153 A. 621 | Pa. | 1930
The County of Montgomery brought this action against Ambler-Davis Company as a principal obligor, and the Metropolitan Casualty Insurance Company as surety, on a bond executed by them to it in connection with the construction of a public highway by the company first named. The defendants filed affidavits of defense in the nature of demurrers and upon the questions of law thus raised the court below entered judgments in their favor; the county has appealed.
The bond was given in the sum of $190,992. It recites the contract between the county and the principal obligor for the building of the road. Its first condition is that the Ambler-Davis Company shall faithfully comply with the contract, which, it is admitted, it has done, and has been paid by the county in full. The second reads as follows: "It is a further condition of this bond that if the principal obligor shall and will promptly pay, or cause to be paid, to any person, partnership or corporation, all sums of money which may be due for labor performed or materials supplied and furnished in and about the performance of the work covered by the above mentioned contract, as provided by law, then this obligation to be void, otherwise to be and remain in full force and virtue." *337
In its statement of claim plaintiff alleges that the latter clause of the obligation is a contract of insurance whereby the defendants, for a valuable consideration, undertook and promised to pay to it a sum equal to all sums of money which thereafter might become due and remain unpaid for labor performed and materials furnished in the performance of the work covered by the contract for the construction of the highway. The statement declares that certain persons, naming them, have not been paid for their labor and materials and that there is due to them the sum of $61,798.97. It is averred that plaintiff is under no obligation, legal or equitable, to any of the persons unpaid, but that it has an insurable interest in the performance by the Ambler-Davis Company of its obligation to them "in that the provision of a fund out of which laborers and materialmen may be paid tends to insure bidding by responsible subcontractors and the better performance of their subcontracts; in that the interests of the county and the safety of the public are jeopardized by the outstanding temptation to acts of violent resentment growing out of the nonpayment of the just claims of laborers and materialmen; in that it is contrary to sound morals and good policy that the plaintiff should be compelled to accept and utilize work and material for which just payment has not been made; and in that the officers of the county are public officials who owe a duty of protection to the interests of all those the fruit of whose labor and material is enjoyed by the county. The plaintiff avers that said insurable interest is the basis of the contract of insurance embodied in the writing obligatory pleaded."
The argument made in plaintiff's behalf, both in the brief and at bar, is based on the premise that the bond in suit is not merely a contract of indemnity but is also one of insurance. It probably would be possible to join two such provisions in a single bond, the primary purpose of which, and indeed the only one in which the indemnitee is directly interested, being to have the work expeditiously *338
and satisfactorily done, but it must be admitted that such a dual purpose in the one instrument is most unusual. See Lancaster v. Frescoln,
When the obligation in suit was given, August 17, 1926, the case of Greene Co. v. Southern Surety Co.,
The judgments are affirmed.