United States Fidelity Guaranty Company v. United States For the Use and Benefit of Struthers Wells Company

• Decision Date: 06 April 1908
• Docket Number: No. 154,154
• Citation: 52 L.Ed. 804,28 S.Ct. 537,209 U.S. 306
• Parties: UNITED STATES FIDELITY & GUARANTY COMPANY, Plff. in Err., v. UNITED STATES FOR THE USE AND BENEFIT OF STRUTHERS WELLS COMPANY
• Court: U.S. Supreme Court

209 U.S. 306

28 S.Ct. 537

52 L.Ed. 804

UNITED STATES FIDELITY & GUARANTY COMPANY, Plff. in Err.,

v UNITED STATES FOR THE USE AND BENEFIT OF STRUTHERS WELLS COMPANY.

No. 154.

Argued March 5, 1908.

Decided April 6, 1908.

This is a writ of error to the circuit court of appeals for the second circuit, which brings up for review the judgment of that court affirming that of the circuit court of the eastern district of New York in favor of the defendant in error (plai- ntiff below) against the plaintiff in error for the sum of $2,054.23. The action was brought in the circuit court above mentioned, in the name of the United States, for the use and benefit of Struthers Wells Company against the plaintiff in error, and against the individual defendant Flaherty, as well as one Lande, upon a bond dated December 10, 1903, executed by Flaherty as well as one the above-mentioned plaintiff in error as surety, by which they were held bound in the sum of $40,000, to be paid the United States as liquidated damages, the condition of the obligation being that if Flaherty, his successors, heirs, etc., should well and truly execute the contract annexed to the bond, which he had entered into with Colonel W. A. Jones, U. S. A., engineer, of the fifth lighthouse district, for and in behalf of the United States, by which Flaherty covenanted and agreed to completely construct and deliver the metal work for the Baltimore lighthouse, Maryland, according to all the conditions of the said contract, and should promptly make payments to all persons supplying said Flaherty labor and materials in the prosecution of the work provided for in such contract, then the obligation was to be void; otherwise to remain in full force and virtue.

It was averred in the complaint that the action was brought in the name of the United States by Struthers Wells Company, for its use and benefit, against the plaintiff in error and Flaherty (and also one Lande, who had been joined with Flaherty in the contract), pursuant to the act of Congress of August 13, 1894. See 28 Stat. at L. 278, chap. 280, U. S. Comp. Stat. 1901, p. 2523. The section is set forth in the margin.

The Struthers Wells Company, under an agreement with the defendants Flaherty and Lande, and in or about the month of March, 1904, supplied to them certain materials, described in the complaint, for use by them in the prosecution of the work which they had contracted with the United States to do in constructing the metal work for the Baltimore lighthouse, as mentioned in the bond. The material furnished by the company was of the value of $1,890.25. The company duly performed all the conditions of its contract with the defendants, which it had agreed to perform, and made delivery as provided for in its agreement, and by reason of the premises there became due and payable to the company from the defendants, including the plaintiff in error, the sum of $1,890.25, with interest from June 7, 1904, no part of which has been paid. Judgment was demanded for that sum, with interest, as stated.

The action was commenced on the 12th of April, 1905. The plaintiff in error demurred to the complaint on the ground, first, that the court had no jurisdiction of the person of the defendant the United States Fidelity & Guaranty Company; second, that the court had not jurisdiction of the subject of the action; and, third, that the complaint does not state facts sufficient to constitute a cause of action against the defendant the United States Fidelity & Guaranty Company. This demurrer was overruled, with leave to the defendant to answer, which the defendant refused to do, and thereupon judgment was entered for the plaintiff against it, which was affirmed by the circuit court of appeals.

Mr. Leonidas Dennis for plaintiff in error.

[Argument of Counsel from page 309 intentionally omitted] Mr. Herbert A. Heyn and Messrs Heyn & Covington for defendant in error.

[Argument of Counsel from page 310 intentionally omitted] Mr. Justice Peckham, after making the foregoing statement, delivered the opinion of the court:

The demurrer put in by the plaintiff in error is founded upon an amendment of the above-mentioned act, which, it is contended, applies to the case before us. The amendment is set forth in the margin.¹ The record shows that the contract between Flaherty and the United States was entered into December 10, 1903, and the material was furnished to Flaherty by the Struthers Wells Company in March, 1904. It thus appears that the bond was executed under the provisions of the original act of Congress, and the materials were furnished Flaherty while that act was in force and before its amendment. The legal rights of the Struthers Wells Company had become vested before the enactment of the amendment. It is contended on the part of the plaintiff in error that the passage of the amendment (February 24, 1905) made it necessary for the defendant in error to follow its provisions when it commenced this action on the 12th of April, 1905. It is argued that the amendment prescribes the procedure to be followed by materialmen in enforcing claims against a surety on a bond of the nature of the one in suit; that, as amended, the law prohibited a materialman from commencing any action in any district other than that in which the contract was to be performed (in this case the Maryland district of the fourth circuit), and also not until after the complete performance of the contract for the performance of which the bond was given, and until the expiration of six months after such completion, during which time the United States alone has the right to commence an action. The plaintiff in error insists that, although the cause of action herein arose before the passage of the amendment, the action itself not having been commenced until after that time, all the provisions of the amendment regulating the enforcement of such cause of action apply to the action before us, as they do not affect the cause of action itself, but only the method of enforcing the same. In other words, it is contended that he amendment is to have retroactive effect in all matters relative to procedure, and that, as so construed, this action was improperly brought in the circuit court of the United States for the eastern district of New York, and that it was prematurely brought because it does not appear that at the time of the commencement of this action the contract had been completed, or that six months had expired since its completion, or that the United States had not itself sued on the bond.

The act which is amended consists of but one material section, the 2d section providing only for the comparatively unimportant matter of security for costs. The act amending the section also consists of but one section. The question is whether the amended act applies to this case.

There are certain principles which have been adhered to with great strictness by the courts in relation to the construction of statutes, as to whether they are or are not retroactive in their effect. The presumption is very strong that a statute was not meant to act retrospectively, and it ought never to receive such a construction if it is susceptible of any other. It ought not to receive such a construction unless the words used are so clear, strong, and imperative that no other meaning can be annexed to them, or unless the intention of the legislature cannot be otherwise satisfied. Dash v. Van Kleeck, 7 Johns. 499, 5 Am. Dec. 291; Jackson ex dem. Hicks v. Van Zandt, 12 Johns. 169; United States v. Heth, 3 Cranch, 399, 414, 2 L. ed. 479, 484; Southwestern Coal & Improv. Co. v. McBride, 185 U. S. 499, 503, 46 L. ed. 1010, 1012, 22 Sup. Ct. Rep. 763; United States v. American Sugar Ref. Co. 202 U. S. 563, 577, 50 L. ed. 1149, 1152, 26 Sup. Ct. Rep. 717.

The language of the amended act is prospective, as it provides 'that hereafter any person or persons entering into a formal...