O'Brien v. Mayor of New York (139 N.Y. 543, 1893)

Peckham, J.

For a number of years prior to 1883 the city of New York had experienced the discomforts of an inadequate supply of water.

The necessity in that year for at once entering upon some work of magnitude sufficient to insure a largely increased supply for the city became imminent and inexorable. The past growth of the municipality had been phenomenal, and provision was to be .made for water not only enough for present necessities, but also sufficient for a population which the coming years were reasonably certain to see congregated within the corporate limits. The expense of such an undertaking could, of course, be only approximately estimated, but it was certain to cost, in any event, many millions of dollars. It is obvious that the machinery provided for the administration of the ordinary affairs of the city would be insufficient and inappropriate for devising and adopting a plan and superintending the due execution of an undertaking such as would be required in order to insure to New York the water necessary fo'r'its present prosperity and future growth. It was necessary to resort to the legislature in order to procure the passage of a-statute, by virtue of which the powers appropriate for such a work might be called into requisition and a body created'fitted to discharge the functions, in some respects, of a governing and controlling tribunal, with regard both to the work itself and to the men by whom that work should be accomplished.

The legislature accordingly passed an act which is entitled “An act to provide new reservoirs, dams and a new aqueduct with the appurtenances thereto, for the purpose of supplying the city of New York with an increased supply of pure and wholesome water.” The act is known as chapter 490; of the Laws of 1883, and it contains an elaborate scheme for the accomplishment of the end in view.

The learned presiding justice who delivered the opinion of the Supreme Court in this case has made a careful synopsis, of the material portions of the act, and I cannot do better than reproduce it here. It is as follows :

“ By the first section of this act the mayor, comptroller, commissioner of public works and three citizens were authorized, empowered and directed to carry out the provisions of the act in the manner thereinafter provided, and they were to be known as the aqueduct commissioners. By the second section it was provided that the commissioner of public works should, under the direction of the aqueduct commissioners, as soon as possible after the passage of the act, submit to them a plan or plans- for the construction of a new aqueduct of conduit for water, and for the construction of one or more dams or reservoirs to retain such water, and" for the construction of the appurtenances thereto. These plans the aqueduct commissioner's might adopt, modify or reject in whole or in part, and might cause such surveys to be made as they might deem expedient to enable them to act intelligently in the premises; and it was provided that in case of the rejection of any such plan or plans by the said aqueduct commissioners, the said commissioner of public works should, in like manner, prepare and submit another plan or plans, etc., which course should be continued until a plan or plans covering the entire work contemplated by the act should be approved by the aqueduct commissioners.

“The act then provided for the acquisition of the land necessary to carry out the work. And by the twenty-fifth section it was provided that the commissioner of public works should, from time to time, as might be necessary, prepare and submit to the aqueduct commissioners and to the counsel to the corporation forms of contract and specifications, and bonds for the faithful performance thereof, for the doing of the work and the furnishing of the materials required to be done and furnished by the said approved plan, or for the doing of such parts of such work and the furnishing of such parts of such materials as might from time to time be required for that purpose; which forms of contracts, specifications and bonds were to be approved by the aqueduct commissioners, and approved as to.form by the counsel of the corporation ; and that the said aqueduct commissioners should have"the exclusive authority to determine what provisions should be embodied in said contract, in order, so far as.might be possible, to save the city from loss, embarrassment and litigation by reason of any work done or supplies furnished thereunder, which approval should be evidenced by their certificate indorsed thereon, signed by a majority of them; and .the approval of the counsel to the corporation was to be evidenced by his certificate to that effect, indorsed in like manner.

“ By section 26 it was provided that when the form of the contract with its specifications and the form of the bond for the faithful performance thereof should have been approved as above provided, the said commissioners should advertise for sealed bids or proposals for the doing of the work or the furnishing of the material called for in such approved form of contract; and after the receipt of such bids or proposals, by section 28 it was provided that they should be publicly opened by said aqueduct commissioners, who were empowered to accept that bid or proposal, the acceptance of which would, in their judgment, best secure the performance of the contract; or they might reject any and all such bids. Section 30 provided that the contracts when so awarded were to be executed in triplicate by the contractors on the one part and the aqueduct commissioners, acting for the city of New York, on the other part; and that the work and materials, called for by such contract should be done and furnished under the direction and supervision and subject to the inspection of said aqueduct commissioners, their engineer, supervisors and inspectors, but such direction, supervision and inspection might be intrusted to the engineers and other subordinates of the department of public works so far as said commissioners should so direct; but in no event should the city of New York be held in any action or proceeding brought or had under any contract so made to any other or greater liability than that expressed therein, nor be required to pay out or . otherwise dispose of any sum of money for the doing of such work or the furnishing of such material greater than is stipulated in said contract) nor otherwise than in strict conformity to the terms thereof.

“ Section 33 provided that all work thereby authorized to be done and all materials to be furnished involving an expenditure of over §1,000 should be procured by contract made in the manner required by and pursuant to the provisions of the act. The said commissioners were, however, empowered without contract to cause such surveys to be made and such maps and plans prepared as should, in their opinion, be necessary to carry out the provisions of the act'; and might appoint and fix the compensation of suitable engineers and other persons to supervise and inspect all the work by said act authorized to be done. The said aqueduct commissioners were also empowered to procure any work to be done ivithout contract, not involving the expenditure of over §5,000, if they should certify that, in their opinion, it was for the public interest that such work should be so done, and in such certificate they were required to state their reasons therefor.”

