United Bonding Ins. Co. v. City of Holly Hill for Use and Benefit of Martin

• Court: Florida District Court of Appeals
• Writing for the Court: WIGGINTON; CARROLL, DONALD K., Acting C. J., and SPECTOR
• Citation: United Bonding Ins. Co. v. City of Holly Hill for Use and Benefit of Martin, 249 So.2d 720 (Fla. App. 1971)
• Decision Date: 22 June 1971
• Docket Number: No. O-121,O-121
• Parties: UNITED BONDING INSURANCE COMPANY, a corporation, Appellant, v. CITY OF HOLLY HILL, a municipal corporation, for the Use and Benefit of Mac MARTIN d/b/a Martin Brick and Sand Company, Appellees.

Page 720

249 So.2d 720

UNITED BONDING INSURANCE COMPANY, a corporation, Appellant, v. CITY OF HOLLY HILL, a municipal corporation, for the Use and Benefit of Mac MARTIN d/b/a Martin Brick and Sand Company, Appellees.

No. O-121.

District Court of Appeal of Florida, First District.

June 22, 1971.

Fred J. Woods, Jr., of Trenam, Simmons, Kemker, Scharf & Barkin, Tampa, for appellant.

Leon G. Van Wert, Daytona Beach, for appellees.

WIGGINTON, Judge.

Appellant surety company has appealed a summary final judgment rendered in favor of appellee materialman in an action on a contractor's performance bond issued by appellant to the City of Holly Hill, a municipal corporation. The critical question presented for decision is whether this action by the materialman is barred by the statute of limitations and should have been dismissed on the motion of appellant.

The facts in the case are not in dispute. Appellee City of Holly Hill entered into a contract with Rowell Construction Company for the construction of a sanitary sewer system. Under the terms of the contract Rowell was required to furnish a penal bond conditioned upon the faithful performance of the contract and payment to all persons supplying labor, material and supplies used directly or indirectly in the prosecution of the work. In fulfillment of this obligation Rowell procured from appellant, United Bonding Insurance Company, a contractor's performance bond which met the minimum requirements of the contract and further provided additional coverage by agreeing to indemnify and save harmless the obligee city from (a) all costs, expenses and damages, injury or loss by reason of any wrongdoing, misconduct, want or need of care or skill, negligence or default, including patent infringements by the contractor; (b) cost of all fuels, repairs on machinery, equipment and tools used in the construction, including all insurance premiums; (c) all damages, expenses and costs which may arise by virtue of any defects in the work within a period of one year from the date of completion and acceptance of the work by the city; (d) for all labor performed in the work, whether by subcontractor or otherwise.

Appellee use-plaintiff, Martin Brick and Sand Company, furnished certain materials to the contractor Rowell for use in the performance of the contract, for which the company was not paid. More than one year after delivery of the materials furnished, Martin instituted this suit on the performance bond furnished by appellant for recovery of the amount due it by Rowell.

Appellant's entire defense is predicated upon the proposition that the controlling statute relating to suits on performance bonds furnished by sureties in connection with public works contracts requires that suit be instituted on the bond within one year from the performance of the labor or complete delivery of the materials and supplies. Appellant's defense on this ground was stricken by the court and summary judgment rendered against it.

The statute relied upon by appellant to support its position is as follows:

'Bond of contractor constructing public buildings; suit by materialmen, etc.--

'(1) Any person entering into a formal contract with the state, any county of said state, or any city in said state, or any political subdivision thereof, or other public authority, for the construction of any public building, or the prosecution and completion of any public work or for repairs upon any public building, or public work, shall be required, before commencing such work, To execute the usual penal bond, with good and sufficient sureties, with the additional obligations that such contractor shall promptly make payments to all persons supplying him labor, material and supplies, used directly or indirectly by the said contractor, or subcontractors, in the prosecution of the work provided for in said contract; and any person, making application therefor, and furnishing affidavit to the treasurer of the state, or any city, county, political subdivision, or other public authority, having charge of said work, that labor, material or supplies for the prosecution of such work has been supplied by him, and payment for which has not been made, shall be furnished with certified copy of said contract and bond, upon which, said person, supplying such labor, material or supplies shall have a right of action, and may bring suit in the name of the state, or the city, county, or political subdivision, prosecuting said work, for his use and benefit, against said contractor, and sureties, and to prosecute the same to final judgment and execution; provided, that such action, and its prosecution, shall not involve the state, any county, city or other political subdivisions, in any expense.

'(2) Any person supplying labor, material or supplies used directly or indirectly in the prosecution of the work to any subcontractor and who has not received payment therefor, shall, within ninety days after performance of the labor or after complete delivery of materials and supplies, deliver to the contractor written notice of the performance of such labor or delivery of such materials and supplies and the nonpayment therefor, and no action or suit for such labor or for such materials and supplies may be instituted or prosecuted against the contractor unless such notice has been given. No action or suit shall be instituted or prosecuted against the contractor or against the surety on the bond required in this section after one year from the performance of the labor or completion of delivery of the materials and supplies.' ¹ (Emphasis supplied)

Appellant contends that the surety bond issued by it was furnished pursuant to the requirements of the foregoing statute and that it is entitled to the protection afforded by subsection (2) thereof which requires that any suit brought by a materialman against the contractor and surety on the bond be brought within one year from the completion of delivery of the materials. Appellant cites authority for the proposition that under statutes of this kind the time within which the suit must be brought operates as a limitation of the liability itself as created, and not of the remedy alone--to be treated in such cases as a condition attached to the right to sue, controlling no matter in what form the action is brought. ²

It is appellees' position, with which the trial court agreed, that the surety bond furnished by appellant is not the statutory bond required by F.S. Section 255.05, F.S.A., which carries the one-year limitation period for bringing actions thereon. Appellees rest their position in this regard on several factors. They point out that nowhere in the bond itself is any reference made to the statute, nor does it contain any provision to the effect that it is furnished pursuant to the requirements of the statute. Appellees also invite attention to the fact that the bond contains no limitation with respect to the time within which a materialman's suit on the bond may be commenced. Appellees argue that the bond furnished by appellant in this case is a common law bond which not only affords the minimum coverage required by F.S. Section 255.05, F.S.A., but grants extensive additional coverage beyond that required by the statute. It is appellees' position that since the bond furnished by appellant is a common law and not a statutory bond, the general statute of limitations applicable to suit on a written contract applies. ³

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