Court Opinion

ID: 7811464
Source: CourtListenerOpinion
Date Created: 2022-09-07 17:13:19.738835+00
Date Added: 2024-06-11T16:30:29.030240
License: Public Domain

Hart, J. (after stating facts). It was the theory of the plaintiff that the Oliver Construction Company was liable to him under section 4 of its contract with the road improvement district. The court adopted this theory of the case in its instructions to the jury. The court told the jury that, although the plaintiff was not a party to the contract, if he did any work and labor or furnished any materials towards the construction of the road, he had a cause of action against the defendant for such work or materials, as he had proved that he had earned under the contract fixing the compensation for work and labor done. The court also instructed the jury that, if it found that the plaintiff and Eich were partners in the work on the road, plaintiff was bound by the settlement of Eich with the defendant. The court further instructed the jury that the Oliver Construction Company would not be liable for any work done or materials furnished beyond the prices fixed in the contract between it and the district. It is conceded by counsel for the defendant that the right of the plaintiff to recover depends upon the construction to be given to section four of the contract between the road improvement district and the Oliver Construction Company copied in our statement of facts. In Reiff v. Redfield School Board, 126 Ark. 474, the facts were that the directors of the'school district entered into a contract with the contractor for the construction of a schoolhouse. The contractor gave the bond required by § 6913 of Crawford & Moses’ Digest. He failed to pay certain persons for materials furnished and used in the construction, of the building. The materialmen were allowed to recover against the contractor and his sureties. The court held that where a bond is executed pursuant to the statute it shall inure to the benefit .of those furnishing labor and materials, and that an action' may be maintained thereon by one of such persons to recover for services performed. or materials supplied in the fulfillment of the contract. Section 6913 of Crawford & Moses’ Digest reads as follows: “Whenever any public officer shall, under the laws of this State, enter into a contract in any sum exceeding one hundred dollars, with any person or persons, for the purpose of making any public improvements, or constructing any public building, or making any repairs on the same, such officer shall take from the party contracted with, a bond with good and sufficient sureties to the State of Arkansas, in a sum not less than double the sum total of the contract, whose qualifications.shall be verified, and such sureties shall be approved by the clerk of the circuit court in the county in which the property is situated, conditioned that such contractor or contractors shall pay all indebtedness for labor and material furnished in the construction of said public building, or in making said public improvements.” It will be noted that the section includes making any public improvement as well as constructing any public building. This court has always given a liberal interpretation to statutes giving liens to those furnishing-labor and materials used in the construction of private buildings. As against the road improvement district, no lien is provided by statute, and it was the evident purpose of § 6913 of the Digest to substitute the obligation of a bond for the security given by the statutory lien in the case of the property of private individuals. Such statutes and contracts made under them should receive a liberal interpretation in order to effectuate the beneficent object intended. The obligation of the bond, when construed in the light of the statute requiring its execution, is for the protection of laborers and materialmen, and under the statute is conditioned that the contractor shall pay all the indebtedness for labor and materials furnished in the construction of said public building' or in making said public improvement. The language is broad enough to include laborers who have performed work for a sub-contractor, who furnished labor or materials which the original contractor had obligated himself to furnish. Hill v. American Surety Co., 200 U. S. 197. The statute under consideration in that case provides in substance that persons entering into formal contracts with the United States for the construction or repair of public buildings and works shall be required, before performing such work, to execute the usual penal bond with good and sufficient sureties with the additional obligation “that such contractor or contractors shall promptly make payments to all persons supplying him or for labor or materials in the prosecution of the work provided in such contracts.” In construing it the court said: “Language could hardly be plainer to evidence the intention of Congress to protect those whose labor or material has contributed to the prosecution of the work. • There is no language in the statute nor in the bond which is therein authorized limiting the right of recovery to those who furnish material or labor directly to the contractor, but all persons supplying the contractor with labor or materials in the prosecution of the work provided for in the contract are to be protected. The source of the labor or material is not indicated or circumscribed. It is only required to be ‘supplied’ to the contractor in the prosecution of the work provided for. How supplied is not stated, and could only be known as the work advanced and the labor and material are furnished.” Again the court said: “The obligation is ‘to make full payments to all persons supplying it with labor or materials in the prosecution of the work provided for in said contract.’ The language, read in the light of the statute, looks to the protection of those who supply the labor or materials provided for in the contract, and not to the particular contract or engagement under which the labor or materials were supplied. If the contractor sees fit to let the work to a sub-contractor, who employs labor and 'buys materials which are used to carry out and fulfill the engagement of the original contract to construct a public building, he is thereby supplied with materials and labor for the fulfillment of his engagement as effectually as he would have been had he directly hired the labor or bought the materials.” The reasoning of that case controls here. The language of the statute is no stronger than the language used in our own statute. Such statutes are enacted in the exercise of a sound public policy. The contractor gets the benefit of the work done and materials furnished, and the statute requires him to pay for them. The contractor had supervision of the work, and it is easy for him to see what labor and materials are used in the work. In Philadelphia v. Stewart, 201 Pa. 526, the reason for the enactment of such statutes is clearly stated as follows: “Seldom are contractors for large public works able of themselves to furnish the labor and material necessary to the completion of their contracts; in nearly every case they rely on many sub-contractors and materialmen to furnish different kinds of mechanical skill and labor, also material, such as stone, brick, lumber, glass and iron; these have nothing on which to rely for payment except the honesty and ability of the principal contractor. If the contractor of himself do not inspire confidence among these, who must be subordinate to him, his ability in many cases to bid for large work must be weakened or altogether destroyed; as a necessary consequence, competition for work disappears, in large measure, and there follows a monopoly to the few contractors of large capital, with the inevitable result of exorbitant prices. Every one knows that the city will pay the principal contractor, but will he pay his sub-contractors and materialmen, whether he makes or loses on his contract, is the question with them. ’ ’ Of course, the giving of the bond under the statute adds nothing to the obligation of the contractor. It only has the effect to add sureties to his obligation and thus more effectively protect those furnishing labor and materials which are used in the construction of the public building or in making the public improvement. As pointed out in Reiff v. Redfield School Board, 126 Ark. 474, many cases from the various States in support of the doctrine are cited in a case note to Ann. Cas. 1916-A, at p. 761. Cases like Dickinson v. McCoppin, 121 Ark. 414, relied upon by counsel for the defendant, have no application. Section 6913 of the Digest above referred to was a part of act 446 of the Acts of 1911, which was approved June 2, 1911. See General Acts of 1911, p. 462. The facts under which the MoCoppin case was decided arose before the passage of the statute, and its construction was not involved, and therefore not discussed or determined. This seems to have been the construction placed upon the statute by the parties at the time they entered into the contract. It will be noted that section 4 provides for the execution of the bond provided by the statute. Section 10 provides that the contractor shall enter into a bond with the district in the sum of $100,000 conditioned for the faithful performance of the contract. The bond provided by section 4 is for the purpose of securing the laborers and material men in the payment of their claims, and the bond under section 10 is intended to secure the district in the faithful performance of the contract by the contractor. The bond required under t'he general statute, § 6913, is intended to protect laborers and materialmen, and serves another purpose and operates in a different field than the bond for the faithful performance of the contract in favor of the road district, which is prescribed ¡by the special act creating the road district; and the special act does not repeal the general act. It follows that the judgment must be affirmed.