C. S. Luck & Sons Inc v. Boat-wright.*

• Citation: 162 S.E. 53
• Court: Supreme Court of Virginia
• Decision Date: 14 January 1932
• Parties: C. S. LUCK & SONS, Inc., et al. v. BOAT-WRIGHT.*

162 S.E. 53

C. S. LUCK & SONS, Inc., et al.

v.BOAT-WRIGHT.^*

Supreme Court of Appeals of Virginia.

Jan. 14, 1932.

EPES, J., dissenting in part.

Error to Law and Equity Court of City of Richmond.

Action by S. A. Boatwright against C. S. Luck & Sons, Inc., and others. To review an adverse judgment, defendants bring error.

Modified, and, as so modified, affirmed.

Argued before CAMPBELL, C. J., and HOLT, EPES, and BROWNING, JJ.

J. P. Hall and Leith S. Bremner, both of Richmond, for plaintiffs in error.

T. E. Didlake, of Manassas, and J. H. Rives, Jr., of Richmond, for defendant in error.

HOLT, J.

For convenience the parties will be referred to in the position occupied by them in the court below. A. P. Heymond, defendant, acting for himself and for Luck & Sons, Inc., entered into a contract on May 31, 1928, with the state road commission of Maryland for the construction of a section of highway in that state, and, as he was required to do, executed his bond with United States Fidelity & Guaranty Company, as surety, conditioned for its faithful performance. On June 14, 1928, he sublet to Daniel, Knighton & Co. all grading, clearing, and grubbing on thatproject. Shortly thereafter, and as a result of negotiations between Heymond, the contractor, Daniel, Knighton & Co., the subcontractor, and S. A. Boatwright, plaintiff, this subcontractor sublet to Boatwright the "hauling, delivery and distributing of the excavation" at a unit price of 20 cents a cubic yard.

After that contract had been in effect for a time, it was on August 29, 1928, by consent, canceled, and a new one was executed. Under it he did the same work in the same way, but, instead of being paid so much per cubic yard, ho was to be paid for services, etc. and equipment on a rental basis. He was not paid at all, and has obtained a judgment against the contractor and his surety for $8,284.06, the correctness of which is challenged in this appeal. The defendant's claim is that nothing is due, while the plaintiff is claiming a larger sum and has set up that claim in a cross-assignment of error.

The subcontractor is insolvent, and, if the plaintiff is to be paid at all, he must be paid by the principal contractor and his surety.

As we have seen, A. P. Heymond was the successful bidder for the construction of a certain section of highway in Alleghany county, Md. His bid was received and approved by the state road commission of Maryland, under whose supervision contracts of this character came. Statutory provision for this is made in article 91, § 30, of the Maryland Code of 1924, and reads as follows:

"In all cases where the contract for work and materials shall be given out after competitive bidding, the successful bidder shall promptly execute a formal contract to be approved as to its form, terms and conditions by said commission, and shall also execute and deliver to said commission a good and sufficient bond to be approved by said commission to the State of Maryland in not less than the amount of the contract price. In no case shall any such bond be approved or accepted unless the obligators bind themselves therein to the payment of all just debts for labor and materials incurred by the bidder in the construction and improvement of the road contracted for."

From this it appears that the bond must contain certain minimum statutory requirements and be approved by the commission.

The contractor did execute a bond which was approved and accepted. In it he bound himself to complete his contract "in a manner satisfactory to the State Roads Commission, complete the work contracted for, and shall save harmless the State of Maryland from any expense incurred through the failure of said Contractor to complete the work as specified, or for any damages growing out of the carelessness of said Contractor or his, their or its servants, or for any liability for payment of wages due or materials furnished said Contractor; and shall well and truly pay all and every person furnishing material or performing labor in and about the construction of said roadway, all and every sum or sums of money due him, them or any of them for such labor and materials for which the Contractor is liable."

[I] In the case in judgment the contractor is by statute made liable for debts "incurred" by him, while in his contract he promises to pay for labor and materials for which he is "liable." The statute and the bond are to be read together and measure the extent of his undertaking. American Fidelity Co. v. State, 128 Md. 50, 97 A. 12; Ætna Casualty & Surety Co. v. Earle-Lansdell Co., 142 Va. 435, 120 S. E. 263, 130 S. E. 235; Philip Carey Co. v. Maryland Casualty Co., 201 Iowa, 1063, 206 N. W. 808, 47 A. L. R. 495; Franzen v. Southern Surety Co., 35 Wyo. 15, 246 P. 30, 46 A. L. R. 496.

