In Stowell et al. v. Clark, 152 Miss. 32, 118 So. 370 (1928), the prime contractor sublet a part of the work in constructing a highway to one Galbreak, who, after partially completing the work, abandoned it and the contractor then sublet the work to the plaintiff.Summary of this case from Mississippi Road Supply v. Western Casualty
October 8, 1928.
1. HIGHWAYS. Subcontractor working on yardage basis held entitled to recover on proving amount of work done by force account ( Hemingway's Code 1927, sections 2617-2622).
Where subcontractor completed work on highway pursuant to contract providing for measurement by yardage by engineer in charge of work, he was entitled to recover under Hemingway's Code 1927, sections 2617-2622 (Laws 1918, chapter 217), on showing amount of work done by force account on engineer's failure to measure yardage, in view of fact that yardage and force account were interconvertible terms and one could be ascertained from the other by calculation.
2. HIGHWAYS. Surety held liable for sum agreed to be paid subcontractor, in addition to contract price, as bonus ( Hemingway's Code 1927, section 2617).
Surety on highway contractor's bond, in accordance with Hemingway's Code 1927, section 2617 (Laws 1918, chapter 217, section 1) was liable for a sum agreed to be paid subcontractor, in addition to contract price, as bonus, such sum being as much a part of contract as yardage price for excavating and graveling.
3. INTEREST. Subcontractor held entitled to interest at six per cent. on balance due under contract from date of completion ( Hemingway's Code 1927, section 2223).
Under Hemingway's Code 1927, section 2223 (Code 1906, section 2678), subcontractor was entitled to interest at the rate of six per cent. per annum for balance due on contract from date of completion thereof, in the absence of any agreement to the contrary by parties.
4. HIGHWAYS. Surety on highway contractor's bond held liable for attorney's fees allowed subcontractor suing for balance due on contract ( Hemingway's Code 1927, section 2617).
Surety on bond executed on highway contract pursuant to Hemingway's Code 1927, section 2617, held liable on its bond for attorney's fees allowed subcontractor suing for balance due on contract.
APPEAL from circuit court of Claiborne county, HON. E.L. BRIEN, Judge.
McNeil Hendrick, for appellants.
It is the appellee's contention that he could not tell how many yards of dirt he took out on this project and that is the reason that he was attempting to recover for so much a team instead of so many yards of dirt excavated. It is true of this item and of the items that go to make up the appellee's statement of account that the burden was on him to establish by a preponderance of evidence his claim in every particular. This was expressly decided by this court by a memorandum opinion in King v. Estate of Stauddy, No. 26821, recently decided.
In our opinion, even though granting that Stowell could be held liable to his sub-contractor for these teams, the defendant, Bonding Company, under the provisions of chapter 217, of the Laws of 1918, could not be held so liable for the reason that these teams constituted the sub-contractor's equipment for doing the work and according to the latest decision of this court the statute under which this clause was filed does not cover equipment. U.S.F. G. Co. v. Yazoo County, 110 So. 780; McElrath Rogers v. Kimmons Sons, 112 So. 164.
In spite of the holdings of our court in this regard the lower court gave judgment in full for all the foregoing items. We say that it was clearly incumbent upon the plaintiff, Clark, to make out his case, and if he could not show that Stowell and the Bonding Company were liable to him for so many yards of dirt excavated and so many miles of gravel hauled, then he certainly cannot be permitted to come into court and collect from the Bonding Company for the equipment which he should have had in order to carry out his contract.
In McElrath Rogers v. Kimmons, supra, the court held where chapter 217 of the Law of 1912, was being construed in a case similar to this one that the interest claimed was not maintainable. The provision with reference to an attorney is in the condition of the bond and that is not in connection with the condition for payment of claims of furnishers of labor and material, but in connection with the rights of the named obligee, the district, county or highway department, and that obligee's enforcement of them under the contract bond, and only in suits for the benefit of the obligee would that provision under its plain terms be operative. The statute itself does not provide for any attorney's fees.
Even though we should be mistaken in this regard and this court should hold that appellee is entitled to attorney's fee on both the principal and interest, we earnestly submit that twenty per cent of the principal and interest is unreasonable, and in all events this amount should be reduced.
Brunini Hirsch and R.B. Anderson, for appellee.
