Case Name: WILLIAM F. GRAVES v. GILES W. MERRILL and Others
Court: Minnesota Supreme Court
Jurisdiction: Minnesota
Decision Date: 1897-04-08
Citations: 67 Minn. 463
Docket Number: Nos. 10,220—(221)
Parties: WILLIAM F. GRAVES v. GILES W. MERRILL and Others.
Judges: 
Reporter: Minnesota Reports
Volume: 67
Pages: 463–476

Head Matter:
WILLIAM F. GRAVES v. GILES W. MERRILL and Others.
April 8, 1897.
Nos. 10,220—(221).
Building Contractor’s Bond — Action for Breach.
Plaintiff made a contract with M. to furnish all materials and labor and build for plaintiff a house for a stipulated sum, to be paid as the work progressed, not exceeding 85 per cent, of the total amount of materials and labor furnished, the balance to be withheld until completion of the contract. M., as required by the contract, gave the plaintiff a bond, with E. as surety, indemnifying him against liens. Held, in an action against E. for a breach of the conditions of the bond, that the fact that the plaintiff, during the progress of the work, made payments to the contractor exceeding 85 per cent, of the contract price, without proof that such payments exceeded 85 per cent, of the total amount of the materials and labor already furnished for tlie construction of the house, did not constitute a defense.
Appeal by defendant Eaton from an order of the district court for Ramsey county, Brill, J., denying a motion for a new trial.
Affirmed.
Flandrwu, Squires c& Outcheon, for appellant.
Simonson v. Grant, 36 Minn. 439, 31 N. W. 861; Wheaton v. Wheeler, 27 Minn. 464, 8 N. W. 599; Allis v. Ware, 28 Minn. 166, 9 N. W. 666; Campion v. Whitney, 30 Minn. 177, 14 N. W. 806; Wager v. Brooks, 37 Minn. 392, 34 N. W. 745; Erickson v. Brandt, 53 Minn. 10, 55 N. W. 62; Bell v. Forrestal, 55 Minn. 431, 57 N. W. 55, 223; Tomlinson v. Simpson, 33 Minn. 443, 23 N. W. 864; Duluth v. Heney, 43 Minn. 155, 45 N. W. 7; National Inv. Co. v. Schickling, 56 Minn. 283, 57 N. W. 663; Reed v. McGregor, 62 Minn. 94, 64 N. W. 88; Harsh v. Klepper, 28 Oh. St. 200; Bank v. Lane, 8 Oh. St. 405; Erath v. Allen, 55 Mo. App. 107; Oberbeck v. Mayer, 59 Mo. App. 289; Bethune v. Dozier, 10 Ga. 235; Bowan v. Sharps' Rifle Mfg. Co., 33 Conn. 1; United States v. Tillotson, 1 Paine, C. C. Rep. 305, Fed. Cas. No. 16,524; Bank v. Douglass, 51 Ga. 205; General St. N. Co. v. Rolt, 6 Com. Bench (N. S.) 550; Eneas v. Hoops, 42 Jones & S. (N. Y. Super. Ct.) 517; Bragg v. Shain, 49 Cal. 131; Taylor v. Jeter, 23 Mo. 244; Calvert v. London Dock Co., 2 Keen, Ch. Rep. 638; Zimmerman v. Judah, 13 Ind. 286; Judah v. Zimmerman, 22 Ind. 388; Miller v. Stewart, 9 Wheat. 680, were cited.
W. D. Cornish, for respondent.
Reported in 70 N. W. 502.

Opinion:
PEB CUBIAM.
This is an appeal by the defendant Eaton from an order of the district court for the county of Bamsey denying his motion for a new trial. The cause was tried by the court without a jury, and judgment ordered upon the findings of fact for the plaintiff against the defendants in the sum of $2,397.02. The findings of fact are supported by the evidence. The facts are these: July 13, 1893, the plaintiff enters into a written contract with the defendant Merrill, whereby the latter agrees to furnish all labor and materials and build a dwelling house for the plaintiff, according to certain plans and specifications, for the agreed price of $16,109.45, to be paid in instalments as the work progresses, on the certificate of the architect in charge, in amounts not exceeding 85 per cent, of the total amount of materials and labor furnished at the building at the time the certificate is issued; the balance of 15 per cent, to be withheld until the contract is entirely finished and accepted, when the amount thereof will be incorporated in the amount of the final certificate, the condition being that, prior to first payment being made, the contractor should furnish a satisfactory bond to protect the plaintiff against liens to the extent of $25,000. The contract further provided that before each payment, if required, the contractor should give to the architect sufficient evidence that the premises were free from liens chargeable to the contractor.
