Jacob & Youngs v. Kent (1921)

Jacob & Youngs v. Kent
Court of Appeals of New York, 1921.
230 N.Y. 239, 129 N.E. 889.

Facts: Jacob and Youngs (P) contracted with Kent (D) to build a house at the cost of upwards of $70,000.  The defendant refused to pay the remaining balance of $3,438.46, and plaintiff sued to recover.  One of the specifications for the plumbing work provided 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, after they had begun to occupy the house, that some of the pipe was produced in factories other than Reading.  The architect directed the plaintiff to remove the non-Reading pipe, and install the correct pipe called for in the agreement.  Due to the expense of removing the pipe, the plaintiff left the work undone, and the architect declined to provide his certificate.  At trial, the plaintiff provided evidence that the installation of the incorrect pipe was neither fraudulent nor willful.  Additionally, the plaintiff attempted to show that, although the pipe was made by different manufacturers, its quality was the same.  This evidence was excluded, and a verdict was directed for the defendant.  The Appellate Division reversed, and granted a new trial.

Issue: Would the use of substitute materials, of equal or greater quality to those specified in an agreement, bar substantial performance?

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Holding: No.

Decision/Analysis: (Cardozo, J.) The court felt that had the evidence provided by the plaintiff as to the similarity of the pipes made by the different manufactures been admitted, it would have provided a basis for the inference that the defect was insignificant in relation to the project.  In this case, an allowance should be made for the difference in value of the structure had the Reading pipe been used rather than the pipe of other manufacturers, which would be nominal or nothing.  “The owner is entitled to the money which will permit him to complete, unless the cost of completion is grossly and unfairly out of proportion to the good to be attained.  When that is true, the measure id the difference in value.”  The order was affirmed, and judgment absolute directed in favor of the plaintiff upon the stipulation, with costs in all courts.

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