Court Opinion

ID: 8898024
Source: CourtListenerOpinion
Date Created: 2022-11-27 00:26:05.072072+00
Date Added: 2024-06-11T17:07:37.800618
License: Public Domain

GARTH, Circuit Judge
(dissenting):
I respectfully dissent because, like the district court, I believe that submission of vouchers signed by the general contractor, with FHA Form 2403 attached, is not a condition precedent to recovery by Craftmark under the terms of its guarantee.
In construing this guarantee, as with any contract, the intent of the parties as ascertained from the entire agreement is controlling. Land Title Bank & Trust Co. v. Baron, 341 Pa. 241, 19 A.2d 62 (1941). The court cannot under the guise of interpretation create obligations not imposed by the plain meaning of the terms of the guarantee. Miller v. Commercial Electric Construction, Inc., 223 Pa.Super. 216, 297 A.2d 487 (1972). But neither can it construe acts not expressly made conditions precedent as such, unless this clearly appears to be the intent of the parties. Sharp v. McKelvey, 196 Pa.Super. 138, 172 A.2d 580, 583 (1961). Moreover, under Pennsylvania law, which is controlling, any doubt as to the meaning of the guarantee must be resolved against the compensated surety, without regard to whether the beneficiary is an individual or a corporation. Monongahela Street Ry. Co., v. Philadelphia Co., 350 Pa. 603, 39 A.2d 909 (1944); Miller v. Commercial Electric Construction, Inc., supra.
Viewing the guarantee in its entirety, I conclude that the .guarantor’s overriding concern was not with the furnishing of vouchers but rather with obtaining full performance, and its intent was to make this, and only this, a condition precedent to recovery. As noted in the majority opinion, the guarantee provides in pertinent part:
Payment shall be made by the Bank on satisfactory performance [of labor and on delivery and storage of the materials under arrangements satisfactory to the Bank] (including the schedule or time of delivery) upon vouchers properly signed by the General Contractor to the order of the said SubContractor with FHA Form No. 2403 —Application for Insurance of Advance of Mortgage Proceeds attached. These vouchers shall constitute evidence of performance and delivery and acceptance thereof, it being understood that such payment is subject to the Bank’s inspection and approval of the labor performed and the materials and arrangements for storage, the inspection to be performed within three days after receipt of the voucher. Provided, however, that upon failure of the sub-Contractor to perform satisfactorily the labor and supply all of the materials herein contemplated, this guarantee shall become null and void and the Bank shall be relieved of the conditions and obligations herein stated.
As I read the language of the guarantee that “these vouchers shall constitute evidence of performance” I can find no intent to make their submission a condition precedent to recovery. Rather, the vouchers serve to notify the Bank that Craftmark has performed to the general contractor’s satisfaction. Here, the Bank received notice of Craftmark’s claimed performance when Craftmark made its demand for payment under the guarantee.1 The Bank could have inspected the work performed at that time but chose not to do so. In any event the Bank does not and cannot claim prejudice on this score, for the district court found that Craftmark had performed satisfactorily.
My view of the “voucher submission” requirement is substantiated by what I regard as a logical and reasonable reading of the guarantee. The last sentence of the guarantee provides that “upon failure of the sub-Contractor to perform satisfactorily . . . this guarantee shall become null and void.” This provision in my opinion creates the only express condition precedent to be found in the guarantee — a condition precedent of satisfactory performance. The majority, however, contends that the first sentence *795of the guarantee creates a condition precedent by requiring “payment on satisfactory performance upon vouchers signed properly by the General Contractor . . . .” (Emphasis added.) If in fact the first sentence of the guarantee creates a condition precedent as the majority urges, then the final sentence of the guarantee which requires the sub-contractor to “perform satisfactorily” would be wholly unnecessary and meaningless. If we are to give meaning to every part of this contract, as we must to the extent possible, Best v. Realty Management Corp., 174 Pa.Super. 326, 101 A.2d 438 (1953), I must then conclude that it was not the intent of the parties that the first sentence of the guarantee constitute a condition precedent to payment.
Moreover, the evidence in the record is to the effect that there was full and satisfactory performance by Craftmark, and the court below so found.2 Craft-mark’s Director of Design and Engineering testified at trial that the contract had been fully performed,3 and Craft-mark introduced into evidence the invoices on which its claim against the general contractor was based, which showed full performance.4 The Bank could have introduced evidence of deficient performance but it did not. The district court’s finding is binding on this court, since it is not “completely devoid of minimum evidentiary support displaying some hue of credibility.” Krasnov v. Dinan, 465 F.2d 1298, 1302 (3d Cir. 1972). Under these circumstances I cannot hold the submission of vouchers to be a condition precedent to recovery absent a clear expression of intent to produce this result.
Nor does the nature of the FHA Form 2403- — Application for Insurance of Advance of Mortgage Proceeds, compel a contrary result, since there is no evidence that the Bank was prejudiced by the absence of this form. There is nothing in the record which indicates that the FHA may not respond to the Bank even without the formalities of a completed Form 2403, under the present circumstances. Nor is there anything to prevent the Bank from instituting an action to obtain the necessary signatures on the form if in fact it is required by .the FHA.
Accordingly, the Bank as author of the guarantee form having failed to provide for its own protection in explicit unequivocal terms, as it could have, cannot now complain that the protection it desires but did not afford, is unavailable. I would affirm the order of the district court.

. Comprehensive Statement of Uncontested Facts 11; App. at 45a, 51a.

. District Court Opinion, Finding of Fact 28, App. at 153a.

. App. at 77a, 78a.

. Exhibits P-2 to P-9, App. at 127a-134a.