Philip Richenburg Insurance Agency, Inc. v. Ruscito Contracting Co.

35 Mass. App. Dec. 43
CourtMassachusetts District Court, Appellate Division
DecidedApril 8, 1966
DocketDocket No. 51957
StatusPublished

This text of 35 Mass. App. Dec. 43 (Philip Richenburg Insurance Agency, Inc. v. Ruscito Contracting Co.) is published on Counsel Stack Legal Research, covering Massachusetts District Court, Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Philip Richenburg Insurance Agency, Inc. v. Ruscito Contracting Co., 35 Mass. App. Dec. 43 (Mass. Ct. App. 1966).

Opinion

Lee, J.

This is an act of scire facias commenced against the Town of Stoughton, Trustee pursuant to the provisions of G.L. c. 246, §45-

The preliminary facts are:

The plaintiff, Richenburg, had obtained judgment in the District Court against the defendant, Ruscito Contracting Co., Inc., on October 23, 1964. Execution issued on November 2, 1964, in the amount of $9,020.74 and remains unsatisfied.

The town of Stoughton had been served on August 24, 1964 as trustee in the original action but failed to file an answer, was adjudged a trustee upon failure to answer, has refused upon demand to pay the judgment, and thus the present action of scire facias.

The answer of the trustee-town in the present proceeding was in part as follows:

“... that prior to service upon it, the Town of Stoughton had contracted with the Defendant Ruscito Contracting Co., Inc. to construct Sanitary Intercepter Sewers for it, and in construction of said sewers, the Defendant Ruscito Contractin gCo., Inc. hired or engaged sub-contractors to do part of said construction, and further ordered materials to be used in said construction and had not paid for same, and the Defendant Ruscito Contracting Co., Inc. had not completed the aforesaid sewer contract, and had also improperly performed part of [46]*46the .construction, and that at the time of said service, the Defendant Ruscito Contracting Co., Inc. had not been paid by the Town of Stoughton the whole contract price for said construction, and whether the Town of Stoughton had any goods, effects or credits of the Defendant Ruscito Contracting Co., Inc. in its hands or possession at the time of service of the trustee writ, it submits to examination under oath.”

In the present proceedings there was also filed by the Glens Falls Insurance Company an adverse .claimant’s claim as follows:

“[The] Glens Falls Insurance Company makes [claims as] an adverse claimant under. the provisions of Massachusetts General Laws, Chapter 246, Section 33, as follows :
That at the time of the service of the Plaintiff’s writ on the Trustee, Town of Stoughton goods, effects or credits in the possession of said Trustee, allegedly belonging to the principal Defendant, Ruscito Contracting Co., Inc., were legally and/or equitably goods, effects or .credits of the Glens Falls Insurance Company.
WHEREFORE, your claimant makes claim that the goods, effects or credits in the possession of said Trustee be found to be due to Glens Falls Insurance Company, and for its costs.”
At the trial the evidence was as follows:
The town of Stoughton and Ruscito had [47]*47entered into a contract relative to the construction of a sewer line and said contract, under the provisions of G.L. c. 149, §29, called for bonds by Ruscito conditioned upon faithful performance of the contract and prompt payment of labor and materials and Glens Falls Insurance Company was the surety on these bonds. The said contract also provided for monthly payments by the town to Ruscito for work completed and accepted by the town. These payments would be made after a requisition had been submitted by Ruscito and approved by the town Engineer. Ruscito had submitted a requisition for work performed in July, 1964, and it had been approved by the town Engineer. The net amount of the requisition after retained percentage was $28,377.11. Of this amount $8,836.24 was paid to Ruscito or for his benefit and the balance of $19,540.87 was withheld by the town because a notice of claim in that amount had been received prior to August 24, 1964, by the town of Stoughton. This notice of claim was filed by New England Concrete Pipe Company which had supplied materials on the job and1 had not been paid. The town, under the terms of the contract, had the right to withhold payments due Ruscito and pay directly creditors of Ruscito.
On August 24, 1964, the date of service of the plaintiff’s trustee writ, the town still had in its possession the $19,540.87, the balance of the July requisition. The town admitted that as of August 24, 1964, it had not received [48]*48any writ of attachment or trustee process in connection with any claim against Ruscito other than that of the plaintiff Richenburg. The town further admitted that as of August 24, 1964, it had not received notice of the assignment by Ruscito to the bonding company as required under Section H, Paragraph 31 of the contract, a copy of which was offered in evidence and provides as follows :

"ASSIGNMENTS

The Contractor shall not assign the whole or any part of this contract or any moneys due or to become due hereunder without written consent of the Owner. In case the Contractor assigns all or any part of any moneys due or to become due under this contract, the instrument of assignment shall contain a clause substantially to the effect that it is agreed that the right of the assignee in and to any moneys due or to become due to the Contractor shall be subject to prior claims of all persons, firms and corporations for services rendered or materials supplied for the performance of the work called for in this contract.”

Counsel for Glens Falls Insurance Company stipulated that no notice had been given prior to August 24, 1964. Counsel also stipulated that the assignment was never recorded anywhere.

The assignment in question is contained in the bond application of Ruscito and the same was dated October 18, 1963.

[49]*49There was no evidence of any formal notice of default on the part of Ruscito, nor was there any notice by the bonding company that they were taking over the completion of the contract prior to August 24, 1964. Subsequent to August 24, 1964, Ruscito was defaulted by the town of Stoughton and there was evidence that the bonding company has to date paid out some $351,409.11 because of Ruscito’s default, for labor and material claimants of Ruscito and in completing the contract. Of the $351,409.11 only approximately $12,000.00 was paid' prior to August 24, 1964, for labor claims.

The evidence as to the assets of Ruscito Contracting at the time of the assignment was that it consisted of two trucks both of which were mortgaged, and a claim against the town of Amherst in the amount of $9,000 to $12,000.

The plaintiff made the following requests for rulings, which with the court’s action thereon, was as follows:

1. On August 24, 1964, the Town of Stoughton had in its possession funds due and owing to the defendant, Ruscito, without contingency. Denied.
2. On August 24, 1964, the plaintiff was the only creditor with a perfected lien upon the funds held by the Town of Stoughton due to Ruscito. Denied.
3. The assignment by Ruscito to the bonding company was in fact a security instrument under the Uniform Commercial [50]*50Code. Allowed, but I hold that filing was not required under U.C.C.
4.

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Cite This Page — Counsel Stack

Bluebook (online)
35 Mass. App. Dec. 43, Counsel Stack Legal Research, https://law.counselstack.com/opinion/philip-richenburg-insurance-agency-inc-v-ruscito-contracting-co-massdistctapp-1966.