Case Name: Gernatt Asphalt Products, Inc., Appellant-Respondent, v. Bensal Construction, Inc., Defendant; Erie County Finance Department et al., Respondents, and Aetna Casualty and Surety Company et al., Respondents-Appellants. R. P. Myers, Inc., et al., Third-Party and Interpleader Plaintiffs-Respondents-Appellants, v. Robert Smolinski et al., Third-Party and Interpleader Defendants-Respondents-Appellants, and United States of America, Third-Party and Interpleader Defendant-Respondent
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1982-11-09
Citations: 90 A.D.2d 993
Docket Number: 
Parties: Gernatt Asphalt Products, Inc., Appellant-Respondent, v Bensal Construction, Inc., Defendant; Erie County Finance Department et al., Respondents, and Aetna Casualty and Surety Company et al., RespondentsAppellants. R. P. Myers, Inc., et al., Third-Party and Interpleader Plaintiffs-Respondents-Appellants, v Robert Smolinski et al., Third-Party and Interpleader Defendants-Respondents-Appellants, and United States of America, Third-Party and Interpleader Defendant-Respondent.
Judges: 
Reporter: Appellate Division Reports
Volume: 90
Pages: 993–994

Head Matter:
Gernatt Asphalt Products, Inc., Appellant-Respondent, v Bensal Construction, Inc., Defendant; Erie County Finance Department et al., Respondents, and Aetna Casualty and Surety Company et al., RespondentsAppellants. R. P. Myers, Inc., et al., Third-Party and Interpleader Plaintiffs-Respondents-Appellants, v Robert Smolinski et al., Third-Party and Interpleader Defendants-Respondents-Appellants, and United States of America, Third-Party and Interpleader Defendant-Respondent.

Opinion:
Order modified and, as modified, affirmed, without costs, in accordance with the following memorandum: We find that Bensal Construction, Inc. (Bensal) under its contract (to furnish stone and gravel for public improvement projects for the County of Erie and the Southtowns Sewage Treatment Agency) with R. P. Myers, Inc. (Myers), the general contractor, was a materialman and not a contractor or a subcontractor (see A & J Buyers v Johnson, Drake & Piper, 25 NY2d 265). Therefore, because plaintiff (which supplied stone and gravel to Bensal) and interpleaded defendants (who performed labor and services for Bensal) were not persons "performing labor for or furnishing materials to a contractor, his subcontractor or legal representative, for the construction or demolition of a public improvement" (Lien Law, § 5), they have no rights as lienors. Nor do plaintiff and interpleaded defendants have valid claims against Aetna Casualty and Surety Company (Aetna) under its payment bonds covering the general contractor as principal, because as persons furnishing materials or performing labor for a party having the status of a materialman (not contractor or subcontractor), they have no nexus with or claim against the general contractor (see Neo-Ray Prods. v Boro Elec. Installation, 65 AD2d 687, affd for reasons stated at App Div 48 NY2d 781). There is no significant difference between the payment bonds issued by Aetna and the bond in Neo-Ray. Each bond covers lawful claims for materials furnished, used or consumed and labor performed in the prosecution of the work. We hold, therefore, that summary judgment should have been granted dismissing the claims of plaintiff and interpleaded defendants based on the liens and the payment bonds against Myers and Aetna. Myers' claim of willful exaggeration under sections 39 and 39-a of the Lien Law is without merit. Inasmuch as Bensal was a materialman and not a contractor or a subcontractor, there is no impediment to the enforcement of the United States Government tax lien against the $9,261.38 held by Myers and admittedly owed to Bensal. Plaintiff and interpleaded defendants have no claim against this sum as trust funds under the Lien Law (§ 70, subds 1, 2; § 71, subd 2, par [a]). Accordingly, summary judgment is granted to Myers and Aetna dismissing plaintiff's complaint and the counterclaims of the interpleaded defendants. Myers' motion to be discharged as stakeholder and permitting it to pay the $9,261.38 into court pursuant to CPLR 1006 (subd [f]) is granted. All concur, except Doerr and Denman, JJ., who dissent, in part, in the following memorandum.