Title: Wyandotte Electric Supply Co. v. Electrical Technology Systems, Inc. (Opinion - Leave Granted)
Citation: N/A
Docket Number: 149989
State: Michigan
Issuer: Michigan Supreme Court
Date: May 3, 2016

WYANDOTTE ELECTRIC SUPPLY COMPANY v  
ELECTRICAL TECHNOLOGY SYSTEMS, INC 
 
 
Docket No. 149989.  Argued November 5, 2015 (Calendar No. 3).  Decided May 3, 2016. 
 
 
Wyandotte Electric Supply Company (Wyandotte) brought an action in the Wayne 
Circuit Court against Electrical Technology Systems, Inc. (ETS), KEO & Associates, Inc. 
(KEO), and Westfield Insurance Company (Westfield).  KEO was the principal contractor for a 
renovation project at the Detroit Public Library.  Westfield provided a surety bond for the project 
in accordance with the public works bond act (PWBA), MCL 129.201 et seq.  KEO 
subcontracted with ETS to provide labor and materials for the project, and ETS, in turn, 
subcontracted with Wyandotte for materials.  Over the course of the library project, ETS only 
paid Wyandotte sporadically.  Wyandotte filed a claim with Westfield, seeking to recover on the 
payment bond.  Westfield denied the claim, and Wyandotte subsequently brought this action.  
ETS defaulted, and Wyandotte moved for summary disposition against KEO and Westfield.  The 
court, Robert J. Colombo, Jr., granted Wyandotte’s motion in part, concluding that there was a 
valid bond claim, given that Wyandotte had complied with the notice requirements of the 
PWBA, and that Wyandotte could recover a time-price differential as well as attorney fees.  A 
bench trial was then held on the question of damages.  The court found that the unpaid balance 
owed to Wyandotte was $154,343.29, that Wyandotte was entitled to a total time-price 
differential of $76,403.44, and that Wyandotte was entitled to $30,000 in attorney fees.  
Wyandotte moved for entry of judgment and further requested postjudgment interest under MCL 
600.6013(7).  The court granted the motion over the objections of KEO and Westfield and 
entered a judgment in the total amount of $272,927.70.  KEO and Westfield appealed.  The 
Court of Appeals, BECKERING, P.J., and HOEKSTRA and GLEICHER, JJ., affirmed the judgment of 
the trial court in an unpublished opinion per curiam.  KEO and Westfield then sought leave to 
appeal.  The Supreme Court granted leave. 497 Mich 958 (2015). 
 
 
In an opinion by Justice BERNSTEIN, joined by Justices MARKMAN, MCCORMACK, 
VIVIANO, and LARSEN, the Supreme Court held: 
 
 
1.  Under MCL 129.207 of the PWBA, a claimant not having a direct contractual 
relationship with the principal contractor shall not have a right of action upon the payment bond 
unless (a) the claimant has within 30 days after furnishing the first of such material or 
performing the first of such labor, served on the principal contractor a written notice, which shall 
inform the principal of the nature of the materials being furnished or to be furnished, or labor 
 
Michigan Supreme Court 
Lansing, Michigan 
Syllabus 
 
Chief Justice: 
Robert P. Young, Jr. 
 
Justices: 
Stephen J. Markman 
Brian K. Zahra 
Bridget M. McCormack 
David F. Viviano 
Richard H. Bernstein 
Joan L. Larsen 
This syllabus constitutes no part of the opinion of the Court but has been  
prepared by the Reporter of Decisions for the convenience of the reader. 
Reporter of Decisions: 
Corbin R. Davis 
being performed or to be performed and identifying the party contracting for such labor or 
materials and the site for the performance of such labor or the delivery of such materials, and (b) 
the claimant has given written notice to the principal contractor and the governmental unit 
involved within 90 days from the date on which the claimant performed the last of the labor or 
furnished or supplied the last of the material for which the claim is made, stating with substantial 
accuracy the amount claimed and the name of the party to whom the material was furnished or 
supplied or for whom the labor was done or performed.  Each notice shall be served by mailing 
the same by certified mail, postage prepaid.  In this case, KEO asserted that Wyandotte failed to 
properly serve KEO because KEO never received the 30-day notice.  The plain language of the 
statute, however, does not require actual receipt of the notice.  Wyandotte sent the 30-day notice 
through certified mail as required by the statute.  When a claimant has complied with the notice 
procedures set forth by the Legislature in MCL 129.207, there is no actual-notice requirement. 
 
 
2.  MCL 129.207 of the PWBA permits an unpaid supplier of materials or labor to sue on 
the payment bond for the amount, or the balance thereof, unpaid at the time of institution of the 
civil action, prosecute such action to final judgment for the sum justly due the claimant and have 
execution thereon.  Wyandotte sought payment based on its prior contracts with ETS: an open-
account agreement entered into in 2003, the bid Wyandotte made for the Detroit Public Library 
project in 2009, and the ensuing purchase orders.  Wyandotte argued that it was entitled to the 
unpaid balance for the materials it had provided as well as further damages under time-price-
differential and past-due-accounts provisions in the open-account agreement.  Contractual privity 
is not a requirement for recovery under MCL 129.207, so the fact that KEO and Westfield did 
not agree to those provisions was immaterial.  The dispositive question was whether amounts 
due under the time-price-differential and past-due-accounts provisions were part of the sum 
justly due to Wyandotte under the statute.  The sum justly due under MCL 129.207 is the amount 
provided for in the claimant’s contract.  At the time Wyandotte commenced this action, ETS had 
already fallen behind on its payments to Wyandotte for the materials Wyandotte had provided in 
connection with the library project.  The time-price differential referred to in the contracts 
between Wyandotte and ETS was in play, reflecting the increased cost to Wyandotte as ETS’s 
bills went underpaid or unpaid.  Therefore, a time-price differential was part of the amount 
unpaid and due to Wyandotte when it instituted the instant action, and the trial court properly 
included the time-price differential as part of the judgment in Wyandotte’s favor.  The past-due-
accounts provision stated that if ETS’s account was placed into the hands of an attorney for 
collection after default, ETS agreed to pay 33% of the unpaid balance for attorney fees together 
with applicable costs.  The open-account agreement containing the provision covered all of 
ETS’s past, present, and future unpaid accounts receivable balances with Wyandotte.  Thus, the 
terms of the open-account agreement clearly indicated that ETS and Wyandotte intended that the 
past-due-accounts provision would apply for the duration of their ongoing business relationship, 
and it was not improper for the trial court to include attorney fees in its judgment as part of the 
sum justly due.  Accordingly, in this case, Wyandotte was entitled to the time-price differential 
and attorney fees it would have received under its contracts with ETS.   
 
 
3.  Under MCL 600.6013(7), if a judgment is rendered on a written instrument 
evidencing indebtedness with a specified interest rate, interest is calculated from the date of 
filing the complaint to the date of satisfaction of the judgment at the rate specified in the 
instrument.  In this case, the judgment was not rendered on a written instrument.  Although the 
contract between Wyandotte and ETS defined the scope of the damages that Wyandotte was 
entitled to seek under the PWBA, the underlying claim was not a contract claim.  Wyandotte’s 
cause of action did not arise directly out of its contract; it arose out of the PWBA.  Therefore, 
even though the contract between ETS and Wyandotte determined the extent of Wyandotte’s 
recovery, judgment was rendered on Wyandotte’s statutory claim rather than on the contract 
itself.  Interest on the judgment should have been calculated under MCL 600.6013(8), the 
general rule for interest on a money judgment in a civil case. 
 
 
Court of Appeals judgment regarding sufficiency of the notice and the recovery of 
attorney fees and a time-price differential affirmed.  Court of Appeals judgment regarding 
postjudgment interest reversed.  Case remanded to the trial court for further proceedings.   
 
 
Chief Justice YOUNG, concurring in part and dissenting in part, agreed with the majority 
that Wyandotte complied with the notice requirements of MCL 129.207 and that a time-price 
differential was recoverable under the statute, but would have held that the attorney fee award 
was not integrally related to the price of the materials Wyandotte furnished, so the attorney fee 
award was not recoverable as a sum justly due within the meaning of the PWBA.  Chief Justice 
YOUNG also dissented from the majority’s reasoning regarding the award of postjudgment 
interest.  MCL 129.207 only makes compensable the unpaid costs of labor or materials 
furnished.  Thus, the statute limits a claimant’s recovery to the contractual terms that are related 
to the price of labor or materials furnished.  While both the time-price-differential and the past-
due-accounts provisions were in Wyandotte’s agreement with ETS, only the former actually 
related to the cost of furnishing the materials.  In addition, the PWBA limits the claimant’s 
recovery based on when certain price terms are triggered; to be recoverable, the price term must 
be triggered before the expiration of 90 days after the last of the materials are supplied or labor 
furnished.  The time-price-differential provision was triggered before Wyandotte gave its 90-day 
notice.  Accordingly, Wyandotte could recover the time-price differential.  In contrast, the 
attorney fee was not closely associated with the cost of materials furnished for the library project.  
The past-due-accounts provision created a penalty for collection efforts rather than determining 
Wyandotte’s expectancy.  Because this provision described a liquidated collection cost rather 
than a cost of the materials, the attorney fees set forth in the provision were not part of the sum 
justly due.  In addition, the past-due-accounts provision was not triggered by the 90-day deadline 
given that Wyandotte did not file suit until well after the 90-day deadline had passed.  The trial 
court, therefore, erred by awarding attorney fees.  Finally, the majority mistakenly concluded 
that the judgment was rendered on the PWBA rather than on a written instrument.  The 
agreement between Wyandotte and ETS was as much the basis for the trial court’s judgment as 
the statute, so the judgment was rendered on a written instrument.  Nonetheless, 
MCL 600.6013(7) did not apply because the underlying agreement did not evidence 
indebtedness.  Therefore, the general interest rate set forth in MCL 600.6013(8) applied, but not 
for the reason stated by the majority.   
 
