Case ID: ohio-app_34/html/0169-01.html
Source: Caselaw Access Project
Author: {"author": "Crow, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The Citizens Savings Bank of Pemberville v. Hocker et al.
    (Decided January 15, 1930.)
    
      Mr. Charles E. J ordan and Mr. George A. Cheney, for plaintiff in error.
    
      Messrs. Marshall, Melhorn, Marlar & Martin, for defendants in error.
   Crow, J.

The plaintiff in error was the plaintiff below. Plaintiff’s petition in the court of common pleas set forth in substance the following averments :

Plaintiff was a corporation duly existing under the laws of Ohio; defendant Metropolitan Casualty-Company was a corporation existing under the laws of the state of New York, duly authorized to transact business in the state of Ohio; one Jimison performed labor for one C. J. Hoeker at the special instance and request of the latter, in and about the construction and repair of a certain state highway, the charge for which labor was reasonable; when said Jimison had finished the performance of the labor there remained due him from Hoeker for said labor $300, which sum was later evidenced by a promissory note executed and delivered by Hoeker to Jimison, payable to the order of Jimison 60 days after its date, which was October 5,1928; thereafter plaintiff in due course purchased said promissory note from Jimison, and Jimison assigned and transferred to plaintiff the debt which the promissory note evidenced; Hoeker, a defendant in this suit, as principal, and the said Metropolitan Casualty Insurance Company, as surety, executed and delivered their joint and several bond in the form set forth in Section 2365-4, General Code, for a consideration which had been duly paid, which bond had been duly exacted in connection with the said state highway improvement, pursuant to Section 2365-1, General Code, and had been approved, pursuant to Section 2365-2, General Code; Jimison, subsequent to furnishing the labor, and before plaintiff acquired said promissory note and claim, furnished defendant Metropolitan Casualty Insurance Company the requisite statutory statement under oath of the amount due him from Hoeker for said work and labor, and that more than 60 days had elapsed subsequent to said furnishing; and a copy of the promissory note and also of the bond in controversy were attached to and made part of the petition.

Defendant Metropolitan Casualty Insurance Company demurred to the petition on the ground that it did not state facts sufficient to constitute a cause of action. The demurrer was sustained, and, plaintiff not desiring to plead further, judgment was entered, dismissing the petition as to the Metropolitan Casualty Insurance Company. Error is prosecuted here to reverse the judgment.

The sole question for determination is whether the right of action or claim of Jimison, who furnished the labor and material, was, as to the Metropolitan Casualty Insurance Company, assignable to plaintiff.

In an extended opinion the very learned judge of the court below took the position that the right of Jimison was entirely personal, so far as the liability of the surety on the bond of the contractor was concerned.

We do not doubt that, if the benefits and rights conferred on those who furnish to contractors and subcontractors labor and materials in the construction of public buildings, or other public works or improvements, by Sections 2365-1 to 2365-4 of the General Code, were designed to apply only to a class, or to classes, of persons, such, for instance, as those from whose hands the labor or materials pass directly into the buildings, works, or improvements, the position of the court below was the correct one.

Without quoting the whole of Section 2365-1, Gen- • eral Code, it is at once apparent from even the most casual consideration that the “additional obligation” therein referred to is the payment by the contractor and all subcontractors for the labor and materials, absolutely, and without limitation or qualification of any nature whatsoever.

Section 2365-2, General Code, provides that the bond, including the “additional obligation” mentioned in Section 2365-1, General Code, shall be conditioned for the payment by the contractor and by all subcontractors of all indebtedness which may accrue to any person, firm or corporation on account of any labor performed or materials furnished, and there are no words of limitation or qualification in this section.

Section 2365-4, General Code, provides a form which shall be substantially followed, which was done in the case at bar, which form contains the recital that the bond shall be for the benefit of any materialman or laborer having a just claim. This section also mentions “recovery by any claimant,” and makes such recovery subject to the conditions and provisions of the related sections.

Nothing in any of the provisions of these statutes can be discerned which is indicative of an intent that one who furnishes labor or materials, and perfects a claim therefor, cannot lawfully assign the indebtedness thus due him.

It is but common knowledge that the furnishing of labor and materials in the construction of public improvements is habitually financed by credit extended on the faith of the indebtedness to become due those who so furnish, and it is also common knowledge that, but for such credit, in many instances intending bidders would not be able to bid. Whether this situation moved the enactors of the statutes in controversy to include no restriction on assignments, we do not know, but it is quite probable such was the case. At all events we repeat that there is nothing to even suggest a design in the statutes already mentioned, that a claimant may not ’ assign the obligation due him from the contractor or subcontractor mentioned in the statutes, as well' as the right of action against the surety on the bond when the claim has been perfected pursuant to the statutes. Therefore resort must be had to the common law, and to such other statutes, if any, as pertain to the assignment of a cause of action.

It is of the utmost importance to note that there is no question concerning a lien in the instant case; the right of Jimison was a cause of action against defendant the Metropolitan Casualty Insurance Company, based on its contract of suretyship, of which the statutes under consideration became a part, as a matter of law.

It is a general rule, requiring no citation of au-' thority in its support, that all rights of action which j would, upon the death of the assignor, pass to his! legal representative may be assigned. Certainly no one would claim that the cause of action in Jimison would not have survived to his legal representative in the event of Jimison’s death. A very thorough and admirable treatment of the subject of assignability is contained in 3 Ohio Jurisprudence, 241.

By the assignment from Jimison to plaintiff the j latter was the real party in interest, and, as such,) was the only person who could have recovered on! the contract which the Metropolitan Casualty In-j surance Company entered into for the purpose of. making sure that the labor and materials going into the improvement would be paid for. Section 11241, General Code.

The demurrer should have been overruled, and for having sustained it the judgment of the court of common pleas must be reversed.

Judgment reversed.

Hughes and Justice, JJ., concur.