Sureties for hire are not wards of court to be shielded from heedlessness or folly. They must abide by their contracts and pay everything which by fair intendment can be charged against them. They act, not to accommodate others, but to promote their own interests, and are to be judged accordingly.

"The rule that sureties deserve the special protection and consideration of courts has no application to sureties who become such for a consideration, and their contract of suretyship should be given such a construction as will effectuate the accomplishment of the real and expressed purpose for which it is given." Fidelity, etc., Co. v. Mason, 145 Va. 138, 133 S. E. 793, 795.

Of course, if the principal contractor is not liable, his surety is not, for it would be a solecism to hold that he is bound beyond his principals.

In recent years, road building has developed to an unusual degree. Commonly it is done by contractors and in many instances by subcontractors also. From this a mass of litigation has come, dealing with the liability of principal contractors for labor and material primarily contracted for by him and with like claims in the second degree growing out of dealings with subcontractors.

It is, of course, possible to frame statutes and contracts under which they work in such manner as to make them liable for all labor performed and all supplies and materials furnished from whatever source and through whatever agency they may come. This is usually done in general terms, though they sometimes descend into particulars and make the contractor expressly liable for the dealings of subcontractors and sometimes declare them to be his agent, but always liability turns upon the statute.

We are to determine if the plaintiff, whose contract was with, and who worked for. thesubcontractor, can enforce bis claim against the principal contractor and his surety.

In Faurote v. State, 110 Ind. 463, 11 N. E. 472, 475, it appears that Faurote and Lewis L. Brown, as principals, with Lewis, D. M. Brown, and Cranor as sureties, executed their bond to the board of commissioners of Rush county, Ind.

This bond recites that its principals had been awarded a contract for the construction of a certain road and was to be void, if that road was properly completed, otherwise to remain in full force and effect. These contractors let this undertaking to one Cooney, and the work and labor for which recovery was sought he did.

In section 4246, Rev. Stat, of Ind., 1881, it is provided that the bond of a contractor for the construction of any county work shall guarantee its faithful performance, and that ho "shall promptly pay all debts incurred by him in the prosecution of such work, including labor, material furnished, and for boarding of laborers thereon."

Section 4247 authorizes "any laborer and material man, or person furnishing board to said contractor * * * and having a claim against such contractor therefor" to bring suit against the contractor and bondsman.

"By this contract the sureties guarantied that the contractor should promptly pay all debts incurred by him, and it gave to any laborer, materialman, or person furnishing board to the contractor, and having a claim against him therefor, a right of action on the bond. The sureties did not, however, engage to become liable for debts incurred by a subcontractor, nor did they agree that any person having a claim against a subcontractor might maintain an action against them on the bond. * * *

"Since there is no statute imposing liability on the contractor for laborers hired by a subcontractor, we can discover no principle which would authorize the court, in the absence of any charge of fraud, bad faith, or concealment, to extend the obligation of the bond, and the liability of the sureties thereon, beyond the terms of the statute which entered into and became a part of the bond. The statute which regulates the manner of contracting for the construction of court-houses, and other public works for counties, does not in terms forbid subletting parts, or the whole of the work, nor does it prescribe the instrumentalities which the contractor must employ, In order to execute his undertaking. It may have been that the legislature supposed it impracticable to do so. In the construction of a work of magnitude, it may have been thought that the subletting of such parts, as pertained to different handicrafts or trades, might be a necessity, and it may have been supposed that it would impose an unnecessary burden to require a contractor and his sure ties to answer on his bond for the liability of subcontractors, wherever and to whomsoever such liabilities might be incurred. At all events, subletting was not forbidden, nor did the statute provide that the contractor and his sureties should become liable on their bond for the liabilities of such contractors to their employees. It is not allowable, therefore, that the courts should extend the operation of the statute, so as to correct supposed omissions or defects in legislation, or add to the terms of the contracts of parties by construction, in order to meet the emergency of a particular case." See State v. Granite Co., 117 Ind. 476, 20 N. E. 437.

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