Arrow Const. Co., Inc. v. American Emp. Ins. Co.

• Decision Date: 01 February 1973
• Docket Number: No. 9189,9189
• Citation: 273 So.2d 582
• Parties: ARROW CONSTRUCTION COMPANY, INC. v. AMERICAN EMPLOYERS INSURANCE COMPANY et al.
• Court: Court of Appeal of Louisiana — District of US

Page 582

273 So.2d 582

ARROW CONSTRUCTION COMPANY, INC. v. AMERICAN EMPLOYERS INSURANCE COMPANY et al.

No. 9189.

Court of Appeal of Louisiana, First Circuit.

Feb. 1, 1973.

Rehearing Denied March 14, 1973.

Richard B. Crowell and Michael S. Tudor, Alexandria, for appellant.

W. Leonard Werner, Baton Rouge, for appellees.

Before LANDRY, TUCKER and PICKETT, JJ.

LANDRY, Judge.

Defendants, Mark C. Smith and Sons, Inc. (Owner), Mark C. Smith, Jr., Mark C. Smith, III, and Succession of Bilwood Smith (Contractor), and American Employers Insurance Co. (Surety), (Appellants), appeal a judgment in favor of plaintiff, Arrow Construction Company, Inc. (Appellee), for the rental value of machinery and equipment furnished by Appellee to a subcontractor on a housing project undertaken by Contractor for Owner and bonded by Surety. We reverse.

The contract was for a 250 unit housing complex. Contractor, the alter ego of Owner, subcontracted the entire project to Tudor Construction Company (Tudor). Certain site preparation work required was re-subcontracted by Tudor to Mason Construction Company (Mason) to whom Appellee furnished manned earth moving equipment. Appellee obtained judgment against Owner, Contractor and Surety in the sum of $1,000.00, plus $100.00 attorney's fees. The trial court rejected Appellee's claim for the sum of $52.00 spent in recording a lien against subject property, and also rejected all of Appellee's demands against Tudor who was also named defendant. Notwithstanding rejection of Appellee's claims against Tudor, said defendant has joined in the appeal taken by Owner, Contractor and Surety. Plaintiff-Appellee has neither appealed nor answered the appeal taken by Appellants.

ON MOTION TO DISMISS THE APPEAL

Appellee has moved to dismiss this appeal on the ground that while Owner, Contractor, Surety and Tudor have appealed, and their names appear as principals on the appeal bond, the bond was in fact signed as principal only by Tudor against whom no judgment was rendered. Appellee contends that since Tudor was exonerated from liability, there is no judgment from which it could appeal, therefore, Tudor was not an appellant since it was a stranger to this appeal. On this premise, Appellee argues there was in effect a failure to file an appeal bond herein by the only parties entitled to appeal consequently this court is without jurisdiction to hear the appeal.

We find Appellee's contention without merit. This is not an instance in which there was a total failure to file an appeal bond, or in which an appeal bond was untimely filed. Here a bond was timely filed. The contention made by Appellee herein addresses itself to the validity of the appeal bond, not the failure to post bond, or the untimely posting of bond. The question posed is whether the bond actually filed meets the requirements of law.

LSA-C.C.P. art. 2088 provides, inter alia, that after an appeal has been perfected, jurisdiction remains in the trial court to '. . . consider objections to the form, substance, and sufficiency of the appeal bond, and permit the curing thereof, as provided in Articles 5123, 5124, and 5126.' Article 5123, above, declares that a party wishing to test the validity or sufficiency of an appeal bond shall rule into court the party furnishing the security to show cause why the security should not be ruled insufficient or invalid. Article 5124, above, prescribes in detail the manner and delay during which an Appellant may furnish supplemental security.

Our jurisprudence is well established to the effect that an appeal will not be dismissed because the appeal bond is invalid or insufficient unless the validity or sufficiency of the bond is first contested in the trial court, and Appellant has been afforded opportunity to supply the insufficiency or cure the invalidity. Blaize v. Cazezu, 208 La. 1081, 24 So.2d 147, and cases therein cited. See also, Bertrand v. Home Indemnity Company, 202 So.2d 670 (La.App.).

