Opinion ID: 546198
Heading Depth: 2
Heading Rank: 2

Heading: The Miller Act Claim

Text: 36 The Miller Act requires government contractors to post payment bonds for the protection of all persons supplying labor or material in the prosecution of work provided for under certain federal construction projects. See 40 U.S.C. Secs. 270a, 270b. Miller Act bonds provide to workers and contractors on federal projects a remedy similar to the protection available under state mechanic lien statutes and similar laws from which federal property is exempt. F.D. Rich Co. v. Industrial Lumber Co., 417 U.S. 116, 122, 94 S.Ct. 2157, 2161, 40 L.Ed.2d 703 (1974). Under section 270b, persons may sue for the sum or sums justly due for labor or material used in the federal project. 37 The district court found that standby time is not labor or material under the Miller Act. That determination is a legal issue subject to independent review. Id. at 118, 94 S.Ct. at 2159. Eastern has argued with some force in this court that under the circumstances of this case standby time is labor or material under the Miller Act. However, we need not reach this issue since appellant has failed to prove that payment is justly due for the standby time. 38 [I]t was not the intention of Congress to extend or enlarge the liability of the surety [under a Miller Act bond] beyond the contractual or quasi-contractual obligations of the contractor who remains primarily liable. United States ex rel. Harrington v. Trione, 97 F.Supp. 522, 526 (D.Colo.1951). There must be some legally sufficient reason to justify the use of quantum meruit, or any contractor upon seeing that he had made a bad bargain would seek compensation for the reasonable value of its services, and not the amount provided for in the contract. United States ex rel. F.E. Robinson Co. of North Carolina v. Alpha-Continental, 273 F.Supp. 758, 777 (E.D.N.C.1967), aff'd, 404 F.2d 343 (4th Cir.1968). 39 As stated above, we discern no error in the district court's judgment that Eastern failed to prove by a preponderance of the evidence that Metzger breached the contract. The district court also found that Eastern is not entitled to quantum meruit recovery under the Miller Act. 40 Liability under the doctrine of quasi-contract arises by implication from the specific facts and circumstances unique to each case. Id. Although the remedy of quantum meruit was developed as part of the common law of contracts to avoid unjust enrichment under a contract implied by law, equitable considerations influence the determination of whether recovery is warranted in a given case. Constantino v. American S/T Achilles, 580 F.2d 121, 123 n. 2 (4th Cir.1978) (citing 12 Williston on Contracts Sec. 1485, at 307 (Jaeger ed. 1970)) (in turn quoting Wellston Coal Co. v. Franklin Paper Co., 57 Ohio St. 182, 48 N.E. 888, 889 (1897)). See also Black's Law Dictionary 1119 (5th ed. 1979); E. Farnsworth, Contracts 98-99 (1982). The duty to pay arises not from the intent of the parties but from the law of natural justice and equity. 41 We agree with the district court that Eastern is not entitled to quantum meruit recovery since Eastern chose to reap the benefits of completing the contract and accepting an extension on the same terms rather than pursuing its right, assuming one could be implied under the contract, to be compensated for standby time in excess of six days on each trip regardless of Metzger's diligence in unloading the stone. The record reflects that Eastern neither stopped its performance nor reserved its right to do so. Even assuming arguendo that Metzger's attempts to rectify the delays did not completely relieve the financial strain of the delays in excess of six days, Eastern elected its remedy and cannot complain that it should be compensated in quantum meruit under the Miller Act. United States ex rel. Harkol, Inc. v. Americo Constr. Co., 168 F.Supp. 760, 761 (D.Mass.1958). See also, Annotation, Quantum Meruit Recovery by Subcontractor Under Miller Act, 26 A.L.R.Fed. 746, 762-63 (1976). Cf. H.B. Zachry Co. v. Travelers Indem. Co., 391 F.2d 43, 48 (5th Cir.1968) ([subcontractor] 'entitled to choose between the prize of further employment with the pecuniary and other advantages that may flow from it, and the prize of freedom from [its] own liabilities under the contract' ) 14 (quoting 5 Williston on Contracts Sec. 688, at 302 (3d ed. 1961); Id. at Sec. 687, p. 292; Sec. 695, p. 336 (laches can bar equitable remedy used to enforce a legal right).