Source: https://supreme.justia.com/cases/federal/us/244/376/
Timestamp: 2019-04-19 18:20:37+00:00

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Justia › US Law › US Case Law › US Supreme Court › Volume 244 › Illinois Surety Co. v. John Davis Co.
First: The purpose of the act was to provide security for the payment of all persons who provide labor or material on public work. This was done by giving a claim under the bond in lieu of the lien upon land and buildings customary where property is owned by private persons. Decisions of this Court have made it clear that the statute and bonds given under it must be construed liberally in order to effectuate the purpose of Congress as declared in the act. In every case which has come before this Court where labor and materials were actually furnished for and used in part performance of the work contemplated in the bond, recovery was allowed if the suit was brought within the period prescribed by the act. Technical rules otherwise protecting sureties from liability have never been applied in proceedings under this statute. [Footnote 2] As the basis of recovery is supplying labor and material for the work, he who has supplied them to a subcontractor may claim under the bond even if the subcontractor has been fully paid. Mankin v. United States, 215 U. S. 533.
It is urged that the bond referring to Schott provides protection only to those "supplying him or them labor and materials." But the claims in question were in a very practical sense furnished him, as well as the Engineering Company. He remained liable on the contract, and no one else was known to United States. Furthermore, if the attention is to be directed to the precise wording of the bond, it should be noted that it refers to Schott, "his or their heirs, successors, executors or administrators," and the Engineering Company may properly be deemed a successor. The argument that the surety's risk ought not to be increased by holding it liable for the default of strangers to the original contract is of no greater force in the case of an assignee than it is in that of the subcontractor. The Surety Company could protect itself by insisting that the contractor require a bond from all subcontractors and assignees. The Surety Company was in nowise prejudiced by the transfer of the business, since the management remained unchanged, and no reason is shown for applying the rule of strictissimi juris. Guaranty Co. v. Pressed Brick Co., 191 U. S. 416, 191 U. S. 426.
attention to. Dickerson v. Colgrove, 100 U. S. 578, 100 U. S. 580. There is in fact no inconsistency between the claimants' earlier acts and their attempt to recover on the bond. The Surety Company's contention is without merit.
Fourth: The specific objection made to the claim of the United States Equipment Company, for rental of cars, track, and equipment used at the Naval Training Station, and the expense of loading the plant and freight thereon to and from the station, is also unfounded. The Surety Company contends that this is not supplying "labor and materials." The equipment was used in the prosecution of the work. Material was thus supplied, although a loan serving the purpose, no purchase of it was made. The expense of loading and freight was properly included with the fixed rental as recoverable under the bond. Title Guaranty & Trust Co. v. Crane Co., 219 U. S. 24, 219 U. S. 34.
Guaranty Co. v. Pressed Brick Co., 191 U. S. 416; Hill v. American Surety Co., 200 U. S. 197; United States Fidelity Co. v. United States, 209 U. S. 306; Mankin v. Ludowici-Celadon Co., 215 U. S. 535; Title Guaranty & Trust Co. v. Crane Co., 219 U. S. 24; United States Fidelity Co. v. Bartlett, 231 U. S. 237; A. Bryant Co. v. N.Y. Steam Fitting Co., 235 U. S. 327; Illinois Surety Co. v. Peeler, 240 U. S. 214. See also Equitable Surety Co. v. McMillan, 234 U. S. 448. In Hardaway v. National Surety Co., 211 U. S. 552, where recovery was denied, the "use plaintiffs" had not furnished materials or labor, but were financiers. In Texas Cement Co. v. McCord, 233 U. S. 157, the questions involved were whether suit was brought within the statutory period. In United States Fidelity Co. v. Kenyon, 204 U. S. 349; United States v. Congress Constr. Co., 222 U. S. 199; Title Guaranty & Surety Co. v. United States, 228 U. S. 567, the questions raised were as to the jurisdiction of the court.

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