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Shannon v. Continental Casualty Co.

Decided: February 3, 1930.

J. JACOB SHANNON & COMPANY, PLAINTIFF,
v.
CONTINENTAL CASUALTY COMPANY, A CORPORATION, DEFENDANT



On appeal from the Supreme Court.

For the plaintiff, Andrew J. Whinery.

For the defendant, McCarter & English.

Case

The opinion of the court was delivered by

CASE, J. These are cross appeals. Plaintiff furnished materials on a public work to a contractor who was bonded by the defendant under, and in substantially the language of, the statute. Pamph. L. 1918, ch. 75, ยง 4; 1 Cum. Supp., pp. 107, 149, ch. 4.

Plaintiff sued on the bond for $5,039.83, with interest. Verdict was directed for the plaintiff in the amount of $2,039.83, with interest. Plaintiff appeals from the reduction in the amount claimed. Defendant appeals from the allowance of interest.

Plaintiff's contract figure was $5,600. It furnished extras in the amount of $39.83, making the total bill $5,639.83. Before rendition to the defendant of the statement of the amount claimed to be due, plaintiff had received from the contractor $600 in cash, for which full credit was given, reducing the claim to $5,039.83; and, in addition, plaintiff had received a trade acceptance and a promissory note aggregating $3,000, of which, however, no cognizance was taken either in the said statement or in the complaint instituting suit. These instruments matured subsequent to the furnishing of the statement but before suit was brought, and, indeed, before the statutory sixty day waiting period (section 3) had elapsed. There was no proof that plaintiff had accepted these instruments, or either of them, in part payment of the debt. The trial judge, feeling constrained by the decision of the Supreme Court in the case of Taylor v. Wahl, 72 N.J.L. 10, determined that inasmuch as the negotiable instruments had not matured when the statement was rendered, the portion of the claim represented by them was not due and that therefore there must be a reduction from the claim of an amount equal to their aggregate sum and consequently, in directing a verdict, struck off the sum of $3,000.

The statute (cited supra) about which the litigation revolves is entitled "An act to protect persons performing labor or furnishing materials for the construction, alteration or repair of public works."

Section 1 requires that "when public buildings * * * are about to be constructed * * * it shall be the duty of the board * * * to require the usual bond * * * with an additional obligation for the payment by the contractor, and by all subcontractors, for all labor performed or materials furnished * * *."

Section 2 provides that "such bond shall be * * * conditioned for the payment by the contractor, and by all subcontractors, of all indebtedness which may accrue to any person, firm or corporation, on account of any labor performed or materials furnished * * *" and "shall be * * * held * * * for the use of any party interested therein.

Section 3 provides that "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 * * * within eighty days after the acceptance thereof 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 ...


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