CONTRACT CLAIM

Hauraki Plains Gazette, Volume XXXIV, Issue 4618, 26 October 1923, Page 2

CONTRACT CLAIM

BRENAN AND CO V. J. S. ANCHOR. JUDGMENT FOR PLAINTIFFS. (Before Mr J. H. Salmon, S.M.) A special sitting of the Magistrate’s Court was held In Paeroa on Wednesday last, when the greater part of the sitting was occupied in hearing the case of Brenan and Co., Ltd. (Mr J. L. Hanna) v, J. S. Anchor and Co. (Mr F. A. de la Mare), in which the plaintiffs claimed ,the sum of £lOO from the defendants, being the balance alleged to be due for goods supplied and work done in connection with a sewerage contract in Paeroa between the months of January and September, 1922. Mr Hanna said that the claim was for the balance due. Several payments had been made off the original claim during the year 1922. Letters were produced from defendants acknowledging the amount due and promising to pay by monthly instalments, plus interest. The supply of gravel commenced in January, 1922. No complaint was made about the goods being supplied until nearly five months after the last delivery. Mr Hanna said that plaintiffs did not wish to hide anything in connection with the transactions.

Philip E. Bfenan, sworn, said that he was secretary of Brenan and Co., Led., and it was his practice to keep the books of the company. Anchor and Co. obtained the contract for the borough sewerage, and his firm was engaged to supply gravel for the work at 16s per yard. The tally of the gravel supplied was kept daily. The driver of the vehicle carting the gravel handed in the record of his day’s work to witness, who entered the particulars in the books each evening. The contract commenced in January, 1922, and was concluded in September, 1922. The first cash payment was £2O, made in April, 1922, and the last payment was of £lOO in January, 1923.* The net balance of the account was £loo’. After a number of letters between plaintiffs and defendants concerning payments had been lead witness said that metal was usually supplied by the carters in the late afternoons a,nd was charged for on the date it was delivered. He -was quite sure that the gravel had been supplied as detailed in the records.

by Mr de la Mare, witness admitted that he was Mayor of the borough during the time the contract was in force. The shareholders in Brenan and Co., Ltd., were Jo«oph Brenan, Irene M. Brenan, Ethel Mary Brenan, H. R. Bush, M. H. Chamberlain, and F. J. Wilson. The Brenan family held altogether 16,000 shares out of 20,000. Arrangement for the supply of gravel were made between Messrs Anchor and Rusden on the Paeroa railway station. Witness was not the manager of the plaintiff firm. He did not remember his father quoting 15s per yard to the defendants, and had not said that his father hfid nothing to do with arranging the price. He could not produce the carters’ delivery books, and had to rely to a large extent' on the word of the carters. The waggons were often inspected, when signs of gravel would be seen. Witness was prepared to swehr that Messrs Anchor and Rusden had never asked for daily delivery dockets for- gravel supplied, but Mr Rusden had asked on occasions that the supply should be more regular. Witness remembered saying, when arranging the contract, that his firm would not quarrel over a few yards of of gravel. Defendants knew the. system which his firm intended to adopt when supplying gravel. He had no personal check on gravel delivered, and had to accept the word of the drivers. Mr Marsh had been paid for taking out 621% yards of gravel fipm the gravel bed at Mackaytown. Witness knew when the waggons carried sideboards, when approximately an additional half yard of gravel could be carried on the waggons. He did not always question the drivers as to whether sideboards were cairied. Frequently the waggoqs went out to Mackaytown specially tp bring in gravel or sand for the sewerage contract.

