The jury here was entitled to find that by reason of the obligation which Beaver Valley had assumed under its pending subcontract, it was required to and did incur expense; and that Terminal benefited from the expense incurred by Beaver Valley to the extent of the portion of the contract work which Beaver Valley had performed when, as the jury apparently found, Beaver Valley was prevented by Terminal from further performance. The net effect of such findings, which are consistent with the jury's affirmative verdict in favor of Beaver Valley, was the recognition of a loss to Beaver Valley enuring to the benefit of Terminal. Implicit, if not expressed, in Terminal's present motions is the contention that, because of the absence of evidence from which it may be inferred that Beaver Valley would have made a profit if it had completed the contract work, no profit would have been made. The burden of proving that no such profit would have accrued to Beaver Valley upon full completion of the contract falls, under the provisions of § 333 of the Restatement, upon Terminal. The jury was justified in finding, upon the evidence adduced, that defendant had not discharged that burden.
To the facts in this case, as disclosed by the evidence, the Behan, rather than the Kehoe rule for the measurement of damages, is more appropriate. There was evidence from which the jury in the case at bar could have found that Beaver Valley appropriately incurred reasonable expense in performing the work which it did under the contract, in the amount of $ 169,363.12 against which amount Beaver Valley was obliged to credit payments received by it on account, as set forth in the stipulation to which reference is made above. The jury was not required to accept the asserted costs less the payment on account as Beaver Valley's net expense, and it apparently did not do so, but awarded only a portion thereof, to wit, the sum of $ 29,394.76. Terminal, therefore, cannot be heard to complain of an award less than that which the jury might have made against it under the evidence.
Terminal further contends, in support of its pending motions, that no cause of action as alleged in the complaint persisted in favor of Beaver Valley because, by written document dated April 30, 1950, marked Exhibit D-21, Beaver Valley, in consideration of an intermediate payment due on its subcontract with Terminal, released Terminal 'from all manner of debts, sums of money, liens, claims, and demands of whatsoever kind, which it (Beaver Valley) now has or might have against it (Terminal) or against the said building and land by reason of the premises so that the owner of said premises and its successors and assigns shall be freed and discharged of said claims, and so that it shall and may hold and enjoy the said buildings and land freed and discharged from all liens, claims and demands whatsoever which the Releasor (Beaver Valley) now has or might or could have on or against the same, if these presents had not been made.' Beaver Valley's president, Kazel, a witness in its behalf, testified, in response to a question by the Court, that this release was one required by Terminal from Beaver Valley as a condition precedent to the payment of the respective installments provided for in the contract, in accordance with printed paragraph 9 of the pending subcontract, which provided:
'9. RELEASES: The Subcontractor shall furnish and execute, or cause to be executed, upon request and in any form designated by the Contractor, releases or receipts from all persons or firms performing work and supplying materials or services of any nature, to the Subcontractor, as well as releases from Subcontractor to Contractor.'
The purpose and intent of the parties with respect to each of these releases against intermediate payments was submitted as a question of fact to the jury under the instructions of the Court. Each release related, by its terms, to a separate intermediate payment and the acknowledgment of Kazel, who executed the release for Beaver Valley, expressly states that the release was made to induce Terminal to make the particular intermediate payment in accordance with the contract. The jury properly found that the breadth of the language embodied in each of the releases was not intended to discharge the general contractor from liability to the subcontractor for payments or damages due or accruing after the date of the particular release. The Court takes judicial notice of the provisions of the Capehart Housing Act relating to the necessity of preserving the priority of the mortgage liens to accrue upon the housing areas upon completion, as against mechanics liens under the law of the State of New Jersey or otherwise.
The Court in its charge instructed the jury, in part, as follows:
'There are before you in evidence in this case a series of written releases from Beaver Valley to Terminal Construction. One of these releases was executed in connection with and in consideration of each of the installment payments made by Terminal Construction to Beaver Valley under the contract in suit. Each of these releases purports to discharge Terminal Construction from liability to Beaver Valley for any cause up to the date of that release. Beaver Valley claims that it was compelled to execute each release in order to obtain each payment and that its financial need compelled it to do so. You may and should determine whether each release was the act of Beaver Valley, and whether the language of each release is consistent with such of Beaver Valley's present claims as are based upon what Terminal Construction did or did not do under the contract prior to the date of the release which you may be considering. Financial necessity of Beaver Valley would not constitute duress which would impair the effectiveness of its release within the scope of the language of that document.'
By returning a substantial verdict in favor of Beaver Valley, the jury necessarily found that each of these releases related only to the work done which entitled the releasor to the installment payment mentioned therein, and in compliance with the condition of the contract above quoted. Terminal's contention that these or any of these releases deprived Beaver Valley of the case of action alleged in the complaint in this case must be overruled.
The motions for judgment notwithstanding the verdict, and for a new trial, are accordingly denied. Plaintiff may submit an order in conformity with the views expressed in this opinion.
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