Bickham v. Womack

• Decision Date: 04 March 1935
• Docket Number: 32833
• Citation: 181 La. 837,160 So. 431
• Court: Louisiana Supreme Court
• Parties: BICKHAM v. WOMACK et al

160 So. 431

181 La. 837

BICKHAM v. WOMACK et al

No. 32833

Supreme Court of Louisiana

March 4, 1935

Rehearing Denied April 1, 1935

Appeal from Twenty-Second Judicial District Court, Parish of Washington; C. Ellis Ott, Judge.

Concursus proceeding by William E. Bickham against Thomas G. Womack and others, wherein other parties intervened, and Thomas G Womack and the Globe Indemnity Company filed a reconventional demand against the Louisiana Highway Commission. From judgment rendered, the Globe Indemnity Company, Thomas G Womack, and the Pan-American Petroleum Company appeal.

Amended and affirmed.

Ott & Johnson, of Franklinton, for Great Southern Lumber Co.

Wylie M. Barrow, of Baton Rouge, for Mississippi Valley Co.

Ellis, Ellis & Ellis, of Amite, for appellees Anderson & Tynes.

L. H. Gosserand, of New Orleans, for Gulf States Creosoting Co.

Lewis L. Morgan, of Covington, for Louisiana Highway Commission.

Monroe & Lemann, of New Orleans, S. S. Reid, of Amite, and W. J. Suthon, Jr., of New Orleans, for Globe Indemnity Co. and Thos. G. Womack.

T. M. Milling, F. L. Hargrove, and A. M. Curtis, all of New Orleans, for Standard Oil Co. of Louisiana.

Ott & Johnson, of Franklinton, and Cobb & Jones and Herman M. Baginsky, all of New Orleans, for Pan-American Petroleum Corporation.

Ben W. Miller, of Bogalusa, curato ad hoc.

OPINION

FOURNET, Justice.

The Louisiana highway commission, on July 7, 1931, entered into a contract with Royce Kershaw, Inc., to construct Louisiana project No.6803, and, in compliance with the provisions of the contract and the requirements of law, the contractor furnished bond, with the Union Indemnity as surety. Subsequently, Royce Kershaw, Inc., assigned the contract in its entirety to Thomas G. Womack, who, under the terms, conditions, and considerations of the assignment, assumed the entire obligations of Royce Kershaw, Inc., and furnished bond for the sum of $ 15,000, with the Globe Indemnity Company as surety.

Under the provisions of Act No. 224 of 1918, as amended by Act No. 271 of 1926, W. E. Bickham, in order to recover on his claim for certain materials furnished in the construction of the project aforesaid, instituted this concursus proceeding, making parties thereto the Louisiana highway commission, Union Indemnity Company, the Globe Indemnity Company, and the parties whose claims against the project were filed of record. It later developed that other claims were timely filed, and these claimants intervened.

The case was tried and judgment rendered, allowing certain claims and rejecting others. The Globe Indemnity Company, Thomas G. Womack, and the Pan-American Petroleum Company have appealed.

The Standard Oil Company of Louisiana filed a motion in this court, seeking to have us remand the case to the district court of Washington parish under our supervisory powers conferred by section 10, art. 7, of the Constitution of 1921, in order to permit it to intervene herein and assert and establish its claim. In the motion it is alleged that its lien was filed about a week after the concursus proceeding was instituted, and it did not know of the existence of the case until it was pending on appeal before this court.

It is obvious that to grant the motion would be to delay the final termination of this case for an indefinite period of time. Article 391 of the Code of Practice declares that an intervention may be filed provided it does not retard the principal suit. We must therefore refuse the motion of the Standard Oil Company.

We shall now consider the appeal of each appellant separately and begin with that of the Globe Indemnity Company. This company filed exceptions of lis pendens, prematurity, misjoinder of parties defendant, misjoinder of asserted causes of action and of no right or cause of action to the claims of all parties. The judge of the trial court, in a thorough and well-written opinion, overruled the exceptions. The Globe Indemnity is only pressing the exception of no cause or right of action before this court. The basis of the exception is that the bond executed by the Globe Indemnity Company as Thomas G. Womack's surety is a conventional one, and that Royce Kershaw, Inc., is the only party who had any right to sue on the bond. Its counsel rely on the cases of Salmen Brick & Lumber Co. v. Le Sassier et al., 106 La. 389, 31 So. 7; Hughes v. Smith et al., 114 La. 297, 38 So. 175; Lhote Lumber Mfg. Co. v. Dugue et al., 115 La. 669, 39 So. 803; and State v. C. S. Jackson & Co. et al., 137 La. 931, 69 So. 751.

