Erath & Flynn v. R. K. Allen & Son

Smith, P. J. This is an action to recover a penalty in a bond. It seems from the record before us that R. K. Allen & Son entered into a written contract with the board of county commissioners of the county of Jefferson, in the state of Nebraska, to do all the work and furnish all the material for the proper construction and completion of a court house and jail building for said county, in accordance with the plans, elevation, sections and detail drawings, and in the manner specified in'the specifications, for which the commissioners were to pay Allen & Son $54,800, etc. The statute of the state of Nebraska, 1891, section 2172, provides: “It shall be the duty of the board of public lands and buildings, boards of county commissioners, the contracting board of officers of all cities and villages and all public boards now or hereafter in — 110 — power by law, to enter into a contract for the erecting and finishing, or the repairing of any public building, bridge or other public structure to which the general provisions of the mechanics’ lien laws do not apply, and where mechanics and laborers have no lien to secure the payment of their wages, to take from the person or corporation, to whom the contract is awarded, a bond with at least two good and sufficient sureties, conditioned for the payment of all laborers and mechanics for labor that shall be performed in the erecting, furnishing or repairing of the buildings or in performing the contract; said bond shall be to the board awarding the contract; and no contract shall be entered into by such board until the bond herein provided for has been filed with, and, approved by, said board. The said bond shall be safely kept by the board making the contract, and may be sued on by any person entitled to the benefit of this act. The action shall be in the name of the party claiming the benefit of the act.” Accordingly, Allen & Son entered into a bond with the other defendants, Wyeth and Uhlman, as sureties thereon in the sum of $15,000, conditioned as required by the above recited statute. Afterwards the plaintiffs entered into a written contract under Allen & Son, by which the former agreed to do all the work and furnish all the material for the proper construction and completion of the cut stone and rubble work in said building, in accordance with the plans, elevations, sections and detail drawings of the architect thereof, for $20,100, ninety per cent, of the material furnished and labor performed and permanently put in place to be paid for'from time to time as the work progressed on the estimates of the architect, etc. It appears further that the plaintiffs proceeded to furnish the materials and do the work as they had con — 111 — tracted to do, and received of Allen & Son therefor from time to time payments which in the aggregate amounted to the contract price, less the sum of $1,143, which the plaintiffs claim remained unpaid at the time the said buildings were paid for and accepted by the commissioners. There is some claim made by the defendants that the building was left by plaintiffs in an unfinished condition and that the defendants, Allen & Son, were compelled to finish the same at their own expense. However this may be, the amount of such expense was small and, in the view we shall take of the of the case, is unimportant. The suit is brought on the bond given to the commissioners to recover the amount which Allen & Son were behind with plaintiffs on their subcontract. In this connection it may be proper to state that during the time the plaintiffs were performing their part of said contract with Allen & Son, they employed themselves in superintending the getting out of the stone and the placing of the same in the buildings, taking sometimes the part of a hand in both getting out and preparing the material and doing the work on the building. The plaintiffs, it appears, paid the laborers and mechanics the wages due on account of the work done by them on the buildings. The court, against the objections of the defendants, gave for plaintiff an instruction telling the jury that by the terms of the contract read in evidence between Allen & Son and the commissioners in charge of the construction of. the court house at Fairbury, Nebraska, it was the duty of said Allen & Son to pay the laborers and mechanics employed on said building for labor performed and services rendered in the construction thereof; that by the terms of the bond read in evidence, the defendants, Uhlman and Wyeth, upon default of Allen & Son to pay laborers and mechanics engaged in — 112 — constructing said building, became, and are, liable for all sums due laborers and mechanics engaged in the construction of said building, not exceeding the amount of the balance claimed by plaintiffs in the evidence as the agreed balance due to them; and if you find from the evidence that plaintiffs, as mechanics under their agreement with Allen & Son, necessarily employed laborers to work on the stone work of said building; that defendants, Allen & Son, have been paid in full for the construction of said building; that they have failed to pay the laborers and mechanics employed by plaintiffs in full for the work done by them and services rendered in constructing said building; that plaintiffs, as such mechanics, were compelled to, and did, advance money and pay said laborers the balance due on account of their labor and services rendered, then the jury will find for plaintiffs and against all the defendants for such sum as you find, from the evidence, remains due plaintiffs on account of such labor and services rendered not exceeding the sum of $1,143.58, the amount claimed by plaintiffs, together with six per cent, interest from the date the same was demanded from defendants, Allen & Son. The court refused to instruct the jury that, under the pleadings and evidence, the jury should find for defendants, Uhlman and "Wyeth. The' verdict and judgment were against all of the defendants, who have brought the case here by appeal. Several questions have been discussed in the briefs of counsel in this case, but we shall only consider that of them which we think is decisive of the case, namely, the liability of Wyeth and Uhlman, the sureties on the bond of Allen & Son to the commissioners. The plain meaning of the statute of Nebraska, already quoted, is that the commissions shall, in cases where mechanics and laborers have no lien to secure the — 113 — payment of their toages, take