United States of America, for the Use and Benefit of William R. Carlson, D/B/A W. R. Taylor & Co. v. Continental Casualty Company

414 F.2d 431, 1969 U.S. App. LEXIS 11243
CourtCourt of Appeals for the Fifth Circuit
DecidedAugust 1, 1969
Docket27459
StatusPublished
Cited by34 cases

This text of 414 F.2d 431 (United States of America, for the Use and Benefit of William R. Carlson, D/B/A W. R. Taylor & Co. v. Continental Casualty Company) 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
United States of America, for the Use and Benefit of William R. Carlson, D/B/A W. R. Taylor & Co. v. Continental Casualty Company, 414 F.2d 431, 1969 U.S. App. LEXIS 11243 (5th Cir. 1969).

Opinions

AINSWORTH, Circuit Judge:

Pursuant to new Rule 18 of the Rules of this Court, we have concluded on the merits that this case is of such character as not to justify oral argument and have directed the Clerk to place the case on the Summary Calendar and to notify the parties in writing. See Murphy v. Houma Well Service, 5 Cir., 1969, 409 F.2d 804.

This action was brought under the Miller Act, 40 U.S.C. § 270a et seq. The question for decision is whether summary judgment was properly granted against a general contractor’s surety upon failure of a subcontractor to reimburse a materialman. Finding no error, no genuine issue of fact and that appellee is entitled to judgment as a matter of law, we affirm the District Court. See Rule 56, Fed.R.Civ.P.

The Development Corporation of America entered into an agreement with the United States to furnish labor and materials in connection with the construction of bachelor officers quarters to the U.S. Naval Air Station, Pensacola, Florida. Appellant Continental Casualty Company, as surety for Development Corporation, prime contractor, executed a standard Government form of payment bond whereby it bound itself to make payment to all persons supplying labor and material in the prosecution of the work. The prime contractor thereafter entered into a subcontract with Owen [433]*433Plastering Company, which company requested William R. Carlson, use plaintiff, to furnish certain materials for the project. Use plaintiff complied but the subcontractor defaulted in its payment in the sum of $9,552.83. Consequently, in compliance with the Miller Act provisions, use plaintiff notified the prime contractor of the default within ninety days of furnishing the last materials.

On motion by use plaintiff, which incorporated the pleadings, an affidavit and deposition of use plaintiff, answers to interrogatories, exhibits consisting of the ledger account of plaintiff, invoices and dray tickets showing the material furnished, the price thereof, the Government project number and location of the jobsite, the District Court granted summary judgment.

Appellant’s contention on appeal is that since use plaintiff has not shown that the materials were used on the job, he is required to prove that he reasonably believed they were so intended and in good faith supplied them, and that such proof has not been made. Appellant further contends that summary judgment was improper as it was granted upon hearsay testimony.

Several well-established principles have emerged from Miller Act cases. It is fundamental that in order for a materialman to recover under the Act it is necessary only that he show that the materials were supplied in prosecution of the work provided for in the contract, that he has not been paid therefor, that in good faith he had reason to believe the materials were intended for the specified work, and that he complied with the jurisdictional requisites. It is immaterial to his right of recovery that the materialman deliver the materials to the jobsite or that such materials actually be used in the prosecution of the work. Riley-Stabler Const. Co. v. Westinghouse Electric Corp., 5 Cir., 1968, 396 F.2d 274, 276, 277; Boyd Callan, Inc. v. United States, 5 Cir., 1964, 328 F.2d 505, 511; Glassell-Taylor Co. v. Magnolia Petroleum Co., 5 Cir., 1946, 153 F.2d 527, 529. Nor is diversion of materials a valid defense if the supplier has acted in good faith. Riley-Stabler, supra at 276, 277; Glassell-Taylor, supra at 530. Another precept which we may derive from Miller Act litigation is that the Act is highly remedial in nature and is “entitled to a liberal construction and application in order properly to effectuate the Congressional intent to protect those who furnish labor or materials for public works.” Glassell-Taylor, supra at 529, 530; Boyd Callan, Inc., supra at 512.

Appellant, in urging that summary disposition of the matter was improper, relies principally on this Court’s decision in Riley-Stabler Const. Co. v. Westinghouse Electric Corp., 1968, 396 F.2d 274, and the Supreme Court decision of Poller v. Columbia Broadcasting System, 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962). Riley-Stabler involved an interpretation of an Alabama statute which was the counterpart of the Miller Act. This Court, in reversing the District Court’s summary judgment, said, 396 F.2d at 277: “[I]t is our opinion that as a general proposition the issue of good faith is inappropriate for determination by summary judgment procedure. A factual dispute on that issue can more properly be resolved on trial of the case.” Later, in denying a petition for rehearing in Riley-Stabler Const. Co. v. Westinghouse Electric Corp., 1968, 401 F.2d 526, the majority of the Court noted that “good faith” was at issue as it had been raised by affidavit of the defendant corporation alleging “that a substantial portion of material had been used on [other] projects.” However, the Court said, “It is only where there has been a diversion that there would be any necessity for raising the question of good faith.” Id. at 527.

In the present case appellant has alleged no facts, by countervailing affidavit or otherwise, which would put appellee’s good faith at issue. At the instance of opposing counsel, appellee was thoroughly examined on deposition, and [434]*434his answers are consistent with the other evidence offered in the record. The entire basis for appellant’s defense appears to be its contention that appellee has not affirmatively borne the burden of proving good faith. Whether it was incumbent upon appellant to meet such a burden under the circumstances of this case, we need not decide, for the record amply demonstrates that good faith did in fact exist.

The Supreme Court decision of Poller v. Columbia Broadcasting System, supra, is of no advantage to appellant. The only unifying factor between that decision and this case is that both cases entail use of summary judgment. Poller reiterates the well-established principle that summary procedure should be avoided and litigants must be afforded their right to jury trial when “they really have issues to try.” 368 U.S. at 467, 82 S.Ct. at 488. It is inapposite to the present case, however, for at least three reasons. First Poller was a “complex antitrust litigation where motive and intent play leading roles,” 368 U.S. at 473, 82 S.Ct. at 491;1 secondly, the issue of good faith was not only raised, it was of the essence of the suit; and, thirdly, respondent’s affidavits in response to the motion for summary judgment did not effectively contravene the many factual allegations of the petitioner.

Appellant’s second contention that summary judgment was based on hearsay evidence is without merit.

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414 F.2d 431, 1969 U.S. App. LEXIS 11243, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-of-america-for-the-use-and-benefit-of-william-r-carlson-ca5-1969.