C.S. Luck & Sons v. Boatwright

• Decision Date: 14 January 1932
• Citation: 157 Va. 490
• Court: Virginia Supreme Court
• Parties: C. S. LUCK & SONS, INC., ET ALS. v. BOATWRIGHT.

Page 490

157 Va. 490

C. S. LUCK & SONS, INC., ET ALS. v. BOATWRIGHT.

Supreme Court of Virginia, Staunton.

January 14, 1932.

Present, Campbell, C.J. and Holt, Epes and Browning, JJ.

1. WORKING CONTRACTS — Highway Contractors — Bond and Statute — Read Together. — The instant case was an action by a subcontractor of a subcontractor against the original contractor on his bond. In such a case the statute requiring the bond of the contractor and the bond are to be read together and measure the extent of the contractor's undertaking.

2. SURETYSHIP — Sureties for Hire Bound by Their Contracts. — Sureties for hire are not wards or 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.

3. SURETYSHIP — Sureties for Hire Bound by Their Contracts — Special Protection Afforded Sureties. — 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 read and expressed purpose for which it is given.

4. WORKING CONTRACTS — Contractor's Liability for Debts of Subcontractor. — It is of course possible to frame statutes and contracts under which road contractors 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 agents, but always liability turns upon the statute.

5. WORKING CONTRACTS — Liability of Contractor for Dealings of Subcontracts — Bond and Contract of Contractor — Case at Bar. — In the instant case it was to be determined if the plaintiff, who was a subcontractor of a subcontractor, whose work was with, and who worked for the subcontractor, could enforce his claim, for the work done by him, against the principal contractor and his surety, on the insolvency of the subcontractor. The contractor was by statute made liable for debts incurred by him, while in his bond he promised to pay for labor and materials for which he was "liable."

Held: That if the bond could not go beyond the statute, it could not fairly be said that plaintiff's claim was a liability incurred by the contractor; but both the bond and the statute must be considered, as the bond is a voluntary undertaking and its terms must be observed, and under the bond there could be no doubt that plaintiff could recover if the words "for which the contractor is liable" had been omitted; for the measure of the contractor's liability we must look to the general law; and the settled policy of the general law, everywhere made manifest, is to protect those who furnish labor, supplies and material used in and about the construction of public works, and of this contractors must take cognizance. Against the shortcomings of subcontractors they and their sureties can be amply protected by proper bonds.

6. WORKING CONTRACTS — Liability of Contractor for Dealings of Subcontractor — Change in Contract of Subcontractor of Subcontractor — Case at Bar. — The instant case was an action by a subcontractor of a subcontractor against the principal contractor and his surety for work done by him, on the insolvency of the subcontractor. The contract of the subcontractor with his subcontractor was entered into on July 14th, by which he was to be paid so much per cubic yard. On August 29th the parties entered into a new contract under which the subcontractor of the subcontractor was to be paid on a rental basis for services, etc., and equipment. There was no change whatever made in methods used in the prosecution of the work. The only change made was in the computation for compensation. The instrumentalities used were no part of any permanent equipment but were hired for this particular work.

Held: That if plaintiff's claim could be sustained under the contract of July 14th, there was no reason for disallowing it under that of August 29th.

7. WORKING CONTRACTS — Payment by Principal Contractor to Subcontractor of Subcontractor on Request of Subcontractor — Case at Bar. — The instant case was an action by a subcontractor of a subcontractor against the original contractor on his bond. Defendants complained that they were not given credit as of October 10, 1928, for $4,707.99 paid to the subcontractor on request of plaintiff. Defendants offered to pay plaintiff, but he replied that he preferred the payments to be made to the subcontractor and this was done.

Held: That defendants were entitled to a credit for this $4,707.99.

8. ESTOPPEL — Waiver — Reasonable Belief that Party has Waived Certain Rights and Remedies. — Where a party to a transaction induces another to act upon reasonable belief that he has waived or will waive certain rights, remedies or objections, which he is entitled to assert, he will be estopped to insist upon such rights, remedies or objections to the prejudice of the one misled.

9. WORKING CONTRACTS — Contract of July 14th Superseded by Contract of August 29th — Motion for Judgment Based on Latter Contract — Case at Bar. — The instant case, a motion for judgment by a subcontractor of a subcontractor against the principal contractor, was based upon a contract of August 29th, which superseded one of July 14th. The second contract did not blot out the first contract but superseded it and in terms was prospective. The first contract continued to operate until replaced by the second. It follows that any recovery for work done up to August 29th, must be on the first contract and could not possibly be on a quantum meruit. If the present action is based upon a quantum meruit a recovery cannot be had for a period covered by a contract, and if it was based upon contract then a recovery cannot be had for a time which that contract did not cover, but which was covered by another.

Error to a judgment of the Law and Equity Court of the city of Richmond, in a proceeding by motion for a jugment for money. Judgment for plaintiff. Defendants assign error.

The opinion states the case.

J. F. Hall and Leith S. Bremner, for the plaintiffs in error.

T. E. Didlake and J. H. Rives, Jr., for the defendant in error.

HOLT, J., delivered the opinion of the court.

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 and 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 and Guaranty Company, as surety, conditioned for its faithful performance. On June 14, 1928, he sublet to Daniel Knighton and Company all grading, clearing and grubbing on that project. Shortly thereafter and as a result of negotiations between Heymond, the contractor, Daniel, Knighton and Company, the subcontractor, and A. S. Boatwright, plaintiff, this subcontractor sublet to Boatwright the "hauling, delivery and distributing of the excavation" at a unit price of twenty 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 he 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, Maryland. 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, section 30, of the Maryland Code of 1924, and reads as follows:

"In all cases where the contract for work and materials be given out after competitive bidding, the successful bidder shall promptly execute formal contract to be approved as to its form, terms and condition 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 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 of his, their or its servants, or for any liability for payment of wages due or materials furnished said contractor; and shall well...