from the person to whom the contract is awarded a bond with at least two good and sufficient sureties, conditioned for the payment of the wages of all laborers and mechanics for labor performed in erecting the building or performing the contract. The bond in question is not broader or more comprehensive in its scope than the statute provided it should be. The liability of the sureties depends upon the construction of the language of the statute authorizing the bond. The bond, it is seen, is one of indemnity provided by the statute for the benefit of laborers and mechanics. If the plaintiffs are persons falling within either or both of these statutory designations, then they are entitled to the benefit of the indemnity. The obligations of sureties, it has long ago been decided in this state, are to be strictly construed, and their liabilities are not to be extended by implications. Blair v. Ins. Co., 10 Mo. 566; Harrisonville v. Porter, 76 Mo. 358. The statute under consideration, as against the sureties on the bond sued upon, must be strictly construed. It is to be conceded the plaintiffs were the subcontractors of the principal contractors. The former agreed with the latter for a specific amount to furnish the materials and do the work on certain part of the buildings according to the plans and specifications of the architect which were made part of the contract of Allen & Son with the commissioners. The pertinent inquiry now is, whether this statute makes any distinction between a “mechanic” or “laborer” and a “subcontractor,” whose undertaking is like that of the plaintiffs in this case. It is very manifest that if the $15,000 indemnity provided by the bond is for the benefit of a subcontractor who furnishes material, as well as performs labor, that in a case like this, where — 114 — the material furnished is of larger value, the entire indemnity may be appropriated to his use, and thus preclude the laborers and mechanics who worked on the building by the day for the , contractors, or any of their subcontractors, from a participation in its benefits. The bond certainly does not provide any protection for a material man, whether he be or not a laborer or mechanic, who has done work, as well as furnished the material. i But it is insisted that the converse of this is true, that is to say, that a laborer or mechanic, though a subcontractor, furnishing materials, who has performed labor, either in procuring material or in placing and fitting it in the building, is a “mechanic” or “laborer” within the meaning of the statute. But this contention, we think, cannot be sustained, as will appear by reference to some of the adjudged cases construing similar statutes. Section 10 of the statute concerning railroad companies (Wag. Stat. 302) provided that “as often as any contractor, etc., shall be indebted to any laborer for thirty days, or any less number of days, labor performed, etc., such laborer,” etc. In Groves v. Railroad, 57 Mo. 304, it was declared that a construction of the above language could not be made to include those who furnished teams and wagons and drivers hired by them to haul and deliver stone or other material in the construction of the road. It was declared further that this statute was intended for these poor laborers, who are dependent upon their own manual labor for their daily support, against the fraud or insolvency of irresponsible contractors, citing Balch v. Railroad, 46 N. Y. 551. Avery v. Supervisor, 71 Mich. 538, was a suit by a subcontractor on a bond given under a statute very analogous to the one here. There the requirement of the statute was that the bond taken with security should — 115 — be for “tbe payment by tbe contractor and all subcontractors for all labor performed or materials furnished,” etc. Tbe court, in tbe construction of this statute' say that tbe plaintiff did not claim to have entered upon tbe work under this contract, in reliance upon tbe facts that tbe bond provided by statute bad been given. Tbe object and purpose of tbe statute was tbe protection of tbe labor and material man; those who furnished material tó be used in building, without reference to plans and specifications, and furnished either to tbe principal contractor or subcontractor and labor done for either. Tbe subcontractor is an under contractor —one who takes under tbe original contract and presumably with knowledge of tbe terms and conditions of tbe original contract. This bond is not required by tbe statute for tbe protection of that class, but to protect material men and laborers at tbe bands of tbe contractor and subcontractor. In Indiana it has been declared that there is a marked and enforced distinction between subcontractors and laborers. Farmer L. & T. Co. v. Railroad, 127 Ind. 250; Barker v. Buell, 35 Ind. 297; Colter v. Frese, 45 Ind. 96. In Georgia, under .the acts giving to “masons” and “carpenters” a lien for their work and materials found by them, they must, to entitle themselves to tbe benefit of the act, have contracted in that capacity. Pitts v. Bomar, 33 Ga. 96. In harmony with tbe doctrine of the aboved referred to cases are Shields v. Morrow, 51 Tex. 393; Huck v. Gaylord, 50 Tex. 578; Duncan v. Bateman, 23 Ark. 327. Tbe conclusion to be deduced from these cases is, that a subcontractor is no more a “mechanic” or “laborer” than the principal contractor, and that the beneficial provisions of tbe statute relied on in this — 116 — case cannot be invoked by the plaintiffs. They are subcontractors, and are to be distinguished from the the two classes of persons named in the statute, and for whose benefit alone the statutory indemnity is provided. And, even though the plaintiffs paid off the laborers and mechanics employed by them 'in executing their subcontract, there is no principle upon which they can be subrogated to the rights, of such laborers and mechanics. The statute conferred a mere personal privilege or right upon them, which was in no sense assignable. Griswold v. Railroad, 18 Mo. App. 52; Brown v. Railroad, 36 Mo. App. 458; Tewksbury v. Bronson, 4 N. W. Rep. 749; Jones on Liens, secs. 1493, 1494. It, therefore, inevitably follows that the petition not only failed to state a cause of action, but the theory upon which the case was submitted to the jury by the plaintiff’s instruction was an erroneous one, and should not have been given. The defendant’s instruction in the nature of a demurrer should have been given. The judgment of the circuit court must be reversed. All concur.