Under the authority of this act the aqueduct commissioners published notices inviting bids for the execution of the work, which was divided into twelve sections, the total of which extended about thirty miles. The present action pertains only to section six. That section extends a distance of something over seven thousand feet. A copy of the published notice which invited bidders to bid for the contract for the construction is set forth in the record and covers some seven printed pages. It is quite niinute in regard to the various details connected with the proposed work, and the form of the contract which the successful bid o'er would be required to sign was annexed to the notice. The bidders were plainly notified that, the estimates of quantities of the various classes of work did not assume to be accurate, but came as near as possible to the work required, and the bids would be tested by those quantities. The bidders were required to satisfy themselves by personal examination of the location of the proposed work and by any other means as to the accuracy of the estimates, and they were notified that they could not, after the submission of a bid, dispute or complain of any estimate, nor assert that there was any misunderstanding in regard to the nature of the ■work to be done. They were also informed that the prices they bid must include and cover the furnishing of all materials and the performance of all labor requisite and proper, and the building and completing of all the section of the aqueduct, of the materials and in the manner set forth, as described and shown in the specifications and on the plans for the work, and in the form of contract, and were further told that they would be required to complete the entire work to the satisfaction of the aqueduct commissioners and in substantial accordance with the specifications annexed. The amount of security required for the performance of the contract for the section was stated to be seventy thousand dollars.

Parties were thus fully advised in advance of all that would be required of the person who secured the contract for this work. It was to be mostly underground, and its character, therefore, could not be, at the time, definitely or accurately known. Chances had to be taken, risks to be run and unforeseen contingencies to be allowed and provided for while estimating the prices for the various kinds of work that were to be done.

The plaintiffs, after such full notice, and with opportunities for acquiring all the knowledge of the character of the work of which it was capable, made a bid for the construction of this section, which was accepted by the commissioners and a contract entered into between them therefor. Of this contract the same learned justice has made a synopsis, and again I can do nothing better than to set it forth here as containing all that is necessary to refer to in the further examination of the case. It is as follows :

“ By this contract the plaintiffs agreed that they would, at their own expense and in strict conformity to the specifications in said contract contained, furnish all the materials and labor necessary or proper for the purpose, and in good, substantial and workmanlike manner excavate a tunnel and its shafts, do all other excavation and build all masonry, and do all other work necessary to build the aqueduct and all its appurtenances from the points therein named, in the manner and under the conditions therein specified.

“ Yarious general provisions then follow in the contract to the effect that to preveilt all disputes and litigation, it was agreed between the parties to it that the engineer should in all cases determine the amount of the work, and quantities of several kinds of work which were to be paid for under the contract, and should determine all questions in respect to said contract and the construction thereof, and in all cases decide errery question which might arise relative to the execution of the contract on the part of the contractor, and this estimate and decision should be final and conclusive on the contractor in case any question should arise; and should be a condition precedent to the right of the plaintiffs to receive any money under the contract. And the work to be done under the contract being mostly underground, and it being impossible at the time of the execution of the contract to estimate with accuracy the quantity of the various classes of work to be done and materials to be .furnished, it was, therefore, therein stated to be expressly understood and mutually agreed that the estimated quantities stated in the notice attached to the contract should be only for the purpose of comparing on a uniform basis the bids offered; and the contractor agreed that neither the parties of the first part nor the aqueduct commissioners, nor any of them were to be held responsible that any of the said estimated quantities should be found even approximately correct in the construction of the work; that he was satisfied and would at no time dispute the said estimated quantities as a means of comparing the bids, and that he would make no claim for anticipated profits or loss of profits because of a difference between the quantities of the various classes of work actually done or material furnished and said estimate; and he undertook and agreed that he would complete the entire "work to the satisfaction of the aqueduct commissioners and in accordance with the specifications and plans in said contract mentioned, at the price therein agreed upon and fixed therefor, except for such extra work for the performance of which written orders might be received, as in said contract elsewhere specified.

“ It was further agreed that the said tunnel, shafts and trenches should be excavated, and the masonry built, and all the work, labor and material to be done and furnished under the contract should be done and furnished strictly pursuant to and in conformity with the specifications'attached to the contract and the direction of the engineer under them, which specifications were declared to form a part of the contract.

■ “ By the first paragraph of said specifications it was provided that they showed the location of the work and its general character, and that during the progress of the work, working plans should be furnished by the engineer, and that all work during its progress and on its completion must conform truly to the lines and levels given by the engineer, and must be built by the plans and directions given by him from time to time, subject to such modifications and additions as he should deem necessary during its execution; and that in no case would any work in excess of the requirements of the plan or specifications be paid for unless ordered in writing by the engineer.

“ Paragraph 8 declares that borings have been made on portions of the line to ascertain the nature of the underground strata through which the shaft and tunnel are to be constructed, and the results of the borings are shown on the plans; but, should the character and extent of the various materials be found to differ from what is indicated, the contractor shall have no claim, on that account, and it is expressly .understood that the city does not warrant the indications of the borings to be correct. And paragraph 9 provides that the places where it is believed that the excavation is to be in tunnel and where in open trench and the limits of each are shown on the plan, but if, in the opinion of the engineer, the nature of the material to be excavated at any point, or the conditions of the case shall render it advisable, he may require the excavation to be made in tunnel, although the plans indicate that it is to be made in open trench, or vice versa.