Pursuant to this contract, the contractor gave to the plaintiff a bond, with the defendants Eaton and Bodger as sureties, in the sum of $25,000, conditioned that the contractor should promptly pay for all material and labor furnished for the construction of the dwelling house, pursuant to the contract, before the filing of any mechanics' liens therefor, and fully indemnify the plaintiff: from any and all such liens. This condition of the bond was not performed, in this: that liens were filed and adjudged to be valid against the plaintiff's premises for the construction of the dwelling house, and the plaintiff was compelled to, and did, pay, in excess of the contract price, $2,397.02, for the purpose of- discharging such liens. This action was brought on the bond to recover the amount so paid.
The defendant Eaton answered, alleging, among other matters, that the plaintiff and the contractor Merrill, without the knowledge of the defendant, failed to observe and perform the terms of the building contract in respect to the payments to be made thereon; that instead of paying to the contractor only 85 per cent, of the total amount of material and labor furnished at the building, and withholding 15 per cent, thereof, the plaintiff paid to him a sum exceeding 85 per cent, of such material and labor, and did not retain 15 per cent, of the contract price thereof, by reason of which violation of the terms of the contract the liens were made larger than they otherwise would have been. These allegations were in issue, and the trial court's findings of fact as to them were as follows:
"Defendant Merrill performed the work provided for .in said contract, and the same was completed, save in some unimportant particulars, on April 14, 1894. The plaintiff paid said Merrill at various times during the progress of the work, on account of said contract price and upon the certificate of the architect, various sums, amounting in all to fourteen thousand eight hundred forty-seven 55-100 (14.847.55) dollars; the last payment being made upon said April 14, amounting to one hundred forty-five 72-100 (145.72) dollars. The last eleven payments, made at divers times from February 7 to April 14, inclusive, amounting to two thousand four hundred sixty-six 55-100 (2.466.55) dollars, were applied by said Merrill in payment for labor and material furnished him for use in, and used in, constructing said building under said contract. Plaintiff has not made other or further payments to said Merrill. It does not appear that the plaintiff knew at any time, until after the last payment was made to said Merrill, as aforesaid, that any of the material or. labor used in or furnished for the erection of said building had not been paid for."
It is apparent from these findings that more than 85 per cent, of the contract price was paid by plaintiff to the contractor during the progress of the work, but there is neither finding nor evidence that such payments at any time exceeded S5 per cent, "of the total amount of materials and labor furnished at the building."
The claim of the surety Eaton, stated in the exact words of his counsel, is this:
"There is but one question in this case. The building contract provided that not more than 85 per cent, of the price of the building should be paid before its completion. The defendant Eaton became surety for the builder against liens. The owner violated the contract, by paying $1,154.52 more than the 85 per cent, before building was completed; liens accrued; and instead of having in his hands 15 per cent., being $2,410.41, to pay them with, he had only $1,276.90. Did this violation of the original contract discharge the sureties? There is no question about the facts; they stand conceded."
Now, if the assumption of facts which counsel accepts as the premises of his proposition is correct, his conclusion that the surety was released may be conceded. But his premises are unsupported by either finding or evidence. The contract was not that no more than 85 per cent, of the contract price of the building should be paid during the progress of the work, but that such payments should not exceed 85 per cent, of the "total amount of materials and labor furnished at the building at the time said certificate is issued." Such is the plain reading of the contract, and such is the construction placed upon the language of the contract by the defendant in his answer. There is no room for construction or argument. The simple statement of the facts of this case is the argument of the case. It by no means follows that 85 per cent, of the contract price would equal or exceed 85 per cent, of the amount of materials and labor furnished. As the only breach of the building contract here claimed is that payments were made by the plaintiff in violation of the contract, and as there is no evidence in the record to support the claim, it follows that the order appealed from must be affirmed.
So ordered.