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GRAHAM v. JONNEL ENTERPRISES (10/09/69)

decided: October 9, 1969.

GRAHAM
v.
JONNEL ENTERPRISES, INC. ET AL., APPELLANTS



Appeal from judgment of Court of Common Pleas of Clarion County, Aug. T., 1967, No. 31, in case of John F. Graham et al. v. Jonnel Enterprises, Inc. et al.

COUNSEL

Aaron Rosenzweig, with him Samuel M. Rosenzweig, and Rosenzweig & Rosenzweig, for appellants.

H. Ray Pope, Jr., for appellees.

Bell, C. J., Cohen, Eagen, O'Brien, Roberts and Pomeroy, JJ. Opinion by Mr. Justice O'Brien. Mr. Justice Roberts and Mr. Justice Pomeroy concur in the result. Mr. Justice Jones took no part in the consideration or decision of this case.

Author: O'brien

[ 435 Pa. Page 397]

Appellants, Jonnel Enterprises, Inc., (Jonnel) and Arenze, Inc., are the general contractor and owner

[ 435 Pa. Page 398]

    of the real estate, respectively, which were involved in the construction of a dormitory to house students of Clarion State College. Both corporations are controlled by Elmer Jonnett, who was their agent. Appellees, John F. Graham and Roy C. Long, are electrical contractors.

On May 6, 1966, appellees and Jonnel entered into a written agreement by which appellees, in return for $70,544.66 were to perform electrical work and supply materials for the dormitory at Clarion State. According to appellees, they were under the impression that the May 6 agreement obligated them to perform the electrical work on only one building or only one wing of a building, and they had no knowledge of any second wing. They discovered the second wing only after three or four days' work, and informed Elmer Jonnett at that time that they would not wire both wings for $70,544.66. They further testified that a new contract was agreed upon orally, and prepared. Under the new contract, appellees were to wire both wings and were to be paid only $65,000, but they were relieved of the obligation to supply entrances and a heating system. Appellees testified that Jonnett approved the prepared contract and stated that he would take it to Pittsburgh and have it signed. It was never signed.

Acting on Jonnett's alleged agreement with regard to the second contract, appellees resumed work. Payment was to be made in eight 90% progress payments. Seven were made in accordance with the terms of the second contract, but appellants failed to pay the last 90% progress payment. Appellees then brought suit for the last 90% progress payment, the 10% retained by appellants, and some extra work allegedly agreed to by appellants, the entire amount sought totaling $15,629.88. Appellants in their answer averred that the written contract of May 6 was operative and that

[ 435 Pa. Page 399]

    appellees had breached it causing them damages of more than $20,000.00. Further, appellants counterclaimed for ...


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