Re-examined by Mr Hanna, witness said that quite 75 per cent, ofr the loads of gravel would be delivered in the evenings when no one was on the job. There were no means by which a driver could profit himself by making an incorrect statement as to the quantity delivered. Monthly statements had been regularly supplied to defendants, and witness had received no complaint as to the quantity. To His Worship witness said that his firm had been supplying gravel to people other than defendants during the time of the contract. This concluded the case for plaintiffs. THE DEFENCE. Mr de la Mare submitted that the plaintiffs had failed to establish a case. The incorporation of the company had not been proved, and the certificate of incorporation had not been produced as required. He asked, therefore, for a non-suit, as the action had been taken by Brenan and Co., Ltd., and not by P. E. Brenan. Continuing, Mr de la Mare said that he would like.it to be noted that the provisions of sections 40, 41; 42, and 43 of the Municipal Corporations Act provided for the exclusion of the Mayor or councillors in the supply of goods on contract for borough works. He had not had ,the opportunity of finding out the true position of Mr PE. Brenan in his company. Mr Brenan was technically secretary, although he did practically the whole of the work. His Worship was asked to reserve the point as to a man being able to shelter behind his wife and family and control a business, be Mayor of the town, and yet flaunt the Act. A Mayor of a town dabbling in contracts had to be trusted, and his client had trusted him. Mr de la Mare considered that Mr Brenan was in a position that he should not have been in under the circumstances. Mr Brenan had placed himself in an improper position, and defendants had been led to believe that he was head of the firm,

Mr Hanna took exception to these remarks. Mr de la Mare said that he was sorry if Mr Hanna could not realise the impropriety of Mr Brenan’s actions ijn the case. He quoted extracts from the Act in support of the contention. He was prepared to admit that he had no definite proof of Mr Brenan’s position with the plaintiff firm, but the moral circumstances were there, nevertheless, and he asked His Worship to note section 43 of the Act. He submitted that the amount alleged to be due was not due, because the gravel had been short-delivered. The plaintiffs had already been paid £54'4 15s for gravel and extras, approximately 640 yards having actually been paid for. Mr Hanna asked that the other witnesses be ordered out of Court. He' then proceeded to prove that the fact that the wife of P. E. Brenan held shares in the plaintiff company ajs a separate being had no bearing on the case. It could be proved that P. E. Brenan was not, and is not, a shareholder in the company concerned, and the contract could not be termed null and void. Mr de la Mare said that he was prepared to waive the point. J. s. Anchor, of Hamilton, plumber and contractor, sworn said that he was the successful tenderer for the contract for sewerage works in Paeroa. He commenced work early in January, 1922, and later arranged for Rusden to get a supply of gravel for the work. Rusden said that he had been able to arrange for the supply of gravel at 15s per yard with Mr Brenan (senr.). Later Mr P. B Brenan said that he was the man tp fix the price, and not his father, and that the price for gravel would be 16s per yard. Witness said that dll his transactions had been w|th P. & Brenan. Rusden was in charge of the contract, and witness came to Paeroa at regular intervals. Dockets had never, been given by the carters, and he could not get them from Brenan and Co. It was the practice to get dockets for goods delivered by carters in other parts of New Zealand. The reason why he had not insisted on the production of dockets was because P. E. Brenan, in his capacity as Mayor, might make things hard for him. He did not press the point, but instructed Rusden to take a note of all gravel delivered. Mr Lockie Gannon’s estimate for gravel was about 550 yards for the job, including about 50 manholes. He suspected that he was not getting the correct quantities, and had pressed Rusden to get dockets from the carters if Mr Brenan would not supply them. No dockets had been supplied, and Rusden kept a tally for one week. It had been necessary to stop the job on one occasion because he could not get any money from the council. A tally kept by Rusden showed that 12 yards had been delivered, but he had been charged with 35 yards. He had never anticipated any difficulty when it came to squaring up with Brenan and Co. Witness said that his surveyor had taken measurements of the waggons, but he had not seen it actually done.