 
Justice ZAHRA, concurring in part and dissenting in part, agreed that the notice provided 
by Wyandotte was sufficient and that MCL 600.6013(8) governed the calculation of 
postjudgment interest, but disagreed with the majority’s reasoning regarding the calculation of 
interest and also did not agree that Wyandotte could claim attorney fees and a time-price 
differential under the payment bond.  Simply because a remote subcontractor may sue on a 
payment bond under MCL 129.207 does not suggest that its claim is determined by a contract to 
which the principal contractor who furnished the payment bond was not a party.  Under 
Michigan law, a remote contractor’s claim arises solely under the PWBA, which alone forms the 
basis to assess its claim.  MCL 129.207 does not suggest that the principal contractor must 
wholly indemnify claimants under the PWBA.  MCL 129.207 provides, in regard to remote 
subcontractors, that the claimant must provide notice within 90 days from the date on which the 
claimant performed the last of the labor, or furnished or supplied the last of the materials, for 
which the claim is made, stating with substantial accuracy the amount claimed.  This notice 
identifies the labor and materials that the remote contractor has supplied.  The sum justly due 
thus includes the labor and materials identified in the 90-day notice that the claimant has 
supplied but for which the claimant has not been paid.  The majority departed from the statutory 
language by imposing liability for the amount provided for in the claimant’s contract, regardless 
of whether the principal contractor and its surety agreed to that contract’s terms.  Further, the 
majority holds that judgment was rendered on Wyandotte’s statutory claim rather than on the 
contract itself.  This holding missed the entire point of the PWBA.  MCL 129.207 expressly 
provides that a claimant may sue on the payment bond, but, in this case, neither the payment 
bond nor the contract between KEO and the library incorporated by the payment bond contained 
a specified interest rate.  Accordingly, the majority reached the correct result when it concluded 
that interest on the judgment had to be calculated based on MCL 600.6013(8). 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
©2016 State of Michigan 
FILED  May 3, 2016 
 
S T A T E  O F  M I C H I G A N 
 
SUPREME COURT 
 
 
WYANDOTTE ELECTRIC SUPPLY 
COMPANY, 
 
 
Plaintiff-Appellee, 
 
 
v 
No. 149989 
 
ELECTRICAL TECHNOLOGY SYSTEMS, 
INC., 
 
 
 
Defendant/Cross-Defendant, 
 
and 
 
KEO & ASSOCIATES, INC., 
 
Defendant/Cross-Plaintiff-
Appellant, 
 
and 
 
WESTFIELD INSURANCE COMPANY, 
 
Defendant-Appellant. 
 
 
 
BEFORE THE ENTIRE BENCH  
 
BERNSTEIN, J.  
 
Michigan Supreme Court 
Lansing, Michigan 
OPINION 
 
Chief Justice: 
Robert P. Young, Jr. 
 
 
Justices: 
Stephen J. Markman 
Brian K. Zahra 
Bridget M. McCormack 
David F. Viviano 
Richard H. Bernstein 
Joan L. Larsen 
 
 
 
 
2 
This case concerns several facets of the public works bond act (PWBA), 
MCL 129.201 et seq.  First, it poses the question of whether actual notice is required for a 
sub-subcontractor to recover on a payment bond when that sub-subcontractor has 
complied with the notice requirements set forth in MCL 129.207.  Second, the case raises 
the question of whether a PWBA claimant may recover a time-price differential and 
attorney fees that were provided for by the claimant’s contract with a subcontractor, but 
were unknown to the principal contractor holding the payment bond as well as the 
principal’s surety.  Finally, we consider what postjudgment interest is appropriate under 
the PWBA.  We hold that the PWBA contains no actual notice requirement for claimants 
that comply with the statute, that the trial court properly awarded a time-price differential 
and attorney fees on past-due invoices to plaintiff Wyandotte Electric Supply Company 
(Wyandotte), and that the trial court erred in awarding postjudgment interest under 
MCL 600.6013(7).  Accordingly, we affirm the judgment of the Court of Appeals with 
regard to the first two issues and reverse with regard to the third.  We remand this case to 
the trial court for further proceedings consistent with this opinion. 
I.  FACTS AND PROCEDURAL HISTORY 
In 2009 and 2010, the south wing of the Detroit Public Library was renovated.  
Defendant KEO & Associates, Inc. (KEO) was the principal contractor for this project.  
Defendant Westfield Insurance Company (Westfield) supplied KEO with a payment bond 
worth $1.3 million, as required by the PWBA.  KEO was identified as the principal 
contractor and Westfield as the surety on the bond.  KEO subcontracted with defendant 
Electrical Technology Systems, Inc. (ETS) to provide labor and materials for electrical 
 
 
3 
work.  The agreement between KEO and ETS included a pay-if-paid clause, obliging 
KEO to pay ETS only after KEO had been paid for the relevant portion of work 
performed. 
ETS in turn subcontracted with Wyandotte for materials and supplies, making 
Wyandotte a sub-subcontractor from KEO’s perspective.  ETS and Wyandotte first 
formed a relationship in 2003, when they entered into an “open account” agreement that 
governed ETS’s purchases from Wyandotte.  Under this agreement, ETS was to pay a 
“[t]ime price differential” of 1.5% per month (18% per annum) on invoices unpaid after 
30 days.1  For the Detroit Public Library project, ETS solicited a quote from Wyandotte.  
On August 13, 2009, Wyandotte submitted a quote that included the 1.5% time-price 
differential provision.  On February 19, 2010, ETS accepted the quote by issuing a 
purchase order totaling $143,613.25.  Wyandotte first delivered materials to ETS for the 
project on March 3, 2010.  Over the course of the project, ETS paid Wyandotte only 
sporadically and the unpaid balance grew.  Initially, Wyandotte supplied materials on 
credit and credited ETS’s payments to the oldest outstanding balance, but eventually 
Wyandotte began to ship materials only for cash on delivery.  The last shipment with an 
                                              
1 The term “time-price differential” refers to the difference between the current cash price 
of an item and the cost of purchasing the item with credit.  A payment made with cash is 
immediate; a payment made with credit is not.  Thus, when a payment is made with 
credit, the seller is burdened by a cash-flow interruption.  A time-price differential 
compensates for the increased cost to a seller for credit.  It reflects the difference between 
the credit price and the cash price.  Price Bros Co v Charles J Rogers Constr Co, 104 
Mich App 369, 377; 304 NW2d 584 (1981), citing Silver v Int’l Paper Co, 35 Mich App 
469, 470; 192 NW2d 535 (1971).  Despite the contract provision, Wyandotte’s business 
practice was to wait 60 days to pursue the time-price differential. 
 
 
4 
unpaid balance was delivered on or about July 22, 2010; Wyandotte continued making 
deliveries on a cash basis until September 30, 2010. 
On March 3, 2010, when it began work on the library project, Wyandotte sent 
letters to KEO and Westfield asking for a copy of the payment bond related to the library 
renovation project.  The letter, on Wyandotte’s letterhead, referred to the “Detroit Public 
Library South Wing with [ETS.]”  According to Wyandotte, KEO provided a copy of the 
payment bond the next day.  One week later, on March 10, 2010, Wyandotte sent KEO a 
30-day “Notice of Furnishing” in accordance with MCL 129.207, explaining that it was 
one of ETS’s suppliers.  Wyandotte also sent copies of the letter to Westfield, the library, 
and ETS.  As specified by MCL 129.207, Wyandotte sent these notices by certified mail.  
Additionally, Wyandotte sent the notices with return receipts requested.  The notices to 
Westfield, ETS, and the library were all received.  It is unclear what happened to the 
notice sent to KEO—United States Postal Service tracking indicated that it was at the 
Detroit Post Office on March 13, 2010, but it apparently never reached its destination.  
KEO states that it never received the 30-day notice.  Again in accordance with the 
requirements of MCL 129.207, Wyandotte provided a 90-day notice of furnishing on 
November 1, 2010, to KEO, Westfield, ETS, and the library, stating that its last day of 
furnishing materials had been September 30, 2010. 
Throughout the renovation project, KEO made progress payments to ETS totaling 
more than $248,000,2 but ETS was not fully paying Wyandotte.  KEO claims not to have 
                                              
2 KEO claims to have paid more than it owed; ETS claims that KEO failed to pay what it 
owed to ETS.  In any case, Wyandotte undisputedly did not receive full payment. 
 
 
5 
been aware of Wyandotte’s involvement in the project before receiving the 90-day notice 
in November 2010.  After receiving the 90-day notice from Wyandotte, KEO requested 
information from ETS confirming payments in the form of a sworn statement.  According 
to KEO, ETS provided a falsified sworn statement averring that Wyandotte had been paid 
$80,000.  In January 2011, KEO terminated its subcontract with ETS, citing an 
abandonment of the project. 
On January 28, 2011, Wyandotte filed a claim directly with Westfield to recover 
on the payment bond.  Westfield denied the claim, asserting a lack of liability.  
Consequently, on March 14, 2011, Wyandotte filed suit against ETS, KEO, and 
Westfield.  KEO filed a cross-claim against ETS on March 29, 2011.  ETS had apparently 
gone out of business and its president had declared personal bankruptcy, so it failed to 
appear and was defaulted.  Wyandotte continued to pursue claims against KEO and 
Westfield on the basis of the surety bond.3 
On September 7, 2011, Wyandotte moved for summary disposition under 
MCR 2.116(C)(10), which tests the factual sufficiency of a complaint.  The trial court 
heard oral argument on whether there was a valid bond claim when KEO had not 
received the 30-day notice of furnishing and whether Wyandotte could recover the 1.5% 
time-price differential and attorney fees on a bond claim.  On November 4, 2011, the trial 
court granted Wyandotte’s motion in part, concluding that there was a valid bond claim 
because Wyandotte had complied with the notice requirements, and that Wyandotte could 
                                              
3 Because KEO and Westfield’s financial interests with respect to this project are aligned, 
they have filed joint arguments in this appeal.  We refer to them jointly as “defendants” 
throughout this opinion. 
 
 
6 
recover the time-price differential as well as attorney fees.  The only remaining issue was 
the amount of damages, and a bench trial was held on that narrow question.  The trial 
court found that the unpaid balance owed to Wyandotte was $154,343.29, that Wyandotte 
was entitled to a total time-price differential of $76,403.44, and that Wyandotte was 
entitled to $30,000 in attorney fees.4  Wyandotte moved for entry of judgment and further 
requested postjudgment interest under MCL 600.6013(7).  The trial court granted the 
motion over defendants’ objections and entered a judgment in the total amount of 
$272,927.70.5  The Court of Appeals affirmed the judgment in an unpublished opinion.  
II.  NOTICE UNDER THE PWBA 
Defendants first contend that Wyandotte did not have a cause of action against 
them because KEO did not receive Wyandotte’s 30-day notice.  We review a trial court’s 
summary disposition order de novo.  Debano-Griffin v Lake Co, 493 Mich 167, 175; 828 
NW2d 634 (2013).  Likewise, questions of statutory interpretation are subject to review 
de novo.  Elba Twp v Gratiot Co Drain Comm’r, 493 Mich 265, 278; 831 NW2d 204 
(2013).  When interpreting a statute, our foremost rule of construction is to discern and 
give effect to the Legislature’s intent.  Aroma Wines & Equip, Inc v Columbian 
Distribution Servs, Inc, 497 Mich 337, 345; 871 NW2d 136 (2015).  Because the 
language chosen is the most reliable indicator of that intent, we enforce clear and 
                                              
4 The attorney fees award was agreed to by the parties and was less than the attorney fees 
provided for in the contract. 
5 The final award also included, under MCR 2.403(O), $12,180.97 for fees and costs 
arising out of defendants’ rejection of a case evaluation. 
 
