Town Of Gastonia v. Mcentee-peterson Eng'g Co

• Decision Date: 25 November 1902
• Citation: Town Of Gastonia v. Mcentee-peterson Eng'g Co, 42 S.E. 857, 131 N.C. 359 (N.C. 1902)
• Parties: TOWN OF GASTONIA et al. v. McENTEE-PETERSON ENGINEERING CO. et al.
• Court: North Carolina Supreme Court

42 S.E. 857

131 N.C. 359

TOWN OF GASTONIA et al.

v.McENTEE-PETERSON ENGINEERING CO. et al.

Supreme Court of North Carolina.

Nov. 25, 1902.

CONTRACTS—BONDS—GARNISHMENT—lien —RIGHTS OP SURETY.

1.Where, by a contract between a town and a contractor, the contractor was not entitled to a fund applicable to the contract in the hands of the town until after he had completed the contract, and furnished releases of all claims for material used, etc., creditors of the contractor acquired no lien on the fund prior to the completion of the contract and the furnishing of such releases by garnishment against the town.

¶ 1.SeeGarnishment, vol.24 Cent. Dig. § 88.

2.Where a contractor had given bond for the completion of its contract with a town, and the surety had agreed to indemnify the town against the demands of the contractor, the contractor's servants, materialmen, etc., the surety was entitled to have money in the hands of the town, applicable to the contract, applied in payment of claims for material, etc., within the obligation of the bond, as against other creditors of the contractor.

Appeal from superior court, Gaston county; Starbuck, Judge.

Action by the town of Gastonia and others against the McEntee-Peterson Engineering Company and others.From a judgment in favor of plaintiffs, defendantsPost-Glover Electric Company and another, impleaded, appeal.Affirmed.

This was a civil action tried at the spring term, 1902, of Gaston superior court by Star-buck, Judge.A jury trial having been waived, the court found the facts as set out in the record, to which findings there was no exception, except to finding No. 12.The action was originally brought by the town of Gastonia to recover upon a bond in the penal sum of $3,000 executed by the McEntee-Peterson Engineering Company, as principal, and the American Surety Company, as surety, to the town of Gastonia, and its mayor and board of aldermen, to indemnify and save harmless the obligees against loss or damage on account of the construction of an electric lighting plant and waterworks pumping station by the engineering company, and to secure the payment for all materials furnished and used and labor performed in the construction of said public works.The engineering company, before entering upon said work, executed a written contract with the town by which it stipulated to construct said works for $7,270 in accordance with the terms of said contract, and contemporaneous with and as a part thereof executed said bond as principal, with the surety company as surety, for the purposes above stated.The work was completed according to contract and accepted by the town on October 20, 1900, at which time there remained in the hands of the officers of the town a balance of $1,560.86 of the price agreed to be paid for said work, and the engineering company owed to the plaintiffs(other than the town and its officers) $3,907.64 for materials furnished to and used by the engineering company in constructing said work, no part of which has ever been paid.On October 18.1900, the Post-Glover Electric Company instituted a civil action in the superior court of said county against the engineering company to recover the sum of $302.88 (an indebtedness not contracted for materials or labor used in or about said works), and caused a warrant of attachment to be issued therein, by virtue of which the sheriff of said county on October 19th levied upon said waterworks pumping station and electric lighting plant, as the...