New Amsterdam Casualty Co. v. Moretrench Corp.

35 S.E.2d 74, 184 Va. 318, 1945 Va. LEXIS 152
CourtSupreme Court of Virginia
DecidedSeptember 5, 1945
DocketRecord No. 2922
StatusPublished
Cited by7 cases

This text of 35 S.E.2d 74 (New Amsterdam Casualty Co. v. Moretrench Corp.) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
New Amsterdam Casualty Co. v. Moretrench Corp., 35 S.E.2d 74, 184 Va. 318, 1945 Va. LEXIS 152 (Va. 1945).

Opinion

Browning, J.,

delivered the opinion of the court.

We have here a bond, sometimes called a performance bond,, and a contract consisting of enumerated articles, and component parts, allied by being made parts of each other, and by frequent and apposite reference, and certain stipulations, for interpretation.

They form the agreement of Angelo Lucenti, trading as Meade Construction Company, to construct a sewerage system for the city of Portsmouth, Virginia. The bond, entered into and executed by the Meade Construction Company, Principal, and New Amsterdam Casualty Company, as Surety, bound unto the city of Portsmouth, Virginia, in the penal sum of four hundred and twenty-two thousand seven hundred and seventy dollars ($422,770.00), upon the condition 'that the said Construction Company had entered into a Contract with the said City, on the 29th day of July, 1942, for the construction of the said sewerage system and if it, the Construction Company, should well and faithfully perform the said work according to the terms of said contract, and should pay all lawful claims of sub-contractors, materialmen and laborers, for all labor performed and materials furnished in the carrying forward, performing or completing of the said contract, they agreeing and assenting that the undertaking should be for the benefit of any material-[321]*321men or laborer having a just claim as well as for the city, then the obligation would be void, otherwise remain in full force and effect. It was provided in terms in the bond, that said contract was a part thereof, just as though set forth therein.

The said contract of the 29th day of July, 1942, between the City and Construction Company therein called the Contractor, provided in Article I the scope of the work to be performed saying: “ * * # shall provide and furnish all of the labor, materials, necessary tools, expendable equipment, and all utility and transportation services required to perform and complete in a workmanlike manner all the work * * * , in connection with the Sewerage Project of the Owner or in strict accordance with the Plans and specifications, * * # , which Plans and specifications are made a part of this contract, and in strict compliance with the Contractor’s proposal and other contract documents herein mentioned 'which are a part of this contract; and the Contractor shall do everything required by this contract and the other documents constituting a part hereof.’’'’ (Italics added).

Article II entitled: “Compensation To Be Paid To The Contractor,” provided for compensation to the contractor for well and faithfully completing the work, in full compliance with the Plans and specifications, and the requirements of the engineers under them.

Article. Ill entitled: “Component Parts Of This Contract,” lists as such component parts:

1. General Conditions

2. Special Conditions

3. Instruction to bidders

4. Advertisements for bids

5. Specifications, including Addenda Numbers—

6. Plans

7. Contractor’s Proposal

8. This instrument.

Article IV is entitled: “Guarantee”. By it the Contractor guaranteed the work under the contract and agreed that [322]*322the Contractor’s performance Bond should cover all guarantees in this article.

There was a stipulation between the parties to this litigation, accepting and agreeing to certain facts, without having to prove the same; and agreeing further that the exhibits, from which we have liberally quoted, should be treated as original exhibits and as having been offered and accepted in evidence.

The Fourth clause of this stipulation is as follows: “The said bond, contract and component parts thereof together make up the ‘contract documents’ a bound copy of which is incorporated in this stipulation as a part hereof and marked Exhibit ‘A’.”

The Fifth clause stipulated that the Moretrench Corporation had entered into an agreement with the Construction Company, by which it was to lease to the company certain equipment for use in connection with the said project.

The Sixth clause specifically described the equipment as that used to pump underground water from the locations where the sewer pipes were to be installed and under the terms of the agreements, above referred to, this equipment was to be returned to the Moretrench Corporation, unless the construction company exercised its option to purchase it, which it did not do.

The Seventh clause recited that the construction company had failed in the performance of its contract with the City and in its aforesaid agreements with the Moretrench Corporation and had, on May 14, 1943, voluntarily' abandoned the work.

The Eighth clause stipulated that, before the default and abandonment, by the construction company, the More-trench Corporation furnished to it the aforesaid equipment and supplied a demonstrator to superintend the installation thereof, in accordance with the terms of said agreements, and in addition, during the progress of the work, sold to the said construction company certain small parts for use on said equipment. Upon the abandonment of the work certain [323]*323of the said equipment was missing from the job site and could not be returned to the lessor, Moretrench Corporation. It was further stipulated that the rental items and the missing equipment items and the expense incurred in furnishing a demonstrator to explain the operation of said equipment amounted in the aggregate to the sum of $8,012.55..

The Ninth clause stipulated that all of the items, totalling the said amount, were necessary to and actually used in and about the construction of said sewerage system and that the sole issue to be determined by the court is whether the de-. fendant, New Amsterdam Casualty Company, as surety, on said performance bond is liable to plaintiff, Moretrench Corporation, for the aggregate amount admitted herein to be due and owing it by Meade Construction Company, or for any portion thereof, and if so, how much.

On the 30th of November, 1943, Moretrench Corporation instituted suit by notice of motion for judgment against the surety, New Amsterdam Casualty Company, for the amount above stated, being the aggregate of its claim for equipment rentals, missing equipment and expense incurred in furnishing a demonstrator to explain the operation of the equipment, all of which was supplied to the contractor by the plaintiff and used in the construction work and not paid for.

The case was heard and decided by the trial court by agreement of parties, without the intervention of a jury. The judgment was in favor of the plaintiff to the extent of its claim for rentals and the value of the missing equipment, but it was for the defendant as to the item claimed for supplying a demonstrator in explanation of the operation of the equipment.

At the outset we may say that the alleged conflict of authority as to the extent of the coverage of bonds of the nature of this one, is more apparent than real. Their precise wording frequently differs enough to afford a very meticulous juristic a peg on which to hang a distinction without a difference. The terms of bonds and contracts of this type [324]

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35 S.E.2d 74, 184 Va. 318, 1945 Va. LEXIS 152, Counsel Stack Legal Research, https://law.counselstack.com/opinion/new-amsterdam-casualty-co-v-moretrench-corp-va-1945.