Summary
In Western Southern Indemnity Co. v. Chicago Title Trust Co., 128 Ohio St. 422, 191 N.E. 462, a bond similar to that given in the present case was under consideration.
Summary of this case from Manhattan Brass Strip Co. v. Benzing SonsOpinion
No. 24683
Decided June 13, 1934.
Statutory construction — Later enactment repeals former inconsistent provisions by implication — Special statute as exception to statute in general terms — Materialman's action against surety on public contractor's bond — One year limitation from acceptance of work, applies — Action to be brought in county where material furnished or delivered — Sections 2316 and 2365-3, General Code.
1. Where two sections of the General Code contain inconsistent provisions relating to the same subject-matter, the later enactment must prevail and the earlier is repealed by implication.
2. The provisions of Section 2316, General Code, fixing a limitation of one year from the time of the delivery or furnishing of the material within which suit may be brought on a public contractor's bond, was repeated by the subsequent enactment of the provisions of Section 2365-3, General Code, fixing a limitation of one year from the time of the acceptance of the building, work or improvement.
3. A special statute covering a particular subject-matter must be read as an exception to a statute covering the same and other subjects in general terms.
4. The special provision in Section 2316, General Code, that suit on a bond must be brought in the county where the material was furnished or delivered, prevails over the general provision relating to the bringing of such suits contained in Section 2365-3, General Code.
ERROR to the Court of Appeals of Franklin county.
The action was begun in the Common Pleas Court of Franklin county by the plaintiffs, Chicago Title Trust Company et al., as receivers of the Northwestern Terra Cotta Company, appointed and acting under the authority of the United States District Court of the Northern District of Illinois, Eastern Division.
The petition alleged that on December 13, 1930, the Westerman Construction Company filed with the Department of Public Works of the State of Ohio a proposal for the erection, construction and equipment of the power house at Longview State Hospital in Cincinnati in accordance with the plans and specifications prepared by the state architect; that pursuant to the statutes of Ohio said Westerman Construction Company filed with its said proposal a surety bond executed by it as principal, and by the Western and Southern Indemnity Company, formerly known as the American Liability Company, as surety.
The said bond read as follows:
"Contract Bond"Sec. 2316, G. C. (107 O. L., 454) and Sec. 2365-4, G. C. (107 O. L., 642).
"Know all men by these presents, that we, the undersigned The Westerman Construction Company of Columbus, Ohio, as principal, and The American Liability Surety Company of Cincinnati, Ohio, as surety, are held and firmly bound unto the state of Ohio in the penal sum of seventy thousand four hundred and fifty dollars ($70,450.00) for the payment of which well and truly to be made, we hereby jointly and severally bind ourselves, our heirs, executors, administrators, successors and assigns.
"The condition of the above obligation is such, that whereas the above named principal did on the fifteenth day of December, 1930, file with the department of public works, state of Ohio, Columbus, Ohio, a proposal for the erection and completion of general contract for power house and equipment at Longview State Hospital in accordance with plans and specifications prepared by T. Ralph Ridley, state architect, Columbus, Ohio.
"Now, therefore, in the event that said proposal is accepted, if the said principal within ten days next after the awarding of the said contract enter into a proper contract in accordance with the proposal, plans, details, specifications and bills of material, which said proposal and contract are made a part of this bond the same as though set forth herein; and faithfully perform each and every condition of such contract; and indemnify the state of Ohio against all damage suffered by failure to perform such contract according to the provisions thereof and in accordance with the plans, details, specifications and bills of material therefor; and pay all lawful claims of subcontractors, material men and laborers for labor performed or material furnished in carrying forward, performing or completing of said contract; we agreeing and assenting that this undertaking shall be for the benefit of any sub-contractor, material men or laborer having a just claim, as well as for the obligee herein; then this obligation shall be void; otherwise the same shall remain in full force and effect; it being expressly understood and agreed that the liability of the surety for any and all claims hereunder shall in no event exceed the penal amount of this obligation as herein stated.