“Paragraph 18 provides that masonry should be built within the tunnel at such points, and of such material, and of such form and dimensions as the chief engineer may determine from time to time, referring to certain sheets for illustrations of some of the proposed forms.

“ Paragraph 19 provides for weepers of certain dimensions to be built in the side walls and floor, and that no deduction in the measurement of the masonry will be made for the weepers, which must be built true and smooth.

“ Paragraph 21 provides that the tunnel at any place is to be excavated to the lines of the cross section determined by the engineer for that place, and that no payments would be made for any excavating outside of the cross section of the tunnel excavation determined by the engineer, but all loose or shaky rock must be removed. The price per cubic yard stipulated in said contract for tunnel excavation was to cover all excavation due to .the presence of quicksand or other soft material, rotten rock, boulders, etc., and the cost of all pumping and baling, of all timbering and the removal of same, of removing all excavated materials, of all ventilation, and of all other work incident to the excavation of the tunnel, and any expenses that might arise from loose and shaky rock, or from falls or cave-ins or from unexpected obstacles, was to be borne by the contractor.

“ Paragraph 22. The engineer was authorized to order at any time additional excavations in the tunnel or shafts, and the contractor was to do such excavation, which was to be measured according to the lines of the cross sections determined by the engineer, and paid for by the cubic yard as tunnel excavation.

“ By paragraph 23 it was provided that if after the excavation had been made of a certain size by direction of the engineer, he should be of the opinion that the nature of the rock or other material was such that the form and dimensions of the masonry for which said excavation was intended must be increased, he might order an enlargement of the excavation for the purpose of building masonry of greater thickness, and the contracter was to make such enlargement, which was to be measured according to the lines given by the engineer, and to be paid for at the price per cubic yard in said contract stipulated for tunnel excavation.

“ Paragraph 24. In rock excavation, the drilling and blasting were to be conducted with all possible care, so as not to shatter the roof and sides of the tunnel outside of the lines determined by the engineer, and in soft material precautions must be taken not to allow cavities to be formed behind the timbering or other supports, and especially in the vicinity of the existing Croton aqueduct the blasting and timbering and other operation connected with the work should be so regulated as not to cause injury to said aqueduct. And the contractor was to be held responsible for all injuries to said aqueduct caused by his work.

£,£ Paragraph 25. If, in the opinion of the engineer, the contractor, by the use of too high explosives, bad location of drill-holes and defective arrangements of timbers or supports, or want of proper skill or attention, should excavate the tunnel or shafts to greater dimensions than was required for the proper building of the masonry, the excess of tunnel or shaft area thus formed should be filled solid at the expense of the contractor with such kinds of masonry (brick, concrete or rubble masonry as in the said contract specified) or other material as the' engineer might direct.

££ By paragraph 26 the contractor was made responsible for properly supporting the roof and sides of the tunnel, and the sides of the trenches and shafts with timber or other supports. And it was further provided that if the engineer should be of opinion that sufficient and proper supports had not been provided he might order additional supports, order them modified or replaced at the expense of the contractor, and the compliance with such order by the contractor should not relieve or release him from his responsibility for the sufficiency for such supports. “ Paragraph 49 provided that all lines and grades were to be given by the engineer who might change them from time to time as he might be authorized and directed by said aqueduct commissioners, even to the extent of lowering or raising the grade line of the aqueduct, or ordering vertical or side drifts.

“ By paragraph 51 it was stated that the plans and specifications were intended to be explanatory of each other, and should any discrepancy appear, or any misunderstanding arise as to the import of anything contained in either, the explanation and decision of the chief engineer should be binding and final upon the contractor, and all explanations required, alluded to or necessary to complete any of the provisions of the Specifications and give them due effect were to be given by the engineer.

“ By section H of the specifications it was provided that no claim for extra work should be made unless before the performance of such extra work the said commissioners should have first authorized in writing such extra work, and should have also first certified in writing for each and every order that it is in their opinion for the public interest that such extra work should be done, stating in such certificate their reasons therefor ; nor unless before the performance of such extra work the price or prices to be paid therefor should likewise first have been agreed upon in writing between said commissioners and the contractor, and done in obedience to the written order of the chief engineer; and that the aggregate price should not exceed the sum of $5,000 on any one order.

“ By sub. O the prices for the work and its general character were fixed; for tunnel excavation, including all work incidental thereto, seven dollars per cubic yard was to be paid; for brick masonry laid in American cement mortar, and all incidental work, ten dollars per cubic yard; for concrete masonry, including all incidental work, five dollars per yard for one composition and five dollars and fifty cents for another; and for rubble stone masonry, including all incidental work, five dollars per cubic yard, etc.

“ By sub. T of the specifications it was provided that in order to enable the contractor to prosecute the work advantageously, the engineer should once a month make an estimate of the work done and the value thereof according to the terms of the contract, which estimates should not be required to be made by strict measurement, but might, at the option of the engineer, be approximate only; and upon each such estimate being made, the contractor was to receive ninety per cent of the estimated value of the work done and materials furnished; and that whenever, in the opinion of the engineer, the contractor should have completely performed his work, the engineer should so certify in writing to the aqueduct commissioners, and his certificate should state from actual measurement the whole amount of the work done by the contractor, and also the value of the work according to the terms of the contract; and that on the expiration of thirty days after the acceptance by the said commissioners of the work agreed to be done the city should pay to the contractor in cash the amount remaining after deducting from the amount so valued, contained and stated in said last-mentioned certificate, all such sums as should theretofore have been paid.