Prior to the effective date of LSA-C.C.P. arts. 5123 and 5124, Act 112 of 1916 similarly provided for service of notice upon Appellant of an alleged defect in an appeal bond. The statute also required that Appellant be afforded opportunity to correct a defect and furnish new or supplemental bond. The clear import of all the above statutory provisions is that jurisdiction to try an alleged insufficiency or invalidity of an appeal bond is vested and remains exclusively in the trial courts. Our review of the cases interpreting both the old and new statutes discloses that the jurisprudence has in effect confirmed the concept that the issue is jurisdictional, and that jurisdiction in such instances is vested exclusively in the trial court.

We hold, therefore, that jurisdiction to test the sufficiency or validity of a timely filed appeal bond rests exclusively in the trial courts. It follows that appellate courts are without jurisdiction to initially try such an issue. In these cases, the jurisdiction of appellate courts is limited to review of the trial court's action. Blaize v. Cazezu, above.

The motion to dismiss this appeal is denied.

ON THE MERITS

The record discloses that Appellee fully performed its verbal contract to furnish Mason manned earth moving equipment in site preparation for the private work in volved. It is conceded Appellee received no payment from Mason and that the sum of $1,000.00 is due and owing. Appellee, believing it had a lienable claim under our Private Works Act, duly recorded its claim, and ultimately filed suit against Owner, Contractor, Tudor and Surety. Appellee sought recognition of its lien and sale of the liened property to effect payment thereof. Appellants excepted to Appellee's lien as not being timely filed, and also filed an excepiton of no cause of action based on the claim that the furnishing of manned equipment was not a charge for which a lien is granted under the Private Works Act. Said exceptions were overruled below. After trial, the lower court held Appellee's claim is nonlienable pursuant to LSA-R.S. 9:4801(A). In so holding, the court relied upon Mayeaux v. Lamco, 180 So.2d 425 (La.App.), which held that LSA-R.S. 38:2241, et seq. (The Public Works Act) does not include within its list of lienable claims, a claim for the rental of manned equipment. The lower court reasoned that the Public Works Act and Private Works Act are laws in pari materiae and should interpreted uniformly.

Notwithstanding its finding that Appellee's claim is nonlienable under the Private Works Act, the trial court allowed recovery upon finding that Apex Sales Company v. Abraham, 201 So.2d 184 (La.App.4th Cir. 1967) was controlling, and stands for the proposition that the fact one did not have a lienable claim does not prevent recovery based upon the terms of the building contract and bond itself. The trial court thus found that, in accordance with the terms of the contract and bond herein involved, Appellants obligated themselves to pay all claims, including those in the nature of Appellee's, in addition to any obligations imposed by the lien laws. In this regard, the trial court noted: 'These contractual obligations show clearly that the contractor obligated itself to pay all laborers and furnishers of machinery, which necessarily include manned rental equipment provided by the plaintiff.'

Subject contract obligates Contractor to construct the units called for and to '. . . deliver the same free and clear of all liens, encumbrances and claims whatsoever, in connection with the work performed.' The bond in question provides that '. . . the condition of this obligation is such that if the CONTRACTOR shall truly and faithfully perform said building contract according to its terms, covenants and conditions for the completion and delivery of the work undertaken So that the obligee shall suffer no loss or damage arising by reason of the failure of CONTRACTOR faithfully to perform the above mentioned Contract, and for the payment of all subcontractors, journeymen, cartmen, workmen, laborers, mechanics and furnishers of material, machinery or fixtures, then this obligation shall be null and void . . ..' (Emphasis supplied.) The bond also provides: 'In addition to, but not in limitation of, the other conditions of this bond and the liabilities of the SURETY with respect thereto, it is expressly agreed and understood that this bond is also given in accordance with the provisions of Louisiana Revised Statutes 9:4802, et seq., and that said SURETY is liable for all obligations thereunder.'

Plaintiff-Appellee maintains the trial court erred in holding that its claim for manned equipment rental was not lienable pursuant to our Private Works Act. Appellee, of course, argues the trial court correctly awarded judgment pursuant to the terms of the contract and bond. Appellee maintains that even if his claim be nonlienable, the obligations of Appellants under their contract of suretyship are broader than the obligations imposed...