
    Alfred M. Wiles and William H. Wiles, Respondents, v. John C. Provost and Others, Appellants.
    
      Executor'll contract for- the manufacture and sale of an engine—the rule of substantial performance does not apply to it—acceptance presumed from its subsequent retention and use, after a reasonable time for examination—finding necessary to support a judgment presumed..
    
    In an action brought to recover upon a contract, by which the plaintiffs agreed to manufacture and put up in the defendants’ brick yard a steam engine and other machinery, the referee found that the steam engine was not merchantable or such an article as the contract called for, and that it was worth §1,000 less than the contract price, and he deducted that amount from the amount otherwise due upon the contract. It appeared that after the engine was put into use the defendants complained to the plaintiffs that the engine did not work properly, and the plaintiffs then repaired it, but although the defendants continued to make complaints as to its deficiencies, they never returned nor offered to return it.
    The defendants claimed that the contract had not been substantially performed,' and that a recovery thereunder by the plaintiffs could not be sustained.
    
      Reid, that the rule of substantial performance, applicable to building contracts, has no application to executory contracts for the sale or the manufacture and sale of personal property;
    That in such cases the right to refuse payment or to recover damages, based upon the fact that the article furnished failed to correspond to that called for by the contract, does not survive the acceptance of the property by the vendee;
    That the vendee, is entitled to a reasonable time for examination, but that if he continues to use the article in his business, as he did in the present case, after he has discovered its true condition, although he continues to complain of it, an acceptance of the article is thereby conclusively established;
    
      That although the referee in this ease did not specifically find an acceptance of the engine by the defendants, yet, as the testimony would admit of no other conclusion, the court would, in support of the judgment, presume that such a finding had been made.
    Appeal by the defendants, John 0. Provost and others, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Rockland on the 1st -day of October, 1883, upon the report of a referee.
    
      Jesse Johnson and calvin Frost, for the appellants.
    
      Edward Wells and Edward Wells, Jr., for the respondents.
   Brown, P. J.:

This action was brought to recover upon a contract whereby the plaintiffs agreed to manufacture for the defendants and put up on their brickyard at Fresh Pond, L. I., a steam engine, three brick making machines, two tempering wheels, including shafts, belts, pulleys and other machinery necessary upon a brickyard. The various articles specified in - the contract were manufactured and . delivered and put up on the brickyard in the month of July, 1873, and thereafter were put-in use by the defendants in the manufacture of brick. The contract specified $3,200 as the price for the engine, of which $1,000 was to be allowed for an old engine then upon the yard; a price was- also specified for each brick making machine,, and for each tempering wheel with the necessary shafting and gearing. It further specified that all necessary bolts and braces were to be paid for at, the rate of ten cents per pound, and all extra shafting, spur gear and iron pulleys at the rate of eight cents per pound.

The defendants were to pay for the labor and expenses of the - men furnished by the plaintiffs while engaged in putting up the machinery at the yard, and it was agreed that the work should be ■completed as near the 1st day of May, 1873, as was possible, with •due care to its construction.

, Tip on the facts of this case we deem it sufficient to say that the referee’s findings of fact have support in the testimony,, and we find, no reason to disagree with the conclusions which he reached.

The charge that the contract was procured or induced by fraud, and that it was fraudulently altered after execution, was not sustained by the proof.

Exception was taken to the amount allowed by the referee for labor. The stipulation of the contract in that respect was, that the defendants were to pay three dollars and fifty cents per day for millwrights and machinists, and two dollars and fifty cents for helpers, together with their "board and traveling expenses, and that the plaim. tiffs were to furnish as many men at those prices as the defendants required. The objection made is that the referee charged the defendants with the wages of men on days when they went to or returned to the yard, and also for days coming and going on visits. There is nothing in the case to support this objection. ’ The referee found, upon the defendants’ request, that the plaintiffs' charged for such days, but he was not asked to find whether or not he allowed such charges. The amount stated in the schedule annexed to the report as allowed for labor is less by a considerable sum than the amount claimed in the bill of particulars, and the inference to be drawn from the facts as they appear in the record is that the objectionable charges were not allowed.

