Opinion ID: 1125632
Heading Depth: 1
Heading Rank: 4

Heading: 143 So. at 916.

Text: Finally, we think it relevant to note, in passing, that CIC's actual liability under each bond is, in all probability, less than $150,000, the amount of Lucas' admitted authority. On the labor and materials bond, CIC's liability, including attorneys' fees, was found to be $93,892.53. On the performance bond, its liability, excluding attorneys' fees, was found to be $128,238.97. The attorneys' fees awarded were $40,000.00 and caused the liability to exceed $150,000. That award of attorneys' fees may, however, be reduced as a result of our answer to the third question. Here, CIC is attempting to avoid liability even for the amount of bonds which it admits Lucas had written authorization to write. 3. If the bonds are valid and enforceable is Talladega entitled to an award of attorney fees with respect to either or both bonds? CIC concedes that Tit. 50, § 16, Code of Alabama of 1940 (Recompiled 1958), mandates awarding attorneys' fees to claimants under a labor and materials bond. Consequently, the only question presented is whether Talladega, as the obligee on a performance bond executed pursuant to Tit. 50, § 16, is likewise entitled to an award of attorneys' fees incurred in enforcing the bond. The general rule is that, in the absence of statute, contract, or recognized equitable grounds, there is no right to recover attorneys' fees from an opposing party, either as costs or as damages. Hartford Accident & Indemnity Co. v. Cosby, 277 Ala. 596, 173 So.2d 585 (1965); Mason v. City of Albertville, 276 Ala. 68, 158 So.2d 924 (1963); Inland Mutual Insurance Co. v. Hightower, 274 Ala. 52, 145 So.2d 422 (1962). Talladega argues that the provisions in Tit. 50, § 16, regarding attorneys' fees are ambiguous and may be interpreted to require awarding of attorneys' fees to the obligee on a performance bond. Our reading of Tit. 50, § 16, does not disclose an ambiguity. From the following portion of § 16, it seems clear to us that the provision for attorneys' fees applies only to labor and materials bonds: Any person, firm or corporation entering into a contract with the state or any county or municipal corporation or subdivision thereof in this state for the repair, construction or prosecution of any public buildings or public work, highways or bridges, shall be required, before commencing such work, to execute a performance bond, with penalty equal to fifty percent of the amount of the contract price, and in addition thereto, another bond with good and sufficient surety, payable to the state, county or municipal corporation or subdivision, letting the contract, in an amount not less than fifty percent of the contract price, with the obligation that such contractor or contractors shall promptly make payments to all persons supplying him or them with labor, materials, feed-stuffs or supplies for or in the prosecution of the work provided for in such contract, and for the payment of reasonable attorneys' fees, incurred by successful claimants or plaintiffs in suits on said bond; and any person, firm or corporation that has furnished labor, materials, feed-stuffs or supplies for or in the prosecution or repair of any public building or public work, highways or bridges, and payment for which has not been made, shall be authorized to institute an action upon said bond in his or their name or names and to have their rights and claims adjudicated in such action and judgment rendered thereon; . . . The remainder of the paragraph quoted above sets forth the procedural requirements for bringing suit on a labor and materials bond. The provision for attorneys' fees is preceded by and succeeded by language which pertains solely to labor and materials bonds. There is nothing to indicate that the legislature intended that the provision should pertain to anything but labor and materials bonds. Talladega further contends that the following paragraph of the labor and materials bond entitles it to recover attorneys' fees incurred in enforcing both bonds: The above named Principal and Surety hereby jointly and severally agree with the Owner that every claimant as herein defined, who has not been paid in full before the expiration of a period of ninety (90) days after the date on which the last of such claimant's work or labor was done or performed, or materials were furnished by such claimant, may sue on this bond for the use of such claimant, prosecute the suit to final judgment for such sum or sums as may be justly due claimant, and have execution thereon. The Owner shall not be liable for the payment of any costs or expenses of any such suit. [Emphasis supplied.] The indemnification provision of this paragraph applies only to the type of suits which are the subject of the paragraph, namely, suits by claimants on the labor and materials bond. It does not obligate CIC to indemnify Talladega for the costs it may incur in a suit against CIC to enforce either bond. The provision does, however, obligate CIC to indemnify Talladega for its costs in defending suits brought against it by claimants on the labor and materials bond. Finally, Talladega contends that CIC's breach of its promise in the performance bond to remedy the contractor's default promptly necessitated Talladega's employment of counsel to enforce the bond and thus entitles Talladega to recover attorneys' fees as damages resulting from this breach of the bond contract. This argument is not based on any of the well-recognized grounds for recovery of attorneys' fees stated above. Carried to its logical conclusion, this argument would justify recovery of attorneys' fees whenever one party to a contract breached it, necessitating the other party's bringing suit. This is not the law of Alabama. Our answer to the Court of Appeals' third question is, therefore, that Talladega is not entitled to recover for attorneys' fees incurred in enforcing the performance bond against CIC, but is entitled to recover all costs and expenses, including attorneys' fees incurred in defending suits brought against it by claimants under the labor and materials bond.