Bourrett v. W. M. Bride Const. Co., No. 49178

CourtUnited States State Supreme Court of Iowa
Writing for the CourtGARFIELD; All Justices concur, except SMITH
Citation84 N.W.2d 4,248 Iowa 1080
PartiesCharles BOURRETT, d/b/a Bourrett Tin and Furnace Shop, Appellant, v. W. M. BRIDE CONSTRUCTION CO., Inc., Continental Casualty Company, and Sunnyside Investment, Inc., Appellees.
Docket NumberNo. 49178
Decision Date26 June 1957

Page 4

84 N.W.2d 4
248 Iowa 1080
Charles BOURRETT, d/b/a Bourrett Tin and Furnace Shop, Appellant,
v.
W. M. BRIDE CONSTRUCTION CO., Inc., Continental Casualty Company, and Sunnyside Investment, Inc., Appellees.
No. 49178.
Supreme Court of Iowa.
June 26, 1957.

Page 5

Hutchison, Hurst & Duggan, Sioux City, for appellant.

Harper, Gleysteen & Nelson, Sioux City, for appellee Continental Casualty Co.

GARFIELD, Justice.

This appeal by plaintiff involves the liability to it, a subcontractor, of defendant Continental Casualty Co., surety on a private building bond of the principal contractor. The trial court held there was no liability and sustained the Casualty company's motion to dismiss plaintiff's petition. We affirm the decision.

Plaintiff Bourrett's petition is in two counts. Defendants to Count I are W. M. Bride Construction Co., Inc., principal contractor, Continental Casualty Co. and Sunnyside Investment, Inc., owner. Count II is against the Casualty company only. Liability of the principal contractor and owner has not been adjudicated and is not now before us.

Count I of the petition alleges: Sunnyside owns certain lots in Sioux City, plaintiff orally contracted with Bride to furnish heating equipment for erection of a service station thereon and performed his contract, $911.86 is owing plaintiff thereon, plaintiff field his claim for a mechanic's lien with the clerk [248 Iowa 1083] of the district court and gave written notice thereof to Sunnyside three months and 26 days after the last material

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was furnished and labor performed, Bride as general contractor had a written contract with Sunnyside to erect the service station and gave it a bond for the performance of the contract signed by the Casualty company as surety. Judgment for $911.86 is asked against Bridge, the Casualty company and Sunnyside, together with foreclosure of plaintiff's mechanic's lien.

Count II of the petition incorporates the allegations of Count I and also alleges the bond was given in conformance with rule 3, Rules of Civil Procedure. It asks only a money judgment against the Casualty company.

Copies of the principal contract and bond are attached to and made part of the petition. The contract provides Bridge shall furnish all materials and perform all labor necessary for the service station and is to furnish a satisfactory bond guaranteeing performance of contract and payment for labor and material.

The bond provides Bride, as principal, and the Casualty company, as surety, are bound unto Sunnyside in the sum of $23,051 (the contract price) and: 'Whereas, the Principal has entered into a written contract * * * with the Obligee (Sunnyside) for erection of new service station * * * which contract is hereby referred to and made a part hereof, * * *

'Now, Therefore, the Condition of this obligation is such, that if the Principal shall indemnify the Obligee against any loss or damage directly arising by reason of the failure of the Principal to faithfully perform said contract, then this obligation shall be void; otherwise to remain in full force and effect.

'Provided, however, and upon the express conditions, the performance of each of which shall be a condition precedent to any right to recovery hereon: * * *

'Sixth: That no right of action shall accrue upon or by reason hereof, to or for the use or benefit of any one other than the Obligee herein named; and that the obligation of the Surety is, and shall be construed strictly as, one of suretyship only * * *.'

The Casualty company's motion to dismiss each count of [248 Iowa 1084] the petition is based on the ground its liability is as surety only to Sunnyside and under the sixth paragraph of the bond no right of action under it accrues to any other party. By resistance to the motion plaintiff alleges the Casualty company's liability is that of surety and guarantor of the rights of materialmen and laborers and its contract is a third party beneficiary one upon which plaintiff has a direct cause of action against the Casualty company. As stated, the trial court sustained the motion to dismiss.

Plaintiff's desire to recover on the bond of the Casualty company is understandable in view of the fact his claim for mechanic's lien was not filed within 60 days from the date the last material was furnished or labor performed as provided by section 572.9, Code 1954, I.C.A. Liens, like plaintiff's, filed after the 60-day period are enforceable 'only to the extent of the balance due from the owner to the contractor at the time of the service of such notice; * * *.' Code section 572.11, I.C.A. Apparently the balance due from Sunnyside to Bride (alleged to be insolvent) is insufficient to pay claims of subcontractors filed prior to plaintiff's and also his claim. See section 572.17.