“ And by sub. U it was expressly agreed and understood that the city of Mew York should not, nor should any department or officer of the city of Mew York, be precluded or stopped by any return or certificate made or given by any engineer, inspector or officer, agent or appointee of said aqueduct commissioners from at any time showing the true and correct amount and character of the work which should be done and the materials which should have been furnished by the contractor.

“ And by sub. Y it was expressly understood and agreed that the action of the engineer by which the said contractor was to be bound and concluded according to the terms of his contract should be that evidenced by his final certificate, all prior partial payments being merely upon estimates subject to the correction of such final certificate, which final certificate might be made without notice thereof to the contractor or the measurements upon which the same were based.”

The plaintiffs, immediately subsequent to the execution of the contract, agreed with other parties that the latter should do the work specified therein, and should receive in payment therefor a certain percentage of the amount to be paid the plaintiffs under their contract with the commissioners. In thirty-three calendar months after the execution of the contract (which was Dec. 18, 1884), the plaintiffs therein agreed to complete the whole work according to the terms of the agreement. On Wednesday, June 25, 1890, the aqueduct commissioners adopted a resolution accepting the work done •and materials furnished by the plaintiffs under their contract for section 6, after making some reductions from the amount found due them under the certificate of the chief engineer.

Upon this contract the plaintiffs have been paid, on account, ns the work proceeded, and under monthly estimates of the amount of work done each month, the sum of seven hundred .and twenty-seven thousand, two hundred and fifty-five 83-100 dollars, and a final certificate has been given for twenty-one thousand five hundred and ninety-seven 14-100 dollars, which would make a total cost of that section of seven hundred and forty-eight thousand, eight hundred and fifty two 97-100 dollars. The plaintiffs allege that the city owes them a large ■amount of money in addition to the sum which has been paid them under this contract, and as the city has denied the existence of any legal claims against it by the plaintiffs growing out or by reason of the contract in question, the plaintiffs have commenced this action to recover the amounts of such claims, which they have placed at a total sum of seven hundred and thirty-two thousand, three hundred and twelve 93-100 dollars, with interest on various sums from various dates as stated in their complaint. The different causes of action are set forth in the complaint with all proper minuteness and detail.

The defendants put in an answer denying most of the plaintiffs’ allegations, and also setting up counterclaims not material io be here stated.

The plaintiffs put in a reply to the counterclaims. The •aggregate of the claims made in this action by the plaintiffs is alone sufficient to show the great importance of the case both to the plaintiffs and to the city of ¡New York.

The plaintiffs, however, had contracts of a similar nature for the construction of several other sections of the aqueduct, amounting in all to about one-half or fifteen miles of the entire work. On each section it is said that much the same circumstances existed, and claims against the city to a large amount and of a nature similar to those in suit have been made by the plaintiffs.

In addition to that it was also stated on the argument that the other fifteen miles of the work which had been let to other contractors had given rise to the same questions, and that in truth the present action was a kind of test suit upon which would depend to a large extent the result of the claims of the plaintiffs and the other contractors arising out of the work on the balance of the sections. It seems probable, therefore, that a sum of money amounting possibly to several millions of dollars depends upon the decision of this case, and its importance can scarcely be overestimated. The court has felt and appreciated the grave responsibility that has been cast upon it, and this decision is the result of a careful consideration of all the facts which were proved during the trial. The whole of the bulky record has been patiently gone over with an anxious desire that full justice should be done all the parties to this controversy. After mature reflection, and in the light of all the testimony in the case, we have come to certain conclusions which will now he stated.

The claims of the plaintiffs are set forth in some twenty-five different causes of action contained in their complaint. Their counsel have themselves separated the different causes of action into two classes, one of which includes claims for moneys earned under the provisions and according to the terms of the contract alluded to, and the other includes claims for the increased cost of work, occasioned by the mistakes, omissions and acts of the defendant and its officers during the performance of the work.

An analysis of the various causes of action set out in the complaint of the plaintiffs would show that a great variety of questions would arise in the course of an examination of the evidence with regard to the specific causes of action set forth in the complaint if it became necessary to enter upon a discussion of the merits of each. For the reasons which will be stated hereafter, such an examination of most of them will not be necessary. The claim for compensation for rock excavation is the principal one in that class of claims which seeks the recovery of moneys pursuant to the terms of the contract. It stands upon a foundation by itself, and may be treated separately from the others.

First. The causes of action set forth in the complaint and comprising the first four counts thereof, are those which refer to this matter of excavation. It is a most important claim, and amounts, as alleged in the complaint, to about $150,000.

It is for an amount of tunnel excavation which plaintiffs allege has been done by them and has not been allowed by the chief engineer or paid for by defendant. The latter answers this claim by setting up the fact that the city has paid the plaintiffs all the moneys covered by the monthly or progress estimates of work done during the construction of the aqueduct in section 6, and that a final certificate showing a small sum due the plaintiffs has been made by the chief engineer, as provided for by the contract, and that in any event only the sum represented to be due in such final certificate can be recovered from the city. This difference between the amount of the plaintiffs’ claim for tunnel excavation and the amount allowed therefor by the chief engineer does not arise from any mere alleged mistake in the measurement by the engineer of the amount claimed to have been excavated by the plaintiffs. It arises to a great degree from a radical difference in the construction of the terms of the contract between the parties. The line of limitation within which the measurement of the excavation should be made is the matter of difference between them. The plaintiffs claim that the contract calls for one line to be determined upon certain principles, while the defendant claims that the true construction of the contract calls for another line which allows a much smaller amount of excavation. The measurement, as finally made, has been according to defendant’s construction of the contract. There is no dispute as to the fact that a larger amount of excavation has- in truth been made by the plaintiffs than they have been paid or allowed for, but the respondents allege that the plaintiffs have been paid or allowed for the full amount of excavation called for by the contract, and for which the defendants were under any liability to pay. The question of the construction of this contract upon the matter of the payment for excavation is one of law,- and is of fundamental importance, and will be first discussed.