Appellants argue that item 1 is for teams and extra men and that since this court has held that the bond is not liable for the equipment used in and about a project, this item cannot justly be charged against the U.S.F. G. Co. We beg to refer the court to page 20 of the record, which is Exhibit B. to the declaration. Here is the way the account (Exhibit) reads: "For grading done, as per item No. 1 hereto attached, three thousand two hundred seventy dollars and forty cents." The item is in no sense a charge for equipment. By reference to the testimony of plaintiff, it will readily be seen that Clark was to get twenty-five cents per cubic yard for grading and the grading was to be measured by the engineer. A former contractor who had thrown up his job had gone over this work and the engineer, after Clark had performed his part of the grading, did not cross-section the work for Clark, and it was, therefore, impossible to furnish the measurement by the method that was used ordinarily. Clark testified that he and Stowell had agreed that the engineer should estimate the work, and that as this was not done, the only way to estimate and charge for the work was by figuring on the teams and men employed. Clark said "This is the only method that could be used under the circumstances."
The fact is, therefore, that the real charge is for grading done, not a charge, at all, for teams or equipment.
Counsel for appellants cite the case of U.S.F. G. Co. v. Yazoo County, 110 So. 780. This case merely holds that tools, plant equipment, such as wagons, harness, gear, could not be recovered against the bond. These things had been sold to the contractor by the several plaintiffs in that case, as had been such things as auto tires, beds, mattresses, dishes, cooking utensils, etc. Appellee is not seeking to recover for teams sold or rented to the contractor, but simply for work done by the men and teams on the job.
The case of McElrath Rogers v. Kimmons, 112 So. 164, cited by appellants is authority only for the proposition laid down by this court in the Yazoo County case, supra.
The appellee was certainly entitled to be paid when his claim fell due, and under his undisputed testimony the full amount sued for became due September 1, 1925. The court allowed interest on the principal sum found to be due appellee, at the legal rate from that date.
The intent of the bond is to secure to persons who furnish labor or material the full amount earned and to save them harmless. The fees paid attorneys for prosecuting actions is certainly a proper charge, and the bond would not furnish full protection, nor such protection as the statute intends, unless these fees were covered by the bond. This court has recognized the attorney's fee as a legitimate part of the recovery in this kind of suit. In McElrath Rogers v. Kimmons, 112 So. 164, cited by appellants, in speaking of the item of attorneys' fees, the court said, "We think the court's allowance of the attorneys' fees was proper," etc.
We understand the rule to be that this court will not set aside a judgment such as this, except where the testimony does not sustain the finding or where there is no evidence to support it.
Argued orally by Leon Hendrick, for appellant, and R.B. Anderson, for appellee.
Appellee, Clark, brought this action in the circuit court of Claiborne county, under chapter 217, Laws of 1918 (Hemingway's 1927 Code, sections 2617-2622, inclusive), against appellants W.C. Stowell and the United States Fidelity Guaranty Company (the former being the principal in road contractor's bond, and the latter the surety on the bond), to recover the sum of four thousand four hundred ninety dollars and six cents, alleged by appellee to be due him as subcontractor by appellant Stowell, growing out of the road construction project in which the bond sued on was executed. The cause was tried without a jury, resulting in a judgment in appellee's favor in the sum of three thousand seven hundred sixty-nine dollars and forty-eight cents, with interest from September 1, 1925, and attorney's fee of twenty per cent. From that judgment, appellants prosecute this appeal.
Appellant Stowell entered into a contract with the highway commissioners of the second district of Claiborne county and the Mississippi highway department for the construction of two Federal Aid Projects, 153-B and 169, in Claiborne county. Appellant United States Fidelity Guaranty Company was surety on appellant Stowell's bond as such contractor, which bond was given as provided by section 1, chapter 217, Laws of 1918 (Hemingway's 1927 Code, section 2617). A part of these road projects was first let by appellant Stowell to one Galbreath. The work on the project sublet to Galbreath consisted of certain grading and graveling. The contract between appellant Stowell and Galbreath was made in accordance with the provisions and plans and specifications of the contract between appellant Stowell and Claiborne county and the highway department. Under the provisions of that contract the grading was to be done at so much per cubic yard, as also was the graveling.
Appellant Stowell sublet the work to be done by Galbreath at a lower price than he was to receive from Claiborne county. Galbreath did part of the work, and abandoned it. Appellant Stowell then sublet the Galbreath contract to appellee Clark; and, in addition to agreeing to pay appellee, Clark, by the yardage for both the excavation and the graveling, agreed to pay him the sum of three hundred and fifty dollars on the completion of his contract. The evidence for appellee tended to show that appellant Stowell agreed with appellee, Clark, to have measured by the engineer in charge the work completed by Galbreath, in order to be able to later determine what proportion of the work was done by appellee, Clark, and also agreed to have the engineer in charge to measure the yardage of the excavation and the gravel work done by appellee, Clark, as he progressed in carrying out his contract. The evidence for appellee tended to show that the engineer in charge failed to measure the work done by appellee according to yardage, but, instead, measured it according to "force account;" and that measurement according to force account meant the force, teams, shovels, and drivers at work and the time they worked. The evidence tended to show that appellee was not at fault in not having the work done by him measured according to yardage. But it tended also to show that the measurement of the work on the basis of "force account" showed substantially the same result as if it had been measured according to yardage, as provided in the contract — in other words, that the measurement by force account could be converted into yardage, and the measurement by yardage could be converted into force account; that yardage and force account were interconvertible terms. The trial court found that to be true from the evidence; otherwise, a judgment could not have been rendered for appellee.
