Summary
In Ohio Crane Co. v. Hicks, 110 Ohio St. 168, 171, 143 N.E. 388, 389, the court said: "The parol evidence was admissible in this case for several reasons: (1) Because the written contract expressly refers to a verbal contract, and thereby excludes the theory of the merger of the oral agreement into the written agreement."
Summary of this case from J.I. Case Threshing Mach. Co. v. Buick MotorOpinion
No. 18165
Decided April 15, 1924.
Contracts — Construction to determine intent of parties — Oral agreement supplemented by writing — Compensation a percentage of total building cost — Parol evidence admissible to explain writing, when.
ERROR to the Court of Appeals of Crawford county.
This action below was by the defendant in error against the plaintiff in error, to recover 10 per cent. of the total cost of a building constructed by defendant in error for plaintiff in error. The plaintiff in error furnished all material, and paid for labor, which defendant in error agreed to furnish, and did. Defendant in error also furnished trucks, ropes, blocks, wrenches, erection tools, scaffolding, and all things incidental to the erection of steel work, brick work, wood work, and so forth.
The negotiations were in their inception verbal. Thereafter the plaintiff in error addressed a letter to defendant in error, of which the following is a copy:
"The Ohio Crane Company,
"Bucyrus, Ohio, August 10, 1916.
"To George B. Hicks, South Charleston, Ohio.
"To labor required in erecting the steel work, brick work and carpenter work on our new erecting shop 90'x200'.
"Price — as verbally agreed upon — actual cost plus 10%.
"It is understood that the company is to furnish all the materials used in construction of this building and that the contractor is to furnish his necessary tools for carrying on this work.
"The steel work is expected to arrive in Bucyrus by the latter part of August, and it is essential that the steel work be erected as soon as it arrives on the ground.
"Acknowledged 8/12, 1916.
"The Ohio Crane Company,
"C. Michael, Purchasing Agent."
To which the defendant in error sent the following reply:
"Geo. B. Hicks, Contractor.
"South Charleston, Ohio. August 14, 1916.
"The Ohio Crane Co., Bucyrus, O. — Dear Sirs: Yours of the tenth inst. received, covering extent of work and contract price.
"I will keep in close touch with the progress of your work, and will have the men and tools ready to place the steel when it arrives, and proceed with the work.
"Awaiting your further orders, I beg to remain, "Very truly yours, Geo. B. Hicks."
The record discloses that the defendant in error erected the building to the satisfaction of the plaintiff in error; that the period consumed in the erection was approximately 90 days. The plaintiff in error paid the wages of the laborers furnished by defendant in error in the sum of $2,639.94, which included all labor performed upon the building except the personal labor of defendant in error and of his superintendent, Johnson; that defendant in error personally spent a few hours per week actually on the construction job, and an indefinite portion of his time in securing laborers to work on the construction; that his superintendent, Johnson, spent on an average of two-thirds of every day upon the job; that the labor of defendant in error and his superintendent, Johnson, were not included in the pay roll; that defendant in error was paying his superintendent, Johnson, $40 per week.
It was the contention of defendant below, and is its contention here, that the letter of the plaintiff in error, and the reply thereto of the defendant in error, constitute the contract, that it is plain and unambiguous, and that the defendant in error was entitled to receive for erecting the building 10 per cent. of the cost of the labor, to wit, 10 per cent. of $2,639.94.
It was the contention of plaintiff below, and is here, that the contract, as evidenced by the letters, contemplated the payment to him for the erection of the building of 10 per cent. of the total cost of the building, to-wit, 10 per cent. of $24, 643.80; that the letters themselves require such interpretation, else plaintiff would not receive for the erection of the building a sum equal to the sum he paid his superintendent, and would receive nothing for his own time, his organization and equipment.
The trial court held that the meaning of the contract could not be determined without the aid of extrinsic evidence, and permitted evidence of the verbal negotiations to go to the jury, and in his charge to the jury submitted to them the question of the meaning of the written contract under all the circumstances. The jury returned a verdict sustaining the contention of the plaintiff, defendant in error here; motion for new trial was made and overruled; judgment was entered on the verdict; and error prosecuted to the Court of Appeals, where the judgment of the trial court was affirmed. Error is prosecuted here.
Mr. Chas. Gallinger, for plaintiff in error.
Mr. James B. Malone and Mr. Edward J. Myers, for defendant in error.
This cause undoubtedly was ordered certified by this court under a misapprehension of the facts of the case and the question involved.
The parol evidence was admissible in this case for several reasons:
(1) Because the written contract expressly refers to a verbal contract, and thereby excludes the theory of the merger of the oral agreement into the written agreement.
(2) The words "actual cost plus 10 per cent." are not defined in the writing, and, since the writing itself refers to both labor and material, the language could with equal propriety refer to either or both.
(3) The interpretation contended for by the plaintiff in error, as applied to the facts of this case, leads to an absurd result, in that it leads to the conclusion that it was in the minds of the parties at the time of the making of the contract that the defendant in error was to employ his time, his organization, and his equipment, and the time of his superintendent, for a period of 90 days without any possibility of receiving compensation therefor equal to the sum which he was under contract to pay to his superintendent.
We recognize the fact that, where a contract is plain and unambiguous, it does not become ambiguous by reason of the fact that in its operation it will work a hardship upon one of the parties thereto and a corresponding advantage to the other, that it is not the province of courts to relieve parties of improvident contracts, but that, where a contract is equally subject to several interpretations, one of which presupposes rational action upon the part of all parties thereto and the other irrational action upon the part of one of the parties thereto, courts in seeking to determine the intention of the parties will assume that the parties entering into the contract were each exercising reason, and give to the contract such reasonable construction as it will bear.
The oral evidence was competent in this case, not only because by reference it was made a part of the written contract, but for the purpose of clarifying an ambiguity by showing the meaning which the parties attached to the words they used in the writing at the time the writing was made.
Judgment affirmed.
MARSHALL, C.J., ROBINSON, JONES, MATTHIAS, DAY, and ALLEN, JJ., concur.
WANAMAKER, J., not participating.