157 Wis. 390 | Wis. | 1914
It is contended in behalf of the Surety Company that the court erred in overruling the demurrer to the complaint and the two demurrers to the cross-complaints of the defendants, O. F. Be Longe, the owner of the building, and of Schwoegler and Kelly, subcontractors.
The default of the principal contractor, as alleged in the cross-complaint of the owner, under the contract made by him with the Construction Company for the furnishing of material and the construction of the building embraced in the contract, constitutes a good cause of action against the Construction Company for breach of the contract. It is also alleged that the defendant Surety Company and the defendant contractor made a bond binding themselves to pay the owner $10,300, conditioned that if the contractor “shall well, truly and faithfully comply with all the terms, covenants and conditions of said contract on its part to be kept and performed according to its tenor (except as hereinafter provided), then this obligation to be null and void, otherwise to remain in full force and virtue in law.” The demurrer admits the allegation of breach of this construction contract as set forth in the owner’s cross-complaint. In effect these allegations show a breach of the contract by the Construction Company in failing to furnish the material and labor required to erect the
The question raised by the demurrer of the Surety Company to the complaint of the plaintiff, a subcontractor, and to the cross-complaint of the defendants Schwoegler and Kelly as subcontractors, for furnishing labor and material to the principal contractor, involves claims of a more uncertain nature than those raised by the demurrer to the owner’s cross-complaint. The ground of demurrer is that the facts alleged by the subcontractors in their complaints do not constitute a cause of action against the Surety Company.
In the case of United States G. Co. v. Gleason, 135 Wis. 539, 116 N. W. 238, it was held that where the principal contractor bound himself to the faithful performance of his agreement for the erection of a certain building and “to pay all claims for labor performed and material furnished,” other
In the Electric Appliance Case the court declares that in this jurisdiction the cases do not “sustain the proposition that the third party can maintain an action against an alleged promisor based upon an implied promise to pay;” and further: “We consider the true rule to be that there must not only be an intent to secure some benefit to the third party, but there must be a promise, legally enforceable. The contract and bond in this case fail to meet these requirements. The situation presented shows a want of any intent to secure a benefit to third parties.” We refer to this case at length to show that the subsequent cases on the same subject in this court, cited above, are in accord- and harmony with this case, it being therein determined that the contracts and bonds of the parties showed an intent to secure such benefit to the third parties, and that a legally enforceable promise existed. The Electric Appliance Case was referred to in Lenz v. C. & N.
Applying the rule thus established by the adjudications in this jurisdiction to the instant case the question is: Does the contract of the principal contractor and the owner and the bond given for its faithful performance show that it was intended that subcontractors furnishing labor or material for the erection of this building to the principal contractor should have the benefit of the bond given to secure faithful performance of the construction contract and promise payment to them ? A consideration of the provisions of the contract and bond leads us to the conclusion that it was intended that the bond should be a protection only to the obligee party, O. F. De Longe. The contract and bond are a part of the complaint. It appears that the contractor was to provide all the materials and perform all the work required to erect and remodel the portions of the buildings embraced in the plans and specifications, made a part of the contract. It was provided that, in case of discontinuance of the contract for any of the grounds specified, no further payment should be due the contractor until the buildings were completed, and that the owner should be liable to the contractor for any balance remaining due him in excess of the expenses incurred by the owner in finishing the work, and that “such excess shall be paid by the owner to the contractor;” and that such balance or excess of expense shall be adjusted by the architect between the contractor and the owner. It is also stipulated that the owner shall have the right to deduct from any amount due the contractor his damages, and it is expressly agreed that if there shall be any lien or claim for which the owner is legally liable and which arises from obligation of the contractor, the
By the Courts — The order overruling the demurrer to the cross-complaint of 0. F. De Longe is affirmed, and is reversed as to the demurrers to the plaintiff’s complaint and the cross-complaint of the defendants Schwoegler and Kelly, and it is ordered that the demurrers to the complaint and cross-complaint of the subcontractors be sustained.