In passing on the exception of no cause or right of action, the trial judge considered the authorities cited by counsel, and held that they were not controlling in the case at bar. From an examination of these cases, we agree with the learned district judge in his ruling. These decisions were rendered prior to the adoption of the present public and private works acts, and, until the passage of those acts, there was no provision in our laws giving laborers, materialmen, and furnishers of supplies the right to bring a direct action on the bond against the surety. Such right of action was only in favor of the named obligee in such bonds, which were purely statutory. It therefore becomes necessary for us to analyze the nature and provisions of the bond in question.

In this case Royce Kershaw, Inc., assigned to Thomas G. Womack its entire contract. To make this assignment to Womack complete, it would have been necessary for the Louisiana highway commission to have accepted the transfer and substituted Womack as contractor, but this was not done. Therefore Womack had the legal status of a subcontractor. A subcontractor is not required to give bond under the requirements of law. Act No. 224 of 1918, as amended. It necessarily follows that the bond given by Womack is not a statutory bond. The bond was given in conformity to, and in accordance with, the provisions of the contract of assignment, and must be construed as a conventional bond.

The bond is made in favor of Royce Kershaw, Inc., contractor, and is conditioned on Womack faithfully performing all the obligations assumed by him in the contract of assignment, wherein he (Womack) agreed to take over and perform the contract between the obligee (Royce Kershaw, Inc.) and the Louisiana highway commission for the construction of project 6803, and to faithfully and promptly pay the wages of laborers and the claims of furnishers of materials and supplies and to promptly effect the cancellation of any liens filed against the project. It also contains the following paragraph:

"It is expressly understood and stipulated by and between the parties to this bond that the same is given in accordance with Act 298 of 1926 of the General Assembly of Louisiana."

In construing the meaning and effect of this language, the judge of the lower court properly said:

"If the bond given by the Globe Indemnity Company is to be construed as enuring in favor of the furnishers of material here such construction must arise from the evident intention of the parties to the bond. The bond states that it is given in accordance with Act 298 of 1926. This is the law for private building contracts. If the parties contracted in the bond with reference to this law and intended to become bound by its provisions, they intended to give the laborers and furnishers of material a direct action on the bond as the law with reference to which gives the laborers and furnishers of material such right. If the reference is an error and the parties intended to refer to Act 224 of 1918 as amended by Act 271 of 1926, the same situation would exist as this law also gives the right to the laborers and materialmen of a direct action on the bond. The reference to a law under which the parties intended to be bound must be given some effect, and it must be assumed that one or the other of the acts mentioned must be the one referred to as there are no other acts that could reasonably have any application to the subject matter about which the parties were contracting."

He concluded that "the bond was intended to protect the laborers and furnishers of material and inures to their benefit and gives them a right of action thereon."

Article 3039 of the Revised Civil Code provides that:

"Suretyship can not be presumed; it ought to be expressed, and is to be restrained within in the limits intended by the contract." (Italics ours.)

The parties to the bond, in writing the clause in controversy, evidently intended to give effect thereto. To say otherwise would be saying that they intentionally did a vain and useless thing. Hence this clause in the bond in question must be given some meaning if it is reasonable and fair to do so.

Our Civil Code declares: "When a clause is susceptible of two interpretations, it must be understood in that in which it may have some effect, rather than in a sense which would render it nugatory." Rev. Civ. Code, art. 1951.

We find the following pertinent language in the case of Miller v. Bonner, 163 La. 332, 111 So. 776, 780:

"There is no provision in Act 49 of 1910 requiring a subcontractor to give bond to a contractor. The bond in question, therefore, is conventional and not statutory, and its provisions, as written therein, necessarily constitute the law of the case between the parties, when considered in connection with the contract of Bonner."

In the case of Lichtentag v. Feitel et al., 113 La. 931, at page 939, 37 So. 880, 883, this court made the following observation:

"It seems hardly necessary to say that the contract and specifications contemplate that the contractor shall furnish all the necessary labor and material at his own expense, and hence that, although he may have finished the work, the contract is...