Fulghum v. State

Decision Date21 August 1926
Citation109 So. 644,92 Fla. 662
PartiesFULGHUM et al. v. STATE, for Use of MERRITT.
CourtFlorida Supreme Court

En Banc.

Error to Circuit Court, Escambia County; A. G. Campbell, Judge.

Action by the State on a contractor's bond for the use of Charles W. Merritt, against S. L. Fulghum and another. Judgment for plaintiff, and defendants bring error.

Affirmed.

Syllabus by the Court

SYLLABUS

Test of sufficiency of contractor's bond is whether statutory 'obligation' has been created or imposed and not formula of words used (Rev. Gen. St. 1920, § 3533). The test by which the sufficiency of a contractor's bond, executed pursuant to section 3533, Revised General Statutes 1920, is to be judged, is whether the 'obligation' required by the statute has been created or imposed, and not the formula of words employed to express that obligation.

Bond by highway contractor, with additional obligation to pay just claims for labor and materials, was sufficient to protect persons supplying labor and materials (Rev. Gen. St. 1920, § 3533). Before entering upon public work, a contractor executed a bond with the usual obligation to perform the contract, and with the additional obligation that the principal 'shall promptly pay all just claims * * * for labor and materials incurred by said principal in or about the construction or improvement contracted for.' Held sufficient, under section 3533, Revised General Statutes 1920, to afford protection to persons supplying labor and materials in the prosecution of the work.

Subcontractor on public work, who himself and through employees, or by use of teams and mechanical equipment, furnishes labor, may recover from surety on contractor's bond (Rev. Gen. St 1920, § 3533). A subcontractor on public work, who by himself and through other persons in his employ, or by the use of teams and mechanical equipment, has furnished labor in the prosecution of the work for a stated consideration agreed upon with the principal contractor, may recover that consideration in his status or capacity as such subcontractor from the surety upon a bond executed pursuant to and containing the additional obligation required by section 3533, Revised General Statutes 1920.

Public contractor's bond protects those who 'supply' labor by providing others to do work (Rev. Gen. St. 1920, § 3533). The protection of section 3533, Revised General Statutes 1920, is not limited to those who 'perform' labor on public work, but extends to those who 'supply' labor. One may supply labor by providing others to do the work.

Public contractor's bond covers labor performed with aid of horses, tractors, and derricks and other mechanical equipment, and is not limited to those performing physical labor; 'laborers' (Rev. Gen. St. 1920, § 3533). The protection of section 3533, Revised General Statutes 1920, is not limited to 'laborers'; that is, those who perform physical labor. Labor performed with the aid of horses tractors, and derricks, and other mechanical equipment or devices, is within the meaning of the statute, so long as such labor is supplied in the prosecution of the work.

The broad general purpose of section 3533, Revised General Statutes 1920, is to afford a means of protection to those supplying labor and materials to the contractor in public work in lieu of the lien afforded by other statutes on private work.

COUNSEL

William Fisher, of Pensacola, for plaintiffs in error.

Watson & Rasco, of Pensacola, for defendant in error.

OPINION

STRUM J.

This cause is here on writ of error to review a judgment at law obtained by the defendant in error, who was plaintiff below against plaintiff in error as surety upon the bond of a contractor engaged in the performance of public work. The bond purports to have been executed pursuant to the provisions of section 3533, Revised General Statutes 1920. The amendment of 1925 (chap. 10035, Acts of 1925) is not material to the controversy.

S. L. Fulghum, having entered into a contract with the state of Florida for the construction of a public road in Escambia county, also executed a bond, dated December 19, 1922, to the state of Florida, as obligee. The said contractor, S. L. Fulghum, executed the bond as principal, and his codefendant below, Union Indemnity Company, as surety. The bond contained, the condition, amongst others, that, if the principal 'shall promptly pay all just claims * * * for labor and materials incurred by said principal in or about the construction of improvement contracted for, then this obligation to be void, otherwise to be and remain in full force and virture in law.'