 
7 
unambiguous statutory language as written, giving effect to every word, phrase, and 
clause.  Id. at 345-346.    
Traditionally, public property cannot be the subject of a lien unless a statute 
specifically permits it.  Knapp v Swaney, 56 Mich 345, 347; 23 NW 162 (1885).  The 
Legislature enacted the PWBA to protect contractors and suppliers working on public 
projects who, unlike their private-works counterparts, have no recourse when other 
contractors default on their obligations.  Adamo Equip Rental Co v Mack Dev Co, Inc, 
122 Mich App 233, 236; 333 NW2d 40 (1982), citing Ford v State Bd of Ed, 166 Mich 
658; 132 NW 467 (1911).  While contractors and suppliers can place mechanics’ liens on 
private projects, the PWBA protects those workers on public projects by requiring the 
principal contractor on a public project valued at $50,000 or more to obtain a payment 
bond.  MCL 129.201.  Payment bonds serve to protect subcontractors in privity with a 
principal contractor, as well as remote sub-subcontractors like Wyandotte, who are not 
fully compensated for their contributions to a public project.  MCL 129.203.  The 
principal contractor who obtains the bond, as well as the principal’s surety if applicable, 
is liable to compensate suppliers of labor or materials.  Id. 
MCL 129.207 provides for recovery under a principal contractor’s payment bond, 
but prescribes a two-step notice procedure for a remote party from the principal 
contractor’s perspective, that is, one lacking a direct contractual relationship with the 
principal contractor: 
A claimant not having a direct contractual relationship with the principal 
contractor shall not have a right of action upon the payment bond unless 
(a) he has within 30 days after furnishing the first of such material or 
performing the first of such labor, served on the principal contractor a 
written notice, which shall inform the principal of the nature of the 
 
 
8 
materials being furnished or to be furnished, or labor being performed or to 
be performed and identifying the party contracting for such labor or 
materials and the site for the performance of such labor or the delivery of 
such materials, and (b) he has given written notice to the principal 
contractor and the governmental unit involved within 90 days from the date 
on which the claimant performed the last of the labor or furnished or 
supplied the last of the material for which the claim is made, stating with 
substantial accuracy the amount claimed and the name of the party to whom 
the material was furnished or supplied or for whom the labor was done or 
performed.  Each notice shall be served by mailing the same by certified 
mail, postage prepaid, in an envelope addressed to the principal contractor, 
the governmental unit involved, at any place at which said parties maintain 
a business or residence. 
Defendants’ argument is that there can be no liability under the PWBA because 
KEO never actually received the 30-day notice—i.e., there was a failure of service.6  In 
essence, defendants ask us to read an actual notice requirement into MCL 129.207.  We 
decline to do so.  First, we consider the plain language of the statute.  Because “served” 
in this context is a technical word with a specific meaning in the law, we refer to that 
technical meaning.  MCL 8.3a.  “Serve” means “[t]o make legal delivery of (a notice or 
process)” or “[t]o present (a person) with a notice or process as required by law[.]”  
Black’s Law Dictionary (10th ed).  Therefore, the word “served,” as used in this statute, 
in itself does not implicate any substantive requirements; it merely compels compliance 
with the relevant law. 
Furthermore, service of notice is mandatory under MCL 129.207, because the 
statute declares that a party “shall not have a right of action upon the payment bond 
unless” the two notices are provided and states that the two notices “shall inform” the 
                                              
6 Defendants do not argue in this Court that Wyandotte failed to serve the 90-day notice 
required by MCL 129.207. 
 
 
9 
specified parties of certain information.  However, the Legislature did not specify that 
actual receipt of notice is a requirement of the PWBA, although it has done so in other 
statutes.  Some statutes mandate that a party provide service by taking actions 
“reasonably calculated to give actual notice . . . .”  See, e.g., MCL 125.2335(3); 
MCL 445.1539; MCL 487.3224(1).  Others expand upon delivery directions, requiring 
that mailed notice be sent return-receipt demanded or that some additional step be taken 
to prove that notice was given.  See, e.g., MCL 168.711 (requiring service by “registered 
or certified mail, with a return receipt demanded”); MCL 213.181 (requiring service by 
“registered mail, and a return receipt demanded”); MCL 500.2034 (requiring “the return 
postcard receipt for” a statement served under the statute as proof of service); 
MCL 290.725(3) (“The verified return of service shall be proof of the service . . . .”).  
The Legislature elected not to impose such a burden in MCL 129.207.   
Defendants ask us to overlook the fact that Wyandotte sent its 30-day notice of 
furnishing via certified mail, return-receipt requested, and render a decision based on the 
fact that KEO did not receive that notice.7  The rules of statutory construction demand 
that this Court “ ‘give effect to every word, phrase, and clause and avoid an interpretation 
that would render any part of the statute surplusage or nugatory.’ ”  People v 
                                              
7 At oral argument, defendants additionally suggested that service with return-receipt 
requested was not in conformity with MCL 129.207.  We do not find compelling 
defendants’ contention that Wyandotte failed to comply with the statute when it took the 
additional precaution of sending its correspondence return-receipt requested.  The plain 
language of MCL 129.207 does not require a return receipt, and we decline to read such 
language into the statute.  But we also do not believe that a party that requests a return 
receipt when sending notice by certified mail is not entitled to a right of action on a 
payment bond under MCL 129.207. 
 
 
10 
Cunningham, 496 Mich 145, 154; 852 NW2d 118 (2014), quoting State Farm Fire & Cas 
Co v Old Republic Ins Co, 466 Mich 142, 146; 644 NW2d 715 (2002).  In addition to the 
portions of the statute requiring notice, MCL 129.207 specifies that “notice shall be 
served by mailing the same by certified mail, postage prepaid . . . .”  To accept 
defendants’ argument would render that phrase nugatory.  In order to give effect to this 
phrase, we must conclude that service is accomplished when a complainant mails the 
required information to the proper destination by certified mail within the required time 
frame.  
This Court previously considered the notice requirements of the PWBA in Pi-Con, 
Inc v A J Anderson Constr Co, 435 Mich 375; 458 NW2d 639 (1990).  Defendants 
maintain that this Court held in Pi-Con that the PWBA contains an actual notice 
requirement.  In Pi-Con, a supplier of materials and services to a subcontractor on a 
public works project sent its notice of furnishing to the principal contractor via ordinary 
first-class mail rather than, as required by statute, by certified mail.  Id. at 378-380.  The 
Pi-Con Court reviewed the United States Supreme Court’s construction of the Miller Act, 
40 USC 3131 et seq., the federal analog to the PWBA, in Fleisher Engineering & Constr 
Co v United States ex rel Hallenbeck, 311 US 15; 61 S Ct 81; 85 L Ed 12 (1940), in 
which the Supreme Court observed: 
We think that the purpose of this provision [notice by certified mail 
requirement] as to manner of service was to assure receipt of the notice, not 
to make the described method mandatory so as to deny right of suit when 
the required written notice within the specified time had actually been given 
and received.  In the face of such receipt, the reason for a particular mode 
of service fails.  It is not reasonable to suppose that Congress intended to 
insist upon an idle form.  Rather, we think that Congress intended to 
 
 
11 
provide a method which would afford sufficient proof of service when 
receipt of the required written notice was not shown.  [Id. at 19.] 
Guided by the analysis in Fleisher, the Pi-Con Court concluded that service by first-class 
mail does not preclude recovery under the PWBA as long as the plaintiff can prove the 
defendant’s actual receipt of the notice by a preponderance of the evidence.  Pi-Con, 435 
Mich at 378. 
Defendants refer to the following portion of Pi-Con to support their contention 
that the PWBA contains an actual notice requirement: 
First, a claimant must prove that the principal contractor actually received 
notice.  Second, the notice must relate “the nature of the materials being 
furnished or to be furnished, or labor being performed or to be performed 
and identify[] the party contracting for such labor or materials and the site 
for the performance of such labor or the delivery of such materials . . . .”  
Third, the notice sent must have been written.  Fourth, the notice must have 
been received within the time limits prescribed by the statute.  [Id. at 382 
(citation omitted; alteration in original).] 
But the factual underpinnings of Pi-Con are dissimilar to those in this case, and those 
dissimilarities affect our approach to the PWBA’s notice requirements.  Pi-Con and the 
other Michigan cases that have previously addressed the notice requirement of 
MCL 129.207 all involved parties who failed to employ the statutorily prescribed 
delivery method—certified mail.  See, e.g., Pi-Con, 435 Mich at 380 (notice sent by 
ordinary first-class mail); Thomas Indus, Inc v C & L Electric, Inc, 216 Mich App 603, 
605-608; 550 NW2d 558 (1996) (no notice mailed but all required information included 
on packing slips with shipments of materials).  In this case, by contrast, the parties do not 
dispute that Wyandotte sent notice via certified mail, although KEO apparently did not 
 
 
12 
receive it.  In this situation, Wyandotte complied with the statute, which contains no 
actual notice requirement. 
We reaffirm the continuing application of Pi-Con’s rule in cases in which a 
would-be PWBA claimant fails to comply with the particular method of service specified 
in MCL 129.207.  To deny a PWBA claim when a preponderance of the evidence 
demonstrates that notice was actually received would improperly “elevat[e] form over 
substance.”  Pi-Con, 435 Mich at 385.  Similarly, it would be more than passing strange 
to penalize a claimant for complying with the notice provisions outlined in the statute, as 
Wyandotte has done here.  We conclude that, when a claimant has complied with the 
notice procedures set forth by the Legislature in MCL 129.207, there is no actual notice 
requirement. 
III.  RECOVERABILITY OF A TIME-PRICE DIFFERENTIAL  
AND ATTORNEY FEES8 
In prevailing on its PWBA claim, Wyandotte was awarded a judgment in the trial 
court that included a time-price differential and attorney fees, which had been provided 
for in its contract with ETS.  To the extent that this issue is one of statutory interpretation 
of the PWBA, we review it de novo.  Elba Twp, 493 Mich at 278.  To the extent that it 
involves interpreting the contract between Wyandotte and ETS, this is also a question 
                                              
8 We acknowledge that there may be an issue with regard to whether the “attorney fees” 
requested by Wyandotte are appropriately referred to as such.  In this case, the term 
“attorney’s fees” arises out of a “PAST DUE ACCOUNTS” provision in ETS’s open-
account agreement with Wyandotte and differs from a traditional attorney fees provision.  
For the sake of simplicity, we follow the language used in the contract, and by the parties 
and the Court of Appeals, in continuing to use the term “attorney fees.” 
 
