Maryland Casualty Co. v. Shafer
Maryland Casualty Co. v. Shafer
Opinion of the Court
The county of Tulare and the defendant M. T. Shafer, on the 9th of February, 1918, entered into *581 a contract by the terms of which Shafer agreed to construct a concrete highway for the county. Shafer completed the construction of the highway and the same was accepted by the county January 28, 1919. He failed, however, to pay many persons for labor, material, supplies, team hire, and rental of equipment employed, furnished, and used in the construction of the work. He also made assignments to various persons of sums due or to become due under the contract, and which remain unpaid. The plaintiff, as surety of the contractor, brought this action against the county, the contractor, and all claimants under the contract to secure an adjudication of their respective rights in and to the unpaid installments due from the county and the plaintiff’s liability under its contracts of suretyship. The various claimants filed cross-complaints setting up their respective claims to the unpaid installments and their rights of recovery against the plaintiff. The county paid into court the balance due under the contract, $12,919.81, to be distributed in such manner and to such parties as the court might adjudge, and none of the parties are now claiming anything against the county. Prom the judgment rendered, three separate appeals are being prosecuted. This appeal is by Thompson Brothers from that part of the judgment denying recovery against the plaintiff and adjudging that other parties have superior rights to payment out of the unpaid installment.
The contract provides “that the contractor shall pay all bills for labor, team hire, material and supplies contracted for by him on account of the work herein contemplated, when the same becomes due and payable.” By the terms of the contract Shafer was required to furnish “a good and sufficient bond and undertaking in the sum of $16,426.55 conditioned for the faithful performance of this contract by the contractor, according to the terms and provisions herein expressed.” Pursuant to this requirement, Shafer and the plaintiff executed a “bond for faithful performance of contract” in the usual form, providing, among other things, that the contractor “shall in all things stand to and abide by and well and truly keep and perform the covenants, conditions, stipulations, contracts, agreements and obligations in the foregoing contract, . . . on his part to be kept or performed at the time and in the *582 manner therein specified . . . and shall idemnify and save harmless the said county of Tulare.”
Liability under a contract of suretyship, as under other contracts, is dependent upon the intention of the parties thereto. In the discussion of a similar question in French v. Farmer, supra, it is said: “If . . . any effect whatever is to be given to this clause in the condition of the bond, it must be held that it was the intention of the parties to benefit such third persons. . . . The courts of Nebraska Missouri, Iowa, Indiana, and Michigan seem to hold to the view that if it can be fairly said from either the contract or the bond, which are to be construed together, that the parties intended to and did agree to pay such third persons, a suit could be brought on such bond by such third person to recover upon the promise so made for his benefit.” Here, in compliance with the contract and the statute, a separate bond was given to secure payment of claims of the character under consideration and it would be unreasonable to hold that the parties intended the faithful performance bond to secure the same claims. The Statute of 1897 (as amended by Stats. 1911, p. 1422) provides that the claimants “shall, within ninety days from the time such contract is completed, file with the . . . board of supervisors ... a verified statement of such claim.” Concededly appellant failed to file such a claim and is therefore precluded from recovering on the bond given pursuant to the requirements of that statute. Such failure *583 affords no ground for relief under the faithful performance bond manifestly intended for a different purpose.
The court found that valid claims amounting to $14,-419.50 were duly verified and filed with the board of supervisors and that such claimants in due time filed cross-complaints in this action and were entitled to judgment against the plaintiff for the respective amounts of their claims and that the plaintiff is entitled to have the whole of said $12,919.81 applied to the payment of such claims. The judgment against plaintiff awards such claimants the amounts of their respective claims and directs the clerk to pay them the amount of said fund in the proportion of their claims and on payment to the clerk by plaintiff of the remainder of the judgment, to pay the claimants in full upon satisfaction of the judgment by them. The judgment further provides that, upon payment by plaintiff to any of said claimants of the sums awarded them, the clerk shall pay plaintiff such part of the $12,919.81 as said claimants otherwise would be entitled to *585 receive. Appellant contends that the findings are insufficient to support the judgment. Whatever grounds of objection may be available to other parties defendant, the findings clearly show that appellant, by reason of failure to file a verified statement of claim with the board of supervisors as provided by the contract, is not entitled to participate in the distribution of the fund reserved and, therefore, cannot be heard to complain of the disposition made thereof.
That part of the judgment appealed from is affirmed.
Hart, J., and Burnett, J., concurred.
A petition for a rehearing of this cause was denied by the district court of appeal on June 3, 1922, and a petition to ha-ve the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on July 3, 1922.
All the Justices concurred, except Wilbur, J., who dissented, and Lawlor, J., and Lennon, J., who were absent.
Shurtleff, J., was also absent and Richards, J., pro tern., was acting.
Reference
- Full Case Name
- MARYLAND CASUALTY COMPANY (A Corporation), Respondent, v. M. T. SHAFER Et Al., Defendants; O. M. THOMPSON Et Al., Etc., Defendants, Cross-Complainants and Appellants
- Cited By
- 12 cases
- Status
- Published