Columbia County v. Consolidated Contract Co.

• Decision Date: 06 March 1917
• Citation: 83 Or. 251,163 P. 438
• Parties: COLUMBIA COUNTY v. CONSOLIDATED CONTRACT CO. ET AL.
• Court: Oregon Supreme Court

163 P. 438

83 Or. 251

COLUMBIA COUNTY v. CONSOLIDATED CONTRACT CO. ET AL.

Supreme Court of Oregon

March 6, 1917

Department 2.

Appeal from Circuit Court, Columbia County; J. A. Eakin, Judge.

Action by Columbia County, a municipal corporation, for the use and benefit of O. B. Bennett, against the Consolidated Contract Company, a corporation, and the New England Casualty Company a corporation. From a judgment for plaintiff, defendants appeal. Judgment affirmed.

On March 8, 1914, the Consolidated Contract Company, hereinafter called the Contract Company, entered into a written contract with Columbia county, Or., to be designated as the County, to construct that portion of the Columbia Highway therein between Tide creek and the east line of Clatsop county. The contract provided that the Contract Company should promptly make payments for labor and materials supplied for the prosecution of the work when they became due. On May 11 1914, the defendant Contract Company, as principal, and the New England Casualty Company, as surety, gave a bond for $140,000 to assure the faithful performance by the contractor of the terms and conditions of the contract, a copy of which was made a part of the bond. The bond provided especially that the contractor--

"shall pay all laborers, mechanics, subcontractors and materialmen and all persons who shall supply such laborers, mechanics or subcontractors with materials, supplies or provisions for carrying on such work, and all just debts, dues and demands incurred in the performance of such work."

The contract was executed pursuant to a bid made by the Contract Company in writing. In accordance with the requirements for making such proposal the Contract Company deposited its certified checks, payable to the order of the county for $15,000, upon the condition required by the latter, that if the bid should be accepted and the bidder failed to enter into the contract mentioned in the proposal or to give within the required time a bond as security for the performance of the contract in the sum of one-half the contract amount with satisfactory surety the county court at its option might determine that the bidder had abandoned the contract, and that the $15,000 should be forfeited to the county.

It is pleaded and contended by the defendants that the conditions of the bond required by the county, as set forth above, were in excess of the requirements of the statute and the contract, that on account of the deposit, in order to prevent its forfeiture, the Contract Company was thereby coerced and compelled to accede to the above demand, and that the defendants by reason thereof, and not otherwise, executed the bond.

On May 21, 1914, the Contract Company entered into a written contract with one John Marandas, whereby a portion of the work near Clatskanie was sublet. He thereafter employed Bennett and his assignors as teamsters, and they performed labor in the actual construction of that part of the highway. This action was brought by O. B. Bennett upon the bond given pursuant to section 6266, L. O. L., as amended in 1913 (Laws 1913, p. 59) in the name of Columbia county to recover from defendants the amount due on his original claim and that of ten others assigned to him. At the trial a voluntary nonsuit was taken on two of these claims embraced in the sixth and eleventh causes of action. On each of the remaining causes of action after the formal averments the following is alleged in substance: (1) The making of the contract; (2) the execution and delivery of the bond; (3) the provision in the bond for the payment of laborers and materialmen above set out; (4) the making of the subcontract of the Contract Company with Marandas; (5) the employment of the claimant the performance of his services on such work, and the sum due him therefor; (6) the application for and the obtainment of a certified copy and the bond; and (7) the assignment of claims of the claimants other than his own to plaintiff Bennett.

The defendant filed separate answers and set up as defenses: (1) An agreement of Marandas to pay for the labor and material used in the work under his subcontract; (2) an agreement of these labor claimants to release the Contract Company from payment for their services; (3) that the defendants were coerced by the officers of Columbia county into giving the bond; (4) that the latter committed breaches of the contracts specifically mentioned; and (5) that under the statute the labor claims were not assignable. The defendant New England Casualty Company further set up as a defense that by the general stipulations attached to the contract of May 8, 1914, it is provided that "the contractor shall give his personal attention to the faithful prosecution of the work and shall not sublet without the written consent of the state highway engineer for each individual subcontractor," and that the state highway engineer did not consent in writing to Marandas' subcontract. Plaintiff filed replies, putting in issue the material averments of the answers, but admitting that the work was done under the direction of Marandas; that the Casualty Company permitted him to proceed therewith; and that the signing of the writing alleged as a release was obtained from claimants without any consideration, through fraud, misrepresentations, threats, duress, and coercion perpetrated upon each of them by the Contract Company, specifying the particulars, and pleading an estoppel of defendants to claim, assert, or contend that they are not bound by the conditions of their bond.