 
13 
subject to review de novo.  Rory v Continental Ins Co, 473 Mich 457, 464; 703 NW2d 23 
(2005).  Our goal in contract interpretation is to give effect to the intent of the parties, to 
be determined first and foremost by the plain and unambiguous language of the contract 
itself.  Id. at 468. 
The PWBA permits an unpaid supplier of materials or labor to “sue on the 
payment bond for the amount, or the balance thereof, unpaid at the time of institution of 
the civil action, prosecute such action to final judgment for the sum justly due him and 
have execution thereon.”  MCL 129.207.  Wyandotte sought payment based on its prior 
contracts with ETS: the open-account agreement enacted in 2003, the bid Wyandotte 
made for the Detroit Public Library project in 2009, and the ensuing purchase orders.  
Wyandotte argued, and the lower courts agreed, that Wyandotte was entitled to the 
unpaid balance on the materials and supplies it had provided as well as further damages 
based on the following two provisions that appeared in the open-account agreement: 
TIME PRICE DIFFERENTIAL  Time price differential charges of 
1-1/2% per month (18% per annum) are calculated on all invoices that are 
not paid and past due 30 days or more.  You will be issued a separate 
invoice detailing these (finance) charges.  
*   *   * 
PAST DUE ACCOUNTS  Accounts that are past due will be taken 
off open account and placed on C.O.D. until their account is brought back 
into current status.  In the event your account is placed in the hands of an 
attorney for collection after default, the customer agrees to pay 33% of the 
unpaid balance for attorney’s fees together with applicable costs. 
The time-price differential provision also appeared on the quote for the library project.  
As an initial matter, defendants maintain that they cannot be liable for either type 
of fee because they were not in contractual privity with Wyandotte and never agreed to 
 
 
14 
pay these fees.  This privity argument is unpersuasive.  Contractual privity is plainly not a 
requirement for recovery under MCL 129.207, which specifically allows a “claimant not 
having a direct contractual relationship with the principal contractor” to seek recovery on 
the payment bond.  Defendants’ privity argument would strip away the PWBA’s 
protection of remote contractors.    
The dispositive question here is rather the meaning of “sum justly due” in 
MCL 129.207.  The statute merely states that a complainant may sue “on the payment 
bond for the amount, or the balance thereof, unpaid” and that a final judgment may be 
rendered for the “sum justly due . . . .”  MCL 129.207.  Neither of these phrases explicitly 
informs us whether the Legislature intended to encompass additional contractual 
provisions, such as time-price differential fees or attorney fees, as part of the sum justly 
due.9 
                                              
9 We recognize Chief Justice YOUNG’s argument in his partial dissent that MCL 129.207 
limits a claimant to recovery of a sum “integrally related to the cost of labor or materials 
furnished for the project.”  We find no statutory support for this conclusion.  Contrary to 
his reading of MCL 129.207, the language “[a] claimant who has furnished labor or 
material in the prosecution of the work provided for in such contract” merely serves to 
identify who may make a claim under the PWBA—a party who has furnished labor or 
materials.  It does not by its plain language place a limit on what such a claimant may 
seek to recover. 
Moreover, we discern little reason for distinguishing between (1) the materials 
price itself; (2) the time-price differential provision, which is related to the materials 
price; and (3) the attorney fees provision, which also constitutes part of the contract bid.  
Wyandotte’s decision to actually price materials at a particular level in the contract bid 
was presumably a function of all the other contract provisions, including those pertaining 
to the time-price differential and attorney fees.  That is, Wyandotte presumably adjusted 
its materials price downward, at least to some degree, on the assumption that all contract 
provisions would be given effect, and it would likely have quoted a higher materials price 
in the bid if it did not have the reasonable assurance that it would be reimbursed at a 
certain rate for delinquent payments (time-price differential) or for litigation required to 
 
 
 
15 
The Court of Appeals considered the scope of the phrase “sum justly due” under 
the PWBA in Price Bros Co v Charles J Rogers Constr Co, 104 Mich App 369; 304 
NW2d 584 (1981).  The plaintiff in Price Bros was retained by a contractor on a public 
works project to provide sewer pipe for installation.  The two contracts at issue related to 
the sewer pipe project and contained the following clause: 
Payment shall be due 30 days after the date of the 
statement.  A service charge of 1-1/2 percent per month on 
the unpaid balance will be due on all amounts unpaid for 30 
days after the due date.  A 5% cash discount is applicable if 
paid within 30 days of the date of statement providing no 
other indebtedness to Price Brothers Company is delinquent.  
[Id. at 376.] 
The Court of Appeals considered whether the service charge constituted a separate 
extension of credit or a “flexible price factor employed to reflect plaintiff’s increased 
costs when its bills are not paid promptly.”  Id. at 377.  The Price Bros Court concluded 
that the service charge fell into the latter category and was recoverable under the PWBA 
as an “integral part of the cost of the transaction” and an “integral part of the contract 
                                              
satisfy outstanding debt (attorney fees).  Accordingly, the attorney fees provision is not 
detached from the materials price; rather, it and the materials price are interrelated, just as 
the time-price differential provision and the materials price are interrelated.  Given that 
Wyandotte is entitled to recover the materials price and the time-price differential, we 
believe Wyandotte is entitled to recover attorney fees as well. 
We also note that our conclusion is consistent with how several federal circuits 
have interpreted the Miller Act.  See United States ex rel Maddux Supply Co v St Paul 
Fire & Marine Ins, 86 F3d 332, 336 (CA 4, 1996) (“The Miller Act does not, by its own 
terms, provide for attorney’s fees or interest.  Several circuits have held, however, that 
interest and attorney’s fees are recoverable if they are part of the contract between the 
subcontractor and supplier.”). 
 
 
16 
between [the parties].”  Id. at 377, 379.  However, the Price Bros Court did not provide 
any justification for the use of this standard or consider other approaches to 
understanding the term “sum justly due.”  We therefore do not find it clarifying in this 
case. 
Wyandotte’s position, and that adopted by the Court of Appeals, is that the sum 
justly due for PWBA purposes is the amount provided for in the claimant’s contract, 
regardless of whether the principal contractor and its surety have agreed to that contract’s 
terms.  An alternative position is to use the value of the labor or materials.  We conclude 
that the former approach is more consistent with the plain language of the PWBA, which 
refers to the “amount . . . unpaid” at the time of institution of the action and does not 
expressly state (or limit) what kinds of damages are recoverable.  This phrase implies a 
previous expectation of payment of a certain sum.  In the absence of any further direction 
from the Legislature regarding how the amount unpaid ought to be determined, the most 
logical recourse is to the claimant’s underlying contract, which best illustrates the intent 
and expectations of the parties to the contract.  The Legislature does not differentiate the 
amount unpaid from the sum justly due, and we understand that sum to be determined 
based on the trial court’s fact-finding as to the amount unpaid.   
Because we use the contract to determine the sum justly due, we must ascertain 
what actually constituted the contract in this case.  There were multiple written 
instruments evidencing the agreement between Wyandotte and ETS: the open-account 
agreement dating back to 2003, the quote for the library project, and the purchase orders 
related to the project.  In our recent opinion in Beck v Park West Galleries, Inc, 499 Mich 
___; ___ NW2d ___ (2016), we acknowledged the general rule that separate agreements 
 
 
17 
are treated separately.  However, when parties enter into multiple agreements relating to 
the same subject-matter, we must read those agreements together to determine the 
parties’ intentions.  Culver v Castro, 126 Mich App 824, 826; 338 NW2d 232 (1983), 
citing Reber v Pearson, 155 Mich 593; 119 NW 897 (1909).  Although the initial open-
account agreement does not relate specifically to the library project, all of these 
agreements are directed to the same end—Wyandotte’s provision of materials to ETS.  
Further, by its terms, the open-account agreement covered all “past, present and future 
unpaid accounts receivable balances” between Wyandotte and ETS.  Together, these 
agreements demonstrate that Wyandotte and ETS intended to enter into an ongoing 
business relationship and they define the scope of that relationship.  We therefore 
conclude that these agreements should be considered together. 
The open-account agreement includes provisions regarding both a time-price 
differential and attorney fees.  The later quote for the library project reiterated the time-
price differential provision but was silent regarding attorney fees.  But because the quote 
did not contradict the attorney fee clause present in the initial agreement, we conclude 
that the documents are not inconsistent and the later quote and purchase orders did not 
supersede the initial agreement.  See Culver, 126 Mich App at 828.  Accordingly, both 
the open-account agreement and the subsequent agreements relating specifically to the 
library project apply here. 
We do not believe that a PWBA claimant’s recovery is limited to the terms of a 
contract or contracts relating to the provision of labor and materials for a specific public 
works project when additional contracts also govern the parties’ relationship with regard 
to that project.  To the extent that the PWBA refers to public works project contracts, it 
 
 
18 
refers to the primary contract between a principal contractor and a governmental unit.  
For example, MCL 129.201, which obliges a principal contractor to obtain a payment 
bond, only discusses this primary contract.  Similarly, MCL 129.203 provides: 
The payment bond shall be in an amount fixed by the governmental 
unit but not less than 25% of the contract amount solely for the protection 
of claimants, as defined in [MCL 129.206], supplying labor or materials to 
the principal contractor or his subcontractors in the prosecution of the work 
provided for in the contract.  [Emphasis added.] 
See also MCL 129.202.  As with MCL 129.201, the phrase “the contract” in 
MCL 129.203 must refer to the primary contract between a principal contractor and a 
governmental unit.  MCL 129.203 directs the principal contractor to obtain a payment 
bond; in stating that the payment bond shall be in an amount not less than 25% of the 
contract amount, the statute clearly indicates that the term “the contract” refers to the 
primary contract, because the principal contractor does not obtain separate payment 
bonds for each lesser contract with a subcontractor.  Therefore, the discussion in 
MCL 129.207 of “[a] claimant who has furnished labor or material in the prosecution of 
the work provided for in such contract in respect of which payment bond is furnished 
under the provisions of [MCL 129.203]” refers to that primary contract yet again.  It does 
not limit a PWBA claimant’s reasonably expected recovery when the claimant is a sub-
subcontractor. 
A sub-subcontractor is, by definition, not a party to the primary contract.  Given 
that the PWBA does not require a sub-subcontractor to be in privity of contract with the 
principal contractor in order to obtain relief, we hold that the PWBA allows a sub-
subcontractor to rely on the terms of the agreement or agreements that govern its 
 
 
19 
relationship with a subcontractor.  There are, of course, scenarios in which a contract 
predating the specific public works project would properly be disregarded under the 
PWBA: namely, when the prior contract is limited in scope and has no bearing on either 
the public works project or any continuing contractual relationship between the involved 
parties.  However, where, as here, the language of an earlier contract indicates that ETS 
and Wyandotte intended it to govern their ongoing business relationship, we consider it 
alongside the specific contracts relating to the public works project. 
At the time Wyandotte commenced this action, ETS had already fallen behind on 
its payments to Wyandotte for the materials it had provided in connection with the library 
project.  The time-price differential referred to in the contracts between Wyandotte and 
ETS was in play, reflecting the increased cost to Wyandotte as ETS’s bills went 
underpaid or unpaid.  Therefore, a time-price differential was part of the amount unpaid 
and due to Wyandotte when it instituted the instant action against defendants.  The trial 
court properly included the time-price differential as part of the judgment in Wyandotte’s 
favor. 
Regarding attorney fees, defendants correctly argue that Michigan follows the 
American rule, which provides that attorney fees are not to be awarded unless specifically 
provided for by a statute, rule, or contractual provision.  Watkins v Manchester, 220 Mich 
App 337, 342; 559 NW2d 81 (1996).  Defendants rely heavily on the fact that the PWBA 
does not expressly provide for an award of attorney fees, but fail to note that the open-
account agreement did in fact have an attorney fees provision.10  And, as noted 
                                              
