad. I do not think that this question is open to discussion. The council of the village of Woodville, in the manner provided by law, has authorized the construction by the defendant company of a street railroad along Water street and over a point where the complainant's railroad crosses that street. This, it seems to me, is conclusive upon the question as to what kind of a railroad the defendant proposes to construct. If it constructs some other kind of a railroad, or puts the railroad constructed to some other
use than that which the law and the ordinance of the village council permit it, doubtless a citizen or property owner affected by this misuse of a right will find ample remedy in the courts. The dominion which the state has delegated to municipalities over streets is so large as to leave no uncertainty as to the effect to be given to the right granted by the municipal authorities to a street railroad to operate its line on a street of the village.
Nor is this all to be said on the question presented. If it be said that the defendant's railroad is not a street railroad, and it is therefore without authority to cross the tracks of the complainant within the village of Woodville, I do not know how, if it is not a street railroad, it can acquire that right. So far as I have been able to discover, the rights of socalled interurban railroads, as respects the subject of appropriation, are determined by section 3443–10; but the right granted by that section can only be exercised outside of municipalities. By the act of April 25, 1904 (97 Ohio Laws, p. 537), provision was made for the method by which a steam railroad might cross the track of another steam railroad within the corporate limits of a city or village. The defendant company is not a steam railroad company, and therefore that act has no application here. The act of April 25, 1904 (97 Ohio Laws, p. 548), provides for the manner in which, outside the corporate limits of a city or village, the track of any kind of a railroad company may cross the track of another railroad company. These are the only laws pertinent to the subject under inquiry.
Complainant's bill assumes the possession by complainant of a right in the street which in law it cannot possess. The bill alleges that the defendant is about to enter upon complainant's “right of way.” In the sense in which this term is used in the bill, the complainant has no right of way in the street; that is, it has no tangible property therein. True, it has in strictness a right of way across the street; but this right is of an intangible nature. It has no more substance than the right of way over a street possessed by a pedestrian. So that to say that the defendant is about to enter upon complainant's “right of way," meaning the right of way it possesses across the street, is to say that the defendant is about to do what any and everybody has a right to do at all times, subject only to the movement of complainant's trains. What the defendant proposes to do is to introduce in the public highway, at the point where complainant's tracks cross it, another public use thereof, under authority of the municipal legislation necessary in such cases. The complainant has no property in the street, and none on it except a few ties and rails. The disturbance of these for the purpose of suiting them to the new use to be made of the public highway is necessary, and results in no invasion of complainant's rights.
But the right to put in crossing frogs does not carry with it the right to change the grade of the railroad. On the state of the case as it is now presented, the frogs and crossing must be so put in as not to disturb the present grade of complainant's track. The restraining order heretofore allowed will therefore be dissolved, and the injunction prayed for denied. An order may be entered accordingly.