Appellants contend that the ascertainment of the work done by appellee in that manner was in violation of the contract. We do not think it was. Appellee did the work he contracted to do; and, so far as the record shows to the contrary, did the work in the manner in which he agreed to do it. It was no fault of appellee that appellant Stowell and the engineer in charge of the project failed to measure the work done by the appellee on the yardage basis. In view of that failure appellee foresaw that, in order to protect his rights he should keep a force account, which he did. He kept an accurate account, according to the evidence, of the teams and employees, and all the implements used by him in carrying out his contract, as well as the time they were employed in the work. Appellant knew, as was shown by the evidence, that with this data his force account could be converted into yardage. The engineer in charge of the project testified that that could be done; that yardage and force account were interconvertible terms; that when you had the one you could get the other by calculation.
Appellant United States Fidelity Guaranty Company contends that it is not liable for the three hundred and fifty dollars which appellant Stowell agreed to pay appellee in addition to the price of so much per yard for the excavation and the gravel work. This three hundred and fifty dollars is referred to in the evidence as "bonus." We think it immaterial how it is denominated by the witnesses in their testimony. The fact was that appellee was to receive so much for his work on the yardage basis, and, in addition, the sum of three hundred and fifty dollars. The three hundred and fifty dollars was as much a part of the contract price as was the yardage price for excavating and graveling. We see no difference. If appellant surety company is liable on its bond for the yardage price, it is liable for the three hundred and fifty dollars.
The court allowed appellee interest at the rate of six per cent per annum from the time of the completion of his contract. Under section 2678, Code of 1906 (Hemingway's 1927 Code, section 2223), the rate of interest on "accounts and contracts shall be six per centum per annum." The statute means that the rate of interest on accounts and contracts shall be six per cent per annum where there is no agreement between the parties as to interest. The amount due under an account or contract bears six per cent interest from the time it is due and payable, unless it is otherwise provided by agreement of the parties.
Appellant United States Fidelity Guaranty Company contends that it was not liable on its bond for the attorney's fee allowed by the court to appellee. Appellee Stowell's bond as the original road contractor contained, among other things, the following provision:
". . . And shall pay the said agents, servants and employees, and all persons furnishing said principal with material and labor in the course of the performance of said work . . . and all of the expense and costs and attorney's fees that may be incurred in the enforcement of the performance of said contract, or in the enforcement of the conditions and obligations of this bond."
It is argued by appellants that the provision in the bond for the payment of attorney's fees was for the benefit of the county alone, and not for the benefit of the subcontractors and others furnishing materials and labor in the construction of the road. The statute, section 1, chapter 217, Laws of 1918 (Hemingway's 1927 Code, section 2617), provides that the contractor shall give a bond to promptly make payments to all persons supplying labor and materials. The bond in this case itself provides, as shown, that if payment for materials and labor going into the work is not promptly made, all expense, as well as attorney's fees, that may be incurred in the enforcement of the performance of the contract, or in the enforcement of the conditions and obligations of the bond, are to be charged against the bond. The contract of appellant Stowell with Claiborne county and the highway department, and his surety bond, so far as appellee's rights are concerned, constituted one contract. Each was incorporated into and made a part of the other. The surety bond was for the benefit of subcontractors and others supplying labor and materials that went into the road work, as well as for the benefit of the county. The purpose of the bond was to make them whole; and, in order to do so, the bond provided that all expenses and costs and attorney's fees incurred by them in the enforcement of their rights should be paid by the obligors in the bond. Section 2 of the statute (chapter 217, Laws of 1918; Hemingway's 1927 Code, section 2618) expressly gives persons furnishing materials and labor in the construction of public work a right of action on the surety bond. It gives them the right, in order to enforce their claims to the benefit of the conditions in the bond. And as shown, the bond provides that they shall have the right to enforce their claims in the courts, and charge the costs and attorney's fees against the surety bond.
We do not think the other questions argued on behalf of appellant are of sufficient gravity to call for discussion by the court.