State, ex Rel.v.Merrell

Supreme Court of OhioFeb 1, 1933
126 Ohio St. 239 (Ohio 1933)
126 Ohio St. 239185 N.E. 56

No. 23892

Decided February 1, 1933.

Statutes — State not bound by general statute, when — Lion upon public funds applies to state road improvement contracts — Sections 8324 et seq., General Code — Mandamus lies by subcontractor against state highway director paying principal contractor.

1. The state is not bound by the terms of a general statute, unless it be so expressly enacted.

2. Sections 8324 et seq., General Code, which provide for establishing a lien upon public funds, apply to contracts for the construction of road improvements by the state.

3. A petition in mandamus states a cause of action, good against demurrer, by alleging in substance that a sub-contractor performed certain work and supplied certain material in the building of a road improvement, that the sub-contractor had within the statutory period and in compliance with Section 8324, General Code, filed with the director of highways of the State of Ohio and with the principal contractor a properly executed, sworn and itemized statement of amount and value of labor performed and materials furnished in the construction of such road improvement, that such sworn and itemized statement showed a balance due and owing to relator from the general contractor, that the final estimate had been approved by the engineer in charge of the job, that no other lien had been perfected against such fund, that the principal contractor had failed to notify the director of highways in writing of its intention to dispute such claim within five days after the receipt of such itemized statement, and that the director of highways will, in disregard of such sworn itemized statement, proceed to pay the principal contractor in violation of relator's rights in the fund, arising under Sections 8324 et seq., General Code. Under this record the state is a stakeholder merely and the proceeding is not a suit against the state.

IN MANDAMUS.

Relator filed a petition in mandamus, which reads as follows:

"Defendant, O.W. Merrell, is the duly appointed, qualified and acting Director of the Division of Highways of the State of Ohio; the defendant, Wade D. Van Ness, is the Auditor of the Division of Highways of the State of Ohio; the defendant, Joseph T. Tracy, is the duly elected, qualified and acting Auditor of the State of Ohio; the defendant, Harry S. Day, is the duly elected, qualified and acting Treasurer of the State of Ohio.

"The relator on towit the 20th day of December, 1932, filed with the defendant, O.W. Merrell, as Director of the Division of Highways of the State of Ohio two certain sworn and itemized statements of the amounts and values of labor performed and materials furnished with all credits and setoffs thereon, for work and labor performed and equipment and materials furnished in and for the construction of a State Highway known as State Highway Project No. 366, Section C, part of D of S. H. No. 42, the Harrison Road in Colerain and Green Townships, Hamilton County, Ohio. The State of Ohio is the owner of the aforesaid project, and The Clements-Orr Company, a corporation, are general contractors with the State of Ohio for said improvement, said contract being entered into with the State of Ohio on September 17, 1931. Said sworn and itemized statements show that the last of said work done and materials furnished was done on the 28th day of August, 1932.

"The relator further alleges that said work and labor was performed, and materials and equipment was furnished under and by virtue of a contract between relator and The Clements-Orr Company, a corporation, general contractors on said job; that said sworn and itemized statements of the amounts and values of labor performed and materials furnished show that there is due and owing to relator from the general contractor, the Clements-Orr Company, a corporation, the total sum of Fourteen Thousand, Eight Hundred Nine and 01/100 ($14,809.01) Dollars.

"Relator further says that he filed with the Recorder of Hamilton County, Ohio, on towit the 20th day of December, 1932, copies of the statements hereinabove mentioned.

"Relator further says that under the principal contract between The Clements-Orr Company, a corporation, and The State of Ohio, a final estimate No. 24, proposal 1, has been approved by the engineer in charge of said job; that the amount of said estimate is Thirty-five Thousand, Nine Hundred Eighty and 56/100 ($35,980.56) Dollars; that under a rule adopted and promulgated by O.W. Merrell, as Director of the Division of Highways of the State of Ohio, and the other defendants hereinabove mentioned, the sworn and itemized statements of claim filed by relator with said O.W. Merrell, as Director of the Division of Highways of the State of Ohio, will not be honored, or this relator's rights thereunder protected; that said O.W. Merrell, as Director of the Division of Highways of the State of Ohio, and the other defendants herein, refuse to detain in their hands all subsequent payments due to The Clements-Orr Company, a corporation, as principal contractor, including the final estimate hereinabove mentioned; that instead, the defendants herein, under the rule of the Division of Highways hereinabove referred to, will proceed to pay the funds due on said final estimate to the principal contractor, in violation of relator's right in and to said fund; that the defendant, O.W. Merrell, as Director of the Division of Highways of the State of Ohio, and the other defendants herein, refuse to respect relator's right to a lien to said fund, and will not upon demand of relator, issue their warrant to relator for his claim of Fourteen Thousand, Eight Hundred Nine and 61/100 ($14,809.01) Dollars and interest.