"The said surety hereby stipulates and agrees that no modifications, omissions or additions in or to the terms of said contract or in or to the plans or specifications therefor shall in any wise affect the obligation of said surety on this bond.
"Signed and sealed this thirteenth day of December, A.D. 1930.
"The Westerman Construction Company, "(Signed) By: Dana R. Westerman. "The American Liability Surety Company, "(Signed) By: Otis Harris, (Seal) "Attorney in Fact.
"Note: The amount of this bond must be at least the total sum of the bid, including all plus alternates."
The said Westerman Construction Company was awarded the contract for the construction of said power house, and entered upon the execution thereof. Upon the order of the Westerman Construction Company the Northwestern Terra Cotta Company furnished material which was used in the construction of the building, and, at the time of bringing this action, the sum of eleven hundred dollars remained due and unpaid.
The last of said materials was furnished to the Westerman Construction Company on November 6, 1931, and on January 7, 1932, the plaintiffs furnished the Western and Southern Indemnity Company a statement of the amount due, in accordance with the provisions of Section 2365-3, General Code. The power house was accepted by the State of Ohio on November 30, 1932, and this action was brought more than sixty days after the furnishing of the said statement, and less than one year from the date of the acceptance of the power house by the state.
The defendant surety company moved to quash the summons on the ground that the court of Franklin county had no jurisdiction. This motion was based upon the claim that the case was ruled, not by Section 2365-3, General Code, but by Section 2316, General Code, and that under the latter section the action could be brought only in Hamilton county, where the material was furnished.
The motion to quash was sustained by the Court of Common Pleas and the petition was dismissed.
The Court of Appeals reversed this ruling, and, pursuant to a motion to certify, the case comes into this court on error.
Messrs. Vorys, Sater, Seymour Pease, for plaintiff in error.
Messrs. Blanchard, Touvelle Nida and Mr. R.H. Hoffman, for defendants in error.
The facts in this case necessitate the construction of Section 2316 and Section 2365-3, General Code. Both appear in Chapter 1 of Title IX of the General Code of Ohio. Chapter 1 is entitled: "Building Regulations".
Section 2316, General Code, appears under the subtitle, "State Buildings", and reads as follows:
"The bond provided for in sections 2315 and 2319 shall be conditioned that, if his proposal is accepted, the bidder will within ten days next after the awarding of such contract, enter into a proper contract in accordance with the proposal, plans, details, specifications and bills of material and that he will faithfully perform each and every condition of the same. Such bond shall also indemnify the state against the damage that may be suffered by failure to perform such contract according to the provisions thereof, and in accordance with the plans, details, specifications and bills of material therefor. Such bond shall also be conditioned for the payment of all material and labor furnished for or used in the construction for which such contract is made. The bond may be enforced against the person, persons or company executing such bond, by any claimant for labor or material and suit may be brought on such bond in the name of the State of Ohio on the relation of the claimant within one year from the date of delivering or furnishing such labor or material, in the court of common pleas of the county wherein such labor or material was furnished or delivered, and such bonds, or sureties thereon shall not be released by the execution of any additional security, notes, retentions from estimates, or other instrument on account of such claim, or for any reason whatsoever, except the full payment of such claim for labor or material."
Section 2365-3, General Code, appears under the subtitle, "General Provisions", and reads as follows:
"Any person, firm or corporation to whom any money shall be due on account of having performed any labor, or furnished any material in the construction, erection, alteration or repair of any such building, work or improvement, at any time after performing such labor or furnishing such material, but not later than ninety days after the acceptance of such building, work or improvement by the duly authorized board or officer, shall furnish the sureties on said bond, a statement of the amount due to any such person, firm or corporation. No suit shall be brought against said sureties on said bond until after sixty days after the furnishing of said statement. If said indebtedness shall not be paid in full at the expiration of said sixty days, said person, firm or corporation may bring an action in his own name upon such bond, as provided in sections 11242 and 11243 of the General Code, said action to be commenced not later than one year from the date of acceptance of said building, work or improvement."