10 As noted earlier in this opinion, the open-account agreement states that “[i]n the event 
[ETS’s] account is placed in the hands of an attorney for collection after default, [ETS] 
 
 
 
20 
previously, the agreement covered all of ETS’s “past, present and future unpaid accounts 
receivable balances” with Wyandotte.  Thus, the terms of the open-account agreement 
clearly indicate that ETS and Wyandotte intended that the attorney fee clause would 
apply for the duration of their ongoing business relationship.  Therefore, it was not 
improper for the trial court to include attorney fees in its judgment as part of the sum 
justly due.11   
We conclude that, because the underlying contract is the source by which we 
determine what relief a PWBA claimant may seek, Wyandotte is entitled to the time-price 
differential and attorney fees it would have received under its contracts with ETS. 
IV.  INTEREST ON THE JUDGMENT 
The trial court awarded, and the Court of Appeals affirmed, postjudgment interest 
to Wyandotte under MCL 600.6013(7), which provides: 
                                              
agrees to pay 33% of the unpaid balance for attorney’s fees together with applicable 
costs.”   
11 Even though the parties have not raised this issue, in his partial dissent Chief Justice 
YOUNG contends that the attorney fees provision was not triggered before Wyandotte sent 
its 90-day notice to defendants and, therefore, Wyandotte cannot claim attorney fees.  He 
argues that MCL 129.207 limits a claimant’s potential recovery to the amount unpaid 90 
days after supplying the last of the labor or materials in question.  This argument 
fundamentally misunderstands the 90-day provision of MCL 129.207, which merely 
creates a notice requirement.  It does not purport to preclude claimants from recovering 
damages that accrue after the 90-day notice is served.  Chief Justice YOUNG’s partial 
dissent implicitly recognizes this point by agreeing that the time-price differential is 
recoverable under the statute—including the amounts that accrued after Wyandotte sent 
its 90-day notice to KEO on November 1, 2010.  This conclusion is made emphatically 
clear by the first sentence of MCL 129.207, which allows a claimant to seek “the amount, 
or the balance thereof, unpaid at the time of institution of the civil action,” not the amount 
unpaid 90 days after the claimant ceased performance. 
 
 
21 
For a complaint filed on or after July 1, 2002, if a judgment is 
rendered on a written instrument evidencing indebtedness with a specified 
interest rate, interest is calculated from the date of filing the complaint to 
the date of satisfaction of the judgment at the rate specified in the 
instrument if the rate was legal at the time the instrument was executed. If 
the rate in the written instrument is a variable rate, interest shall be fixed at 
the rate in effect under the instrument at the time the complaint is filed.  
The rate under this subsection shall not exceed 13% per year compounded 
annually. 
Defendants contend that this was not the proper section under which to calculate 
interest on the judgment.  We review this question of statutory interpretation de novo and 
seek to effect the Legislature’s intent, turning first to the plain language of the statute.  
See Elba Twp, 493 Mich at 278. 
MCL 600.6013(7) applies when certain criteria are met: the judgment must be 
“rendered on” a written instrument, the instrument must evidence indebtedness, and there 
must be a specified interest rate.  This issue may be resolved based upon the first 
criterion.  “Render” means, in relevant part, “to cause to be or become” and “to hand 
down (a legal judgment).”  Merriam-Webster’s Collegiate Dictionary (11th ed).  To the 
extent that “render” is a technical legal term, to render means “to deliver formally,” when 
undertaken by a judge.  Black’s Law Dictionary (10th ed).12  This restrictive term 
requires the written instrument to be the actual basis of the judgment for 
MCL 600.6013(7) to apply. 
                                              
12 Because both the lay and legal dictionary definitions of “render” are substantially 
similar, we need not determine whether it is a legal term of art or a common term.  See 
Brackett v Focus Hope, Inc, 482 Mich 269, 276; 753 NW2d 207 (2008). 
 
 
22 
The judgment here was not rendered on a written instrument.  Regardless of 
whether the documents evidencing the contract between Wyandotte and ETS can even be 
said to constitute a written agreement for purposes of interest on the judgment, the 
judgment in this case was not rendered on them.  Although the contract between 
Wyandotte and ETS defined the scope of the damages that Wyandotte was entitled to 
seek under the PWBA, the underlying claim was not a contract claim.13  Wyandotte’s 
cause of action did not arise directly out of its contract; it arose out of the PWBA.  
Without the legislatively provided remedy of the PWBA, Wyandotte would not have had 
a claim against defendants.  Therefore, even though the contract between ETS and 
Wyandotte determined the extent of Wyandotte’s recovery, judgment was rendered on 
Wyandotte’s statutory claim rather than on the contract itself.  Because judgment was not 
rendered on a written instrument at all, we need not address whether the written 
instrument in this case evidenced indebtedness at a specified interest rate.  Interest on the 
judgment should instead be calculated under MCL 600.6013(8), the general rule for 
interest on a money judgment in a civil case.  
V.  CONCLUSION 
We conclude that MCL 129.207 did not require actual receipt of notice by the 
principal, that a time-price differential and attorney fees were part of the sum justly due 
to Wyandotte under its contracts, and that interest on the judgment should have been 
                                              
13 By contrast, Wyandotte’s action directly against ETS, which ended in a default 
judgment, was a breach of contract claim.  A judgment in such a case could be said to be 
rendered on the contract. 
 
 
23 
calculated under MCL 600.6013(8) rather than MCL 600.6013(7).  Accordingly, we 
affirm in part and reverse in part the judgment of the Court of Appeals and remand to the 
trial court for entry of a judgment consistent with these holdings. 
 
 
Richard H. Bernstein 
 
Stephen J. Markman 
 
Bridget M. McCormack 
 
 
David F. Viviano 
 
Joan L. Larsen 
S T A T E  O F  M I C H I G A N 
 
SUPREME COURT 
 
 
WYANDOTTE ELECTRIC SUPPLY 
COMPANY, 
 
 
Plaintiff-Appellee, 
 
 
v 
No. 149989 
 
ELECTRICAL TECHNOLOGY SYSTEMS, 
INC., 
 
 
 
Defendant/Cross-Defendant, 
 
and 
 
KEO & ASSOCIATES, INC., 
 
Defendant/Cross-Plaintiff-
Appellant, 
 
and 
 
WESTFIELD INSURANCE COMPANY, 
 
Defendant-Appellant. 
 
 
 
YOUNG, C.J. (concurring in part and dissenting in part). 
 
This case addresses the issue of whether a claimant under the public works bond 
act (PWBA)1 may recover a time-price differential and attorney fees that were permitted 
by its contract with a subcontractor, but were unknown to both the principal contractor 
                                              
1 MCL 129.201 et seq. 
 
 
 
2 
and its surety.  MCL 129.207 of the PWBA allows claimants to recover a sum justly due 
for labor and materials furnished on a public project.  I concur in Parts I and II of the 
majority opinion.  As to Part III, I agree with the majority opinion that the time-price 
differential is recoverable under the statute, but I would hold that the attorney fee award 
is not integrally related to the price of the materials Wyandotte Electric Supply Company 
(Wyandotte) furnished, so it is not recoverable as a sum justly due within the meaning of 
the PWBA.  Accordingly, I dissent from Part III and would reverse that portion of the 
holding of the Court of Appeals that permitted plaintiff to recover attorney fees.  Finally, 
while I agree with the ultimate conclusion, I also dissent from the majority’s reasoning in 
Part IV regarding the award of postjudgment interest.  Wyandotte argues under 
MCL 600.6013(7) that the interest rate specified in its contract with Electrical 
Technology Systems, Inc. (ETS) applies, while defendants argue that the general interest 
rate in MCL 600.6013(8) controls.  I disagree with the majority’s reasoning, but I 
nonetheless concur with the majority’s conclusion that the general interest rate under 
MCL 600.6013(8) applies. 
I.  FACTS AND PROCEDURAL HISTORY2 
Defendant KEO & Associates, Inc. (KEO) was the principal contractor on a 
renovation project at the Detroit Public Library in 2009.  As required under the PWBA, 
defendant Westfield Insurance Company (Westfield) supplied a payment bond and stood 
as surety on the bond. 
                                              
2 Though I concur in the majority’s statement of the facts, I restate the most relevant facts 
here for the sake of clarity. 
 
 
 
3 
KEO subcontracted with defendant ETS to provide labor and materials for 
electrical work on the renovation project.  ETS then subcontracted with plaintiff 
Wyandotte for materials and supplies, making Wyandotte a sub-subcontractor in relation 
to KEO.  ETS and Wyandotte had been in an open-account agreement since 2003, and 
this contract also governed ETS’s purchases from Wyandotte during the library 
renovation.  The contract specified that ETS would pay Wyandotte a time-price 
differential of 1.5% per month (18% per annum) on invoices unpaid after 30 days.  This 
provision represented an interest rate for purchases ETS made on credit.  The contract 
also specified that ETS would pay 33% of any unpaid balance as an attorney fee if 
Wyandotte had to pursue collection litigation after a default. 
Wyandotte submitted a quote to ETS that included the time-price differential 
provision.  ETS accepted this quote by issuing a purchase order to Wyandotte on 
February 19, 2010.  Wyandotte began delivering materials to ETS on March 3, 2010, and 
made its last delivery on September 30, 2010.  Over the course of the project, ETS 
became increasingly behind in its payments to Wyandotte.  Eventually, ETS stopped 
payment altogether and went out of business.  Though KEO claims it paid ETS all that 
was owed, Wyandotte never received full payment from ETS.  As required by the 
PWBA, Wyandotte sent notice to KEO and Westfield on November 1, 2010, claiming it 
was owed $150,762.33 for electrical materials furnished to ETS and the time-price 
differential.  Wyandotte filed a claim with Westfield on January 28, 2011, to recover on 
the payment bond.  Westfield denied the claim. 
Wyandotte filed a PWBA suit against ETS, KEO, and Westfield on March 14, 
2011, and moved for summary disposition.  The trial court granted the motion in part, 
 
 
 
4 
holding that the bond claim was valid and that, under its contract with ETS, Wyandotte 
could recover both the time-price differential and attorney fees.  A bench trial was held 
on the issue of damages.  The trial court held that Wyandotte was owed a balance of 
$154,343.29, a time-price differential of $76,403.44, and attorney fees of $30,000.  
Wyandotte requested postjudgment interest under MCL 600.6013(7), which the trial 
court granted.  The Court of Appeals affirmed this judgment in an unpublished opinion. 
II.  ATTORNEY FEES 
MCL 129.207 of the PWBA reads as follows: 
A claimant who has furnished labor or material in the prosecution of 
the work provided for in such contract in respect of which payment bond is 
furnished under the provisions of [MCL 129.203], and who has not been 
paid in full therefor before the expiration of a period of 90 days after the 
day on which the last of the labor was done or performed by him or 
material was furnished or supplied by him for which claim is made, may 
sue on the payment bond for the amount, or the balance thereof, unpaid at 
the time of institution of the civil action, prosecute such action to final 
judgment for the sum justly due him and have execution thereon.[3] 
When contractors are not fully paid after providing labor or materials for a public 
project, this statute permits them to sue on the payment bond for the amount unpaid at the 
time the civil action is instituted.  The extent of defendants’ statutory liability is the “sum 
justly due.”4  As the majority opinion correctly states, the phrase “amount . . . unpaid”5 
implies a “previous expectation of payment of a certain sum.”  Because the statute gives 
                                              
