Court Opinion

ID: 8817015
Source: CourtListenerOpinion
Date Created: 2022-11-26 15:21:21.592617+00
Date Added: 2024-06-11T17:04:30.544199
License: Public Domain

Mr. Presiding Justice Thompson delivered the opinion of the court. The appellant contends that it is not liable to complainants either under the bond executed by it to the Railway Company as surety for the Bridge Company, or under the contracts made between the Bridge Company and the Surety Company when the Bridge Company became embarrassed on August 3, 1906, for the ten per cent, withheld before August 3, 1906, from the complainants until the completion and acceptance of the work, and the work done after August 3rd, by the complainants all of which, under the assignment by the Bridge Company, was paid to the Surety Company. When the work was finally completed the evidence shows that it was found there was a loss on the work done by other sub-contractors. In arriving at this loss the Surety Company adds to the cost of the work the loan of $5,000 and interest made by the Surety Company to the Bridge Company on August 3,1906. It was found that final payment'made to the Surety Company by the Railway Company, after the Surety Company had retained the amount of $5,000 loan and interest would only pay the sub-contractors sixty-nine per cent, of the amount due them. All the sub-contractors except complainants received sixty-nine per cent, of the amount due them in full of their respective claims, and the Surety Company still holds in the hands of its treasurer the sixty-nine per cent, of the sum due complainants, and the $5,000 and interest applied by it on the loan of August 3, 1906. The Bailway Company on April 4, 1907, paid to the Surety Company, as assignee of the Bridge Company, its final payment on the work done by complainants under their sub-contract, together with money due for work done by other sub-contractors. One W. T. Durbin was at that time president of the Surety Company. The Surety Company endorsed the check to Durbin, and he deposited it to his account and paid part of the money received to other sub-contractors and it is admitted that Durbin, who is now treasurer of the Surety Company, still holds $3,038.11 of said sum then received for the complainants. The $3,038.11 is sixty-nine per cent.' of the principal sum due them. The Surety Company claims it is not liable for the money Durbin holds, that it turned over to him* The claim of the Surety Company is not tenable. The money Durbin holds that was turned over to him as an officer of the Surety Company by the Surety Company must be considered as held by the Company. There is no disagreement, or at least it is not disputed, but that the principal sum claimed by the complainants as found by the court to be due them is the correct sum due to complainants. If by virtue of the contracts of August 3, the Surety Company obligated itself to collect the money earned by complainants and to pay them out of the money collected then this decree is substantially right. The assignment made by the Bridge Company was made for the purpose of securing the Surety Company against loss on its bond, and eliminates the Bridge Company from contesting the disposition of the moneys received from the Railway Company. It gives the Surety Company “full power and control over all said moneys.” This assignment was made with the knowledge of the Railway Company and in contemplation of the interest of all parties. The contract made by the Surety Company was made at the same time and in consideration of the. assignment. These two instruments must be construed as one contract. The contract made by the Surety Company after certain recitals provides, “First:—That the Federal Union Surety Company will pay over to the said Collier Bridge Company ‘all moneys received by it under assignments hereinbefore mentioned under such reasonable restrictions as will insure the proper application of all such moneys to the discharge of labor, material and other bills incurred by the Collier Bridge Company in the prosecution of work under said contracts. ’ ” “ Second:—When all the bills, accounts and obligations incurred by the Collier Bridge Company in connection with the prosecution of the work under the said several contracts shall have been paid the said Surety Company shall retain from any moneys assigned to it, as aforesaid a sufficient sum to reimburse it for the Five Thousand Dollars this day loaned to the Collier Bridge Company with interest thereon.” The contract clearly provides that all the obligations of the Bridge Company incurred in the prosecution of the work under the several sub-contracts shall be paid by the Surety Company as assignee of the Bridge Company before the Surety Company had the right to repay itself the $5,000 loan. The Surety Company has on hand of the moneys received from the Railway Company the $3,038.11 held by its former president, now treasurer, for the complainants and the $5,000 appropriated by it wrongfully to pay the loan that it had made to the Bridge Company without having paid the debt due to complainants, and on which it has obligated itself to apply the money received by it from the Railway Company before paying the debt to itself. It is also insisted the allegations of the bill are not sufficient to sustain the decree even if the evidence is sufficient. The bill alleges that the sole consideration for the assignment of moneys due the Bridge Company to the Surety Company was an agreement on the part of the Surety Company to distribute said moneys among the complainants and other sub-contractors in accordance with the estimate sheets and vouchers issued and paid to the Surety Company, and that the Surety Company became a trustee holding said sums paid by the Bailway Company for and on behalf of complainants. While the complainants might have amended their bill after the coming in of the answers and set up the contract at length the allegations of the bill sufficiently allege the general terms of the contract which sustains the decree. There is no averment in the bill either that the contract was made or that the work was performed in the state of Indiana or that the legal rate of interest in Indiana is six per cent., although the evidence shows that the contract was made and the work was all done in Indiana and that the legal rate of interest in Indiana is six per cent. The appellant has neither assigned error on the question of interest or mentioned that question in its argument and any error, if there be any on that question, .is waived. The appellees presented a claim for $187.85 for extras with interest thereon amounting to $60.17. The claim for the principal sum of the extras was disallowed but the appellees admit that through some oversight the item of $60.17 interest is included in the decree. The decree is therefore excessive and erroneous to that amount. The appellees in their argument consent to an order for a remittitur of the sum of $60.17. The decree is therefore affirmed for the sum of $5,697.25 at the costs of appellee. Decree affirmed in part. Affirmed.