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McCloskey & Co. v. Minweld Steel Co.

United States Court of Appeals for the Third Circuit
220 F.2d 101 (1955)


Facts

McCloskey & Co. (McCloskey) (plaintiff), a general contractor, entered into three contracts with Minweld Steel Co. (Minweld) (defendant) to furnish and erect steel on two buildings to be constructed on the grounds of a state hospital. The contracts provided, in part, that should Minweld at any time fail or refuse to supply a sufficient quantity of the materials required by the contract or fail to perform the contract, then McCloskey had the right to provide the materials and deduct the cost from payments due Minweld or to terminate the employment of Minweld. The contract did not fix a specific date for Minweld's performance, but provided that labor, material and equipment would be furnished at such times as directed by McCloskey, and prompt delivery and installation of the materials were made essential to the agreement. Per McCloskey’s request, Minweld sent a letter outlining expected dates for delivery and completion of construction. McCloskey replied by threatening to terminate the contract unless Minweld gave unqualified assurances that firm arrangements had been made for delivery of the steel within 30 days. In its July 24 reply letter, Minweld explained that it could not give any assurance of acquiring the steel or when it would be delivered due to the difficulty in acquiring the necessary steel, and Minweld asked for McCloskey's help in procuring it. McCloskey cancelled the contracts, claiming that the July 24 letter was an admission by Minweld that it could not perform the contracts. McCloskey then procured the steel and brought in other subcontractors to do the work. McCloskey commenced an action in the United States District Court for the Western District of Pennsylvania alleging anticipatory breach by Minweld. The court granted Minweld's motion to dismiss and denied McCloskey's motions for findings of fact, to vacate judgments and for a new trial. McCloskey appealed.

Rule of Law

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Issue

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Holding and Reasoning (McLauglin, J.)

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