After the cause was at issue in Columbia county the defendants moved for a change of venue to another county, upon the ground that Columbia county is a party to the action, and that no taxpayer therein is qualified to sit as a juror. They set up by affidavit that the inhabitants of that county were so prejudiced against them that they could not expect an impartial trial there. The cause was tried before the court and a jury, resulting in a judgment in favor of the plaintiff for $1,280.96. The defendants filed a demurrer to the plaintiff's complaint as insufficient, which was overruled. At the close of plaintiff's case in chief, and after all the testimony had been given, the defendants moved for a directed verdict in favor of plaintiff for $5 on the first cause of action and in favor of defendants on the other causes of action. At the proper time they also moved for a nonsuit on each cause of action except the first. These several motions were denied. Defendants appeal.

John H. Hall, of Portland (Jesse Stearns and Chas. E. McCulloch, both of Portland, on the brief), for appellants. W. H. Powell, of Portland, for respondent.

BEAN, J. (after stating the facts as above).

The first assignment of error urged by counsel for defendants upon this appeal is the refusal of the trial court to grant a change of venue. The first ground for the motion for such change is that the county is a party to the action, and, particularly, that in the event the defendants were successful, it would be liable for costs. The county is a nominal party only, and has no real interest in the case, but is the trustee for the real party in interest. In such an instance, in the absence of bad faith, costs should not be awarded against a nominal party, but, in the event of defeat, against the real party in interest. L. O. L. § 575. As somewhat analogous see Teed v. Marvin, 41 Mich. 216, 2 N.W. 20; Sand v. Church, 32 A.D. 139, 52 N.Y.S. 854; Nelligan v. Groth, 126 A.D. 444, 110 N.Y.S. 619. Such a condition would not disqualify a taxpayer of the county as a juror.

The second ground was prejudice of the inhabitants of that county against the defendants. This was supported by an affidavit on the part of the defendants and opposed by counter affidavits on behalf of the plaintiff. These affidavits are not contained in the bill of exceptions; therefore we cannot review the ruling of the trial court in this respect. It must be assumed that it exercised its discretion properly in overruling such motion, and its action will not be disturbed unless an abuse of the discretion is clearly shown. State v. Humphreys, 43 Or. 44, 70 P. 824; State v. Armstrong, 43 Or. 207, 73 P. 1022.

The lemurrer and the several motions interposed by the defendants were based largely upon the fact that the action was upon a bond not in conformity with that prescribed by the statute of this state, and were relying for recovery upon the provisions inserted which are not contained in the statutory bond. The questions relating thereto may be considered together.

The gist of section 6266, L. O. L., as amended by Laws 1913, p 59, was taken from the act of Congress of August 13, 1894, 28 Stat. p. 278, c. 280 (U. S. Comp. St. 1913, § 6923). The requirement that the bond shall contain a clause "that such contractor or contractors shall promptly make payments to all persons supplying him or them labor or materials for the prosecution of the work provided for in such contracts" is identically the same in each statute. It is contended that the following words were improperly inserted in the bond in suit, namely, "pay all laborers, mechanics, subcontractors and materialmen, and all persons who shall supply such laborers, mechanics or subcontractors with materials, supplies or provisions for carrying on such work." In so far as the present case is affected the requirement of the bond to "pay all laborers, mechanics, subcontractors and materialmen" is applicable, and is no broader than the intent and scope of the statute. The several claims made are for labor and material supplied and used in the prosecution of the work provided for in the contract. That such labor and material were supplied to the contractor, not directly, but...