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CHAPTER II

REQUISITES OF CONSTRUCTION
CONTRACT

§ 62. In General.-There is naturally nothing of more importance as affecting the mutual rights and liabilities of the owner, the builder, and, to a certain extent, the architect, than the construction contract, in that it is to the contract that the courts will look primarily in determining and interpreting the special rights and liabilities of the parties.1

While in the absence of a specific statute it is not necessary that the contract, if it is to be performed within a year, shall be in writing,2 yet the custom of reducing the terms of the understanding to written form has now become so well-nigh universal, and the desirability of a contract in definite written form is so apparent, that in referring to the contract hereafter it may be assumed, unless it is otherwise definitely indicated, that where the word contract is used a written contract is referred to.

It is one of the prime requisites of any contract that a valid consideration be present, and the

1 O'Keefe v. St. Francis's Church, 59 Conn. 551.

2 Champlain Construction Co. v. O'Brien, 117 Federal 271.

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building contract is no exception to the rule. It is essential also that there be present in the contract the element of mutuality-the obligation upon the builder to do the work and upon the employer to make payment for the work that is done;* a mere memorandum of prices signed by the parties cannot be held to be a binding contract, in the absence of an undertaking by the parties to perform the agreement. To these more fundamental requisites of a valid contract must be added the element that the building contract must be so phrased as to allow the intent of the parties to be deduced therefrom with a reasonable degree of certainty. In a comparatively recent case before the Federal Supreme Court, it appeared that there was a variance between the provisions of the contract and the specifications, and the court, in its opinion by Chief Justice White, referring to the irreconcilable provisions of the contract and specifications, said:

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"it is evident that there was a conflict so irreconcilable between the essential provisions of the assumed contract as to render it impossible to enforce it as an agreement between the parties . . . under the circumstances, therefore, the court erred in treating the contract as a valid agreement."

Analogous to the foregoing rule is the rule that where the specifications, in exact accordance with which it is covenanted the building must be

3 Majory V. Shubert, 82 (N. Y.) A. D. 633.

• Durkin v. City of New

York, 49 Misc. (N. Y.) 114.

Greve v. Ganer, 36 Wisconsin 369.

erected, are so indefinite and so erroneously drawn as to make impossible any proper interpretation of them, or the erection pursuant to them, of a building of any known dimensions, the contract will not be enforced."

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Other elements of the valid contract which should be specially noted are: That the contract must not contemplate a building in its very character capable of being used for an illegal purpose, and that it must, also, be so drawn as to comply with the provisions of the building codes and regulations in force where the building is to be erected."

It is not necessary that the construction contract, any more than an ordinary contract, be contained in one instrument solely, and other conditions or provisions may be incorporated in the contract as a part thereof by proper reference to them in the main instrument.10 Thus the pro

vision contained in Article 4 of the new standard form of agreement issued by the American Insti

6 United States v. Ellicott, 223 U. S. 524.

7 Lyle v. Jackson Co., 23 Arkansas 63, and see Turney v. Bridgeport, 55 Conn. 412.

8 Spurgeon v. MacElwain, 6 Ohio 442.

Burger v. Koelsch, 77 Hun. (N. Y.) 44; Eastern, etc., Metal Co. v. Webb Granite, etc., Co., 195 Mass. 356; but see Morse v. Maurer, 35 Pa. Super. Ct. 196, holding that where the contract has been performed in accordance with

its terms, the owner may not defend on the ground that additional expense will be required to make the work conform with the building regulations; and see Girard Life Insurance Co. v. Cooper, 162 U. S. 529; Disken v. Herger, 73 N. Y., A. D. 453.

10 Francis v. Heine, etc., Co., 105 Federal 413, reversed, but on other grounds, 109 Federal 838; Howard v. Pensacola, etc., Co., 24 Florida 560.

tute of Architects and approved by the National Association of Builders' Exchanges and other associations, providing that the drawings and specifications are made a part of the contract, is good; and when they are so incorporated in the contract, they become at once, by virtue of such incorporation therein, elements of direct importance in determining the rights of the various parties." The mere fact that the plans and specifications are not attached to the contract, although it is agreed that they shall be, has been held immaterial where the contract itself is sufficiently definite to determine the rights of the parties.12

While there would seem to be no damage occasioned either party by not attaching the plans and specifications as agreed where the contract is absolutely definite and clear without them, nevertheless, where the provision that they shall be attached is made a definite term of the contract, and is clearly inserted for the purpose of protecting the parties, by making definite and clear every term of their agreement, it is unsafe to attempt to extend the rule as stated so as to include such a case, or to take liberties with the contract by not attaching the plans and specifications, when it has been specifically covenanted as a term of the contract that they shall be attached.

11 Wilemet Steam, etc., Co. v. Los Angeles College Co., 94 Cal. 239; Howard v. Pensacola, etc., Co., supra., 24 Fla. 560; Cleveland, etc., Railroad Co. v.

Moore, 170 Ind. 328; but see
Hayes v. Wagner, 113 Illinois
Appeals 299.

12 Womble v. Hickson, 91 Arkansas 266.

§ 63. Importance of Statutory Provisions.The provisions in the various States in regard to construction and other contracts differ, as is natural, in many respects, and, as in the case of a lien, the only really safe course to pursue in any given case is to become thoroughly acquainted with the special provisions of the statute in the jurisdiction in which the case arises. In California, it has been held 13 that the contract cannot support an action for damages for its breach unless it is recorded, and that where an ordinance specifies that a permit must be obtained, a contract to construct without a permit is not lawful and will not be allowed to form the basis of a civil action.14 In Connecticut an agreement to build from plans and specifications not submitted to and approved by the officers by whom the statute required they should be approved, has been held to be void. 15 While the foregoing are instances of special State statutes they should be noted, especially, as excellent examples of the rule that prudence requires that in the making and in the performance of the contract, all the parties should give proper heed to such ordinances and statutes as may apply, even if it be considered that their application is not necessarily clear or of any considerable importance.

§ 64. Void and Illegal Contracts.—In this same connection a distinction should be noted between

13 Condon v. Donohue, 160 Cal. 749.

14 Smith v. Luning, 111 Cal.

15 Wilcox Manufacturing Co. v. Brazos, 74 Conn. 208.

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