Owen v. Salvation Army, Inc.
Owen v. Salvation Army, Inc.
Opinion of the Court
Tbe bond executed by tbe plaintiff, T. R. Owen, as principal, and by tbe Royal Indemnity Company of New York, as surety, and payable to tbe defendant, Salvation Army, Inc., as obligee, contains clauses as follows:
“Whereas tbe principal bas by means of a written agreement dated 3 July, 1928, entered into a contract witb tbe owner for additions and alterations to Salvation. Army Building at 520 South Elm Street, Greensboro, N. C., in accordance witb plans prepared by M. L. Alber-ton, designer, a copy of wbicb agreement is by reference made a part hereof:
Now, therefore, tbe condition of tbis obligation is such tbat if tbe principal shall faithfully perform tbe contract on bis part, and satisfy all claims and demands incurred for same, and shall fully indemnify and save harmless tbe owner from all cost and damage wbicb be may suffer by reason of failure so to do, and shall fully reimburse and repay tbe owner all outlay and expense wbicb tbe owner may incur in making good any such default, and shall pay all persons who have contracts directly witb tbe principal for labor and materials, then tbis obligation shall be null and void; otherwise, it shall remain in full force and effect.”
Tbe allegation in tbe answer or cross-complaint, wbicb is admitted by the demurrer, tbat tbe principal in said bond bas failed to perform bis contract witb tbe obligee, witb tbe result tbat tbe obligee bas suffered damages in tbe sum of $2,342.89, is sufficient to constitute a cause of action on wbicb tbe obligee is entitled to recover of tbe principal and tbe surety in said bond. There is no allegation in tbe complaint of a breach of tbe bond for wbicb tbe surety would be liable only as an indemnitor; tbe absence of such allegation, however, does not render tbe cross-complaint demurrable. Where there is an allegation in tbe complaint of a breach of tbe bond, resulting in damages to' tbe obligee, for *613 wbicb tbe surety is liable not as an indemnitor, but as a surety, sucb allegation is sufficient to constitute a cause of action against botb tbe principal and tbe surety. In tbe instant case, there is no provision in tbe bond or in tbe contract wbicb requires tbat tbe owner shall complete tbe contract, upon tbe default of tbe contractor, as a condition precedent to recovery in an action on tbe bond. There was therefore no error in tbe order overruling tbe demurrer. Tbe order is
Affirmed.
Reference
- Full Case Name
- J. R. Owen v. Salvation Army, Inc., and Royal Indemnity Company of New York.
- Status
- Published