National Surety Co. v. Lincoln County, Mont.

• Decision Date: 08 January 1917
• Docket Number: 2825.
• Citation: 238 F. 705
• Parties: NATIONAL SURETY CO. v. LINCOLN COUNTY, MONT.
• Court: U.S. Court of Appeals — Ninth Circuit

238 F. 705

NATIONAL SURETY CO. v. LINCOLN COUNTY, MONT.

No. 2825.

United States Court of Appeals, Ninth Circuit.

January 8, 1917

Rehearing Denied February 13, 1917. [Copyrighted Material Omitted]

Clarence H. Gilbert, of Portland, Or., Gunn, Rasch & Hall, of Helena Mont., Edmund C. Strode, of Lincoln, Neb., and Coy Burnett of Portland, Or., for plaintiff in error.

J. B. Poindexter, Atty. Gen., W. H. Poorman, Asst. Atty. Gen., and Sidney M. Logan, of Kalispell, Mont., and James M. Blackford, of Libby, Mont., for defendant in error.

Before GILBERT, ROSS, and HUNT, Circuit Judges.

GILBERT Circuit Judge.

The defendant in error entered into a contract with the Coast Bridge Company, whereby the latter was to construct a bridge across the Kootenai river at Rexford, Mont., a swift mountain stream more than 400 feet wide. The bridge was to be for highway purposes, to be 18 feet in floor width, to consist of two spans each 220 feet long, supported by a central pier. The bridge company agreed to provide all material and labor and to build the bridge in a good, workmanlike, and substantial manner, 'so as to make it a perfect bridge, according to the plans and specifications. ' The bridge company was to furnish the plans and specifications. The bridge was completed and paid for late in the fall of 1912, and early in the spring of 1913 the central pier was undermined so that it overturned and the bridge fell. The loss was total. The defendant in error brought an action against the bridge company and the National Surety Company, the plaintiff in error, to recover the sum of $30,000, the penal sum of the surety company's bond. The case was tried before the court, a jury trial having been waived. The court reached the conclusion that the piles of the center pier were not driven in accordance with the contract, and that because thereof the pier and the bridge fell, and made a general finding for the defendant in error, and entered judgment for $29,345 with interest and costs. No special findings were requested by either party. At the conclusion of the testimony, the plaintiff in error moved for judgment in its favor, not on the ground that there was no evidence sufficient in law to sustain a judgment for the defendant in error, but upon the alleged insufficiency of the complaint to state a cause of action, and upon certain specified grounds on which it was contended that the plaintiff in error was discharged of liability upon its bond.

On this writ of error we are limited to the consideration of the specific questions which were presented on the motion for a judgment. It is well settled that if a jury trial is waived, and a general finding is made by the court, review in an appellate court is limited to such rulings of the trial court in the progress of the trial as are presented by a bill of exceptions. In Dunsmuir v. Scott, 217 F. 200, 133 C.C.A. 194, this court said:

'The question whether or not, at the close of the trial, there is substantial evidence to sustain a finding in favor of one of the parties to the action, is a question of law which arises in the progress of the trial. Where the trial is before a jury, that question is reviewable on exception to a ruling upon a request for a peremptory instruction for a verdict. Where the trial is before the court, it is reviewable upon a motion which presents that issue of law to the court for its determination at or before the end of the trial.'

See, also, Mason v. Smith, 191 F. 502, 112 C.C.A. 146; National Surety Co. v. United States, 200 F. 142, 118 C.C.A. 360; New York Life Ins. Co. v. Dunlevy, 214 F. 1, 130 C.C.A. 473; Tiernan v. Chicago Life Ins. Co., 214 F. 238, 131 C.C.A. 284.