The liability of a surety is to be determined by the specified conditions of the bond and cannot be enlarged beyond them. Hay v. Hassett, 174 Iowa 601, 603, 156 N.W. 734, and citation; Carr & Baal Co. v. Consolidated Independent Dist., 187 Iowa 930, 939, 174 N.W. 780; Lamson v. Maryland Cas. Co., 196 Iowa 1185, 1191, 194 N.W. 70; 72 C.J.S. Principal and Surety § 91.

It is frequently stated by courts that the intention of the parties to a contractor's bond is the controlling factor in determining the right of laborers and materialmen

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to recover thereon. 9 Am.Jur., Building and Construction Contracts, section 96; Annotation, 77 A.L.R. 21, 28.

This intention is to be gathered from the nature of the instrument, fairly read in the light of all the circumstances attending its making and the apparent purpose it was designed to serve. Hay v. Hassett, supra, and citations at pages 603-604 of 174 Iowa, 156 N.W. 734. As stated in somewhat different language it is a question of intention, to be derived from the language used, the situation of the parties, and legal principles they are presumed[248 Iowa 1085] to know and have in mind. Fidelity & Deposit Co. of Baltimore, Md. v. Rainer (Use of Mfrs.' Warehouse Co.), 220 Ala. 262, 125 So. 55, 77 A.L.R. 13, 17.

Although there are a few outside decisions to the contrary it is well settled in Iowa and is the weight of authority generally that laborers and materialmen may recover on a contractor's bond conditioned that the contractor shall pay all claims for labor and material, or shall faithfully perform a contract providing...

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9 practice notes
  • Wolverine Insurance Company v. Phillips, Civ. No. 1015.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • August 12, 1958
    ...acted as a "mere volunteer" the Government cites and relies upon the case Bourrett v. W. M. Bride Construction Co., 1957, 248 Iowa 1080, 84 N.W.2d 4. In that case it was held that an unpaid subcontractor could not recover against the surety on a private building bond given by the ......
  • L & L Builders Co. v. Mayer Associated Services, No. C 97-4034-MWB.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • April 5, 1999
    ...articulated comparable principles when interpretation of a construction surety bond was at issue. See Bourrett v. W.M. Bride Constr. Co., 248 Iowa 1080, 1084, 84 N.W.2d 4, Page 886 (1957) ("[T]he intention of the parties to a contractor's bond is the controlling factor in determining t......
  • Rowe v. Stufflebeam, No. 49393
    • United States
    • United States State Supreme Court of Iowa
    • May 6, 1958
    ...the obligee's departure from terms of the contract. Appellant calls attention to this statement from Bourrett v. Bride Construction Co., 248 Iowa 1080, 84 N.W.2d 4, 6: 'The liability of a surety is to be determined by the specified conditions of the bond and cannot be enlarged beyond them.'......
  • La Salle Iron Works, Inc. v. Largen, No. 52226
    • United States
    • Missouri Supreme Court
    • December 12, 1966
    ...surety wishes to exclude this type of liability it may consider such a bond as is shown in Bourrett v. W. M. Bride Construction Company, 248 Iowa 1080, 84 N.W.2d 4, where all rights of action by any one except the named obligee in the bond were expressly excluded. The present surety is a Ne......
  • Request a trial to view additional results
9 cases
  • Wolverine Insurance Company v. Phillips, Civ. No. 1015.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • August 12, 1958
    ...acted as a "mere volunteer" the Government cites and relies upon the case Bourrett v. W. M. Bride Construction Co., 1957, 248 Iowa 1080, 84 N.W.2d 4. In that case it was held that an unpaid subcontractor could not recover against the surety on a private building bond given by the ......
  • L & L Builders Co. v. Mayer Associated Services, No. C 97-4034-MWB.
    • United States
    • United States District Courts. 8th Circuit. Northern District of Iowa
    • April 5, 1999
    ...articulated comparable principles when interpretation of a construction surety bond was at issue. See Bourrett v. W.M. Bride Constr. Co., 248 Iowa 1080, 1084, 84 N.W.2d 4, Page 886 (1957) ("[T]he intention of the parties to a contractor's bond is the controlling factor in determining t......
  • Rowe v. Stufflebeam, No. 49393
    • United States
    • United States State Supreme Court of Iowa
    • May 6, 1958
    ...the obligee's departure from terms of the contract. Appellant calls attention to this statement from Bourrett v. Bride Construction Co., 248 Iowa 1080, 84 N.W.2d 4, 6: 'The liability of a surety is to be determined by the specified conditions of the bond and cannot be enlarged beyond them.'......
  • La Salle Iron Works, Inc. v. Largen, No. 52226
    • United States
    • Missouri Supreme Court
    • December 12, 1966
    ...surety wishes to exclude this type of liability it may consider such a bond as is shown in Bourrett v. W. M. Bride Construction Company, 248 Iowa 1080, 84 N.W.2d 4, where all rights of action by any one except the named obligee in the bond were expressly excluded. The present surety is a Ne......
  • Request a trial to view additional results

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