Texas Co. v. Schriewer

• Decision Date: 12 March 1931
• Docket Number: No. 1026.,1026.
• Citation: 38 S.W.2d 141
• Parties: TEXAS CO. v. SCHRIEWER et al.<SMALL><SUP>*</SUP></SMALL>
• Court: Texas Court of Appeals

Page 141

38 S.W.2d 141

TEXAS CO. v. SCHRIEWER et al.^*

No. 1026.

Court of Civil Appeals of Texas. Waco.

March 12, 1931.

Appellees' Motion for Rehearing Denied April 16, 1931.

Appellant's Motion Granted in Part April 16, 1931.

Second Motion for Rehearing Denied May 7, 1931.

Appeal from District Court, Brazos County; W. C. Davis, Judge.

Suit by the Texas Company against Paul Schriewer and others. Judgment for plaintiff for part of relief claimed, and plaintiff appeals.

Modified in part, affirmed in part, and reversed and rendered in part.

F. T. Baldwin and E. S. Morris, both of Houston, for appellant.

Henderson & Hoyle and R. V. Armstrong, all of Bryan, and A. S. Rollins, of Dallas, for appellees.

ALEXANDER, J.

This was a suit in the district court of Brazos county by the Texas Company against Paul Schriewer, Allen Smith, and the American Surety Company of New York to recover from Paul Schriewer the sum of $12,941.81 for material furnished him as a subcontractor in the construction of a state highway in Young county, and against Allen Smith as principal and American Surety Company as surety on the contractor's bond executed by Allen Smith in compliance with the provisions of Revised Statutes, art. 5160 (as amended by Acts 1929, 41st Leg., c. 226, § 1 [Vernon's Ann. Civ. St. art. 5160]), and against Allen Smith and American Surety Company on a release bond executed in compliance with the provisions of article 5472b— 1 (as added by Acts 1929, 41st Leg., 2d Called Sess., p. 154, c. 78 [Vernon's Ann. Civ. St. art. 5472b—1]). A trial before the court without a jury resulted in a judgment for plaintiff against Paul Schriewer for the sum of $12,941.81, and that plaintiff take nothing against defendants Allen Smith and American Surety Company. The plaintiff appeals.

Allen Smith entered into a contract with the state highway department for the construction of a public highway in Young county and executed a bond with the American Surety Company as surety for the faithful performance of the contract. He sublet a part of the contract to Paul Schriewer. The court filed findings of fact in which it was found that the Texas Company furnished Paul Schriewer for the construction of said highway, material of the value of $12,941.81, and that all of such material was used in the construction of said highway, and that same has not been paid for. The Texas Company, however, did not file with the county clerk of Young county an itemized list of the material so furnished by it within ninety days from the date of the delivery of such material as provided in Revised Statutes, art. 5160. After the state highway department had paid Allen Smith approximately $100,000 on said contract and while there was still owing him thereon a balance of $23,414.58, the Texas Company notified the state highway commission of its claim for the material so furnished Paul Schriewer. Allen Smith as principal, and American Surety Company as surety, executed to the state highway department a release bond as is provided in article 5472b—1, and obtained a release of the balance due under said contract. The trial court held that appellant could not recover against Allen Smith and American Surety Company on the original bond given for the performance of the contract because appellant did not file an itemized statement of its account with the county clerk of Young county within the time provided by law. The court also held that appellant could not recover against Allen Smith and American Surety Company on the release bond because, (a) the appellant did not furnish the material to the original contractor, but furnished the same to a subcontractor, (b) notice was not given before the first payment was made on the contract, and (c) notice of appellant's claim should have been given to the state treasurer and not to the highway commission.