3 Emphasis added. 
4 MCL 129.207. 
5 Id. 
 
 
 
5 
no further direction on how to calculate the sum justly due, we examine the underlying 
contract to determine the parties’ expectations.  In this case, the open-account agreement 
from 2003, Wyandotte’s quote for the library project, and ETS’s purchase orders for the 
project collectively constitute the basis for determining Wyandotte’s contractual 
expectations.6  I concur with the majority’s analysis of the time-price differential and 
attorney fee issues up to this point and with the majority’s conclusion that the trial court 
properly awarded Wyandotte the time-price differential. 
I dissent from the majority opinion as to its further analysis of, and conclusion 
regarding, the attorney fee provision.  The majority holds that, merely because the 
attorney fee provision was part of the open-account agreement with ETS, the trial court 
appropriately included the attorney fee in its judgment.  This approach treats the PWBA 
as if it creates a statutory breach of contract claim.  I respectfully disagree.  The statute 
only makes compensable the unpaid costs of labor or materials furnished.  Thus, the 
statute limits a claimant’s recovery to the contractual terms that are related to the price of 
labor or materials furnished.  While both the time-price differential and the attorney fee 
provision are listed in Wyandotte’s agreement with ETS, only the former actually relates 
to the cost of furnishing the materials, so the trial court should not have awarded 
Wyandotte an attorney fee. 
                                              
6 Because each instrument was related to the same subject matter (i.e., Wyandotte’s 
provision of materials to ETS), we read these instruments together, as required under 
Culver v Castro, 126 Mich App 824, 826; 338 NW2d 232 (1983), citing Reber v 
Pearson, 155 Mich 593; 119 NW 897 (1909).  Furthermore, the PWBA allows sub-
subcontractors, like Wyandotte, to rely on agreements that govern a continuing 
contractual relationship with a subcontractor, like ETS.   
 
 
 
6 
I would hold that MCL 129.207 requires us to consider whether a provision of an 
underlying contract used to determine the expectancy of the unpaid contractor is 
integrally related to the cost of labor or materials furnished for the project.  MCL 129.207 
allows a claimant to sue on the payment bond for the amount unpaid and recover the sum 
justly due him.  The statute defines the amount unpaid in terms of the cost of labor and 
materials provided on the project, stating that “[a] claimant who has furnished labor or 
material . . . and who has not been paid in full therefor . . . may sue on the payment bond 
for the amount, or the balance thereof, unpaid . . . .”7  In other words, the PWBA entitles 
a claimant to full payment for the labor or materials furnished; a claimant is not entitled 
to full damages that might otherwise be available for a breach of contract claim.  
Therefore, we should hold the principal contractor and surety liable for only those terms 
that are integrally related to the cost of labor or materials supplied, not for any and all 
collateral terms in the underlying contract.  The majority erred by limiting its review 
simply to whether Wyandotte’s claimed damages were allowed by the contract. 
Furthermore, the PWBA limits the claimant’s recovery based on when certain 
price terms are triggered.  MCL 129.207 states: 
A claimant who has furnished labor or material in the prosecution of 
the work . . . and who has not been paid in full therefor before the 
expiration of a period of 90 days after the day on which the last of the labor 
was done or performed by him or material was furnished or supplied by 
him for which claim is made, may sue on the payment bond for the 
amount, or the balance thereof, unpaid at the time of institution of the civil 
action, prosecute such action to final judgment for the sum justly due him 
and have execution thereon.  A claimant not having a direct contractual 
                                              
7 MCL 129.207. 
 
 
 
7 
relationship with the principal contractor shall not have a right of action 
upon the payment bond unless . . . he has given written notice to the 
principal contractor and the governmental unit involved within 90 days 
from the date on which the claimant performed the last of the labor or 
furnished or supplied the last of the material for which the claim is made, 
stating with substantial accuracy the amount claimed and the name of the 
party to whom the material was furnished or supplied or for whom the labor 
was done or performed.[8] 
MCL 129.207 repeatedly refers to a 90-day period after supplying the last of the 
labor or material for which the claim is made.  Based on this language, Wyandotte’s 
“claim is made” for labor or materials furnished for which Wyandotte “has not been paid 
in full therefor before the expiration of a period of 90 days after the day on which the last 
of the . . . material was furnished or supplied . . . .”9  In other words, we must examine the 
price terms in the contract that came due by that 90-day deadline but were not paid in 
full, for which the claimant may then proceed against the payment bond. 
Under this interpretation, Wyandotte’s claim is for the cost of materials furnished, 
limited to the price terms under the contract that came due by the 90-day deadline.  
Notably, the statute required Wyandotte to notify KEO and Westfield of its claim, 
“stating with substantial accuracy the amount claimed . . . .”10  Wyandotte is then entitled 
to sue “for the amount, or the balance thereof, unpaid at the time of institution of the civil 
action . . . .”11  When a claimant receives partial payment between its 90-day notice and 
                                              
8 Id. (emphasis added). 
9 Id. 
10 Id. 
11 Id. 
 
 
 
8 
the institution of its action under the PWBA, the amount unpaid will be less than the 
amount originally claimed in the notice.  In the present case, Wyandotte was paid nothing 
between its 90-day notice and the time it filed its PWBA suit, so the amount unpaid is the 
entire amount owed, based on the price terms in its contract with ETS that triggered by 
the 90-day deadline.12 
The majority claims that the plain language of the statute does not support this 
interpretation.  However, the majority only cites a portion of the statute for this 
contention rather than reading the provision as a whole.  The majority fails to analyze the 
full portion of MCL 129.207 quoted in this opinion, namely that “[a] claimant who has 
furnished labor or material . . . and who has not been paid in full therefor . . . may sue on 
the payment bond for the amount, or the balance thereof, unpaid . . . .”  Thus, the statute 
plainly states that the claimant may only sue for the amount unpaid for labor and 
materials the claimant supplied, thereby limiting the claimant’s recovery to the cost of 
labor and materials supplied.  The majority opinion is internally inconsistent because, 
although the majority acknowledges that Wyandotte’s claim against defendants is not a 
contract claim and does not arise directly out of the contract, the majority uses the 
entirety of the contract as a measure of Wyandotte’s damages.  Instead, the PWBA 
                                              
12 The majority misconstrues my argument, stating, “He argues that MCL 129.207 limits 
a claimant’s potential recovery to the amount unpaid 90 days after supplying the last of 
the labor or materials in question.”  The 90-day deadline does not cap the amount of 
damages that a claimant may recover.  Instead, the deadline merely determines which 
price terms have triggered and, therefore, which categories of damages may be included 
in the claimant’s recovery.  For example, when a time-price differential or similar 
provision is applicable, the amount unpaid may increase between the time the claimant 
gives its 90-day notice and the time the civil action is instituted, as in the present case. 
 
 
 
9 
instructs us to use the contract only to establish Wyandotte’s expectancy regarding the 
cost of labor or materials Wyandotte furnished but was not paid for.13 
The time-price differential is inextricably related to the cost of materials furnished 
for the library project and the provision triggered before Wyandotte gave its 90-day 
notice: it is a part of the price term of the agreement with ETS and the provision applied 
to invoices that went unpaid after 30 days.  In Wyandotte’s contract with ETS, the time-
price differential provision states, “Time price differential charges of 1-1/2% per month 
(18% per annum) are calculated on all invoices that are not paid and past due 30 days or 
more.”  This provision created an interest rate for purchases ETS made on credit, which 
compensated Wyandotte for delayed payment.  Wyandotte included this amount in the 
quote it submitted to ETS as a cost of materials.  The Court of Appeals adequately 
explained in Price Bros Co v Charles J Rogers Constr Co why such a cost differential is 
closely related to the expectancy that is properly considered as the sum justly due under 
the PWBA: 
[T]he differential is an integral part of the cost of the transaction. If the 
buyer pays cash, the seller receives the money immediately and no burden 
is placed on him. If the buyer elects to purchase on credit, the seller is 
                                              
13 I am not persuaded by the majority’s argument, citing United States ex rel Maddux 
Supply Co v St Paul Fire & Marine Ins, 86 F3d 332 (CA 4, 1996), that certain federal 
circuit courts have interpreted the Miller Act, 40 USC 3131 et seq., to allow recovery of 
attorney’s fees.  In Maddux Supply Co, the Fourth Circuit specifically noted that allowing 
recovery of attorney’s fees was consistent with its prior rulings “that contractors and their 
sureties are obligated to pay amounts owed by their subcontractors to suppliers.”  Id. at 
336.  The PWBA does not require a general contractor or its surety to pay the amount 
owed by a subcontractor to a sub-subcontractor.  Instead, as I have explained, the PWBA 
explicitly limits recovery to the amount unpaid for labor or materials furnished.  See 
MCL 129.207. 
 
 
 
10 
burdened by the interruption to its cash flow, and so the buyer may pay a 
“price” for the benefit of receiving the materials without paying for them 
immediately.[14] 
Accordingly, the time-price differential is an integral part of the sum justly due for 
materials Wyandotte supplied on the renovation project because it establishes an interest 
rate that directly relates to the price of the materials Wyandotte furnished when ETS paid 
on credit. 
 