One ground on which it is contended that the complaint fails to state a cause of action is that the contract therein presented as an exhibit bears date February 5, 1912, whereas the bond which is also presented as an exhibit bears date February 20, 1911, and in the body of the complaint it is alleged that the contract was entered into on December 18, 1911. But the complaint alleges, also, that during the month of February, 1912, the defendant in error and the Coast Bridge Company made certain modifications of the specifications, attached to and made a part of such contract, 'a copy of which contract, together with the changed and modified specifications thereunto annexed and made a part of the same, is hereto annexed, marked 'Exhibit A,' and made a part of this complaint. ' And it alleges that the bond was conditioned upon the bridge company's compliance with all the terms, conditions, and provisions in said contract, and the changed and altered plans and specifications mentioned. The discrepancy between the date which the contract bears and the date of the bond alleged in the complaint was not called to the attention of the court below. The contract of December 18, 1911, and plans and specifications referred to therein, were introduced in evidence without objection. Pursuant to a stipulation of the parties, permission was granted to amend the complaint by alleging that the original contract was made on December 18th, and the agreement modifying the same on February 5, 1912. The plaintiff in error then interposed a general objection to the introduction of any evidence in support of the complaint as amended, upon the ground that the complaint did not state facts sufficient to constitute a cause of action. It appears from the opinion that this objection was for the 'purpose of the record,' and that no defect in the complaint was pointed out. The court overruled it 'as of a class disfavored, in that it tends to defeat justice rather than to promote it,' and stated that if the complaint was defective an amendment would be allowed, and 'if necessary the amendment is deemed made to conform to proof. ' The case went to trial on the understanding of all parties, so far as the record discloses, that the bond sued upon was the bond given for the performance of the contract under which the bridge was constructed; and the bond on its face shows that it was given to secure the performance of that contract. It refers to the contract of December 18, 1911, to the bond which the bridge company had given for the performance thereof, to the fact that the original contract had been changed and altered, and a new contract had been made in accordance with the changed plans and specifications, and to the fact that the county commissioners had ordered that a new bond be given, and then it declares that the Coast Company and its surety undertake that the principal therein shall faithfully and truly observe and comply with all the terms of the contract as altered. The fact that the bond which was then executed bore date December 20, 1911, must be disregarded as a clerical error which resulted from inadvertence in copying the previous bond.

One ground of the motion of the plaintiff in error was that there was neither allegation nor proof that approval of the plans and specifications for the bridge, or permission for its construction, had been obtained from the War Department. In this connection, it is contended, also, that the complaint was insufficient for failure to allege that said permission and approval were had. In the original contract between the defendant in error and the bridge company, it was stipulated that the contract should not take effect until the War Department 'has approved the plans and specifications and granted permission for the construction of said bridge. ' In the contract of February 5, 1912, that stipulation was omitted. An act of Congress was duly passed authorizing the construction of the bridge, the same to be built in accordance with the act of Congress of March 23, 1906 (34 Stat. 84), an act which requires that a bridge over navigable waters, authorized by Congress, shall not be built until the plans have been approved by the Secretary of War and the Chief of Engineers, and provides that any person who shall be guilty of a violation thereof shall be deemed guilty of a misdemeanor and on conviction shall be punished by a fine. The prohibition is against persons constructing or commencing to construct bridges without complying with the requirements of the statute. The act defines 'persons,' as therein used, to include 'municipalities, quasi municipal corporations, corporations, companies, and associations. ' The complaint contains no allegation that the plans and specifications upon which the bridge was constructed were approved by the War Department, and there is no proof to that effect. No objection was interposed on that account during the progress of the trial, and no mention was made of that omission until the motion was made by the plaintiff in error for a judgment in its favor.

The court below in denying the motion was of the opinion that since the contract to construct the bridge had been performed, it must be presumed that it was lawfully performed, and that the necessary approval was had, and that the obligation to secure the approval rested upon the contractor as much, if not more than upon the county, that the surety engaged that its principal would lawfully perform, and that, if the latter unlawfully performed its contract, the surety was not discharged. In so ruling we think the court below committed no error. We think that it should be presumed that, when the bridge company began the construction work, it had determined, as it was its duty to do, that the conditions upon which it could lawfully proceed had been complied with....