Adams Supply Co. v. U.S. Fidelity & Guaranty Co.
| Decision Date | 01 November 1956 |
| Docket Number | 3 Div. 698 |
| Citation | 90 So.2d 284,265 Ala. 178 |
| Court | Alabama Supreme Court |
| Parties | ADAMS SUPPLY COMPANY v. UNITED STATES FIDELITY & GUARANTY CO. et al. |
Knabe & Nachman and Jack Crenshaw, Montgomery, for appellant.
Rushton, Stakely & Johnston, Montgomery, for appellees.
This is an appeal by complainant from a final decree sustaining a demurrer to a bill in equity and dismissing the bill upon the failure of complainant to amend after the demurrer was sustained.
The bill had been redrafted completely, to which the demurrer was sustained when the final decree was rendered. The bill as redrafted and finally amended (as was also the original bill) was against the United States Fidelity & Guaranty Company, J. B. Whitehead Plumbing and Heating Company (referred to hereafter as J. B. Whitehead), and Folmar-Flinn Corporation (referred to hereafter as (Folmar-Flinn). It alleged the existence of contracts by Folmar-Flinn as general contractors to build one hundred and forty-six dwelling units for three different owners. Folmar-Flinn made subcontracts with J. B. Whitehead to do the plumbing for each house. The U. S. F. & G. Co. as surety executed a bond as to each owner with J. B. Whitehead as principal, said bond being payable to Folmar-Flinn as obligee and conditioned as follows: 'that the principal shall well and truly indemnify and save harmless the said obligee from any pecuniary loss resulting from the breach of any of the terms, covenants and conditions of the said contract on the part of the said principal'.
The contract between J. B. Whitehead and Folmar-Flinn provided that J. B. Whitehead agreed to furnish Folmar-Flinn 'a payment and performance bond' (but that Folmar-Flinn are to pay the premium on it), and Paragraphs 6 and 7 of the amended bill set out the nature of the controversy here involved, and are as follows:
The letter referred to as Exhibit 'D' is as follows:
'October 14, 1950
'Folmar-Flinn Corporation
'P. O. Box 12
'Montgomery, Alabama.
'Subject: Happiness Homes, Inc.
Dallas Homes Inc.
Clover Homes Inc.
'Gentlemen:
'Reference is herewith made to the subject 146 units that we have under contract with you.
'It is requested that all future payments due us for performance of this work be made in the form of checks payable jointly to J. B. Whitehead and Adams Supply Company.
'This acknowledges that said Adams Supply Company is material supplier for the subject projects.
'It will be greatly appreciated if you will acknowledge your co-operation with this request.
'Yours very truly,
'J. B. Whitehead
'Plumbing & Heating
'CC
'Adams Supply Co.
'Folmar-Flinn Corp.
'By: J. W. Rutland, Jr. (Signed)'
In paragraph 9 of the bill the contention of the respective parties is set out, as to which a justiciable controversy is alleged to exist as follows:
'That it is the contention of the complainant that the said bonds so executed by United States Fidelity and Guaranty Company should be construed in accordance with the intention of the parties as a performance bond guaranteeing the performance by said J. B. Whitehead of his said subcontracts with Folmar-Flinn Corporation, including the payment by said J. B. Whitehead of all materials furnished in the erection of said housing units; that if mistaken therein complainant further contends that it had a lien on said premises to the extent of any unpaid balance due from Folmar-Flinn Corporation to said J. B. Whitehead, which unpaid balance was in the sum of $2,194.13; the respondent, United States Fidelity and Guaranty Company, contends that no liability exists under said bond for the payment to complainant of any amount for the materials so furnished by complainant for the erection of said housing units.'
The relief prayed for is as follows:
'(a) Construing said bond executed by United States Fidelity and Guaranty Company as surety for J. B. Whitehead, as a performance and payment bond.
'(b) Declaring the rights and obligations of the complainant and the respondents herein.
'(c) Declaring that said Folmar-Flinn Corporation and United States Fidelity and Guaranty Company are liable to complainant for the balance of such materials furnished and used in the erection of said housing units, which said balance is the sum of $15,545.69.
'And if mistaken in the relief hereinabove prayed for, complainant prays that the court will make and enter a decree declaring that said respondents, Folmar-Flinn Corporation and the United States Fidelity and Guaranty Company, are liable to complainant for the sum of $2,194.13, representing the balance due from Folmar-Flinn Corporation to J. B. Whitehead at the time of the acceptance of said letter of October 14, 1950, after giving credit for said amounts heretofore paid.
'And if mistaken in the relief hereinabove prayed for, complainant prays for such other, further, and general relief to which in equity and good conscience it may be entitled.'
There was only one demurrer filed to this amended bill. It begins: 'Comes the respondent in the above styled cause and * * * refiles the demurrers now on file in said cause and in addition' assigns further grounds to the bill as a whole; and then to that aspect whereby complainant prays a judgment for $15,545.69, and assigns grounds. Then it proceeds to demur to that aspect which claims that liability on the bond against U. S. F. & G. Co. should be fastened by virtue of the contract between Folmar-Flinn and J. B. Whitehead, and assigns grounds. Then it proceeds to demur to that aspect which seeks to establish a lien for $2,194.13, and assigns grounds. Then to that aspect which seeks a revision and reformation of the bond referred to, and assigns grounds. Then to that aspect seeking an interpretation and revision of the bond so as to show an intention to make complainant beneficiary of the bond, and assigns grounds. The demurrer was signed by counsel for U. S. F. & G. Co. The decree sustained the demurrer, (1) to the bill as a whole; (2) to that aspect which claims a judgment against respondent for $15,545.69; (3) to that aspect which claims that liability should be fastened on U. S. F. & G. Co. as for 'a performance and...
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