In contrast, the attorney fee is not closely associated with the cost of materials 
furnished for the library project.  The attorney fee provision in the contract states, “In the 
event your account is placed in the hands of an attorney for collection after default, the 
customer agrees to pay 33% of the unpaid balance for attorney’s fees together with 
applicable costs.”  The language of this provision indicates that attorney fees are 
unrelated to the cost of materials because, unlike the time-price differential, they bear no 
relation to the cost of supplying labor or materials.  The attorney fee provision creates a 
penalty for collection efforts rather than determining Wyandotte’s expectancy—i.e., the 
price ETS owed for materials Wyandotte supplied.  Indeed, it does not appear to be an 
attorney fee provision at all, because it does not define itself in terms of actual or 
reasonable attorney fees.  It is, in fact, a liquidated damages clause that plaintiff could 
invoke if it placed an overdue debt into the hands of a collecting attorney.15  Because this 
                                              
14 Price Bros Co v Charles J Rogers Constr Co, 104 Mich App 369, 377; 304 NW2d 584 
(1981) (emphasis added). 
15 See UAW-GM Human Resource Ctr v KSL Recreation Corp, 228 Mich App 486, 508; 
579 NW 2d 411 (1998) (“A liquidated damages provision is simply an agreement by the 
parties fixing the amount of damages in case of a breach.”).  In this agreement, if ETS 
breaches by defaulting on its payments and Wyandotte must litigate to recover the 
 
 
 
 
11 
provision describes a liquidated collection cost rather than a cost of the labor or materials 
themselves, it is not part of the sum justly due. 
Furthermore, the attorney fee provision did not trigger by the 90-day deadline.  In 
its 90-day notice to KEO and Westfield, dated November 1, 2010, Wyandotte claimed 
that the amount owed included the cost of materials furnished to ETS and the time-price 
differential.  Wyandotte did not claim that it was owed an attorney fee because the 
provision had not yet triggered—Wyandotte did not sue ETS, KEO, and Westfield until 
March 14, 2011, which was well after the 90-day period that began to run on September 
30, 2010.  Thus, Wyandotte’s “amount claimed”16 does not include an attorney fee 
because not only is the attorney fee provision not a price term related to the cost of 
                                              
amount owed, the attorney fee provision fixes Wyandotte’s damages: Wyandotte may 
recover the unpaid balance plus an additional 33% of that unpaid balance.  In regard to 
attorney fee provisions and liquidated damages clauses, Williston on Contracts states: 
It is a common provision in promissory notes, and an occasional 
stipulation in other kinds of contracts, especially mortgages, that in case of 
breach, the promisor will pay an attorney’s fee, the percentage or amount of 
which is sometimes stated, for enforcing the obligation.  There seems no 
occasion to distinguish between mortgages and other contracts with 
reference to such a provision, which is clearly in the nature of a liquidated 
damages provision. 
*   *   * 
The contract sometimes makes no provision concerning the amount 
of the stipulated fee; sometimes it fixes a sum, either by stating a 
percentage of the principal debt or by stating a lump sum.  [24 Williston, 
Contracts (4th ed), § 65:23, pp 319-324 (emphasis added; citations 
omitted).] 
16 MCL 129.207. 
 
 
 
12 
materials Wyandotte furnished, as already explained in this opinion, but the provision 
also did not trigger by the 90-day deadline. 
Therefore, while I agree with the majority that the time-price differential was 
properly included in Wyandotte’s award, I would hold that Wyandotte is not entitled to 
the attorney fee award because it is not directly related to the cost of materials it supplied.  
The attorney fee provision also triggered after the 90-day deadline created by the statute. 
III.  POSTJUDGMENT INTEREST 
There are two relevant statutes on postjudgment interest in this case.  Defendants 
argue that postjudgment interest should have been calculated under the default formula 
given in MCL 600.6013(8).17  Instead, the trial court awarded Wyandotte postjudgment 
interest under MCL 600.6013(7), which states: 
For a complaint filed on or after July 1, 2002, if a judgment is 
rendered on a written instrument evidencing indebtedness with a specified 
interest rate, interest is calculated from the date of filing the complaint to 
the date of satisfaction of the judgment at the rate specified in the 
instrument if the rate was legal at the time the instrument was executed.  If 
the rate in the written instrument is a variable rate, interest shall be fixed at 
the rate in effect under the instrument at the time the complaint is filed.  
                                              
17 MCL 600.6013(8) states: 
Except as otherwise provided in subsections (5) and (7) and subject 
to subsection (13), for complaints filed on or after January 1, 1987, interest 
on a money judgment recovered in a civil action is calculated at 6-month 
intervals from the date of filing the complaint at a rate of interest equal to 
1% plus the average interest rate paid at auctions of 5-year United States 
treasury notes during the 6 months immediately preceding July 1 and 
January 1, as certified by the state treasurer, and compounded annually, 
according to this section. 
 
 
 
13 
The rate under this subsection shall not exceed 13% per year compounded 
annually.[18] 
MCL 600.6013(7) only applies when the judgment is rendered on a written 
instrument.  According to the majority, this means MCL 600.6013(7) only applies if the 
written instrument is the actual basis of the judgment.  However, I believe that the 
majority mistakenly concludes that the judgment was rendered on the PWBA rather than 
on a written instrument.  As noted in the majority opinion and earlier in this opinion, 
although the PWBA creates Wyandotte’s cause of action, the trial court must examine the 
underlying agreement between Wyandotte and ETS to determine what sum is justly due.  
The agreement here is as much the basis for the trial court’s judgment as the statute itself, 
so the judgment is rendered on a written instrument.  Therefore, I believe it is most 
accurate to say the trial court’s judgment is rendered pursuant to the statute, but it is 
rendered on the underlying contract. 
But there is an even more compelling reason to reject MCL 600.6013(7) as the 
basis for determining postjudgment interest.  MCL 600.6013(7) does not apply because 
the underlying contract does not evidence indebtedness.  MCL 600.6013(7) only applies 
“if a judgment is rendered on a written instrument evidencing indebtedness with a 
specified interest rate . . . .”19  In this case, the agreement between Wyandotte and ETS 
did not evidence indebtedness for the simple reason that ETS did not owe plaintiff 
anything on the construction project at the time they entered into the agreement.  Rather, 
                                              
18 Emphasis added. 
19 Emphasis added. 
 
 
 
14 
the agreement merely provided structure for calculating a potential future debt.  The plain 
language of MCL 600.6013(7) requires that the written instrument provide evidence of an 
existing debt, not evidence of a potential debt.  “Evidence of indebtedness” is a term of 
art.20  Indeed, when our statutes use the phrase “evidence of indebtedness,” they do so in 
contemplation of debt-bearing contracts or notes.21  I therefore concur with the majority 
that the general interest rate under MCL 600.6013(8) applies, but I do so because the 
underlying contract does not provide evidence of indebtedness as required by 
MCL 600.6013(7). 
IV.  CONCLUSION 
 
I do not believe Wyandotte is entitled to attorney fees.  The so-called attorney fees 
specified in Wyandotte’s agreement with ETS are not related to the price of the materials 
                                              
20 See MCL 8.3a (“[T]echnical words and phrases, and such as may have acquired a 
peculiar and appropriate meaning in the law, shall be construed and understood according 
to such peculiar and appropriate meaning.”). 
21 See Const 1963, art 9, § 31 (“The limitations of this section shall not apply to taxes 
imposed for the payment of principal and interest on bonds or other evidence of 
indebtedness . . . .”); MCL 12.272(d) (“ ‘Bond’ means a bond, note, financial instrument, 
or other evidence of indebtedness or obligation issued by the authority under this act.”); 
MCL 41.284 (“In lieu of borrowing money and issuing bonds or other evidence of 
indebtedness . . . .”); MCL 120.15 (“[T]he commission is authorized and empowered to 
issue notes, bonds or other evidences of indebtedness which shall be a lien upon the 
property to be acquired . . . .”); MCL 207.634 (“Bonds, obligations, or other evidences of 
indebtedness of the local governmental unit . . . .”); MCL 324.50102(3) (“ ‘Bond’ means 
a bond, note, or any other instrument issued to evidence indebtedness.”); 
MCL 388.981b(1) (“The state administrative board may authorize and approve an interest 
rate exchange or swap, hedge, or similar agreement or agreements in connection with the 
issuance of bonds, notes, or commercial paper issued under this act or in connection with 
outstanding bonds, notes, or commercial paper, or other obligations or evidence of 
indebtedness of this state under this act.”). 
 
 
 
15 
Wyandotte furnished nor did the provision trigger by the statute’s 90-day deadline.  
Therefore, I would hold that attorney fees are not recoverable as a sum justly due and 
reverse the Court of Appeals on this issue.  Furthermore, I do not agree with the 
majority’s reasoning regarding the award of postjudgment interest.  Nevertheless, I 
concur with the majority’s conclusion that postjudgment interest should have been 
calculated under MCL 600.6013(8) rather than MCL 600.6013(7). 
 
 
Robert P. Young, Jr. 
S T A T E  O F  M I C H I G A N 
 
SUPREME COURT 
 
 
WYANDOTTE ELECTRIC SUPPLY 
COMPANY, 
 
 
Plaintiff-Appellee, 
 
 
v 
No. 149989 
 
ELECTRICAL TECHNOLOGY SYSTEMS, 
INC., 
 
 
 
Defendant/Cross-Defendant, 
 
and 
 
KEO & ASSOCIATES, INC., 
 
Defendant/Cross-Plaintiff-
Appellant, 
 
and 
 
WESTFIELD INSURANCE COMPANY, 
 
Defendant-Appellant. 
 
 
 
ZAHRA, J. (concurring in part and dissenting in part). 
This case primarily addresses a single statute, MCL 129.207, under the public 
works bond act (PWBA).1  I agree with my colleagues that this statute does not require a 
claimant to provide actual notice of his or her claim to the principal contractor.  A 
claimant need only provide notice “by mailing the same by certified mail, postage 
                                              
1 MCL 129.201 et seq. 
 
 
 
2 
prepaid, in an envelope addressed to the principal contractor . . . .”2  Wyandotte Electric 
Supply Company satisfied the statutory requirements of notice in this case.  I therefore 
agree with Part II of the majority opinion.  I write separately because I disagree with 
majority’s conclusion that Wyandotte may claim attorney fees and a time-price 
differential under the payment bond.  And while I agree that MCL 600.6013(8) should 
govern the calculation of postjudgment interest in this case, I disagree with my 
colleagues’ reasoning for rejecting use of MCL 600.6013(7).  
I.  ATTORNEY FEES AND THE TIME-PRICE DIFFERENTIAL  
My disagreement with the majority arises under the first sentence of 
MCL 129.207, which states: 
A claimant who has furnished labor or material in the prosecution of 
the work provided for in such contract in respect of which payment bond is 
furnished under the provisions of section 3, and who has not been paid in 
full therefor before the expiration of a period of 90 days after the day on 
which the last of the labor was done or performed by him or material was 
furnished or supplied by him for which claim is made, may sue on the 
payment bond for the amount, or the balance thereof, unpaid at the time of 
institution of the civil action, prosecute such action to final judgment for 
the sum justly due him and have execution thereon.[3] 
The majority views the “sum justly due” under this statute as “the amount 
provided for in the claimant’s contract, regardless of whether the principal contractor and 
                                              
2 MCL 129.207. 
3 Under, MCL 129.206, the term “claimant” means “a person having furnished labor, 
material, or both, used or reasonably required for use in the performance of the contract.”  
For purposes of this opinion, a claimant who lacks a direct contractual relationship with 
the principal contractor, such as plaintiff Wyandotte, is referred to as a “remote 
subcontractor” while a claimant who has a direct contractual relationship with the 
principal contractor is referred to as a “subcontractor.” 
 
