Miller v. Am. Bonding Co.

• Decision Date: 23 June 1916
• Docket Number: No. 19804[160].,19804[160].
• Court: Minnesota Supreme Court
• Parties: MILLER v. AMERICAN BONDING CO. (LANDON et al., Interveners).

133 Minn. 336

158 N.W. 432

MILLER

v.AMERICAN BONDING CO. (LANDON et al., Interveners).

No. 19804[160].

Supreme Court of Minnesota.

June 23, 1916.

Appeal from District Court, Winona County; Arthur H. Snow and George W. Granger, Judges.

Action by Emil Miller against the American Bonding Company, and W. J. Landon and others intervene. From an order sustaining demurrers to several causes of action stated in the complaint, plaintiff appeals. Reversed in part and affirmed in part. From a judgment against the interveners, they appeal. Affirmed.

Syllabus by the Court

The bond required to be given by the one to whom is let the construction of a state rural highway, and conditioned as provided by section 8245, Gen. St. 1913, secures the payment of labor, skill and material furnished in repairs upon tools and machinery employed in the construction of the highway, and also for the reasonable value or agreed price of the use of appropriate tools and machinery furnished during and in the construction; but it does not secure payment of the purchase price of tools or machinery sold to the contractor and which become a part of his equipment, although the same are sold for the particular contract and are necessary and appropriate for that purpose.

The judgment, dismissing the intervening plaintiffs' claims against the surety on a bond, of the kind mentioned, for the purchase price of tools and machinery sold to the contractors for the construction of state rural highways are right and are affirmed.

The order, sustaining the demurrer to the sixteenth and twenty-seventh causes of action stated in the complaint, is also affirmed, but the order sustaining the demurrer to the sixth, seventh, eighth, twelfth, thirteenth, fifteenth, nineteenth and twenty-first causes of action therein stated is reversed, each of said causes of action containing items of labor, skill, or material furnished in needed repair to the contractors' equipment while employed in the construction. Webber & Lees and J. M. George, all of Winona, for appellant.

Chester L. Caldwell, of St. Paul, amicus curiae. Keith, Kingman, Cross & Wallace, of Minneapolis, for respondent.

HOLT, J.

On the 12th of August, 1912, separate contracts were let by the county of Winona for the construction of two concrete state rural highways under the Elwell law to the partnership of Prinz & Carlson, and the defendant bonding company gave the statutory bonds. The contracts entered upon the work, but abandoned it in the fall of 1913, leaving unpaid a number of claims for labor, materials, tools, and machinery procured in the performance of the work by themselves and subcontractors. Many of these claims were assigned to plaintiff, who herein seeks to enforce them against the bonding company. Crane & Ordway Company and R. D. Cone Company were permitted to become intervening plaintiffs, each setting up a cause of action for instrumentalities sold the contractors, to be used, and which were used, in the construction of the roads. A demurrer was sustained to several of plaintiff's claims, and, after a trial, the intervening plaintiffs were denied a recovery. The actions of the courts below-the sustaining of the demurrer by the late Judge Snow and the rejection of the claims of the two intervening plaintiffs by Judge Granger-now come up for review.

[1][2] The Elwell law (chapter 254, Laws 1911 [Gen. St. 1913, §§ 2603-2609]), requires the contractor's bond to be conditioned as provided by chapter 230, Laws 1905, in drainage proceedings, and in section 15 of the latter is found this requirement: ‘Every such contract shall embrace all the provisions provided by law for the giving of bond by contractors for public works and improvements,’ etc.-thus making applicable section 8245, G. S. 1913. The bond here involved is conditioned that Prinz & Carlson ‘shall pay, as they become due, all just claims for all work and labor performed and all tools, machinery, skill, and materials furnished under, or for the purpose, or in the execution of’ the contract. This is in substantial conformity to said section 8245.

The two claims disallowed by Judge Granger, and many items in the different causes of action to which Judge Snow sustained the demurrer, depend upon the bonding company's liability for the purchase price of tools and machinery sold to the contractors or subcontractors as proper equipment for the building of the highways.

As to the claims of Crane & Ordway Company the findings are, in substance, that at the request of the contractors the company in September, 1912, sold and delivered to them iron pipes, tees, plugs, hose nipples, clamps, and hose of the reasonable value of $729, to be used, and which were used, by them in conveying water to the concrete mixer, used in the construction of the highways. That the materials were not manufactured by the seller expressly for this purpose, but were ordinary materials carried in stock. As to the claim of the partnership of R. D. Cone Company, the court found that it sold and delivered 12 dump wagons to be used in hauling material for the construction of the highways, and they were so used. The balance unpaid on the wagons is $861.05. Both the piping and the wagons were found to have become a part of the general equipment of the contractors.

The contention of appellants is that, under the plain reading of the law, one who furnishes tools or machinery for a public improvement may resort to the contractor's bond for the payment of their market or agreed price. It is argued that, although it might be possible to give an interpretation to the statute so as to confine claims for machinery against a contractor's bond to machines incorporated into, or becoming a part of, the works or improvement, the same may not be done in respect to tools which never can become a component part of a work or improvement-tools might here include both the piping and wagons without being unduly liberal in the interpretation of a statute designed to be remedial. It must be conceded that so far as the rights of a vendor of a tool to have recourse to a bond of this sort for its purchase price, use, or repair, it must be the same as the rights of a vendor of machinery.

A proper construction of the statutes here applicable is not free from difficulty. Chapter 354, Laws 1895, was the first law exacting a bond from contractors upon public works and improvements to better secure the state, the public corporations, and the parties performing labor and furnishing materials for such works or improvements. The first section, standing alone, might have covered labor performed and skill and material furnished in the execution of the contract to the same extent as under the mechanic's lien statute. The fourth section, however, provides:

‘Whoever shall perform or cause to be performed any work or labor or furnish or cause to be furnished any skill or material including any work, labor skill or material necessary in the repair of any tool or machine and including the use of any tool or machine or material furnished...