United States ex rel. Proctor Mfg. Co. v. Illinois Surety Co.

228 F. 304, 142 C.C.A. 596, 1915 U.S. App. LEXIS 2016

• Court: Court of Appeals for the Second Circuit
• Decided: November 9, 1915
• Docket: No. 19
• Status: Published

Opinion

RACOMBE, Circuit Judge.

[1] This cause was begun as an action at law; subsequently the District Judge by order transferred it from the law to the equity side of the court. Error is assigned to such disposition of the cause, but the point thereby raised need not be here discussed. It was disposed of adversely to appellants in our opinion in U. S. ex rel. Miller v. Mitchell, 212 Fed. 136, —- C. C. A.-.

The proposition mainly relied upon on the argument was that the notice to creditors required by the third proviso above quoted was not given in conformity with the requirements of the statute. The provisions of the statute in that particular are intricate and in some respects inconsistent. The Supreme Court made short work of them in Alexander Bryant Company v. New York Steam Filtering Company, 235 U. S. 327, 35 Sup. Ct. 108, 59 L. Ed. 253. But it is not necessary to apply the construction laid down in that case; the facts proved here show compliance literally with the terms of the statute.

Final settlement between the government, and contractor was complete October 10, 1912. The period of six months within which the government alone could bring, suit expired April 10, 1913. This suit was instituted by one of the creditors on June 9, 1913. It was therefore begun after performance and final settlement and within one year after such performance and settlement.

[2] Upon June 24, 1913, plaintiff submitted an affidavit to the court stating that it had made diligent efforts to ascertain the names of other creditors of. the contractor in connection with the contract sued upon, who may be entitled to intervene, and gave a list of such creditors as it had been able to discover, with their addresses. Upon this affidavit the court ordered that to each of these creditors there should be sent by mail, postage prepaid, a copy of an order which the court had made on June 10, 1913. This order of June 10th stated that an action had been commenced in the District Court, Northern District of New York, against Stannard. (the contractor) and his surety (the defendant) to recover for labor and material used in the construction of the United States post office at Malone, N. Y., on account of his contract for the construction of said post office building. It further stated that all persons who had furnished labor or material to the contractor for such construction and who had not been paid may, if they were entitled to intervene in said suit, have their rights adjudicated under the provisions of the acts of Congress. Copies of this order, which constituted tire personal notice ordered by the court, were mailed to all known creditors on June 27th, except as to three who were served personally on June 28th, and July 8th. This in our opinion was a full compliance with the terms of the third proviso as to personal service, even if such proviso had not been practically eliminated by the recent decision in Alex. Bryant v. New York S. F. Company, supra. The circumstance that subsequently additional creditors may have been discovered and notified, or that subsequently additioñal notice may have been sent to these already notified, ex abundante cautela,-is immaterial. The circumstance that the order of June 10, 1913, contained a manifest error, directing publication to be made in a newspaper ‘'prior to October 10, 1910,” is too trivial for discussion.

The order of June 11th, which was certainly a sufficient form of notice under the statute, was published once a week, viz. June 13, June 20, and June 27, 1913, in the Malone Evening Telegram, a newspaper of general circulation. This was in compliance with the statute ; it was published in three successive weekly issues of the paper, and more than three weeks elapsed between the date of the first publication and the date on which, under the statute, the person notified might intervene. Moreover, the last publication was more than three months before October 10, 1913. The circumstance that the court did not direct that it should be published in that párticular newspaper is of no importance; the last half of the third proviso does not require selection of the newspaper to be rna.de by the court. There was full compliance, so far as newspaper publication is concerned, with the requirements of the third proviso1, even if it had never been modified by the Supreme Court in 235 U. S. 327, 35 S. Ct. 108, 59 L. Ed. 253. The circumstance that subsequently a further advertisement was made in another newspaper is unimportant.

[3] The appellant also claims that the court below should have allowed no interest to the complainant, nor to any of the intervening creditors. The objection is based on the assumption that the claims were not liquidated until the court on November 13, 1914, determined in final judgment the amounts due to each of the claimants. It is said the claims could not, prior thereto, have been ascertained by a mathematical computation. Interest has been allowed on the various claims beginning May 1, 1914, that being the date of final hearing.

We find no error in the allowance of interest in the case of the intervening creditors. In the case of each of them the amount due was capable of being ascertained by mere computation, which is all that is required; the old common-law rule, which required that a demand should be liquidated or its amount ascertained, having been to that extent modified. Excelsior Terra Cotta Co. v. Harde, 181 N. Y. 11, 73 N. E. 494, 106 Am. St. Rep. 493. In the case of each of the intervening creditors the amount due was a mere matter of computation.

In the matter of the Proctor Manufacturing Company the facts are somewhat different from the facts as to the claims of the intervening creditors. At the hearing the Surety Company presented two claims, one for $60 for painting, and one for $40.72 for freight and cartage. The first of these the court disallowed, and the second it allowed. But the answer contained no reference to either of these credits subsequently claimed, and in such answer claimed no offsets. We do not see that there is any objection to be made as to the allowance of interest as against it.

Judgment affirmed.