Court Opinion

ID: 5858270
Source: CourtListenerOpinion
Date Created: 2022-01-13 01:10:51.908443+00
Date Added: 2024-06-11T08:44:20.800356
License: Public Domain

Doerr and Denman, JJ. (dissenting).
We disagree with the majority insofar as they would deny plaintiffs and third-party and interpleaded defendants the right to recover under the payment bond issued to Myers by Aetna Casualty *994and Surety Company. The payment bond guarantees payment of all “lawful” claims “of the subcontractors, materialmen, laborers, persons, firms or corporations for labor performed or materials, provisions * * * used or consumed in the carrying forward, performing or completing of said [c]ontract”. We do not view this broad language as limiting protection under the payment bond to those who have some direct relationship with the general contractor or to a subcontractor. Nor can we agree with the finding by the majority that “[tjhere is no significant difference between the payment bonds issued by Aetna and the bond in Neo-Ray” (Neo-Ray Prods. v Boro Elec. Installation, 65 AD2d 687, affd 48 NY2d 781). The bond in Neo-Ray, provided for payment of all lawful claims for materials and supplies, etc., “used or consumed by said principal or any subcontractor” (emphasis supplied). Indeed, the court in Neo-Ray observed, “[t]he language of the payment bond provided for satisfying only those claims made against the principal (Boro) or a subcontractor which remained unpaid” (Neo-Ray Prods. v Boro Elec. Installations, supra). Under the bond issued by Aetna, we would find the surety liable to all claimants furnishing labor or materials in connection with the construction whose claims are provable and unpaid (see American Sur. Co. of N. Y. v Wells Water Dist., Town of Wells, 253 App Div 19, 23, mod on other grounds 254 App Div 717, affd 280 NY 528). Aetna’s policy arguments that it will be required to pay twice for the same material are not persuasive; the surety can limit its own liability by writing the bond in a clear fashion, expressly limiting coverage to those who furnish materials directly to contractors or subcontractors. (Appeals from order of Supreme Court, Erie County, Green, J. — summary judgment.) Present — Hancock, Jr., J. P., Doerr, Denman, Boomer and Schnepp, JJ.