What seem to be the most material provisions of the contract upon this subject are the following:

By clause F11 it is provided that “ the form and area of the cross section of the tunnel excavation at any place shall be such as the engineer may determine for that place, but at all points it shall have an area of at least 201 square feet. Various forms of cross sections of the tunnel excavation are illustrated on sheets Nos. 8£, 9-J and 16 of the plans. On the plans the line limiting the cross section of the tunnel excavation is designated by the letters AAA.”

FZ1.

“ The tunnel at any place is to be excavated to the line of the cross section determined by the engineer for that place.”

“No payment will be made for any excavation outside of the cross section of the tunnel excavation determined by the engineer; but all the loose or shaky rock must be removed.” * * *

F22.

“ The engineer may order at anytime additional excavations for the chambers in the shafts for the skewbacks of arches, for the sump holes or for any other purpose in the tunnel or shafts; and the contractor is to do such excavation which is to be measured according to the lines of the cross sections determined by the engineer, and paid for by the cubic yard as tunnel excavations.”

F23.

“ If, after the excavation has been made of a certain size by direction of the engineer, lie is of opinion that the nature of the rock or other material is such that the form and dimensions of the masonry for which said excavation was intended must be increased, he may order an enlargement of the excavation for the purpose of building masonry of greater thickness, and the contractor is to make such enlargement, which is to be measured according to the lines given by the engineer, and paid for at the price per cubic yard herein stipulated for tunnel excavations.”

Fu.

“ In rock excavation the drilling and blasting must be conducted with all possible care so as not to shatter the roof and sides of the tunnel outside of the lines determined by the engineer.” * * *

F25.

“ If, in the opinion of the engineer, a contractor by either the use of too high explosives, bad location of drill holes, defective arrangement of timbers or other supports, or want of proper skill and attention, shall excavate the tunnel or shafts to greater dimensions than is required for the proper building of the masonry, the excess of tunnel or shaft area thus formed shall be filled in solid at the expense of the contractor with such kind of masonry (brick, concrete or rubble masonry as herein specified) or other materials as the engineer may direct.”

Upon referring to the plans as spoken of in the clause F17, it will be seen that this line AAA is “ the line limiting the cross section of the tunnel excavation.” It includes a space of a horseshoe shape, 15.53 feet from top to bottom and 15.60 feet in width at the widest part. Inside of this line is designated a ring either wholly or in part filled in with brickwork twelve inches in thickness, and the space inside this ring is 18.53 feet in height and 13.60 feet in width..

It appears that the line AAA is in reality coincident with the exterior boundary line of the brick work of the tunnel. ¡Some of the sheets illustrating the various forms of cross sections show the tunnel lining of brick work to be twelve inches in thickness, some of them sixteen inches and some of them even more, but they all leave the inside space of the tunnel to be such as to give the requisite size of 201 square feet.

This general statement of what appears on the plans and specifications is not substantially in dispute, but the inferences, which the parties draw from the various clauses of the contract above set forth differ widely.

By the final certificate the plaintiffs have been allowed at all times at least as much excavation as was limited by the exterior lines of the brick work surrounding the tunnel at any particular point. The allowance has invariably been more than was limited by the line AAA, and such allowance has boen explained by the engineer, and he stated the principle upon which it was done, so that it was always assumed that the line-AAA was the true limit by which to measure the amount of excavation to be allowed the plaintiffs. Upon a careful consideration of the subject it seems to me the defendant is clearly right in the construction of the requirements of the contract upon tlie subject of these measurements. The measurement is governed by the clauses of the contract, which state that the form and area of the cross sections of the tunnel excavation at any place shall be such as the engineer may determine, and that various forms of cross sections of such excavation are illustrated on sheets of the plans, and that on. the plans the line limiting the cross section of the tunnel excavation is designated by the letters AAA, and that no payment will be made for any excavation outside the cross sections of the tunnel excavation determined by the engineer.

The plaintiffs say these cross sections could not be determined by the engineer in advance of the progress of the excavation, and that the contractors could not earlier know just exactly what the cross section was at the point where they were excavating, and that until the cross sections were definitely defined after the excavation was made, there could he no' absolutely accurate fine for determining the exact amount of excavation which should be allowed. They say that in determining the cross section after the excavation was made, regard should be had to the necessary amount thereof taken out in excess of the area for the tunnel, because of the impossibility of cutting out the precise area required through a substance like solid or soft rock, which could not be cut, as was said, like a piece of cheese.

Whether the cross section could be accurately determined before the excavation is not the material point. The contract provided what the rule should be for the determination of the cross section whenever it was determined, and that rule was to determine it in conformity to a line appearing on the sheet annexed to the plans and marked AAA, and that line was coincident with a line which was exterior to the brick work or lining of the tunnel. Boyond that line, the contract, in terms, provided that no payment should be made. The plaintiffs, also, refer to a section of the contract which they say characterizes, and to an extent, explains the meaning of the other clauses already spoken of, and they urge that such section makes it plain that the engineer was to allow in determining the cross section, a certain amount of necessary excavation beyond the area in which the tunnel and its lining could be placed.

