C. A. Dunham Co. v. McKee

• Citation: 57 S.W.2d 1132
• Decision Date: 02 March 1933
• Docket Number: No. 2804.,2804.
• Parties: C. A. DUNHAM CO. v. McKEE et al.
• Court: Texas Court of Appeals

57 S.W.2d 1132

C. A. DUNHAM CO. v. McKEE et al.

No. 2804.

Court of Civil Appeals of Texas. El Paso.

March 2, 1933.

Rehearing Denied March 23, 1933.

Appeal from District Court, El Paso County; P. R. Price, Judge.

Action by the C. A. Dunham Company, a corporation, against R. E. McKee, the Board of Trustees of the El Paso Independent School District, and another. From a judgment for named defendants, plaintiff appeals.

Affirmed.

Leo. L. Heisel, of El Paso, for appellant.

Breedlove Smith, O. R. Armstrong, and Leo Jaffe, all of El Paso, for appellee.

PELPHREY, Chief Justice.

On August 22, 1929, the board of trustees of the El Paso independent school district awarded R. E. McKee, a contractor of El Paso, Tex., the contract to build a public school building in El Paso, Tex. A written contract was entered into in which the contractor was required to furnish a bond for $27,000 conditioned for the faithful performance of his contract, and that he should promptly pay for all labor and material furnished, either to him or to any subcontractors. Thereafter McKee made a contract with Elliott Engineering Company to do a part of the work on the building.

Appellant, on December 5, 1929, sold to Elliott Engineering Company material in the sum of $788.08.

The building was completed by McKee and accepted by the board of trustees, and on or about the 5th day of February, 1930, the board of trustees paid to McKee the remainder of the contract price thereon.

On January 25, 1931, appellant filed with the board of trustees a certified copy of its claim against the Elliott Engineering Company, and thereupon the board of trustees furnished appellant a certified copy of the contract and bond.

Appellant, on February 3, 1931, filed this suit against Elliott Engineering Company, R. E. McKee, and the board of trustees, seeking to recover jointly and severally from them the amount of its claim.

In its petition appellant set out the provision of the contract, between McKee and the board of trustees, relative to the execution of a bond by McKee, and attached to and made a part of its petition the said contract and the bond executed by McKee.

The basis of its recovery against McKee was then alleged as follows: "That under and by virtue of said contract and bond, the said R. E. McKee, Contractor, became bound and obligated to promptly pay for all labor and material used in or furnished for such work, whether furnished to the contractor or subcontractors, if any, in accordance with the plans and specifications for said building."

It then alleged its contract with Elliott Engineering Company and the furnishing to it of the material, which was followed with the further allegation:

"That on or about the 5th day of February, 1930, after the completion and acceptance of said Zavala School Building, under the terms and conditions of said contract, the said owners paid to said contractor, all moneys due, including the 15% agreed to be retained under the terms of said contract; that at the time of the final settlement no satisfactory evidence was submitted and no affidavits made by the contractor, that all just bills for labor and materials furnished under the terms of the above contract, whether furnished to the contractor or subcontractors, had been paid in full as provided by Article 5160 of the Revised Statutes of Texas, as amended."

"8. That by reason of the failure of the Owner to hold said 15% as provided for in said contract, as provided for in said Article 5160, of the Revised Statutes of Texas, plaintiffs were damaged in that the sub-contractor failed and refused to pay for the goods, wares and materials furnished it, which goods, wares and materials were used in the construction of said Zavalla School Building under the terms and specifications as above set forth."

Appellant also alleged the insolvency of the Elliott Engineering Company.

The petition then concludes with the following allegation: "That no part of said sum of $788.08 has been paid by the Owners, Contractors or sub-contractors and that there is due and owing from said defendants, jointly and severally, to the plaintiff, under the terms and conditions of said Contract, and under and by virtue of the Owners having paid to the said Contractor, the full amount of the Contract price without having received proper evidence of the payment for such materials, the full sum of $788.08, interest and costs of suit; that payment thereof has often been demanded and the same is long past due; that attached to the original petition is a fully itemized and verified statement of the account, to which reference is hereby made."

R. E. McKee answered by general demurrer and general denial, and specially excepted to appellant's petition because its claim was not recorded with the county clerk of El Paso county within ninety days from the date of the delivery of the material as required by article 5160, R. S. (as amended by Acts 1929, c. 226, § 1 [Vernon's Ann. Civ. St. art. 5160]). He further pleaded the one-year statute of limitations.

The board of trustees demurred generally to the petition and generally denied the allegations thereof.

It further specially excepted thereto on the ground that suit was based upon a contract between appellant and the Elliott Engineering Company; that the petition showed upon its face that no privity of contract existed between appellant and the board; that, if any cause of action was shown, it was based on tort for which appellant had no legal right to sue; that appellant, by failing to comply with the provisions of article 5160, as amended, was estopped to complain of the board's neglect in securing from the contractor satisfactory evidence or affidavits that all labor and material had been paid for.

The cause was tried before the court, who, upon appellant's motion, filed findings of fact and conclusions of law.

The trial court's conclusions of law read:

"1. The obligation of the contractor to pay for material furnished to sub-contractors on a public work arises solely by virtue of the bond required by Article 5160. To recover on the bond the materialman must comply with the statutory conditions, by filing the itemized statement with the County Clerk as required by Article 5160, as amended, the Acts of 1929, Forty-first Legislature. (See Texas Company v. Schriewer [Tex. Civ. App.] 38 S.W.(2d) 141)."

"2. An Independent School District, after the completion and acceptance of a school building, paying the contractor the amount remaining due thereon, without requiring affidavit of the contractor and satisfactory evidence that all just bills for labor and material has been paid, is not liable to one furnishing material to a sub-contractor who files his claim with the Board long subsequent to such unwarranted payment."

"3. The bond is not released as to a materialman by an unwarranted payment by the Board to the contractor."

This appeal has been prosecuted from the judgment denying appellant any recovery against either McKee or the board of trustees.

Opinion.

Appellant, in its brief,...