Griffith v. Rundle

• Decision Date: 08 December 1900
• Citation: 23 Wash. 453,63 P. 199
• Court: Washington Supreme Court
• Parties: GRIFFITH et al. v. RUNDLE et al.

63 P. 199

23 Wash. 453

GRIFFITH et al. v. RUNDLE et al.

Supreme Court of Washington

December 8, 1900

Appeal from superior court, Spokane county; Thomas H. Brents, Judge.

Action on a bond by John H. Griffith and another, co-partners against Nathan B. Rundle and others. From a judgment in favor of the plaintiffs, defendants appeal. Affirmed.

Henley, Kellam & Lindsley and A. G. Avery, for appellants.

Lewis &amp Lewis, for respondents.

REAVIS J.

In July, 1897, defendant Rundle entered into a contract with the United States for the construction of certain buildings at the army post near Spokane. At the time the contract was executed, a bond was duly executed in accordance with the provisions of the act of congress approved August 13, 1894 (28 Stat. c. 280). The law is entitled 'An act for the protection of persons furnishing materials and labor for the construction of public works.' Its provisions are substantially that any person entering into a formal contract with the United States for the construction of any public building shall be required, before commencing, to execute the usual penal bond with good and sufficient sureties, with the additional obligations that the contractor shall promptly make payments to all persons supplying him labor and materials in the prosecution of the work provided for in the contract; that any persons performing labor or furnishing materials for such work shall be furnised on application with a certified copy of the contract and bond upon which the person supplying labor and materials shall have a right of action, and be authorized to bring suit in the name of the United States against the contractor and sureties, provided that such action shall involve the United States in no expense. The defendants Henley and Snodgrass were sureties upon the bond, the penal sum of which was $10,000. While the contractor, Rundle, was engaged in the construction of the buildings under his contract, materials were furnished by plaintiffs to the contractor, and used by him in the work of construction. Subsequently, and while the buildings were but partially completed, the United States, in the exercise of the right reserved in the contract, took the work out of the hands of Rundle, and at the same time notified the sureties, Henley and Snodgrass, of its action. Thereupon the sureties took up the work of construction, and completed the buildings according to Rundle's contract and the United States accepted their work as full performance of the contract. For defense to the action, after some denials, the sureties set up the fact that Rundle did not complete the contract, but the sureties, under its terms made full performance, which was duly accepted by the United States, and that in their completion of the contract they were necessarily compelled to expend sums in excess of $10,000, the amount of the penalty in the bond.

1. The several assignments of error made by the appellants may be grouped together, and stated as the refusal of the superior court to admit testimony under the affirmative defense set forth in the answer. The court excluded any evidence with reference to the United States having demanded of the sureties the performance of the contract or the payment of damages. It is maintained by counsel for appellants that the limit of the liability of the sureties was the penalty stated in the bond, $10,000; that, if the sureties had not undertaken the performance of the contract of their principal, the entire damages to both the government and the respondents and all of the other claimants for labor and materials would have been liquidated by the payment of $10,000; that the fact that the sureties necessarily expended more than that sum in the completion of the contract, and over the contract price, relieves them from further liability. It is also maintained that, if the contract had not been completed, the government is a preferred creditor, and its claim would exhaust the penalty, and there would be no funds left for the satisfaction of plaintiffs and other claimants of like character; and counsel maintain that it is necessary to determine the question of priority of rights as between the government and these claimants. In a case involving these facts,--U. S. v. Rundle,--in the United States...