They refer to the clause (A25) last above cited, and from it they argue that the meaning of the contract is that if they excavate no more than is reasonably necessary while guiding their blasting with care and caution, the excess of the excavation is to be paid for, while the penalty provided for excessive excavation is their liability to fill up at their own expense the space unnecessarily excavated, with solid masonry of such material as the engineer may direct. There seems to me no connection between the two matters.

As to excavation, the contract provides it shall be measured by the cross section determined by the engineer, however that may be done, and payment shall not be made for any excavation beyond the line of the cross section determined as stated.

This 25th section, does not in any manner interfere with, explain or control the meaning of these other clauses already alluded to. The effect is that not only shall the contractor receive in no case any pay for excavation outside the cross section line, but if the excess of excavation is caused by negligence or using too high explosives, etc., he shall fill up the excess at his own expense.

It does not seem to us that there are any other clauses in the contract, plans or specifications which can alter what we regard as the plain meaning of those already cited, and by which the plaintiffs are limited to the excavation necessary for the tunnel and its lining. The plaintiffs, however, urge that the line AAA was never intended as a line of payment, but ' Snly as a line of guidance for the placing of the drill holes so that the excavation should be at all times as much as that line indicated, and as little more as possible, and that the cross sections to be thereafter determined by the engineer, were to be so determined with reference to the fact that the excavation could not, with the utmost care and caution possible, be restricted to absolutely the area necessary for the aqueduct with its brick lining.

I can draw no such inference or condition from the language employed in the contract, but, on the contrary, it still seems , perfectly plain that the cross sections whenever they were taken or how, should be determined by the engineer with reference to the exterior line of the brick work lining the tunnel.

The fact that the contract provided for working plans to be thereafter furnished the contractors, and that the contract stated that the plans were to show the location of the work, and its general character, does not affect the question. There were working plans subsequently furnished, and the engineers did give orders, from time to time, in the course of the progress of the work, relative to the same. There is no pretense that any working plan, or any orders, provided for or directed an excavation outside of and beyond the area necessary to build the aqueduct with its lining of the thickness which was required at any particular place. We, therefore, think the engineer had no discretion in fixing his cross sections, but that when the thickness of the lining had been settled at any given point, then the cross section should be determined in accordance with the fact as heretofore stated.

If this be the correct interpretation of the meaning of the contract then both parties must be bound by it even though it should seem to be unjust or oppressive in its nature. The parties have so bound themselves would be the answer to any claim of injustice or oppression. In truth the language seems so plain that we could readily believe an assertion that parties-who bid on the work did so in the light of this meaning as to excavation, and that in consequence the price bid for this kind of work was regulated accordingly.

We are, as a result of the examination of this contract, brought to the belief that the cross section, beyond which no payment for excavation could be made, was to be determined in accordance with the views just expressed.

A final certificate embodying the results of measurements made upon such a basis would be the evidence upon which the plaintiffs must rely in their action. It appears the chief engineer has made his final certificate on this basis. Assuming the principles of the measurement to be correct, there is no claim that any mistake has been made in the mere process of measurement upon the basis actually adopted.

The contract provides, in clause 7 of general clauses, for monthly estimates of work done during the preceding months, and for the payment of ninety per cent of the estimated amount, but it is expressly stated that such estimates are not to be required to be strictly accurate, but may be approximate only. And whenever, in the opinion of the engineer, the contractor has completely performed his contract, the engineer must so certify in writing to the aqueduct commissioners, and in the certificate he must state from actual measurements the-whole amount of work done by the contractor and its value under and according to the terms of the contract, and thirty days thereafter the commissioners will pay the amount stated, in the certificate.

By clause V of the contract the contractor agrees that the action of the engineer which is to bind such contractor shall be evidenced by his final certificate, all prior partial payments being made merely upon estimates subject to the correction of such final certificate, which may be made without notice thereof to the contractor or of the measurements upon which the same is based. The contractor also agreed not to demand or be entitled to receive payment for the contract work or materials or any portion, except in the manner set forth in the contract, nor unless all its provisions had been kept and the engineer had given his certificate to that effect and the aqueduct commissioners should have accepted the work.

A final certificate was introduced in evidence by the defendant under which it appeared that there was due the plaintiffs some twenty-one thousand dollars, and the defendant claimed that the plaintiffs were bound by that certificate and could collect no more than the amount specified therein.

