Court Opinion

ID: 3549190
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:02:24.078177+00
Date Added: 2024-06-11T13:56:07.593977
License: Public Domain

This is an action upon a bond by a contractor conditioned to hold the obligee harmless under a contract entered into between the obligee in the bond and the contractor for the erection of a schoolhouse. The building in question was erected pursuant to the provisions of chapter 35, Stats. 1921, which, in addition to providing for the issuing of bonds for the purpose of raising the money necessary to pay for the erection of the building, authorizes the execution of a contract for the construction of the building. This statute also provides that the laws of the state governing the letting of contracts of public buildings are made applicable. Chapter 264, Statute of 1913, provides that in the erection of public buildings a bond shall be exacted of the contractor, conditioned that he shall well and truly pay or cause to be paid all just debts contracted by him for labor performed and materials furnished in the execution of the contract. In the instant case a bond was exacted of and executed by the contractor; but, instead of being conditioned in the language of the statute, it was conditioned to "save harmless" the obligee, and provided that the obligors were bound unto the obligee under the provisions of chapter 35, Stats. 1921.
3. It is the contention of the appellant that the bond in question was not given pursuant to the provisions of chapter 264, Stats. 1913, since it is not conditioned as therein provided, and hence no liability attaches.
I cannot agree with this contention. Public buildings in this state are not subject to mechanics' liens, and, prior to the enactment of 1913, there was no law looking to the protection of laborers and materialmen. Contractors might collect the full amount of their *Page 23 
contract price and pay none of the obligations incurred in complying with the terms of their contracts. Hence the enactment of the 1913 statute. By the terms of this statute the legislature sought to safeguard the rights of materialmen and laborers. The act makes it the imperative duty of public boards and officials letting contracts for the erection of public buildings to exact bonds for the protection of such persons and makes such officials jointly and severally liable for failure to do so. In the instant case the officials exacted a bond — evidently for the sole purpose of complying with the requirements of the statute; but the bond executed does not technically conform to the language of the statute. However, in spirit, it manifests a purpose and intention to do so. I am satisfied that the statute of 1913 must be read into the bond in question. I am of this opinion primarily for the reason that the bond itself alludes to the statute of 1921 which expressly provides that the laws of the state governing the letting of contracts by boards of county commissioners are made applicable to contracts of this character. The general rule applicable to the situation in hand is admirably stated in 9 C.J. p. 34, sec. 56, as follows:
"The law at the time of the execution of a bond is a part of it; if it gives to the bond a certain legal effect it is as much a part of the bond as if in terms incorporated therein. When a bond is given under the authority of a statute in force when it is executed, in the absence of anything appearing to show a different intention it will be presumed that the intention of the parties was to execute such a bond as the law required, and such statute constitutes a part of the bond as if incorporated in it, and the bond must be construed in connection with the statute, and the construction given to the statute by the courts. Such a bond must be given the effect which in reason must have been intended by the statute."
The case of Nye-Schneider-Fowler Co. v. Roeser et al.,103 Neb. 614, 173 N.W. 605, is squarely in point and supports the conclusion which I have reached. *Page 24 
In the case of Acme Brick Co. v. Taylor et al. (Tex.Civ.App.) 223 S.W. 248, the court recognized the rule upon which I rely, but held that the surety could not be held since it appeared from the bond in the case that it was not the intention to execute a statutory bond, which clearly distinguishes it from the instant case.
The bond should be liberally construed for the purpose of effectuating the intention of the parties. The rule of strictissimi juris does not prevail in favor of a surety company which executes a bond for compensation. Lassetter v. Becker (Ariz.) 224 P. 810.
The authorities hold that the presumption prevails that such a bond is given pursuant to statute, and, to my satisfaction at least, this is conclusively shown by the fact that the bond recites that it is given "under the provisions of chapter 35 of Session Laws of Nevada, 1921," which statute expressly provides that —
"The laws in force governing the letting of contracts by boards of county commissioners are hereby made applicable to and the same shall govern the action of the county board of education in carrying out * * * this act."
I do not see how it could more clearly appear that the bond in question was executed and given in pursuance of the statute.