Since the appellant did not file with the county clerk of Young county an itemized list of the materials furnished by it within ninety days after the delivery of the same as provided by article 5160, it cannot recover on the original bond given for the faithful performance of the contract. If it is to recover at all, it must recover by virtue of the provisions of article 5472a, on the release bond given in compliance with the terms of Revised Statutes, art. 5472b—1. Article 5472a reads as follows: "That any person, firm or corporation, or trust estate, furnishing any material, apparatus, fixtures, machinery or labor to any contractor for any public improvements in this State, shall have a lien on the moneys, or bonds, or warrants, due or to become due to such contractors for such improvements; provided, such person, firm, corporation, or stock association, shall, before any payment is made to such contractor, notify in writing the officials of the State, county, town or municipality whose duty it is to pay such contractor of his claim." (Acts 1925, 39th Leg., ch. 17, p. 44, § 1 [Vernon's Ann. Civ. St. art. 5472a]).

Does one who furnishes labor or material for public improvements to a subcontractor, and not to the general contractor, have a lien on the funds due or to become due for the construction of such public improvements? The statute does not, by express terms, include one who furnishes labor or material to a subcontractor. It reads: "That any person * * * furnishing any material * * * or labor to any contractor for any public improvements in this State, shall have a lien on the moneys * * * due or to become due to such contractors for such improvements," etc. In construing statutes, it is the duty of the court to ascertain and give effect to the intention of the Legislature. In order to arrive at such intention, resort may be had not only to the language of the act, but the occasion and necessity of the enactment, the evils to be remedied, the object to be secured, and its relation to existing legislation on the same subject. The court should give to the statute that construction best calculated to secure the benefits intended, and, for the purpose of arriving at such intention, may consider the construction placed on prior similar acts and the established policy of the legislature as disclosed by a general policy of legislation.

For many years it has been the established policy of the state, as disclosed by general legislation on the subject, to secure the laborer or materialman by a lien to insure payment for the labor and material so furnished by him. One furnishing labor or material, either to a general or subcontractor, for private improvements is given a lien on the improvements constructed with the labor or material so furnished. Bassett v. Mills, 89 Tex. 162, 34 S. W. 93; Padgitt v. Dallas Brick & Construction Co., 92 Tex. 629, 50 S. W. 1010; Wilson v. Sherwin-Williams Paint Co., 110 Tex. 156, 217 S. W. 372. Mechanics and laborers in almost every known trade are now given liens or some other cumpulsory process for enforcing payment of their claims.

Prior to the enactment of article 5472a, one furnishing labor or material for the construction of public improvements could neither fix a lien on the improvements nor impound the funds due by the state or municipality for such improvements. The only remedy afforded such laborer or materialman was that given by Revised Statutes, article 5160, by which it was provided that those contracting to construct such improvements should, before commencing such work, execute a bond obligating such contractor to pay all persons supplying labor or material for such improvements. At the time article 5472a was enacted, the state was entering upon a period of extensive road building and public improvements. It is manifest that by the enactment of article 5472a, it was the intention of the Legislature to provide additional security to those who furnish labor or material for public improvements. The Legislature was attempting to provide a method by which the funds set aside for such improvements could be impounded for the benefit of those who directly brought about such improvements. The state was furnishing the funds for such improvements, and it had the right and it was its duty to provide that those who supplied the labor and material for such improvements should be compensated therefor. It is the duty of the courts, therefore, to so construe the statute as to accomplish this end, if they can do so, without doing violence to the language used.

To give the statute that construction contended for by appellee and to hold that those who furnish labor and material to the general contractor may impound the funds, but that those who furnish such labor or material to a subcontractor have no lien thereon, would be a discrimination without warrant. We can perceive no good reason why the Legislature should prefer the laborer who furnishes labor direct to the general contractor over the one who furnishes such labor to a subcontractor. In each case the general contractor gets the benefit of the labor and material necessary for the improvements and for which he has obligated himself to pay. The state likewise gets the benefit of such labor and material and is likewise interested in seeing that it is paid for. Moreover, to place such a construction on the statute would enable the general contractor to practically nullify the statute. By subletting the entire contract, the general contractor could place the funds beyond the reach of the laborer and materialman. The general contractor, under his contract with the state, obligated himself to pay all lawful claims for labor and material furnished for such improvements. It was made the duty of the contractor to supply the labor and material for such improvements at his own cost. He could provide such labor and material himself, or he could delegate or sublet this duty to another, but, by such subletting, the general contractor could not relieve the funds due him under such contract from the danger of being impounded for the payment of the...