McDaniel Bros. Const. Co. v. Burk-Hallman Co.
| Decision Date | 31 May 1965 |
| Docket Number | No. 43534,BURK-HALLMAN,43534 |
| Parties | McDANIEL BROS. CONSTRUCTION COMPANY, Inc. v.COMPANY. |
| Court | Mississippi Supreme Court |
Young & Young, Pat Scanlon, Jackson, for appellant.
Overstreet, Kuykendall, Perry & Phillips, Jackson, Don G. Owens, Memphis, Tenn., for appellee.
McDaniel Bros. Construction Company, a Mississippi Corporation, sued Burk-Hallman Company, a Tennessee Corporation, to recover a sum of money. The suit was filed in chancery court because of an attachment feature. The case was tried before the chancellor on a stipulation of facts and a decree was entered dismissing the bill of complaint. McDaniel Bros. Construction Company, Inc., appealed to this Court.
McDaniel Bros. Construction Company, Inc., hereinafter called Prime Contractor, entered into a contract in 1961 with Coahoma County for the construction of a school building. Prime Contractor as principal entered into bond with proper sureties guaranteeing the payment of all persons supplying labor and material. Prime Contractor entered into a subcontract with Magnolia Paint & Wallpaper, a Mississippi Corporation, hereinafter called Subcontractor, whereby Subcontractor would do the paint work on the school project for the sum of $23,650; said Subcontractor to furnish all labor and materials in fulfilling its contract for the paint work. On May 25, 1962, Prime Contractor received an instrument, dated May 17, 1962, executed by Subcontractor, directing Prime Contractor to pay the full contract price to become due Subcontractor to Burk-Hallman Company, herein called Assignee. Prime Contractor accepted the assignment by executing the same and returning it to Assignee.
At the time of the assignment, Subcontractor owed Assignee $10,561.48 for materials and supplies furnished Subcontractor on projects unrelated to the Coahoma County School job. Relying on the aforesaid assignment dated May 17, 1962, Assignee furnished materials and supplies and made cash advances to Subcontractor for the school project in an amount exceeding $10,000.00. Pursuant to its contract with Subcontractor, and in accordance with the assignment dated May 17, 1962, Prime Contractor made progress payments by checks payable jointly to Subcontractor and Assignee and sent the checks to Assignee. Three such payments were made totalling $20,000.00, which sums were received by Assignee and deposited to its bank account in the normal course of business, after being endorsed by Subcontractor or by the Assignee for the Subcontractor. The said sum of $20,000 was credited by Assignee to the account owed it by Subcontractor, which, with a return of some merchandise, balanced the account.
Subcontractor defaulted and failed to complete its contract, and failed to pay some of its laborers and materialmen. Prime Contractor was required under the terms of the prime contract and under its bond to pay $13,233.78 to Subcontractor's laborers and materialmen and to complete the contract. Thus the total amount spent by Prime Contractor in paying Assignee and in paying Subcontractor's laborers and materialmen and to complete the subcontract was $33,233.78, which was $9,583.78 more than Prime Contractor had agreed to pay Subcontractor to do the painting work. It is this $9,583.78 that the Prime Contractor seeks to recover.
The question is whether a prime contractor, who voluntarily pays the assignee of a subcontractor a sum of money in excess of what said assignee could have recovered if it had sued the prime contractor, may recover said excess from the assignee when said payment was made by the prime contractor without compulsion, fraud, mistake of fact, or promise on the part of the assignee to repay the excess. We hold that such voluntary payment may not be recovered.
Appellant relies strongly on the case of R. B. Tyler Company v. Laurel Equipment Company, 187 Miss. 590, 192 So. 573 (1940), which was followed in Hancock Bank of Gulfport v. G. E. Bass & Company, 247 Miss. 274, 154 So.2d 278 (1963). In Tyler, that firm had entered into a contract with the State Highway Commission to do certain road work, including the hauling of sand. Tyler subcontracted the sand hauling to Broom. Broom purchased eight trucks from Laurel Equipment Company and gave the Equipment Company an assignment of part of his weekly gross earnings as part payment for said trucks. Tyler, in paying Broom for the contract work, would first pay out of the funds owed Broom the amounts necessary to pay Broom's labor and operating expenses, paying the balance to Laurel Equipment Company. Later, Broom failed to pay Laurel Equipment Company for the trucks; it repossessed, sold the trucks at public auction, and brought...
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