Hart v. State ex rel. Rock

• Decision Date: 28 May 1889
• Citation: 21 N.E. 654,120 Ind. 83
• Parties: Hart et al. v. State ex rel. Rock.
• Court: Indiana Supreme Court

120 Ind. 83

21 N.E. 654

Hart et al.

v. State ex rel.Rock.¹

Supreme Court of Indiana.

May 28, 1889.

Appeal from circuit court, Hancock county; M. E. Forkner, Judge.

Action by Charles M. Rock against Andrew T. Hart and others, sureties upon a contractor's bond. Judgment for plaintiff, and defendants appeal. Rev. St. Ind. 1881, § 5095, relates to the manner of letting contracts for the construction of gravel roads, and provides, among other things, that the contract shall be let to the lowest bidder, who shall give such reasonable security for the performance of his contract as the commissioners may deem expedient.Wm. R. Hough, for appellants. New & Jones, for appellee.

Elliott, C. J.

The complaint of the relator is based on a bond executed by Hays as principal and the other appellants as sureties. The condition of the bond is thus expressed: “The conditions of the above obligation are such that whereas, the above-bound Orlando Hays has been awarded the contract for constructing sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, of the Pleasant Hill and Manilla Free Gravel Road, in Shelby county, Indiana, and has entered into a written contract with the engineer and superintendent of said free gravel road to construct and complete said sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 of said road on or before the ------ day of ------, 188-, according to the specifications prepared therefor by said engineer and superintendent, and in compliance with the provisions and requirements of the notice of the letting of the contract for the construction of said road: Now, if said Orlando Hays shall construct and complete said sections 1, 2, 3, 4, 5, 6, 7, 8, 9, 10 of said road according to the provisions of the contract entered into with the engineer and superintendent, then this obligation to be void, otherwise to remain in full force and effect.” It is averred that a written contract was entered into between Hays and the board of commissioners of Hancock county for the construction of the sections of the gravel road mentioned in the bond, and that the bond was executed under the provisions of the act of March 14, 1877. It is also averred that by the mistake of the scrivener who drew the bond it was made payable to the board of commissioners, instead of to the state of Indiana, and that by the further mistake of the scrivener the bond was not conditioned for the payment of debts incurred by the contractor in the prosecution of the work, and for the payment of laborers and persons furnishing material. It is further averred that the claims of the persons named were assigned to the relator; that the contractor became indebted to the persons named for work and for materials, and the particulars of the indebtedness are properly set forth. The complaint also alleges that the relator made demand for payment of the sums due before the action was instituted. The title of the act of March 14, 1877, does not include more than one subject, and the provisions relating to the execution of bonds by contractors are fully within the title. The decision in Faurote v. State, 110 Ind. 463, 11 N. E. Rep. 472, settles the question as to the right of the relator to have mistakes in the bond corrected. The bond was given pursuant to a public statute, and, under the provisions of section 1221, Rev. St. 1881, the parties in interest have a right to have mistakes corrected, so as to give the bond the effect the law intended it should have. The persons who performed labor and furnished materials had a right to sell their claims. A sale of such claims is not champertous. There is no more reason for holding such sales champertous than there is for holding the sale of a claim for work and labor done on a farm, or of a claim for merchandise. Our Code expressly recognizes the right to sell and assign all such claims, and authorizes the assignee to maintain an action in his own name as the real party in interest. After the sale and assignment of the claims to the relator he became the real party in interest, and the demand was properly made by him.

The answer of the sureties is, in substance, this: The assignors and the relator, at the time the assignment was made, entered into an agreement wherein the relator undertook to collect the claims at his own expense, and, when they were collected, to pay to each of the claimants one-half of his claim “of the money which should be by him collected.” In consideration of this undertaking the assignors agreed that the relator should retain one-half of the amount collected on each claim to compensate himself for his services, and to reimburse him for costs and expenses incurred. To this answer a demurrer was sustained, and this the appellants' counsel assert was error, because the agreement between the assignors and the relator was champertous and void. The rule invalidating champertous agreements is still in force in this state, although much restricted by the provisions of the Code. Scobey v. Ross, 13 Ind. 117;Quigley v. Thompson, 53 Ind. 317;Greenman v. Cohee, 61 Ind....