Both sections were enacted by the 82nd General Assembly. Section 2316, General Code, was part of an act passed March 20th, 1917 (107 Ohio Laws, 453). Section 2365-3, General Code, was part of an act passed March 21st, 1917 (107 Ohio Laws, 642). Of these two acts the former applies only to state improvements, while the latter applies to state and also to county, city, township and school improvements.
Section 2316, General Code, provides that action "may be brought on such bond in the name of the state of Ohio on the relation of the claimant within one year from the date of delivering or furnishing such labor or material, in the court of common pleas of the county wherein such labor or material was furnished or delivered, * * *."
Section 2365-3, General Code, provides that "said person, firm or corporation may bring an action in his own name upon such bond, as provided in sections 11242 and 11243 of the General Code, said action to be commenced not later than one year from the date of acceptance of said building, work or improvement."
It thus appears that Section 2316, General Code, establishes a limitation of one year from the date of furnishing the material, whereas Section 2365-3, General Code, permits suit not later than one year from the acceptance of the building, work or improvement. Section 2316, General Code, provides that the action be brought in the county where the material was delivered, whereas Section 2365-3, General Code, is silent as to the place of bringing suit.
By their terms both the act of March 20th, 1917, and the act of March 21st, 1917, apply to state projects. Longview State Hospital is an institution belonging to the state of Ohio, and the power house in question is for the use of the state.
This court has already held that Sections 2314 to 2330, General Code, were not repealed in their entirety by Sections 2365-2 and 2365-3, General Code. State, ex rel. Fleischer Engineering Construction Co., v. State Office Building Commission, 123 Ohio St. 70, 174 N.E. 8.
This court also held that Sections 2314 to 2330, General Code, governed "the manner of advertising for proposals and making the contract" for this particular job at Longview Hospital. State, ex rel. Eliott Co., v. Connar, Supt., 123 Ohio St. 310, 175 N.E. 200.
It is apparent that the bond in question was offered and accepted as a combination bid bond and contract bond, and we see no reason why such combined bond should not be given.
If Sections 2316 and 2365-3, General Code, are both in force, and if both apply to the transaction in question, how are they to be reconciled? We see only one point of irreconcilable difference. Section 2316, General Code, limits the time of bringing suit on the bond to one year from the delivery of the material, while Section 2365-3, General Code, permits suit within one year from the acceptance of the work. Upon this point we are constrained to hold that the limitation in Section 2316, General Code, was repealed by the provisions of Section 2365-3, General Code. As applied to the same subject matter the two are inconsistent, and in this contingency the later enactment must prevail. This later enactment has, in our opinion, the better reason to support it, and we have no difficulty in reaching the conclusion that the legislature intended the more liberal period of limitation.
As to the place of bringing the action, however, there is no real conflict. The effect of the language of Section 2316, General Code, is that the action must be brought in the county where the material was delivered. Section 2365-3, General Code, by its silence on the subject, leaves the claimant free to sue wherever he can obtain service.
"A special statute covering a particular subject-matter must be read as an exception to a statute covering the same and other subjects in general terms." State, ex rel. Elliott Co., v. Connar, supra, at page 314; State, ex rel. Steller et al., Trustees, v. Zangerle, Aud., 100 Ohio St. 414, 126 N.E. 413. Applying this principle it is clear that the special provision as to the place of bringing suit in Section 2316, General Code, must prevail over the general language of Section 2365-3, General Code. This construction, in our opinion, also results in the better rule. To permit suit upon such a bond to be filed in every county in the state would not only vex and harass the defendant company and the state officials involved, but would also, in many cases, render much more difficult the marshalling of claims against the fund.
In our opinion, therefore, the law allowed a period of one year from the time of the acceptance of the power house by the state within which suit might be brought, but required that such suit be brought only in Hamilton county where the material was delivered. The judgment of the Court of Appeals will be reversed and that of the Court of Common Pleas affirmed.
Judgment of the Court of Appeals reversed and that of the Common Pleas Court affirmed.
STEPHENSON, JONES, MATTHIAS and WILKIN, JJ., concur.
WEYGANDT, C.J., and ZIMMERMAN, J., dissent.