To this the plaintiffs interpose several answers. They say that the engineer on February 7, 1887, duly decided under a provision of the contract empowering him so to do, that the true interpretation of the contract was for an equitable allowance for excavation over and above the strict amount necessary to provide for the aqueduct, and that pursuant to such decision the plaintiffs for some time thereafter were allowed on monthly estimates for excavation on such a basis, which was beyond the exterior line of the brick work of the tunnel, and that such measurements had been continued up to the time of a change in the office of chief engineer, and in the personnel of the aqueduct commission, and they claim that the decision of the former chief engineer as to the manner in which future measurements of' excavation should be made, was binding in regard to all such future measurements, and that it must be the guide in making measurements for the final certificate, although to do so would, of course, overturn the principle upon which the measurements had been made up to the time of the decision of February seventh. It was said that the provision referred to regarding the conclusiveness of the final certificate when made did not apply to or reach such a case, because there had been a proper determination as to the true basis for these estimates, which determination was made permanent by the express terms of the contract, and if the final measurements, as shown by the final certificate, did not proceed upon the same basis it was clear and conclusive evidence of a mistake and of such a nature as would allow plaintiffs to recover for the extra amount of excavation notwithstanding such final certificate. It was also alleged that the final certificate had not in fact been made before the commencement of this action, but that it had been .wrongfully, willfully and unreasonably withheld, and the plaintiffs could, therefore, maintain this action without producing such certificate, and could recover for the just amount of excavation upon the basis of the decision of February seventh, and upon proving what was “ unavoidable excavation ” outside of and beyond the lining of the tunnel.

It was also alleged that the final certificate was the result of and was in itself a fraud upon the part of the chief engineer who made it, and hence it was no bar to this action. An estoppel was also claimed to exist in favor of plaintiffs. Upon the question of the decision of the former chief engineer, plaintiffs cited provision “ B ” of the contract.

That provision says that “ to prevent all disputes and litigations, it is further agreed by and between the parties to this contract that the engineer shall in all cases determine the amount or the quantity of the several kinds of work which are to be paid for under this contract, and he shall determine all questions in relation to said work and the construction thereof, and he shall in all cases decide every question which may arise relative to the execution of this contract on the part of the contractor, and his estimate and decision shall be final and conclusive upon said contractor; and such estimate and decision, in case any question shall arise, shall be a condition precedent to the right of the party of the second part to receive any money under this agreement.”

Paragraph 51 of the general clauses of the contract also states that the decision of the chief engineer upon any misunderstanding which has arisen as to the import of anything contained in the plans or specifications, shall be final and binding on the contractor.

In addition to the omission in both-these clauses to provide that the decision of the engineer shall be binding on the commission there is a special clause in the contract that the commission or their successors shall not, nor shall any department or officer of the city of Hew York, be precluded or estopped by any return or certificate made or given by the engineer under or in pursuance of anything contained in the contract, from at any time showing the true and correct amount and character of the work done or materials furnished by the contractors or any other person under the contract.

It apjDears from these citations that the decisions of the engineer are only made final and binding upon the contractor, and hence the defendants are not prevented from asserting the true construction of the 'contract under any of these clauses. The fact that the same expression is used in two widely separated clauses of the contract shows that neither the provision for binding the contractor by the decision of the engineer nor the omission to provide that the decision of the engineer should be final and binding upon the aqueduct commissioners or any one in whose behalf they acted was at all inadvertent. Heither of these provisions authorizes the engineer to finally bind the commission by any decision he may make during the progress of the work. The affirmative provision that the commission shall not be bound, places the matter beyond all question, and leaves it at liberty to contend for the true and legal construction of the contract, notwithstanding any so-called decision of a chief engineer to the contrary.

This contract bears evidence of extreme care and caution in its preparation, and it was intended evidently to guard the interests of the city to the greatest extent possible consistently with the procurement of the work by responsible and capable contractors. In all large and public works experience has shown the necessity for this endeavor. There is no spur like self-interest in business enterprises, and it may be regarded as certain that the contractor will always take care of' his own interests so far as it is possible. This is natural and proper, and no fault can be or is found with such a fact. But how far the officers or employees who represent the general public or the corporation which is building the work can be depended upon for steady, earnest, zealous and able attention to the public interests is always a matter, to say the least, of some doubt. Hence the provisions for the binding force of the engineer’s decision upon the contractors and an omission of any such provision in relation to ihe other parties to the contract.

In fact, however, the evidence plainly shows, as it seems to me, that the proceedings which led up to the writing of the much-talked-of letter of February 7,1887, were not taken, nor was the letter itself written and sent to the committee, with any view of obtaining or pronouncing a decision upon the question of excavation which was to be a binding rule upon the commission and which it expected to follow and be controlled by, whatever it might be.

The main idea would seem to have been on the part of the construction committee to obtain an exact and specific statement of the claims of the contractors, and then to obtain for the information and use of the commission itself, the opinion of the chief engineer upon the subject of those claims and their allowance. The language used to the contractors by some members of the commission, as alleged, that the engineer would give them a ruling on the matter of the excavation, is perfectly consistent with this view. Certainly the very purpose of referring the matter to the chief engineer was to get his opinion or ruling on the question, but the fact that the latter officer treats the matter in the light of a report to the construction committee and not as a decision by him which he was entitled to finally make under the contract, and regardless of the future action of any one, shows what the understanding was upon the subject. A reference to the history of this so-called final decision by the engineer, I think, makes the whole matter perfectly plain.

The question of the allowance for excavation was raised by the plaintiffs, by a demand upon the aqueduct commission for a greater allowance. The demand was in writing and addressed to the chief engineer, but the plaintiffs proposed to show, and claimed that the aqueduct commissioners acted upon it by referring it to him.

