Riley-Stabler Construction Company, a Division of Riley Lumber & Supply Company, Inc. v. Westinghouse Electric Corporation

396 F.2d 274, 1968 U.S. App. LEXIS 6621
CourtCourt of Appeals for the Fifth Circuit
DecidedJune 7, 1968
Docket24539_1
StatusPublished
Cited by26 cases

This text of 396 F.2d 274 (Riley-Stabler Construction Company, a Division of Riley Lumber & Supply Company, Inc. v. Westinghouse Electric Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Riley-Stabler Construction Company, a Division of Riley Lumber & Supply Company, Inc. v. Westinghouse Electric Corporation, 396 F.2d 274, 1968 U.S. App. LEXIS 6621 (5th Cir. 1968).

Opinions

HUGHES, District Judge:

This is an appeal from a summary judgment entered on the motion of Westinghouse Electric Company, plaintiff, against Riley-Stabler Construction Company, defendant.

The record reveals that Riley-Stabler was engaged in the construction of Drake Towers, a public housing project for the City of Huntsville, Alabama. Cason & Martin Electric Company was one of Riley-Stabler’s sub-contractors on that project. Fidelity & Casualty Company of New York is Riley-Stabler’s surety on a Labor & Performance Bond executed to cover the Drake Towers project pursuant to Title 50 section 16 Code of Alabama. Supplies were obtained by Cason and Martin from Westinghouse Electric Company.

This suit was brought by Westinghouse against Riley-Stabler on an alleged unpaid balance of $29,084.92. The district court granted the motion of Westinghouse for summary judgment for the full amount plus a reasonable attorneys fee and interest at &% on the entire amount from date of judgment.

The two principal contentions of Riley-Stabler, appellant, on this appeal are:

(1) Cason & Martin diverted materials furnished by Westinghouse for the Drake Towers project to other jobs, and under Title 50 sec. 16 of the Alabama Code, Riley-Stabler was not liable for materials from which it received no benefit.

(2) Genuine issues of fact were presented by the pleadings and affidavits, and the case should not have been disposed of on motion for summary judgment.

The first question involves an interpretation of Title 50 section 16 of the Alabama Code as revised in 1935. The Alabama Act of 1927 dealing with a performance bond required that the bond cover “persons supplying (the contractor) material * * * in the execution of the work.” (Emphasis added) Alabama cases construing this Act held that there can be no recovery for materials diverted from the job even though ordered for the work. United States F. & G. Co. v. Benson Hardware, 222 Ala. 429, 132 So. 622; United States F. & G. Co. v. Yielding Bros. Co., 225 Ala. 307, 143 So. 176; United States F. & G. Co. v. Andalusia Mfg. Co., 222 Ala. 637, 134 So. 18; Singer, et al. v. Anniston Hardware Co., 222 Ala. 620, 133 So. 910. We do not believe, however, that these decisions are controlling as they were decided prior to the enactment of the present statute.

In 1935 the statute was amended to cover “all persons supplying (the contractor) with labor, materials * * * for, or in the prosecution of the work provided for in such contract.” (Emphasis added). There are no decisions of the Alabama Supreme Court construing the amended act with regard to diversion of materials supplied for public works.

The Act has, however, been construed by a federal district court. In the case of Columbus Rock Company v. Alabama General Insurance Company, D.C., 153 F.Supp. 827, the court held that it was sufficient for recovery by the supplier that the materials were “furnished” to the contractor for the work on the bonded project and that diversion would not defeat the supplier’s right to recover.

The Miller Act, which is the federal counterpart of the Alabama Act here under consideration, was enacted the same year as the amended Alabama statute and provides coverage to “(e) very person who has furnished labor or materials in the prosecution of the work provided for in such contract.” (Emphasis added) 40 U.S.C. § 270a et seq.

In construing the Miller Act this court has held on numerous occasions that a materialman need not prove that his materials were actually used in the prosecu[276]*276tion of the work of the prime contract. In Glassell-Taylor Company v. Magnolia Petroleum Company, 153 F.2d 527, at page 529, 5th Cir. (1946) the court said:

“There is no provision in the statute requiring that materialmen must deliver the material at the job site or that the materials be ‘used’ in the prosecution of the work. The statute only requires that the materials be ‘furnished’ in the prosecution of the work. * * * Whether or not the materials were wholly consumed ‘in the prosecution of’ the work provided for in the contract and bond is not controlling. What is important is the fact that these materials were ‘supplied’ to the subcontractor in the prosecution of the work provided for.”

While this court is hesitant to indulge in the broad presumption urged by Westinghouse that the Alabama legislature intended to incorporate the Miller Act interpretation into the Act of 1935, it does merit consideration that both acts are ostensibly designed for the same purpose and enacted as improvements in their predecessor statutes. Also persuasive is the fact that the Alabama Supreme Court has held that the Act of 1927 was borrowed from the Heard Act, predecessor of the Miller Act. State for Use of Wadsworth v. Southern Surety Company, 221 Ala. 113, 127 So. 805, 70 A.L.R. 296. The Heard Act specifically provided that bond coverage extended only to materials “used” on a bonded project. The Miller Act deleted that provision and, as heretofore stated, has been interpreted to cover materials diverted to other uses.

But irrespective of the historical context, and approaching the issue as an original question, we are constrained to hold that the statutory words “for * * the prosecution of the work” encompass the furnishing of diverted materials as well as non-diverted ones. The insertion of the preposition, “for”, in the 1935 Act constitutes a significant change over the 1927 Act. The legislature is presumed to have made the change for a purpose. The phrase, as revised in the 1935 Act, shifts the inquiry from how or whether the materials were used to the purpose for which they were supplied. The natural and ordinary connotation of the phrase as it now reads is that a bond covers payment of materials which are used on a bonded project or which are furnished in the contemplation of being used on that project whether they are in fact so used or not.

We agree with the trial judge that the 1935 Act, Title 50, Section 16 of the Alabama Code, covers materials furnished for the project even when diverted.

We turn now to appellants’ specification of error dealing with the propriety of using summary judgment procedure in this case.

The controlling principles governing the granting or denial of summary judgment have been stated on several occasions by this Circuit.

In the case of Whitaker v. Coleman, 5th Cir., 115 F.2d 305 (1940), the Court in discussing summary judgment stated:

“The invoked procedure, valuable as it is for striking through sham claims and defences which stand in the way of a direct approach to the truth of a case, was not intended to, it cannot deprive a litigant of, or at all encroach upon, his right to a j ury trial.”

Again in Bruce Construction Corporation v. United States of America, 5th Cir., 242 F.2d 873, 874, this Court said in cautioning against the use of summary judgment:

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Bluebook (online)
396 F.2d 274, 1968 U.S. App. LEXIS 6621, Counsel Stack Legal Research, https://law.counselstack.com/opinion/riley-stabler-construction-company-a-division-of-riley-lumber-supply-ca5-1968.