"Relator further says that he has no adequate remedy by any legal proceeding, to enforce his lien and claim in and to said funds, the same being in the hands of the Defendants in their capacity as officers of the State of Ohio.

"Wherefore, relator prays that a writ of mandamus issue, commanding said O.W. Merrell, as Director of the Division of Highways, and the other defendants herein, to withhold the payment of any funds due on said final estimate to The Clements-Orr Company, a corporation, and that said defendants be commanded to issue, or cause to be issued to the relator, a voucher for the sum of Fourteen Thousand, Eight Hundred Nine and 01/100 ($14,809.01) Dollars and interest, and commanding the defendants, O.W. Merrell, as Director of Highways of the State of Ohio, and Wade D. Van Ness, as Auditor of the Division of Highways of the State of Ohio, and Joseph T. Tracy, as Auditor of the State of Ohio, to deliver to relator their warrant on the Treasury of the State of Ohio, in favor of the relator for said amount."

A supplemental petition was filed by relator, which reads as follows:

"Now comes the relator, and for his supplemental petition herein, sets forth the following facts which have occurred since the 20th day of December, 1932, when he commenced this action:

"The relator says that on towit the 22nd day of December, 1932, on behalf of the State of Ohio and O.W. Merrell, as Director of the Division of Highways of the State of Ohio, he furnished to The Clements-Orr Company, a corporation, general contractors, as set forth in the petition, true and correct copies of the sworn and itemized statements of the labor performed and materials furnished, which he had theretofore on to wit the 20th day of December, 1932, filed with the defendant, O.W. Merrell, as Director of the Division of Highways of the State of Ohio; that said The Clements-Orr Company, as principal contractor with the State of Ohio, did not within five (5) days thereafter, and has not up to the time of the filing of this supplemental petition, notified in writing either the State of Ohio or O.W. Merrell, as Director of the Division of Highways of the State of Ohio, or any other officer, clerk, agent or attorney of the Division of Highways of the State of Ohio, of its intention to dispute the claims set forth in the sworn and itemized statements filed by relator with the Division of Highways as set forth in the petition; that by reason thereof, said The Clements-Orr Company, a corporation, general contractors, under Section 8329 General Code, has assented to the correctness of said sworn and itemized statements.

"The relator further says that since the filing of said true and correct copies of said itemized statements with the Recorder of Hamilton County, Ohio, as alleged in the petition, no other sub-contractors, material men, laborers, mechanics or persons furnishing material, fuel or machinery, have filed with the State of Ohio or O.W. Merrell, as Director of the Division of Highways of the State of Ohio, or any officer or authorized clerk, agent or attorney thereof, a sworn and itemized statement of labor performed, machinery, fuel or material furnished, or to be furnished by them for said improvement, and that under and by virtue of Section 8328 General Code, there are no other liens or claims filed against the funds now held by the defendants as heretofore alleged in the petition; that the relator's claim is just, and there is due and owing him the sum of Fourteen Thousand, Eight Hundred Nine and 01/100 ($14,809.01) Dollars, and that by reason of the proceedings set forth in the petition and the subsequent facts alleged in this supplemental petition, it is the duty of defendants to apply to relator's claims sufficient of said monies and funds in their hands to satisfy the same.

"Wherefore, relator renews the prayer of his petition."

The defendants demurred to the petition on the ground that the petition does not state facts which show a cause of action.

Messrs. Hamilton Kramer and Mr. Marion A. Ross, for relator.

Mr. John W. Bricker and Mr. Gilbert Bettman, attorneys general, Mr. Thomas M. Miller and Mr. Charles G. Williams, for respondents.



ALLEN, J.

