322 U.S. 102 (1944), 483, Clifford F. MacEvoy Co. v. United States

Docket Nº:No. 483
Citation:322 U.S. 102, 64 S.Ct. 890
Party Name:Clifford F. MacEvoy Co. v. United States
Case Date:April 24, 1944
Court:United States Supreme Court
 
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Page 102

322 U.S. 102 (1944)

64 S.Ct. 890

Clifford F. MacEvoy Co.

v.

United States

No. 483

United States Supreme Court

April 24, 1944

Argued March 7, 1944

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE THIRD CIRCUIT

Syllabus

1. Where A sold materials to B, who merely sold them to a contractor for use on a Government project, A is not entitled to recover upon a payment bond furnished by the contractor pursuant to the Miller Act. P. 104.

2. The term "subcontractor" in the proviso of § 2(a) of the Miller Act --

any person having direct contractual relationship with a subcontractor but no contractual relationship express or implied with the contractor furnishing said payment bond shall have a right of action upon said payment bond

-- does not include a materialman who merely sells materials to the contractor. P. 108.

3. The salutary policy of the Miller Act to protect those whose labor and materials go into public projects does not warrant disregard of the plain words of limitation in the proviso of § 2(a) of the Act. P. 107.

137 F.2d 565 reversed.

Certiorari, 320 U.S. 733, to review the reversal of a judgment, 49 F.Supp. 81, dismissing the complaint in a suit against a Government contractor and surety upon a payment bond.

Page 103

MURPHY, J., lead opinion

MR. JUSTICE MURPHY delivered the opinion of the Court.

The United States entered into a contract with the petitioner Clifford F. MacEvoy Company whereby the latter agreed to furnish the materials and to perform the work necessary for the construction of dwelling units of a Defense Housing Project near Linden, New Jersey, on a cost plus fixed fee basis. Pursuant to the Miller Act,1 MacEvoy as principal and the petitioner [64 S.Ct. 892] Aetna Casualty and Surety Company as surety executed a payment bond in the amount of $1,000,000, conditioned on the prompt payment by MacEvoy "to all persons supplying labor and material in the prosecution of the work provided for in said contract." The bond was duly accepted by the United States.

MacEvoy thereupon purchased from James H. Miller & Company certain building materials for use in the prosecution of the work provided for in MacEvoy's contract with the Government. Miller, in turn, purchased these materials from the respondent, Calvin Tomkins Company. Miller failed to pay Tomkins a balance of $12,033.49. There is no allegation that Miller agreed to perform or did perform any part of the work on the construction project.

Page 104

Nor is it disputed that MacEvoy paid Miller in full for the materials.

Within ninety days from the date on which Tomkins furnished the last of the materials to Miller, Tomkins gave written notice to MacEvoy and the surety of the existence and amount of Tomkins' claim for materials furnished to Miller. Tomkins, as use plaintiff, then instituted this action against MacEvoy and the surety on the payment bond. The District Court granted petitioners' motion to dismiss the complaint for failure to state a claim against them. 49 F.Supp. 81. The Circuit Court of Appeals reversed the judgment. 137 F.2d 565. We granted certiorari because of a novel and important question presented under the Miller Act. 320 U.S. 733.

Specifically, the issue is whether, under the Miller Act, a person supplying materials to a materialman of a Government contractor and to whom an unpaid balance is due from the materialman can recover on the payment bond executed by the contractor. We hold that he cannot.

The Heard Act,2 which was the predecessor of the Miller Act, required Government contractors to execute penal bonds for the benefit of "all persons supplying him or them with labor and materials in the prosecution of the work provided for in such contract." We consistently applied a liberal construction to that statute, noting that it was remedial in nature and that it clearly evidenced "the intention of Congress to protect those whose labor or material has contributed to the prosecution of the work." United States v. American Surety Co., 200 U.S. 197, 204. See also Mankin v. United States, 215 U.S. 533; United States Fidelity & Guaranty Co. v. Bartlett, 231 U.S. 237; Brogan v. National Surety Co., 246 U.S. 257; Fleishmann Construction Co. v. United States, 270 U.S. 349; Standard

Page 105

Accident Insurance Co. v. United States, 302 U.S. 442. We accordingly held that the phrase "all persons supplying [the contractor] . . . with labor and materials" included not only those furnishing labor and materials directly to the prime contractor, but also covered those who contributed labor and materials to subcontractors. United States v. American Surety Co., supra, 204; Mankin v. United States, supra, 539; Illinois Surety Co. v. John Davis Co., 244 U.S. 376, 380. We had no occasion, however, to determine under that Act whether those who merely sold materials to materialmen who, in turn, sold them to the prime contractors were included within the phrase, and hence entitled to recover on the penal bond.3

The Miller Act, while it repealed the Heard Act, reinstated its basic provisions and was designed primarily to eliminate [64 S.Ct. 893] certain procedural limitations on its beneficiaries.4 There was no expressed...

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