The contractor, Fulghum, entered upon the work, and sublet to the plaintiff, Merritt, as a subcontractor, certain portions thereof namely, certain grading, subgrading, and excavating, at a stated price per cubic yard, certain clearing and grubbing at a stated price per acre, and certain hauling to be done by teams at stated prices. The principal contractor later abandoned the work, and defaulted in the payment of certain indebtedness due Merritt under the subcontract, to recover which this suit is brought against the principal contractor and his surety.

Upon authority of J. B. McCrary Co. v. Dade County, 80 Fla. 652, 86 So. 612, it is contended that the obligation of the bond sued on does not follow the provisions of the statute, and hence that no recovery can be had upon the bond as a statutory bond under the provisions of section 3533, supra. The statute requires that the principal contractor, before commencing upon public work, shall be required to execute the usual penal bond----

'with the additional obligation that such contractor, or contractors, shall promptly make payments to all persons supplying him, or them, labor and material in the prosecution of the work provided for in such contract.'

In J. B. McCrary Co. v. Dade County, supra, the condition of the bond sued on was that the principal should well and truly perform, carry out, and abide by all of the terms and conditions of the contract and specifications in connection with which the bond was executed. The 'additional obligations' required by the statute were totally omitted. The plaintiff in that case, a dealer who had furnished materials to a subcontractor on the work, contended that, since the contract contained a clause that the principal contractor would promptly pay all just claims for material, supplies, equipment, and damages, and would save the obligee harmless against all claims for material, labor, damages, and supplies due any person by reason of the contract having been let to the principal contractor, and as the contract was made a part of the bond by the terms of the latter, that the statute was, in substance, complied with, and that the plaintiff in that case could recover against the surety. In that case this court pointed out that the usual penal bond--that is, a bond for the faithful execution of the contract according to its terms--is all the protection needed by the public authority under which the work is done, but that the additional obligation is required to be included in such bond in order that the protection of the materialman and laborer may be secured. The court further said:

'The condition of the bond secured the performance of the contract; this condition was for the benefit of the county. There was no privity between third persons and the county, nor between them and defendants. The rights of the materialmen and laborers depended entirely upon the statute, and its provisions were ignored in the drafting of the bond.'

But in the case now before us we have a materially different situation. The bond here sued on, besides the usual obligation to comply with and carry out the contract, contains the additional obligation that the principal contractor 'shall promptly pay all just claims * * * for labor and materials incurred by said principal in or about the construction or improvement contracted for.' The latter language, it is true, is not identical with that of the statute. The statute, however, prescribes the additional 'obligation' to be included in the bond, not the precise language or formula of words which shall be used to create that obligation. An 'obligation' is that which one is legally bound to do. The obligation does not inhere and subsist in the contract itself, proprio vigore, but in the law as applied to the terms of the contract. Ogden v. Saunders, 12 Wheat. 213, 216, 6 L.Ed. 606. The 'obligation' itself is therefore a totally different thing from the language by which the obligation is expressed. The bond here sued on was admittedly executed pursuant to section 3533, Revised General Statutes 1920. The test by which a compliance with the statute is to be judged is whether the 'obligation' required by the statute has been created or imposed, and not the formula of words employed to express that obligation. The language used in the bond here sued on, in its legal effect, imposes upon the principal contractor the 'obligation' required by the statute for the benefit of those furnishing him with material and labor in the prosecution of the work, and, that being so, the bond is sufficient as a statutory bond. City of Philadelphia v. Nichols, 214 Pa. 265, 63 A. 886; Title Guaranty & Surety Co. v. State, 61 Ind.App. 268, 109 N.E. 237, affirmed on rehearing in 61 Ind.App. 268, 111 N.E. 19; Klein v. Beers, 95 Okl. 80, 218 P. 1087; United States v. Hodson, 10 Wall. 395, 19 L.Ed. 937; Stephenson v. Monmouth Mining & Mfg. Co., 84 F. 114, 28 C. C. A. 292; State v. Wotring, 56 W.Va. 394, 49 S.E. 365; 9 C.J. 24, 33. See, also, Cheney v. Trammell, 65 Fla. 451, 62 So. 916.

Although as was said in J. B. McCrary Company v. Dade County, supra, a surety's obligation will be strictly...

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