Opinion ID: 527147
Heading Depth: 2
Heading Rank: 1

Heading: Alabama's Public Works Statute

Text: 23 Alabama's Public Work statute, Sec. 39-1-1, requires public contractors to execute a bond which secures payment to individuals who furnish labor and materials in the performance of government contracts. Universal Elec. Constr. Co. v. Robbins, 239 Ala. 105, 194 So. 194, 198 (1940) (interpreting predecessor statute); Headley v. Housing Auth. of Prattville, 347 So.2d 532, 534-35 (Ala.Civ.App.1977); Ala.Code Sec. 39-1-1 (1988). The statute, which is patterned after and interpreted in accord with the federal Miller Act, 40 U.S.C. Secs. 270a-270d, is highly remedial in nature and is liberally construed to effectuate its purpose of ensuring that suppliers receive full compensation for the abor or materials they provide to public works projects. Sumlin v. Hagen Storm Fence Co., 409 So.2d 818, 820 (Ala.1982); Headley, 347 So.2d at 535; see also United States v. Aetna Ins. Co., 831 F.2d 978, 980 (11th Cir.1987) (construing Miller Act); United States v. Glassman, 397 F.2d 8, 10 (4th Cir.1968) (same). Because the purpose of the Alabama statute and the Miller Act are identical, both are interpreted in the same manner. Price v. H.L. Coble Constr. Co., 317 F.2d 312, 315 (5th Cir.1963); Headley, 347 So.2d at 534-35. Thus, because the body of Alabama law interpreting Sec. 39-1-1 is limited, federal courts' interpretations of the Miller Act will primarily guide our analysis of the questions raised under Sec. 39-1-1 in this appeal. 24 The principal issue raised is whether the facts establish that Trane has relinquished its statutory right to payment for the chiller under the payment bond. It is undisputed that Trane is entitled to payment for the chiller unless Whitehurst-Lassen and USF & G assert and prove a valid defense. 10 The district court's opinion, which denies Trane recovery, relies upon, and is a conglomeration of, the following three defenses: waiver, novation, and estoppel. 11 Our task is to determine whether the record evidence supports the district court's findings under the appropriate legal standard. 25 The legal standard for determining whether a supplier has relinquished its statutory rights is firmly established: absent a novation or clear expression to the contrary, a supplier does not forfeit its right to sue under the public works statute. United States v. Forrester, 441 F.2d 779, 782 (5th Cir.1971); Warrior Constructors Inc. v. Harders, Inc., 387 F.2d 727, 729 (5th Cir.1967). 26 The right to sue on a surety bond is a right created by statute, and in the absence of a novation or clear expression to the contrary, the contention that there has been a waiver or release of that right must fail. 27 Forrester, 441 F.2d at 782; Warrior, 387 F.2d at 729. Thus, absent a novation, waiver, estoppel, or other clear and explicit relinquishment of the statutory right, a supplier is entitled to pursue payment under a bond. Glassman, 397 F.2d at 10 (express waiver must be both clear and explicit); see also Forrester, 441 F.2d at 783 (estoppel a valid defense under the Miller Act); Glassman, 397 F.2d at 11 (same); Graybar Elec. Co. v. John A. Volpe Constr. Co., 387 F.2d 55, 59 (5th Cir.1967) (same); United States v. James Stewart Co., 336 F.2d 777, 779 (9th Cir.1964) (same). 28 Based on this strict legal standard and our review of the record, we hold that the evidence fails to support the district court's legal conclusion that Trane clearly and explicitly relinquished its right to recover under the payment bond. Whitehurst-Lassen and USF & G failed to provide a sufficient evidentiary base to support a defense based on either a novation, waiver or estoppel theory. Our review of the district court's order indicates that the court's erroneous legal conclusion arises from its intermingling the analysis of these three defenses rather than analyzing them separately. We therefore analyze each defense individually.