The main objection urged by the appellants, and the only one we deem it necessary to discuss, is that the testimony showed and the referee found that the contract had not been substantially performed. The referee found as a fact that the steam éngine furnished under the contract was not in all its parts constructed and put up in a workmanlike manner, by reason of which its value was diminished in the amount of $1,000, which sum he deducted from the amount that otherwise would have been due on the contract. At the request of the defendants he further found that the engine was not such an article as the contract called for; that it was not merchantable ; that it was not worth over $1,200, and that the defects 'existing in it were the result of a want of skill and care in its construction.

If the plaintiffs’ right to recover upon the contract depended upon the doctrine of substantial performance, the judgment could not, I think, be sustained upon these findings; but we are of the opinion that that rule hás no application to the case before us.

The general rule applicable to the right to recover upon all contracts is that where performance is the condition of payment, the former must be shown to entitle a party to recover unless it has been waived or released. (Smith v. Brady, 17 N. Y. 173.)

This rule has been modified as to building contracts so as to permit recovery by the builder where lie has substantially performed his agreement, although defects may be shown to exist by reason of inadvertence or unintentional omission. The reason for the relaxation of this rule in building contracts was stated by Judge Church in Glacius v. Black (50 N. Y. 145), to rest upon the fact that that class of contracts embraced many particulars which it was difficult if not impracticable to comply with with entire exactness. But the rule of substantial performance has no application to executory contracts for the sale or manufacture and sale of personal property. In such cases the right to refuse payment or to recover damages on the-ground that the article furnished does not correspond to that called for by the contract does not survive'the acceptance of the property by the vendee. (Reed v. Randall, 29 N. Y. 358; Brown v. Foster, 108 id. 387; Chambers v. Lancaster & N. Y. Stone Crushing Company, 3 App. Div. 215.)

The vendee is entitled to a reasonable time for examination, but if he intends to reject the article furnished as not in compliance with the contract, he. must not, after such examination and after discovering its true, condition, do anything inconsistent with the vendor’s ownership.

Brown v. Foster (supra) was a caso arising out of a contract for the sale of an engine, boiler and saw mill, and in relation- to the acceptance of the articles its facts were not unlike the case under consideration. It was there said that the vendee'was entitled to a reasonable time for examination; ■“ long enough to put the machinery in -motion and see it operate, and he might for that purpose do with it whatever was necessary.” But because the vendee in that-case used the machinery in the prosecution of his business and, although complaining and knowing its defects, did not intermit its use, the court' held there was an unequivocal apt of acceptance.

Chambers v. Lancaster & New York Stone Crushing Company (supra) arose out of a contract for the erection and completion of a stone crushing plant. The company used the crushers, for five months, but although it was said in the .opinion that the. testimony showed such a deviation from the contract that the company might have rejected the crushers, the court held that the use of the machines after knowledge of the defects was a conclusive election to accept them.

In this case it appears that after the engine and machinery were started, the defendants complained to the plaintiffs that the engine did not work right. The plaintiffs thereupon sent one of their employees to the yard and some repairs were made upon it. Thereafter the defendants continued to use it in the prosecution of their business, and although continuing to make complaint as to its deficiencies, they never returned, or offered to return, it or any other part of the machinery. These facts establish conclusively an acceptance of the articles specified in the contract. The referee did not specifically find an acceptance by the defendants, and it is objected that the judgment cannot, in the absence of such a finding, be sustained upon that theory. The testimony which I have referred to, however, can lead to no other conclusion, and as it is undisputed that the defendants retained and used in the business the engine and all the machinery delivered, the court may presume a finding of acceptance for the purpose of sustaining the judgment.

If the' referee, in deciding the case, applied to it the rule of substantial performance, the defendants have no cause to complain. They have received in the allowance of $1,000 made to them for defects in the engine, the benefit of a ruling more favorable to them than they would have been entitled to under the application to'the case of a more correct rule of law.

There is no other question which requires notice.

The judgment must be affirmed, with costs.

All concurred.

Judgment affirmed, with costs.  