no claim for extra work unless the same shall be done in pursuance of a written order from the architect, and all such claims shall be made to the architect in writing before the next ensuing payment, or shall be considered abandoned by the contractor." 15 This form might well be made a trifle fuller to prevent any possibility of mistake, but is interesting as exemplifying the main and essential points which the contract in this connection should cover. The disposition of the courts is to protect the owner in regard to extra work, by requiring that contract conditions precedent in regard thereto must be strictly complied with. Even if there be a separate provision in the contract to the effect that disputes in regard to the value of extra work must be submitted to arbitration, yet this provision will not in any way negative the effect of a provision requiring the builder to produce the architect's certificate of the satisfactory completion of the extra work, inasmuch as the arbitration provision in such a case has to do merely with the value of the extra work, as distinguished from the proper completion thereof.10 The courts have likewise very generally upheld and recognized the validity of the other provisions of the ordinary building contract, such as the provision that no extra work shall be done without the written order of the architect, and that no payment need be made for it, if done,

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

16 Fox v. Powers, 65 (N. Y.) A. D. 112.

without the production of the architect's order.17 The order may, however, be implied from some additional act of the parties, such, for instance, as the adoption of new specifications requiring extra work, an act which is, in itself, equivalent to a proper order for such work.18 The validity has been upheld also of provisions that there shall be no departure from the contract terms or from the specifications or drawings, without the consent of the architect or engineer in charge,1o and that there shall be no subletting of the contract unless the owner's consent be secured.20 While these provisions are inserted for the benefit of the owner, he may, of course, waive them if he elect so to do. 21

§ 68. Right of Owner to Complete.—There is no doubt that the ordinary provision that upon the failure of the builder to do the work the owner may complete the contract and employ others to that end is good; 22 and the courts have been liberal in their construction of such provisions. 23

Where the contractor leaves the work unfinished and fails to complete and the owner, un

17 Langley v. Rouss, 185 N. Y. 201.

18 Hedden Construction Co. v. Rossiter, etc., Co., 136 N. Y. A. D. 601-compare O'Keefe v. St. Francis's Church, 59 Conn. 551.

19 White v. San Rafael, etc., Co., 50 Cal. 417.

20 Danforth V. Tennessee, etc., Co., 93 Alabama 614.

V.

21 Danforth Tennessee, etc., Co. supra; Bartlett v. Stanchfield, 148 Mass. 394, opinion by Holmes, J.

22 Mahoney v. Oxford Realty Co., 133 A. D. (N. Y.) 656.

23 Duplan Silk Co. v. Spencer, 115 Federal 689.

der his contract right to do so under such circumstances, comes in and completes, it has been argued, in behalf of the contractor, that the presumption is that the balance of the contract price remaining unpaid at the time of the abandonment of the work by the contractor will be sufficient to defray the expense of completing the work. This contention is manifestly untenable and the law will not raise or recognize any such presumption under these circumstances.

24

In

§ 69. Suspension of Work by Mutual Consent. -It often happens that work is suspended by mutual consent of contractor and of owner. such a case before the contractor can properly proceed to recover the profits of the contract, he must take some steps to continue the work. An action brought by him before he has made any attempt to continue the work, and when there has been no refusal on the part of the owner to allow him to continue the work and complete the contract, is premature.

25

§ 70. Liquidated Damages.-Upon the question of liquidated damages it is very difficult, if not impossible, to state any definite, enforcible and yet comprehensive rule. The provision that, in the event of delay in the completion of the contract, a certain sum shall be paid to the owner, as damages for each day or similar period that the

24 Brainard v. The County of Kings, 155 N. Y. 538; TriBorough, etc., Co. v. Wechsler Realty Co., 163 N. Y. A. D.

25 Dreyer V. McCormack Real Estate Co., 164 App. Div. (N. Y.) 41.

work shall remain unfinished, is usually and in itself unobjectionable.26 In one of the cases last cited 27 the clause in the contract provided that

"the contractor shall pay to the owner Ten (10) Dollars for every day thereafter that the said work shall remain unfinished as and for liquidated damages,"

and in another case 28 it was provided:

"It is mutually agreed and understood that in the event of said interior finish herein contracted for not being entirely finished on or before the 15th day of March, 1905, that the actual damages sustained by the owner will be difficult of computation; therefore it has been agreed and hereby is agreed by and between the parties hereto that in the event of the failure of said contractor to have all of said interior finish of main entrance and eighth floor completed on or before the 15th of March, 1905, there shall be due and payable and said contractor shall pay to the said owner the just and full sum of $50.00 per day for each and every day after March 15th, 1905, that the same or any part thereof, remains unfinished and incomplete, and that said sum is hereby agreed upon as liquidated damages."

These provisions were sustained as proper provisions, under the circumstances of their respective cases, for liquidated damages, as distinguished from penalties. It must not be considered, however, that it was due to any magic in the language used that the court sustained them, for it is a well

26 Kelly V. Fejervary, 78 Northwestern 828; Mills v. Paul, 30 Southwestern 558; Chapman Decorative Co. v. Security, etc., Co., 145 Fed. 434, aff'd 149 Fed. 189.

27 Kelly v. Fejervary, 78 N. W. 828, supra.

28 Chapman Co. v. Security Co., 145 Fed. 434, supra; and see Standard Documents, Appendix B, p. 255.

recognized rule that in construing provisions of this character the courts will look at the intention of the parties, the subject matter, and the nature of the agreement, and from these determine the meaning of the wording used.29 The reason that the courts will exercise special care in dealing with this point is that, under the law, provisions for liquidated damages are recognized as valid, while a provision which constitutes a penalty, will not be enforced; where such a provision is found the courts will use their own judgment in awarding such damages as they deem reasonable.

The question which must always be determined, therefore, is whether or not, in a given case, the words used, combined with the intention of the parties and with all the attendant circumstances, are to be construed as intending or providing proper liquidated damages, or are to be construed, on the other hand, as a penalty, and therefore as unenforcible. The wording, however, is not entirely negligible by any means, for where it is provided that the amount specified is to be considered as liquidated damages the burden is upon the builder to show that, in reality, the provision constitutes a penalty,30 while if the sum named is alluded to as a penalty the burden is upon the owner to show, by a preponderance of proof, that it was intended to be and may properly be considered as liquidated damages.3 It has been held that

31

29 Ward v. Hudson, etc., Co.,

125 N. Y. 230.

30 Mills v. Paul, 30 S. W.

81 Small v. Burke, 92 A. D. (N. Y.) 338.