Kaufmann v. Cooper

Harrison, J. The petition in this action stated that on the 29th day of June, 1889, Symonds & Blake were awarded and entered into a contract with the state to furnish materials for and perform certain labor upon and about the industrial home at Milford, and executed and delivered to the state a bond for the faithful and full performance of the contract, J. W. Foster and M. J. Kaufmann signing such bond as sureties; that the bond contained the following conditions: “The condition of the above obligation is such that the above bounden Symonds & Blake have been awarded the contract to furnish all the materials and labor and skill necessary to the purpose, and to erect, construct, and fully complete, in a good and workmanlike manner, for the use of the industrial home at Milford, Nebraska, the steam heating, gas fitting, plumbing, ventilation, sewerage, windmill, well, and three cisterns, all to be in strict conformity to tiie plans, specifications, and detailed drawings now on file in the office of the commissioner of public lands and buildings at Lincoln, Nebraska, and to pay off, in full, all claims that may become due for laborers’ and mechanics’ wages or for materials furnished in or about said contract. Now if the above bounden Symonds & Blake shall well and truly keep and perform each and every covenant, promise, and agreement contained in said contract at the several times, and in the manner therein stated, and fully pay all claims due for laborers, mechanics, or furnishers of materials, then this obligation to be void; otherwise to be and remain in full force and virtue in law.” Copies of the contract, the bond, and an itemized statement of the account for material which the party in whose favor the action was instituted claimed to have furnished, were attached to the pleading. To the action there was but one appearance on the part of the defendants, that of Kaufmann, one- of the sureties on the bond. In his answer he denied that the — 647 — material was furnished to Symonds & Blake or by virtue of the contract with them, or that the fact that the bond existed was any inducement to the plaintiff in the action to extend the credit to the parties to whom it was given, and alleged affirmatively that if the plaintiff furnished any material it was to S. C. Blake & Co., and upon the credit of such firm, and without reference to the contract with Symonds & Blake; that the provision of the bond hereinbefore quoted was exacted wrongfully and contrary to legal right, and hence was void; that the firm of Symonds & Blake assigned its contract to S. C. Blake & Co., which was known to plaintiff, and such assignment was acquiesced in or ratified by the state; that the contract contained a provision that Symonds & Blake were to receive for furnishing the material and performance of labor as therein stated the sum of $3,039 “at the times and in the manner following: Eighty-five per cent of the monthly estimates made by the superintendent of construction, as the work progresses; and the balance to be paid when the said contract has been fully completed and tested and accepted by the board of public lands and buildings;” and that a payment was made to plaintiff without any estimate' being made by the superintendent of construction, and other and further payments were made so that in the aggregate they amounted to more than eighty-five per cent of the estimates made during the progress of the work, of all of which these plaintiffs had knowledge and approved; that of and to the doing of these things, all and singular, the answering defendant was not informed, had no knowledge, gave no consent, and his discharge as surety was thereby effected; The reply was a general denial. There was a trial and a verdict and judgment for plaintiff. The defendant Kaufmann, of the sureties on the bond, presents the ease here for review. We will first notice the portion of the contention on behalf of the surety Kaufmann, in which it is asserted that he — 648 — was discharged from any obligations he had assumed as such surety (1) by the payment of $500 to the plaintiff without any estimate of the superintendent of construction as a basis or authority for such payment, and (2) by the payment of more than eighty-five per cent of an estimate made' of the amount due plaintiff by the superintendent of construction. It may be said in regard to the second of these points that the aggregate sum of eighty-five per cent of an estimate made by the superintendent during progress of the work, of the amount due plaintiff, and the alleged prior payment of $500, the basis of the first point mentioned, would make the payments just $500 more than the amount of the estimate; or, in other words, it is claimed that $500» were paid to plaintiff prior to any estimate made, and that, combining it with the payment made on a subsequent estimate, the whole amount of the payments was in excess of eighty-five per cent of such estimate. The promise in the bond to pay the laborers and parties furnishing material was for their benefit, and in an action thereupon by either it was enforceable, notwithstanding the act or acts of the state in making the alleged payments, which, in an action by the state against the contractor principal in the bond for a default in any of its conditions, might have precluded a recovery and have constituted a defense for the sureties on the bond, and released them from liability thereon (which we do not decide), and the sureties were not released from their obligations to either laborers or material-men whose valid claims were unpaid. (Doll v. Crume, 41 Neb., 655.) In the case cited the doctrine was applied to a state of facts which disclosed a payment on an estimate, in excess of the per cent which, according to the terms of the contract, was to be paid upon