Title Guar. & Sur. Co. v. Dutcher

• Decision Date: 07 March 1913
• Docket Number: 1,861.
• Citation: 203 F. 167
• Court: U.S. District Court — Western District of Washington
• Parties: TITLE GUARANTY & SURETY CO. v. DUTCHER et al.

203 F. 167

TITLE GUARANTY & SURETY CO. v. DUTCHER et al.

No. 1,861.

United States District Court, W.D. Washington, Southern Division.

March 7, 1913

James B. Murphy, of Seattle, Wash., for complainant.

Boner &amp Boner, of Aberdeen, Wash., for defendants.

CUSHMAN District Judge.

This cause is now for decision upon an agreed statement of facts. The suit was brought by complainant, the surety upon a contractor's bond, given the defendant, city of Aberdeen to secure the performance of a contract for improving certain streets. Complainant's prayer is that the city be enjoined from recognizing certain assignments made by the defendant contractor, and that it be required to pay the complainant all amounts due upon the contract.

The contract provided:

'(3) In consideration of the full performance of said work by said contractor, the said city agrees to pay the said contractor in local improvement fund bonds issued on said local improvement district No. 322, at the following rates as measured and estimated by the said city engineer, to wit: * * * Payment to be made as the work progresses, upon estimates of said city engineer, no such bonds to be issued, however, until after the equalization of the assessment roll as provided by the ordinances of the city of Aberdeen.

'(4) The plans, specifications and details for said work on file in the office of the city engineer, and a part of the bid in said contract, is hereby referred to and made and part of this contract as fully as though set out herein in detail.

'(5) The said contractor is required to furnish a good and sufficient bond to the city of Aberdeen for the faithful performance of said contract and for the protection of all contractors, subcontractors, laborers, mechanics and materialmen and all persons who shall supply such contractor or subcontractors with provisions or supplies for the carrying on of said work in a sum not less than thirty-one hundred dollars ($3,100) which sum is approximately fifty (50) per cent. of the amount of said contract.

'(6) Said contractor further agrees to save and protect the city free and harmless, from all loss, damage and liability caused by any neglect or want of proper care or act or omission done or suffered to be done by the said contractor, his agents, employes or subcontractors in the performance of said contract.'

The complainant became surety for the contractor on a bond for $3,100, which bond provided:

'Now, therefore, if the above bounden principal, Wm. Dutcher, shall and does, well and truly, faithfully and fully comply with and carry out the terms and conditions of said contract, and shall complete the same in the time and manner specified, and shall pay all laborers, mechanics, subcontractors and materialmen, and all persons who shall supply such contractor or subcontractors with provisions and supplies for the carrying on of the work contemplated in said contract, any and all just debts, dues and demands incurred in the performance of said work, and shall comply with all the requirements of the laws of the state of Washington with relation thereto, then this obligation to be void, otherwise to be and remain in full force and effect.'

The contract and bond were executed in July, 1910.

Before the completion of the contract, the contractor abandoned the work, and failed to pay certain indebtedness incurred in connection therewith on account of labor and materials furnished in the work, and was thereafter adjudged bankrupt.

The contract price for the entire work was $6,251.66. At the time of the abandonment, May 6, 1911, there was work completed to the amount of $3,717.90. Nothing has been paid by the city to the contractor or otherwise. The contractor left unpaid labor and material bills which have been paid by the complainant to the amount of $2,675.71. On March 1, 1911, the contractor borrowed $3,500. The defendant Sargent indorsed his note for this amount, which the indorser, was afterwards compelled to pay. At the time of such indorsement, the contractor agreed to assign to the indorser sufficient of the city's contract bonds to cover the obligation of the indorser. The assignment was not actually made until May 6, 1911. This assignment was for $4,000 of the bonds to become due on account...