The minutes of the construction committee of the aqueduct commissioners show that they received such a communication from the plaintiffs, and also from the contractors for the other sections of the aqueduct, and that they were referred to the chief engineer, and he was directed to communicate with the contractors and°request them to present their claims in writing,

, stating specifically the points for which they claimed extra compensation, and that after the receipt of such communication the chief engineer should fix a day when they could be heard upon the subject. Subsequently the chief engineer asks the contractors to send him their claims in writing, and it appears from the minutes of the same construction committee that at a meeting of the committee held on January 28, 1887, the contractors appeared before the committee and were given an opportunity to state their views to the committee as to their claims for tunnel excavation. The committee then referred the matter to the engineer. That official, as the contractors state, after consultation with some one, prepared a report to be made to the committee in answer to the reference of the question to him, and before handing it in, he read it aloud to the contractors and asked if they accepted it, and they said they did. He then took it to another room and handed or sent it to the committee. He thus became satisfied in advance that his opinion would be favorably received by the contractors. In that opinion he did state that in his view the contract properly construed, permitted and provided for equitable cross sections beyond and in excess of the area required to be excavated for the tunnel and its lining. There seems to be some indefiniteness in regard to the identity of the report made by the engineer, there being two letters (and possibly three to be gathered from the evidence) written by him, each of which differs somewhat from the other, but I assume the first letter set forth in the record, and dated February 7, 1887, is the report which the engineer in fact signed and sent to the committee on construction.

Up to this time the measurements had never been outside of the exterior line of the brick work of the tunnel. Subsequent to the making of the report there is evidence that a few monthly estimates were made upon the basis recommended therein. One witness thought as much as one-seventh of the whole amount of such estimates was so made. It would seem as if this must be a mistake. On the 25tli of February, 1887, the plaintiffs made a written demand on the aqueduct commissioners that the engineer be instructed to make his estimates in accordance with his ruling of February seventh, showing it had not been done up to that time. It is testified that as early as in May, 1887, fault was found by the contractors with the engineer, because he did not estimate on the basis of his letter of February seventh, and he answered that the commission would not permit it. There is no evidence of any change on the part of the commission on that subject during the summer, while in the fall it appears by the record that the question was under discussion and the plaintiffs were not obtaining their estimates under the February letter as they claimed they ought. It would, therefore, seem that in any event but a very small amount of estimates was ever made by the engineer upon the basis of this February report. It may be assumed though that the amount was one-seventh of the whole, and yet the fact is not material.

The question was never regarded as finally settled by the report, nor was it acquiesced in by all parties. There was general and almost daily discussion among the parties on every side in regard to the contract as to what it meant and what it did not mean. The construction committee no later than the 7th of March, 1887, asked the chief engineer to form a code of rules for estimating the extra excavation, and it had not up to that time formally approved the plan contained in the report, but, on the contrary, it was matter of debate. On the 28th of March, 1887, in accordance with the request by the committee the chief engineer sent to it a communication embodying what is termed “ the four rules ” for the measurement of excavation.- These four rules did not give as much excavation as did the report of the engineer to the construction committee, as they limited the line of allowance for excavation to the external boundary line of the masonry or other, supports ordered by the engineer in accordance with sections F 17, 20 and 21.

Yet the construction committee, at a meeting held at sometime prior to the 20th of April, 1887, adopted a report to the aqueduct commission, recommending the commission to-approve and adopt the report of the chief engineer, dated February 7, 1887, for the measurement of the excavation under the contract.

The aqueduct commissioners held a meeting on the 20th of April, 1887, at which the report of the committee on construction was read. The adoption of the report was opposed by one of the commissioners (the commissioner of public works), who read a copy of a letter addressed by him to the counsel to the corporation, and also án opinion of that official dated that day (April twentieth), and then the report by the committee and the communication of the commissioner of public works to the counsel to the corporation and his reply were referred back to the construction committee. The latter committee met on the twenty-fifth of April, and adopted a resolution rescinding and repealing every resolution or action of the committee, prescribing rules and methods for the measurements of excavation in the tunnel, and recommending the chief engineer and his subordinates to conform, in all their determinations and estimates as to quantities, strictly to the provisions of the contract as the sole rule for such determination.

This resolution was reported to the aqueduct commissioners, at a meeting held by them on the twenty-seventh of April, and the report of the committee was unanimously adopted. It was subsequent to the adoption of that resolution and. some time in May, 1887, that the contractors had the interview with the engineer above spoken of, in which they found fault with him for not estimating their excavation upon the basis of his February letter, and in that interview the engineer answered that he did not so estimate upon the excavation, because the commissioners would not allow him to do so, and he said they had directed him to be governed by the corporation counsel’s interpretation of the specifications. The interpretation of the corporation counsel was entirely adverse to the claims of the contractors, and to the interpretation of the contract as made by the engineer on February seventh.

The disputes upon the question were kept up all the summer of 1887, the contractors asking for estimates upon the basis of the February letter, while the engineer omitted to give them, although stating he ’thought his interpretation of the contract as contained in that letter was. the true one, but the commission would not accept it or permit such measurements. In November, 1887, the construction committee •appointed a sub-committee to meet with the corporation counsel and comptroller, and confer with them on the subject of the contractors’ claims for terminal excavation. Upon notification the contractors appeared before this sub-committee and on December 8, 1887, the sub-committee, with the assent of the corporation counsel and the comptroller and the chief engineer, adopted a resolution by which it was decided that the cross section of tunnel excavation (excepting timber sections) should be the area of the conduit plus that of the masonry around the conduit necessary to preserve the shape of the conduit against the surrounding medium, allowances to be made for the necessary weepers and other contrivances especially mentioned in the contracts.

On the 28th of December, 1887, the committee on construction announced to the contractors that if they would agree to it the committee was willing to adopt and approve the resolution recommended by the sub-committee, and would report their views in the premis