 
 
3 
its surety have agreed to that contract’s terms.”4  The majority adopts this view not based 
on the language of the statute, but rather the “the absence of any further direction from 
the Legislature regarding how the amount unpaid ought to be determined . . . .”5  The 
majority then compensates for this supposed Legislative shortcoming by imposing its 
own view that “the most logical recourse is to the claimant’s underlying contract, which 
best illustrates the intent and expectations of the parties to the contract.”6 
The majority’s analysis rests on a false premise.  The principal contractor, KEO & 
Associates, Inc., was not a party to the claimant’s underlying contract.  The contract 
between subcontractor Electrical Technology Systems, Inc. (ETS) and remote 
subcontractor Wyandotte can only illustrate the intent and expectations of ETS and 
Wyandotte.  Indeed, KEO did not contractually agree to pay any of its subcontractors, 
including ETS, a time-price differential or attorney fees, and there is no basis from which 
to conclude that KEO would have agreed to pay a time-price differential or attorney fees 
to a party with whom it had no contractual relationship. 
There is no dispute among my colleagues that MCL 129.207 provides a remote 
subcontractor with a right of action on the payment bond even though it lacks a direct 
contractual relationship with the principal contractor.  However, simply because a remote 
subcontractor may sue on the payment bond under MCL 129.207 does not suggest that its 
claim is determined by a contract to which the principal contractor who furnished the 
                                              
4 Ante at 16. 
5 Ante at 16. 
6 Ante at 16.  
 
 
 
4 
payment bond was not a party.  The only contract mentioned by the Legislature in 
MCL 129.207 is the “contract in respect of which payment bond is furnished,” which 
necessarily cannot include a remote subcontractor.  Under Michigan law, a remote 
contractor’s claim arises solely under the PWBA, which alone forms the basis to assess 
its claim.   
Further, MCL 129.207 does not suggest that the principal contractor must wholly 
indemnify claimants under the PWBA.  Rather, MCL 129.207 refers to the extent of a 
principal contractor’s liability under the payment bond by identifying the claimant’s 
“labor or material in the prosecution of the work,” for which the claimant “has not been 
paid in full therefor before the expiration of a period of 90 days after the day on which 
the last of the labor was done or performed by him or material was furnished or supplied 
by him for which claim is made . . . .”  This provision identifies the labor and materials 
that form the basis of the “amount, or the balance thereof, unpaid at the time of institution 
of the civil action” that the claimant may bring such action for “the sum justly due 
him . . . .”  While a subcontractor has an actual contract with the principal contractor to 
determine the labor and materials it may seek to recoup under the payment bond, a 
remote contractor does not have a direct contractual relationship with the principal 
contractor.  For this reason, MCL 129.207 provides, in regard to remote subcontractors, 
that the claimant must provide notice “within 90 days from the date on which the 
claimant performed the last of the labor or furnished or supplied the last of the material 
for which the claim is made, stating with substantial accuracy the amount claimed and the 
name of the party to whom the material was furnished or supplied or for whom the labor 
was done or performed.”  This notice, as in this case, identifies the labor and materials 
 
 
 
5 
that the remote contractor has supplied.  The “sum justly due” thus includes the labor and 
materials previously identified in the 90-day notice that the claimant has supplied but for 
which the claimant has not been paid.  The only other statutory basis to impose liability 
on the payment bond is MCL 129.206, which provides that “ ‘[l]abor and material’ 
includes that part of water, gas, power, light, heat, oil, gasoline, telephone service or 
rental of equipment directly applicable to the contract.”  That the Legislature expressly 
provided for recovery of these incidental expenses, and these incidental expenses alone, 
strongly suggests that incidental expenses not expressly identified are not recoverable as 
“labor and material.”7 
To the extent that attorney fees and a time-price differential may even be 
considered incidental damages, as opposed to remote damages, they are simply not 
recoverable.  Further, and perhaps more telling, is that even expenses expressly identified 
cannot be recovered unless they are “directly applicable to the contract.”8  Again, the 
only contract mentioned in MCL 129.207 is the “contract in respect of which payment 
bond is furnished . . . .”  No real argument can be made that attorney fees are directly 
related to the contract in respect of which payment bond is furnished.9  And while a 
                                              
7 Under the doctrine of expressio unius est exclusio alterius, the express mention in a 
statute of one thing implies the exclusion of other similar things.  In re MCI Telecom 
Complaint, 460 Mich 396, 415; 596 NW2d 164 (1999).  As applied to statutory 
interpretation, the doctrine reflects, “among other things, a legislative intent not to create 
liability outside the extent to which the legislature has acted.”  22 Mich Civ 
Jurisprudence, Statutes, § 194.   
8 MCL 129.206. 
9 On this point, I am in agreement with Chief Justice YOUNG’s partial concurrence and 
dissent.  As he states, ante at 10-11:  
 
 
 
 
6 
colorable argument can be made that a time-price differential is directly applicable to the 
contract, a time-price differential is not identified by the Legislature as “[l]abor and 
material” costs that may be recovered.10 
Further, MCL 129.203 provides: 
The payment bond shall be in an amount fixed by the governmental 
unit but not less than 25% of the contract amount solely for the protection 
of claimants, as defined in [MCL 129.206], supplying labor or materials to 
the principal contractor or his subcontractors in the prosecution of the work 
provided for in the contract. 
The principal contractor’s liability to remote contractors under the PWBA is solely 
based on the payment bond.  The amount of the payment bond is fixed by the 
governmental unit at no less than 25% of the contract.  If a claimant successfully sues on 
the payment bond and exhausts the payment bond, which may represent as little as 25% 
of the contract, a remote contractor that later sues no longer has no legal recourse to 
recover against the bond furnished by the principal contractor.  Remote subcontractors 
                                              
The language of [the attorney fee provision] indicates that attorney fees are 
unrelated to the cost of materials because, unlike the time-price differential, 
they bear no relation to the cost of supplying labor or materials.  The 
attorney fee provision creates a penalty for collection efforts rather than 
determining Wyandotte’s expectancy—i.e., the price ETS owed for 
materials Wyandotte supplied.  Indeed, it does not appear to be an attorney 
fee provision at all, because it does not define itself in terms of actual or 
reasonable attorney fees.  It is, in fact, a liquidated damages clause that 
plaintiff could invoke if it placed an overdue debt into the hands of a 
collecting attorney.  Because this provision describes a liquidated collection 
cost rather than a cost of the labor or materials themselves, it is not part of 
the sum justly due.  
10 See MCL 129.206. 
 
 
 
7 
only have a right to sue the principal contractor on the bond because the PWBA permits a 
suit despite the absence of a direct contractual relationship.  Significantly, any awards 
received under the PWBA cannot cumulatively exceed the amount of the payment bond. 
This limitation of the principal contractor’s liability to remote subcontractors is 
precisely the reason that the PWBA does not provide for remote subcontractors to seek to 
enforce any and all collateral terms in the underlying contract.  If a single claimant or 
several claimants exhaust the payment bond through an award of a time-price differential 
and attorney fees, another remote contractor may not be able to recoup the actual labor 
and materials it supplied for the public project.  By green-lighting the recovery of remote 
damages found in the underlying contracts between subcontractors and remote 
subcontractors, the majority arbitrarily countenances the shortchanging of other remote 
contractors.  In my view, this effectively thwarts the Legislature’s intent that the payment 
bond be used “solely for the protection of claimants . . . .”  MCL 129.203.  The majority 
has clearly departed from the statutory language by imposing liability for the amount 
provided for in the claimant’s contract, regardless of whether the principal contractor and 
its surety have agreed to that contract’s terms. 
II.  POSTJUDGMENT INTEREST 
The trial court awarded Wyandotte postjudgment interest under MCL 
600.6013(7)11 at the time-price differential rate specified in the contract between 
                                              
11 MCL 600.6013(7) provides: 
For a complaint filed on or after July 1, 2002, if a judgment is 
rendered on a written instrument evidencing indebtedness with a specified 
interest rate, interest is calculated from the date of filing the complaint to 
 
 
 
 
8 
Wyandotte and ETS.  Because I disagree that Wyandotte is entitled to a time-price 
differential under the PWBA, I would reverse the trial court’s award of postjudgment 
interest on that basis alone.  The majority concluded MCL 600.6013(7) does not apply 
here because the judgment was not rendered on a written instrument.  Accordingly, the 
majority concluded that postjudgment interest must be calculated under the general 
statute for determining interest on a money judgment in a civil case, MCL 600.6013(8).  I 
agree with the majority that MCL 600.6013(8) should govern the calculation of 
postjudgment interest, but I disagree with the majority that “[t]he judgment here was not 
rendered on a written instrument.”12  
The majority holds that judgment was rendered on Wyandotte’s statutory claim 
rather than on the contract itself.  This holding misses the entire point of the PWBA.  
MCL 129.207 expressly provides that a claimant “may sue on the payment bond . . . .”13   
The payment bond provides that KEO and Westfield Insurance Company  
are held and firmly bound unto Detroit Public Library . . . as Obligee . . . 
for the use and benefit of claimants . . . in the amount of . . . 
$1,302,040.00 . . . for the payment whereof [KEO] and [Westfield] bind 
themselves, their heirs, executors, administrators, successors and assigns, 
jointly and severally, firmly by these presents. 
                                              
the date of satisfaction of the judgment at the rate specified in the 
instrument if the rate was legal at the time the instrument was executed.  If 
the rate in the written instrument is a variable rate, interest shall be fixed at 
the rate in effect under the instrument at the time the complaint is filed. The 
rate under this subsection shall not exceed 13% per year compounded 
annually.  [Emphasis added.] 
12 Ante at 22. 
13 Emphasis added. 
 
 
 
9 
The payment bond expressly incorporates the contract between KEO and the 
library, and then provides: 
THE CONDITION OF THIS OBLIGATION is such that if [KEO] shall 
promptly make payment to all claimant, as defined in [the PWBA], who 
have complied with all the provisions of the [PWBA], for labor and 
materials used in the performance of the Contract, then this obligation shall 
be void; otherwise it shall remain in full force and effect. 
The payment bond is clearly an “instrument” in that it is a “written legal document 
that defines rights, duties, entitlements, or liabilities . . . .”14  But regardless of whether a 
payment bond that secures future payment may be considered a written instrument 
“evidencing indebtedness,” neither the payment bond nor the contract incorporated by the 
payment bond contain “a specified interest rate.”15  Therefore, while I disagree with my 
colleagues’ reasoning on this issue,16  I nonetheless agree with the result reached that 
interest on the judgment should be calculated based on MCL 600.6013(8). 
III.  CONCLUSION 
 
I agree with the majority that a claimant need not provide actual notice to the 
principal contractor under the PWBA.  I disagree with the majority however that the 
PWBA entitles a claimant to the amount provided for in the claimant’s contract, 
regardless of whether the principal contractor and its surety have agreed to that contract’s 
                                              
14 Black’s Law Dictionary (10th ed).   
15 MCL 600.6013(7). 
16 I also disagree with Chief Justice YOUNG that  the agreement between Wyandotte and 
ETS was as much the basis for the trial court’s judgment as the statute itself.   
 
 
 
10 
terms.  Rather, a claimant’s recovery is limited to labor and materials under the PWBA, 
and does not include incidental expenses not provided for by the PWBA, such as time-
price differentials and attorney fees.  Finally, I agree with the majority’s conclusion that 
interest on the judgment should be calculated based on MCL 600.6013(8).  Under the 
PWBA, judgment is rendered on the payment bond, which is a written instrument 
evidencing indebtedness.  But because this bond contained no specified interest rate, 
MCL 600.6013(7) does not apply. 
 
 
Brian K. Zahra