Utah Const. Co. v. United States

HUNT, Circuit Judge (after stating the facts as above). The contention of the plaintiffs in error, that the findings of fact set forth in the statement are wholly unsupported by evidence, cannot be sustained. The testimony is that, before the execution of the contract with Paul, Samuels, vice president and general manager .of the Wattis-Samuels Company, met Paul; that Paul told him 'that he expected to secure material for the weir from the bed of the Sacramento river; that thereafter Samuels investigated the probability of there being sufficient sand and gravel in the bar to build the weir; that Samuels considered the quality of the material and understood that it was to be furnished by Paul and was to be taken from the bed of the river; that Samuels was advised that the deposit would be dredged and thereafter the sand and gravel would be delivered. It also appeared that Paul dredged the sand and gravel and transported them to the site of the weir in barges belonging to the- interveners, towed by the boat of Lindstrom, the relator; that he furnished and operated the derrick barge [24] which was used under the direction and supervision of the contractor; that he also furnished equipment and labor necessary for the rendition of the services of the dredge and barges. The argument that Paul was only a vendor of material to a subcontractor and that those whom he employed cannot avail themselves of the protection of the bond, is too restrictive of the language of the statute. Under the facts, Paul furnished material and labor with the understanding that it was to be used in the construction of the weir by the contractor, and beyond a doubt it was used in the performance of the contract. The fact that the contract with Paul provided for compensation computed upon the quantity of material transported does not necessarily affect the question; nor, indeed, would it exclude his relationship as that of a subcontractor. United States to the use of Boyer et al. v. Port Deposit Quarry et al. (D. C.) 272 P. 698; Ryndak v. Seawell, 13 Okl. 737, 76 P. 170. But as he did supply material and labor which were used, whether he be called a materialman or a subcontractor supplying Jabor is not of vital importance, for the statute is broad enough to afford protection to him and the relator. In Hill v. American Surety Co., 200 U. S. 197, 26 S. Ct. 168, 50 L. Ed. 437, the Supreme Court considered the two views — one that the'bond should be strictly construed and recovery limited to those who had furnished material or labor directly to the contractor; and the other that recovery should be allowed by those who had furnished labor or material which had been used in the prosecution of the work, whether furnished under the contract directly to the contractor or to a subcontractor. It was held that the obligation should be construed in the light of the manifest purpose of the statute to require that material and labor actually contributed to the construction of the work should be paid for and that a security should be provided to that end. The court said: “There is no language in the statute nor in the bond which is therein authorized limiting the right of recovery to those who furnish material or labor directly to the contractor but all persons supplying the contractor with labor or material in the prosecution of the work provided for in the contract are to be protected. The source of the labor or material is not indicated or circumscribed. It is only required to be ‘supplied’ to the contractor in the prosecution of the work provided for.” • It was also said that, if a construction were given to the bond by limiting! the obligation so as to permit only those to recover who have made contracts directly with the principal, it might happen that the material and labor which had contributed to the structure would not be paid for, and that by a default of subcontractors the manifest purpose to require compensation to those who had supplied such labor or material would be defeated. The language of the statute was regarded as giving protection of those who supply labor or material provided for in the contract and not “to the particular contract or engagement under which the labor or materials were supplied.” Again, in Mankin v. United States, 215 U. S. 533, 30 S. Ct. 174, 54 L. Ed. 315, the court construed the statute. There the Man-kin Company contracted with the Secretary of the Treasury to construct a building and gave bond as required by the statute, and such as was given by the Utah Construction Company in the present ease. Mankin Company made a contract with one Smythe as subcontractor, by which Smythe agreed “to furnish” certain gas fittings and other material to be used in the construction of the building. Some of the claimants sold to Smythe certain materials which he used in the construction of the building as required by the original contract. Smythe failed to make full payment, and claimants brought action against Mankin Company and its sureties. The court, citing Hill v. American Surety Co., supra, held that one who furnishes labor or material for carrying out a contract for a public work, although such materials were furnished to subcontractors to whom a part of the work had been let, could recover upon a bond given under the act. The court rejected the contention that only those who furnished labor or materials directly to the contractor could claim the benefit of the act, and repeated what had been said in the Hill Case, that “the contractor ean protect himself by requiring a bond securing him against liability on account of engagements of the subcontractor with persons who furnish labor and material upon his order.” In United States Fidelity & Guaranty Co. v. Bartlett, 231 U. S. 237, 34 S. Ct. 88, 58 L. Ed. 200, the United States contracted with one Donovan for the construction of a breakwater. Donovan executed the bond containing the obligation required by the act with the United States Eidelity Company as surety. Donovan was associated with certain others, who arranged with Bartlett that he should engage the labor, open a quarry, and superintend the furnishing of stone for the construction of the breakwater. The quarry was operated, the stone was loaded on scows and [25] transported to the breakwater aeeoi'ding to the direction of a government inspector. It was held that the bond given pursuant to the statute for a contract covered the claims for labor on work at the quarry and for hauling and delivering the stone. The court said: “The work involved in the claim here made was all necessary to the performance of the contract, and in our view comes clearly within the class of labor accounts, the satisfaction of which it was the purpose of the act of Congress to secure by a proper bond.” In Brogan v. National Surety Co., 246 U. S. 257, 38 S. Ct. 250, 62 L. Ed. 703, L. R. A. 1918D, 776, the court again held that the bond given under the statute must be construed liberally for the protection of those who furnish labor or material in the prosecution of a public work, and, in the very recent case of Fleischmann Construction Co. v. United States, 270 U. S. 349, 46 S. Ct. 284, 70 L. Ed. 254, the court referred to the purpose of the act as “highly remedial” and said that it must be construed liberally, that it was to provide security for the payment to all persons who supply labor or material in a public work; that is, “to give the creditors a remedy on the bond of the contractor, to be enforced within a reasonable time in a single proceeding in which all claimants shall imite.” Gilmore v. Westerman, 13 Wash. 390, 43 P. 345; Pavarini v. Title Guaranty Co., 36 App. D. C. 348; School District v. Hallock, 86 Or. 687, 169 P. 130; City of Portland v. New England Casualty Co., 78 Or. 195, 152 P. 253; Willey v. St. Charles Hotel Co., 52 La. Ann. 1581, 28 So. 182; Brink v. Bartlett, 105 La. 336, 29 So. 958. It is said that the judgment in favor of relator is excessive in allowing compensation for the use of his boat from October 17,1923, to January 29, 1924. The evidence is that Paul paid the relator up to September 1, 1923, and that relator ceased hauling the barges carrying material for the weir on October 17, 1923. But it is also in evidence that the distinct agreement with Paul was that relator was to be paid the compensation agreed upon, $1,200 a month, until he could float his tug out of the river. Low water conditions were such, however, that he could not get the boat out until January 29, 1924. Considering then that the use of the tug was the most practical means of getting the sand and gravel to the weir, we think the contract between Paul and Lindstrom was not an unreasonable one, and that the allowance made up to the time the tug was floated was just and proper. Brogan v. National Surety Co., supra; Taylor v. Connett (C. C. A.) 277 F. 945. We conclude that the ease is fairly within the expression of Justice Day in Hill v. American Surety Co., supra: “If the contractor sees fit to let the work to a subcontractor, who employs labor and buys materials which are used to carry out and fulfill- the engagement of the original contract to construct a public building, he is thereby supplied with the materials and labor for the fulfillment of his engagement as effectually as he would have been had he directly hired the labor or bought the materials.” With respect to the judgment in favor of the interveners, no error was assigned; hence the allowances made to them will not be disturbed. We find no error, and affirm the judgment.