Section 8329, General Code, provides that when the sworn itemized statement required under Sections 8324 et seq., General Code, has been furnished to the principal contractor, if such principal contractor fails within five days after such receipt by him to notify in writing the owner, board or officer of his intention to dispute such claim, he shall be considered as assenting to its correctness. We have, therefore, under these pleadings, the truth of which is admitted for the purpose of ruling on this demurrer, a claim the correctness of which is not disputed by the principal contractor nor by the director of highways. In other words, in this proceeding, if the petition states a cause of action, the state is a stakeholder merely, and the proceeding to enforce the lien is not, strictly speaking, a suit against the state.

The single legal question raised by the demurrer to the petition is whether Sections 8324 et seq., General Code, apply to contracts for the construction of improvements by the state.

Section 8324, General Code, reads as follows: "Any sub-contractor, material man, laborer or mechanic, who has performed labor or furnished material, fuel, or machinery, who is performing labor or furnishing material, fuel or machinery, or is about to perform labor, or furnish material, fuel, or machinery, for the construction, alteration, removal, or repair of any property, appurtenance or structure, described in sections eighty-three hundred and eight and eighty-three hundred and sixteen, or for the construction, improvement or repair of any turnpike, road improvement, sewer, street or other public improvement, or public building provided for in a contract between the owner, or any board, officer or public authority and a principal contractor, and under a contract between such sub-contractor, material man, laborer or mechanic and a principal contractor or sub-contractor, at the time of beginning to perform such labor or the delivery of the fuel or machinery, or at any time, not to exceed four months from the performance of the labor or the delivery of the machinery, fuel or material, may file with the owner, board or officer, or the authorized clerk or agent thereof, a sworn and itemized statement of the amount and value of such labor performed, and to be performed, material, fuel or machinery furnished, containing a description of any promissory note or notes that have been given by the principal contractor or sub-contractor on account of the labor, machinery or material, or any part thereof, with all credits and setoffs thereon, and proof that the sworn and itemized statement above provided for was mailed by registered letter to the address of the owner, board or officer, shall be taken as prima facie evidence of the filing thereof with the owner, board or officer, as herein provided."

Section 8325, General Code, reads as follows:

"Upon receiving the notice required by the next preceding section, such owner, board or officer or public authority or authorized clerk, agent or attorney thereof, shall detain in his hands all subsequent payments from the principal or subcontractor to secure such claims and the claims and estimates of other sub-contractors, material men, laborers, mechanics, or persons furnishing materials to or performing labor for any contractor or subcontractor who intervenes before the next subsequent payment under the contract, or within ten days thereafter."

It is, in short, the contention of the state that the state as a sovereignty is not bound by the terms of a general statute unless such statute expressly applies to the state. This is a well-established doctrine, laid down in State, ex rel. Parrott, v. Board of Public Works, 36 Ohio St. 409; State, ex rel. Ogelvee, Aud., v. Cappeller, 39 Ohio St. 207; and State, ex rel. Janes, v. Brown, Secretary of State, 112 Ohio St. 590, 148 N.E. 95.

The fourth paragraph of the syllabus in State, ex rel. Parrott, v. Board of Public Works, supra, reads as follows: "In the absence of a statute requiring it, or a promise to pay it, interest cannot be adjudged against the state for delay in the payment of money."

The first paragraph of the syllabus in State, ex rel. Ogelvee, Aud., v. Cappeller, supra, reads as follows: "The state is not liable for any part of the fees or expenses of the county treasurer or county auditor, or their assistants, except where such liability is created by statute * * *."

It will be observed that in these cases it was attempted to enforce a direct liability against the state.

The Attorney General urges that the above-quoted statute, which is totally dissimilar from those construed in the cases cited, does not apply to funds of the state concededly due to contractors for the construction of public buildings, works, or improvements. Without deviating from the holdings above, we differ from the conclusion of the director of highways. Section 8324, General Code, expressly designates "any turnpike, road improvement, sewer, street or other public improvement, or public building." This surely includes road improvements, sewers, streets, or public buildings, erected by the state. The section then goes on to speak of a contract entered into by "any board, officer or public authority." No distinction is made in the statute between county, municipal, or state officers, and this court cannot read such a distinction into words so all-inclusive. The terms certainly include state officials and state improvements. Hence the court overrules the demurrer to the petition.

Demurrer overruled.

WEYGANDT, C.J., DAY, STEPHENSON, JONES and MATTHIAS, JJ., concur.

KINKADE, J., not participating.