Reid v. Pauly

• Decision Date: 16 February 1903
• Docket Number: 849.
• Parties: REID et al. v. PAULY et al.
• Court: U.S. Court of Appeals — Ninth Circuit

121 F. 652

REID et al. v. PAULY et al.

No. 849.

United States Court of Appeals, Ninth Circuit.

February 16, 1903

Ben Sheeks and Sullivan & Christian, for appellants.

Judson & Geraghty and A. R. Titlow, for appellees.

Before GILBERT, ROSS, and MORROW, Circuit Judges.

ROSS Circuit Judge.

In 1890 one John T. Long was awarded a contract to build a courthouse and jail for Pierce county, Wash., for the sum of $270,000. By the laws of that state in force at the time the commissioners of the county were required to take from the person with whom such contract was made 'a good and sufficient bond, with two or more sureties who shall justify as bail upon arrest, which bond shall be conditioned that such person shall pay all laborers, mechanics, and materialmen, and persons who shall supply such contractor with provisions or goods of any kind, all just debts due to such persons or to any person to whom any part of such work is given, incurred in carrying on such work' (Hill's Ann. Code, Sec. 2415), and which bond should be in an amount equal to the full contract price for the work or improvements, and be executed to the state of Washington, but on which there should be a right of action in the person or persons performing labor or furnishing materials for the value thereof. Long undertook to give the bond so required with J. R. Addison, W. H. Fife, Van Ogle, Jacob Ralph Charles T. Uhlman, J. B. Catron, T. A. Bringham, J. L. De Voin, J. C. Mann, and W. B. Kelly, all of the state of Washington as sureties. That bond makes the state of Washington the obligee, but recites substantially that it was for the benefit of Pierce county, and its condition, in substance, is to save the county harmless from liens, claims, loss, damage, or expense occasioned by Long's failure to perform his contract. Long, however, did not sign the bond, nor did the sureties therein named justify in the required amount. Those sureties two days after the date of the bond--which was September 15, 1890-- addressed to the board of commissioners of Pierce county this communication and request:

'We, the undersigned, sureties on the bond of J. T. Long to the State of Washington as indemnity to the laborers and material men and all others having claims against the courthouse and jail, do hereby consent that you accept and approve the said bond with the justification of the sureties to an amount of three hundred and ten thousand dollars, and we waive any and all rights which we may have by reason of said bond being accepted with sureties to justify in said amount, only, and we hereby request you to approve said bond with the sureties now thereon. And we request you to approve said bond with the sureties now thereon. And we request you to make an order and spread the same upon the records of the proceedings of said Board of County Commissioners to the effect that said justification be reduced to said sum.'

It seems that the county commissioners accepted the bond, for it appears to have been filed and recorded at the request of the county. A few days thereafter, to wit, September 23, 1890, J. J. Ligon, P. J. Pauly, Sr., P. J. Pauly, Jr., and John Pauly, of St. Louis, Mo., executed to Addison and the other sureties named in the bond first mentioned a bond in the sum of $270,000, stating the conditions thereof as follows:

'The conditions of the above obligation are such that, whereas one John T. Long has entered into a contract with Pierce County, a corporation of the State of Washington, wherein the said bounden J. T. Long, for a consideration therein named to be paid, to make certain improvements by erecting, completing and furnishing materials for a courthouse and jail to be built in the city of Tacoma, County of Pierce, State of Washington, in accordance with the said contract, plans and specifications therefor, and in said contract agrees to pay all persons performing labor upon said building and doing said work, and to pay for all material furnished and used therein, and all persons who shall furnish said J. T. Long with goods and provisions of any kind, and all claims for damages; and whereas, J. R. Addison, W. H. Fife, Van Ogle, Jacob Ralph, Charles T. Uhlman, J. B. Catron, T. A. Bringham, J. L. De Voin, J. C. Mann, and W. B. Kelly, have become sureties for the said J. T. Long to the said Pierce County to the sum of $270,000 in good and lawful money of the United States, and have bound themselves as such sureties to said county for the performance by the said J. T. Long of all of the covenants and agreements entered into by the said J. T. Long with said Pierce County for the building of the courthouse and jail above referred to in accordance with the certain contract entered into by the said J. T. Long and the said County of Pierce:

'Now, therefore, the condition of the above obligation is such that if the said J. T. Long shall well and truly perform and fulfill the conditions of the contract entered into between him and the said County of Pierce, in manner and form as he is therein required to do, and at all times hereafter save harmless the said J. R. Addison, W. H. Fife, Van Ogle, Jacob Ralph, Charles T. Uhlman, J. B. Catron, T. A. Bringham, J. L. De Voin, J. C. Mann, and W. B. Kelly, their heirs, executors and administrators, of and from said obligation which the above-named sureties have entered into with the said J. T. Long to the said County of Pierce, and of and from all action, cost, and damage for and by reason thereof, then this obligation shall be void, otherwise to remain in full force and effect.'

Long completed his contract in 1893, and, a dispute having arisen between him and the county in respect to the balance due him thereon, he, in that year, brought suit against the county in one of the courts of the state of Washington to recover what he claimed to be due him. He had not, however, paid in full for all of the materials used in the structures, and, as a consequence, he was sued in the courts of the same state by various of the parties furnishing material, in each of which suits judgment was obtained against him; one of which was recovered by the Brown-Haywood Company, a Missouri corporation, to which company all of the other judgments so recovered were afterwards assigned. Based on its own and the assigned judgments, the Brown-Haywood Company, together with Addison and the other sureties named in the bond first mentioned herein, commenced suit in the United States Circuit Court for the Eastern Division of the Western District of Missouri against the Missouri sureties on the bond of September 23, 1890, in which action the Brown-Haywood Company recovered judgment on the 24th day of March, 1899, for the aggregate sum of $25,305 (92 Federal, 851), the court in that case saying:

'Complainant's (the Brown-Haywood Company) equity may consist in the right to be subrogated to the securities held by its debtor (Long), or it may consist in its right to enforce an agreement made by the defendants (the Missouri sureties on the bond of September 23, 1890) for its benefit, under the doctrine of the case of Knapp v. Insurance Co., 29 C.C.A. 171, 85 F. 329 (40 L.R.A. 861).

The defendants to the suit in Missouri, namely, the makers of the bond of September 23, 1890, having paid the amount of the judgment thus given against them, brought, on the 29th day of December, 1900, the present suit against the county of Pierce, state of Washington, John T. Long, and one George T Reid, as trustee of the estate of John T. Long; the latter having in October, 1898, been adjudged a bankrupt, and Reid having been appointed trustee of his estate, and thereafter having been substituted for Long in his suit against the county of Pierce, and having recovered as such trustee on the 1st day of April, 1901, judgment for the sum of $28,800 as the balance due from the county...