W.G. Mills, Inc. v. M & MA Corp.

• Decision Date: 20 March 1985
• Docket Number: No. 84-1299,84-1299
• Citation: 465 So.2d 1388
• Parties: W.G. MILLS, INC., a Florida corporation, and United States Fidelity & Guaranty Company, Appellants, v. M & MA CORPORATION, a Florida corporation, d/b/a McCain Building Supply, and Florida Ceiling & Partitions, Inc., a Florida corporation, Appellees.
• Court: Florida District Court of Appeals

Page 1388

465 So.2d 1388

W.G. MILLS, INC., a Florida corporation, and United States Fidelity & Guaranty Company, Appellants, v. M & MA CORPORATION, a Florida corporation, d/b/a McCain Building Supply, and Florida Ceiling & Partitions, Inc., a Florida corporation, Appellees.

No. 84-1299.

District Court of Appeal of Florida Second District.

March 20, 1985.

Daryl J. Brown and David E. Gurley of Abel, Band, Brown, Russell & Collier, Sarasota, for appellants.

Charles M. Phillips, Jr. of Jacobs, Robbins, Gaynor, Burton, Hampp, Burns, Bronstein & Shasteen, Clearwater, and Robert M. Barker, Largo, for appellee M & MA Corp.

BOARDMAN, EDWARD F. (Ret.), Judge.

W.G. Mills, Inc. (Mills), a general contractor, and United States Fidelity Guaranty Company (USFG), its surety, appeal the final judgment obligating them to compensate M & MA Corporation d/b/a McCain Building Supply (McCain) for materials supplied to a public works construction project. The question presented is whether McCain is entitled to recovery against the contractor and surety under section 255.05, Florida Statutes (1983), the Little Miller Act.

Section 255.05(1) provides subcontractors and suppliers not in privity with the general contractor with a cause of action against the contractor and its bond for materials and labor provided on construction projects involving publicly held property. ¹ Recovery under the statute is conditioned upon compliance with the following notice provisions of section 255.05(2):

(2) A claimant, except a laborer, who is not in privity with the contractor and who has not received payment for his labor, materials, or supplies shall, within 45 days after beginning to furnish labor, materials, or supplies for the prosecution of the work, furnish the contractor with a notice that he intends to look to the bond for protection. A claimant who is not in privity with the contractor and who has not received payment for his labor, materials, or supplies shall, within 90 days after performance of the labor or after complete delivery of the materials or supplies, deliver to the contractor and to the surety written notice of the performance of the labor or delivery of the materials or supplies and of the nonpayment. No action for the labor, materials, or supplies may be instituted against the contractor or the surety unless both notices have been given. No action shall be instituted against the contractor or the surety on the bond after 1 year from the performance of the labor or completion of delivery of the materials or supplies.

On August 26, 1980, Pinellas County entered into a contract with Mills for the construction of the Pinellas County Criminal Court's building. Mills delivered to the county a performance and payment bond in compliance with section 255.05(1), Florida Statutes (1983). Mills then subcontracted with Florida Ceiling & Partitions, Inc. (Florida Ceiling) for the waterproofing, metal studding, and drywall installation on the project. McCain became involved in the project by agreeing to supply Florida Ceiling with drywall building material.

McCain furnished materials to the project from April 10, 1981, to December 18, 1981. On August 7, 1981, 119 days after the first delivery of materials, McCain sent Mills and USFG a notice to owner informing them that it was supplying materials and therefore intended to rely on the performance bond for compensation protection. On March 9, 1982, McCain sent a notice of nonpayment in the amount of $36,631.58, the balance allegedly due and owing to McCain from Florida Ceiling. Having fully compensated Florida Ceiling, Mills, of course, refused payment. McCain then brought suit against Mills and USFG to recover on the surety bond. The trial court entered final judgment in favor of McCain, concluding that Mills "had actual notice of the plaintiff's furnishing labor, materials and/or supplies for the prosecution of the work."

Mills contends the trial court erred in concluding that Mills' knowledge of McCain's involvement with the project was sufficient notice under the statute. McCain, on the other hand, claims that in addition to actual notice, Mills also received timely written notice in the form of a waiver of lien issued to Mills. We agree with Mills.

It is clear that a condition precedent to the maintenance of an action of this kind is compliance with the statutory notice requirement within the prescribed time limit. School Board of Palm Beach County v. Fasano, Inc., 417 So.2d 1063 (Fla. 4th DCA 1982); Fuller Industries, Inc. v. R. Terry Balzier & Son, Inc., 188 So.2d 2 (Fla. 2d DCA 1966); § 255.05(2), Fla.Stat. (1982). However, what constitutes proper notice is not clearly delineated by the statute and therefore poses a difficult question. As stated by the Fourth District in School Board of Palm Beach County v. Fasano, Inc., our objective is to "determine the intent of the legislature and, if possible, to see that the purpose of the statute is accomplished." 417 So.2d at 1065. With respect to the legislative purpose behind section 255.05, the court stated:

Clearly, the major purpose of Section 255.05(1) is to protect subcontractors and suppliers by providing them with an alternative remedy to a mechanics lien on public projects. City of Ft. Lauderdale v. Hardrives Co., 167 So.2d 339 (Fla. 2d DCA 1969). In addition, however, Section 255.05(2) protects the contractor and the contractor's surety from having to account to unknown suppliers and subcontractors by putting the burden on the claimants to advise the contractor and surety of their participation on the project and to advise if they are not promptly paid.

417 So.2d at 1065.

In Fasano, a case relied upon by McCain, Palm Beach County contracted with Fasano for the construction of a technical school. Fasano obtained a performance bond from USFG. Carter Electric was Fasano's electrical subcontractor for the project. On September 18, 1978, Major Electrical Supplies sent a written notice to the school board stating that it was furnishing electrical materials to the project under an agreement with Carter Electric. The supplier sent a copy of the notice to both Fasano, as general contractor, and USFG. The supplier furnished materials from October 2, 1978, until February 22, 1980. On March 14, 1980, the supplier submitted a request for payment which was refused. The supplier then filed suit against the contractor and surety. The trial court dismissed the supplier's claim on the basis that it had failed to comply with the notice provisions of section 255.05(2). The general contractor and the surety argued on appeal that the trial court's decision should be affirmed because the supplier's notice did not state that it intended to look to the bond for protection.

On appeal the Fourth District reversed and held that Major Electric's letter substantially complied with the requirements of the statute. In so holding, the court relied on the fact that the notice was in writing and was delivered by certified mail to the surety as well as the general contractor. The court felt that by noticing both the surety and the contractor, Major evinced an intent to rely on the bond. For this reason, the...