United Bonding Ins. Co. v. Atlantic Roofing & Sheet Metal Co.

• Decision Date: 06 February 1969
• Docket Number: Nos. K--160--K--163,s. K--160--K--163
• Court: Florida District Court of Appeals
• Parties: UNITED BONDING INSURANCE COMPANY, Appellant, v. ATLANTIC ROOFING & SHEET METAL CO., Inc., Appellee. UNITED BONDING INSURANCE COMPANY, Appellant, v. SOUTHERN PAINT & SUPPLY CO., Inc., Appellee. UNITED BONDING INSURANCE COMPANY, Appellant, v. ATLAS WELDING COMPANY, Inc., Appellee. UNITED BONDING INSURANCE COMPANY, Appellant, v. FELLOWS CONSTRUCTION COMPANY, Appellee.

Page 461

221 So.2d 461

UNITED BONDING INSURANCE COMPANY, Appellant, v. ATLANTIC ROOFING & SHEET METAL CO., Inc., Appellee.

UNITED BONDING INSURANCE COMPANY, Appellant, v. SOUTHERN PAINT & SUPPLY CO., Inc., Appellee.

UNITED BONDING INSURANCE COMPANY, Appellant, v. ATLAS WELDING COMPANY, Inc., Appellee.

UNITED BONDING INSURANCE COMPANY, Appellant, v. FELLOWS CONSTRUCTION COMPANY, Appellee.

Nos. K--160--K--163.

District Court of Appeal of Florida, First District.

Feb. 6, 1969.

On Rehearing May 1, 1969.

E. Clay Parker, Holly Hill, for appellants.

Coble and Van Wert, Daytona Beach, for appellees.

RAWLS, Acting Chief Judge.

United Bonding Insurance Company, defendant, has appealed adverse judgments in four case brought by subcontractors or materialmen to collect the amounts due and owing for labor and materials used in constructing an apartment complex for Daytona Apartments, Inc., owner.

These four actions, brought under the mechanic's lien law, named as defendants the general contractor, Project Development Corporation of America, and its surety, United Bonding Insurance Company. Default was entered against the general contractor. United's defense was the same in each cause, namely: (1) general denial; (2) failure to perfect lien under Sections 84.061(2) and 84.231; (3) the work or materials furnished were not part of the original plans and were not covered by the bond; and (4) the plaintiffs failed to give the surety timely notice of the general contractor's default as required by the surety bond. In its answers to interrogatories, United noted that the roof was redesigned and other changes were made without its knowledge and consent after its surety bond was issued, and these changes increased the total cost of the project. Summary judgments were entered for the plaintiffs on the pleadings, answers to interrogatories, admissions or affidavits.

On appeal, United has urged three points: 1. Does the bond guarantee payment for contractual changes such as an alteration in the roof design made after the surety bond was issued and without the surety's We have reviewed the records and cannot find substantial evidentiary facts showing a change of concept or such a substantial departure in the overall project from the initial plans as to permit a discharge of the surety. One primary purpose of the legislature in amending Section 84.231 ¹ in 1963 disallowing pro tanto defenses was to overcome the previously successful efforts of surety companies in securing their discharge by reason of minor changes in specifications during the course of construction. The records in these causes disclose a pattern of nit-picking on the part of the surety--a practice the legislature attempted to eliminate by the enactment of the provision which abolished pro tanto defenses. The trial court properly found that the changes in specifications were not of such consequence as to discharge the surety.

                knowledge and consent, when such changes result in an increase in the total cost of the project?   2.  Are subcontractors estopped to sue on the bond where there was no compliance with a bond provision requiring the obligee (owner) to give the surety immediate notice of default of the contractor?   3.  Were there any genuine issues of material facts raised by the defendant?   We find no merit in appellant's points and affirm
                

As to the second question, we have difficulty in comprehending appellant's theory that the subcontractors are estopped from suing on the bond because there was no compliance with a bond provision requiring the obligee (owner) to give immediate notice of default of the contractor. We find no duty visited upon a subcontractor to ascertain periodically during the course of construction the financial stability of a general contractor who has been cloaked with an instrument proclaiming to the world that 'this job is bonded.' We hastily add that we do not condone the type of conduct appellant contended existed here--i.e., a materialman or subcontractor doing business with impunity with a bonded contractor whom they know is 'broke' and then demanding from his surety payments of money they knew from the outset...