estimates, but is equally forcible where, as in the case at bar, a payment has been made unauthorized by an estimate, the reason which supports the rule being in all respects as pertinent and cogent in reference to the latter phase of the case as to the former — 649 — one, or the one as to which it was declared in the case to which we have called attention. It is urged that the bond, in the particular condition which was made the basis of this action, was illegally required and exacted, was without warrant or authority of law; that inasmuch as the statutes governing the subject involved directed that a bond be taken, and prescribed a number of particulars to be.covered by conditions inserted therein, and did not include the subject of payment to laborers or furnishers of material, the provision in the bond which covered this particular, not coming within thé direct requirements of the statutory provisions, was illegal, unauthorized, and void, and hence not enforceable. A similar question has been presented to, considered, and determined by this court, and it has been decided that it was within the province of the proper officers of the state, upon whom it devolved to let such contract, to exact a bond containing a condition in relation, to the payment of laborers’ wages and the accounts of parties who had furnished material, and it was held that such a condition was valid and any liability arising thereunder could be enforced. (Sample v. Hale, 34 Neb., 220; Korsmeyer Plumbing & Heating Co. v. Me Clay, 43 Neb., 649.) It is also urged that the plaintiff was not a party to the bond, and that no action could accrue or be based thereon in its behalf. A precisely similar question to this one has been heretofore discussed in and by this court, and it was then held that the promise set forth in the condition of the bond under consideration was for the benefit and an action arose thereon in favor of the laborer to whom wages remained due or to the furnisher of. material whose account or any portion thereof was unpaid. (Doll v. Crume, 41 Neb., 655; Hyman v. City of Lincoln, 38 Neb., 794; Korsmeyer Plumbing & Heating Co. v. McClay, 43 Neb., 649; Sample v. Hale, 34 Neb., 220.) It is also urged that' by the • dissolution of the firm of — 650 — Symonds & Blake, and the transfer of the contract to furnish the material and perform the labor to S. C. Blake & Co., or by the new firm assuming its performance, the sureties on the bond were not bound to pay the account for material furnished by plaintiff to the latter firm for use in the performance of the contract with the state under the contract it had made to do so with Symonds & Blake. It is disclosed by the evidence that soon after the firm of Symonds & Blake had entered into the contract with the state, and had further contracted with the plaintiff for the furnishing by it of the material, Symonds withdrew from the firm and S. C. Blake, or S. C. Blake & Co., which consisted of S. C. Blake and one Godfrey J. Kaufmann, who became a partner with Blake at the time Symonds retired from the firm of Symonds & Blake and it was dissolved, succeeded to all the rights of the old firm in the contract with the state, and the plaintiff furnished to S. C. Blake & Co. the material for use in the fulfillment of the contract with the state which it had contracted to furnish to Symonds & Blake. Under these circumstances the sureties on the bond were not released and an action on the bond could be maintained against them by plaintiff for the unpaid amount due it on account of material furnished to Blake, or S. C. Blake & Co., for use in the performance of the contract with the state. (17 Am. & Eng. Ency. of Law, p. 1150; Freeman v. Berkey, 48 N. W. Rep. [Minn.], 194; Abbott v. Morrissette, 48 N. W. Rep. [Minn.], 416; Sepp v. McCann, 50 N. W. Rep. [Minn.], 246; French v. Griffin, 10 S. E. Rep. [N. Car.], 166.) It is urged that the testimony does not show that the material stated in the account, upon which this suit was based, was used in the construction of the “industrial home.” The evidence was sufficient to sustain the finding of the jury in respect to this branch of the case, and in accordance with a well established rule of this court, it will not be disturbed. Errors were assigned of the action of the — 651 — trial court in admission of evidence, but they were not argued in the brief of plaintiff in error, hence will be treated as waived. It was assigned that the court erred in giving instructions 1 and 2 of the instructions given on its own motion. Of these instructions No. 2 was clearly pertinent and proper, and this being ascertained, no further examination of these instructions need be made, as the alleged errors were not separately assigned. Complaint was also made that the court erred in refusing to give instructions 1, 2, 3, 4, 5, and 6, asked by the plaintiff in error. These instructions were framed and submitted in support of the views of counsel for plaintiff in error in relation to the questions involved in the case, and, according to our determination of such questions, were, several of them, clearly erroneous and improper, one of which was that numbered 2, and as they were grouped in the assignment which referred to them, having concluded that one was incorrect and properly refused, it disposes of the entire assignment. The action of the court in giving instructions numbered 1 and 2, requested by the plaintiff in that court, was assigned as error. These instructions do not conflict materially, if at all, with the views herein expressed in regard to the proper disposition to be made of the issues in the case, under the facts as developed in the evidence. There is nothing in them which could prejudice the rights of the complaining party, and their giving was not error. The judgment of the district court is Affirmed.