Jacob & Youngs

Case brief: template

Case name:	Jacob & Youngs, Inc. v. Kent
Court:	COURT OF APPEALS OF NEW YORK
Citation; Date:	230 N.Y. 239 (1921)

PROCEDURAL HISTORY
Trial court:		Appeal court (for appeal cases only):
Plaintiff:	Jacob & Youngs, Inc. - builder	Appellant:
Defendant:	Kent - owner	Respondent:

Facts of the case:
The plaintiff built a country residence for the defendant at a cost of upwards of $77,000, and now sues to recover a balance of $3,483.46, remaining unpaid. The work of construction ceased in June 1914, and the defendant then began to occupy the dwelling. There was no complaint of defective performance until March 1915. One of the specifications for the plumbing work provides that "all wrought iron pipe must be well galvanized, lap welded pipe of the grade known as 'standard pipe' of Reading manufacture." The defendant learned in March 1915, that some of the pipe, instead of being made in Reading, was the product of other factories. The plaintiff was accordingly directed by the architect to do the work anew. The plumbing was then encased within the walls except in a few places where it had to be exposed. Obedience to the order meant more than the substitution of other pipe. It meant the demolition at great expense of substantial parts of the completed structure. The plaintiff left the work untouched, and asked for a certificate that the final payment was due. Refusal of the certificate was followed by this suit.

Remedy sought:

Court opinion (including key issues and arguments):
The evidence sustains a finding that the omission of the prescribed brand of pipe was neither fraudulent nor willful. It was the result of the oversight and inattention of the plaintiff's subcontractor. Reading pipe is distinguished from Cohoes pipe and other brands only by the name of the manufacturer stamped upon it at intervals of between six and seven feet. Even the defendant's architect, though he inspected the pipe upon arrival, failed to notice the discrepancy. The plaintiff tried to show that the brands installed, though made by other manufacturers, were the same in quality, in appearance, in market value and in cost as the brand stated in the contract -- that they were, indeed, the same thing, though manufactured in another place. The evidence was excluded, and a verdict directed for the defendant. The Appellate Division reversed, and granted a new trial. We think the evidence, if admitted, would have supplied some basis for the inference that the defect was insignificant in its relation to the project. The courts never say that one who makes a contract fills the measure of his duty by less than full performance. They do say, however, that an omission, both trivial and innocent, will sometimes be atoned for by allowance of the resulting damage, and will not always be the breach of a condition to be followed by a forfeiture . There is no general license to install whatever, in the builder's judgment, may be regarded as "just as good" . . . The question is one of degree, to be answered, if there is doubt, by the triers of the facts . . . and, if the inferences are certain, by the judges of the law . . . We must weigh the purpose to be served, the desire to be gratified, the excuse for deviation from the letter, the cruelty of enforced adherence.... This is merely to say that the law will be slow to impute the purpose, in the silence of the parties, where the significance of the default is grievously out of proportion to the oppression of the forfeiture. The willful transgressor must accept the penalty of his transgression . . . For him there is no occasion to mitigate the rigor of implied conditions. The transgressor whose default is unintentional and trivial may hope for mercy if he will offer atonement for his wrong . . . In the circumstances of this case, we think the measure of the allowance is not the cost of replacement, which would be great, but the difference in value, which would be either nominal or nothing. dissent: I am of the opinion the trial court was right in directing a verdict for the defendant. The plaintiff agreed that all the pipe used should be of the Reading Manufacturing Company. Only about two-fifths of it, so far as appears, was of that kind The specifications of the contract become the law between the parties until voluntarily changed.

Disposition of case:
The evidence of comparability was excluded, and a verdict directed for the defendant. The Appellate Division reversed, and granted a new trial. Now under appeal The order should be affirmed, and judgment absolute directed in favor of the plaintiff upon the stipulation, with costs in all courts.

ECONOMIC ANALYSIS OF THE CASE

Efficiency/incentive issues discussed in the court opinion:

Other efficiency/incentive issues relevant to the case:

Assessment of the economic consequences of the court decision:

Case 5: Performance Variation From Terms
    1. Suppose a court is concerned only with efficiency: maximing the value from resource use in society. Would such a court order specific performance? (Replacement of the pipe?)
    2. Suppose the intent is to "let the punishment fit the crime": to award damages commensurate with the damages suffered. What measure of damages is appropriate for the case in question?
    3. Use your imagination to answer this: under what circumstances, or why, might a person care what the name is that appears at intervals along the pipe, buried deep in the ground, through which his family sewage flows? In my personal view, such a concern is evidence of a malfunctioning mind. But if a court is not concerned that benefits flow from contracts, and instead is concerned only with upholding agreements, such a question is not of any consequence. Having a morbid fondness for Reading pipe would not serve a homeowner well in an eminent domain proceeding: "I cannot accept a market value offer for my house, because I know the septic system contains only Reading pipe, and the thought of living in a different house for which that is not true simply makes me crazy." Relate that fanciful testimony to the role of subjective value in eminent domain.
    4. Could the Reading Pipe Clause have been inserted into the contract opportunistically? (I the homeowner know that you the builder are unaccustomed to monitoring the manufacture of the sewer pipe you use, and maybe I can entrap you into a contract breach if I can find a piece of pipe of other manufacture in your job.) If so, how should that affect a court's holding?