Cross-examined by Mr Hanna, witness said t,hat he was suspicious that short deliveries were being supplied., Rusden had kept a check for the one week. It was not possible tp complain about the amount charged felon ,the invoices because he had- no figures to check by at that time. He admitted that several chains of concrete had been put' down which exceeded the amount specified in the contract and required extra gravel. He had not complained earlier, about the short deliveries because he took the line of least resistance and tried to keep in with the Mayor, in ease his supply of gravel was stopped and progress payments delayed- Witness said that he had always received dockets for gravel on- .the contract work he had done in the South Island. Mr Brenan had told him at the beginning of the contract that there would be np quarrel over a few yards ofgravel. Harold Rusden, assistant traffic manager with J. J. Craig >,and Co., Auckland, sworn, said that he was manager for J. S. Anchor and Co., Ltd., during the recent sewerage contract for the Paeroa Borough Council. Witness detailed the negotiations entered into with the plaintiff firm’ for the supply of shingle. He contended that p. E. Brenan had said that the price would be 16s per yard, and that his father had nothing to do with quoting prices. He had gone to P. EBrenan because he was under the impression that Mr Brenan was manager. Witness said that he had written. and had also asked for dockets for all gravel supplied, and had been given the reply that “it would be all. right.” It was not possible to keep a check on the gravel, because it was not. delivered in one particular place. A tally had been kept for one week, and it was found that there was a .shortage of some 20 yards. Cross-examined by Mr Hanna, witness said that he trusted Mr P. E. Brenan, and was of the opinion that things were all right. He produced a diary showing the check that had been kept. Witness admitted that his diary was not as reliable as it might have been, as many of the entries had beep copied from a rough notebook. He was unable to keep ah accurate check on the gravel, and had relied on Mr Brenan. Mr, Anchor had asked for dockets, but when they were not forthcoming, rather than get* at loggerheads with Mr Brenan, who wasthen Mayor, the point was not pressed.

Harold E. Bright, civil engineer, Hamilton Borough Council, sworn, said that he was engaged on the sewerage work in Paeroa and was conversant with the details of the work. At Anchor’s request he had prepared an estimate of the amount of concrete required on the job, which was about 540 yar.ds, and the shingle required was about 675 yards. He had allowed a margin of 5 per cent, for wastage on the board in mixing and such like. The job should have beei done easily with 675 yards of gravel. He had checked lorry loads of gravel on two occasions, and both times found a decided shortage. He could not say that shortages occurred in every load, as he was not always present when gravel was delivered.

It was a general practice to receive dockets, and had he been an interested party in the contract he would have insisted on receiving them. To Mr Hanna witness said he knew that the same methods of delivering shingle had been followed out. Oil Spinks’ contract,, and he knew of no complaints as to short deliveries of. shingle. The estimates for concrete' and shingle had been prepared by him in April of .this year. Tp Mr de la Mare witness said that his estimates were based on his actual knowledge of the work. Ha did not know if Brenan was closely connected with Spinks in business. Tn summing Up Mr de la Mare featd that much of the evidence put forward by the plaintiff was more or less - hearsay. No doubt Mr ■P. E. Brenan had been quite honest, but he had put himself in an improper. position in taking part in a contract of that kind. Dockets had been asked for, but were not supplied, and the matter had not been pressed because of Mr Brenans’ position as Mayor of the borough, and also sub-contractor. Technically Mr Brenan might have shelter, but morally he had put himself outside of any leaning that the Court might have. Mr Hanna said that defendants nothing to gain or lose by endeavouring to poison the mind of the Court against Mr P. E. Brenan. He drew attention to the daily check and figures kept by plaintiffs, where defendants had admitted that they could not ' keep a daily tally of gravel. Monthly invoices had been sent to defendants, but they had never been queried. No complaint was made until plaintiffs had threatened to sue failing a settlement of the balance due. His Worship said that there was certainly a dispute regarding a few yards of shingle. The planitiffs had established a certain system of bookkeeping and the keeping of a tally. The system was not a perfect one, but defendants had not kept a tall/ at all. The evidence against defend- -j ants was so strong oh their own statements that the plaintiffs’ claim muster be substantiated. Judgment-wa<s given to’ plaintiffs. for the amount claimed, £lOO, less £43 ' 15s, which had been paid into Court,. leaving a balance of £5B ss, plus. court costs amounting to £8 7s.