PAN AMERICAN SURETY COMPANY, A FLORIDA CORPORATION, APPELLANT,
v.
BOARD OF PUBLIC INSTRUCTION OF DADE COUNTY, FLORIDA, FOR THE USE AND BENEFIT OF ROSE-SAXON LUMBER CO., A FLORIDA CORPORATION, APPELLEE
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A surety company appealed a judgment on a statutory public works bond, challenging both the denial of its defense based on extension of time for payment and the inclusion of attorney's fees in the award. The court affirmed the judgment on the bond itself but reversed the attorney's fees portion, holding that the fee provision in the prime contractor's contract with the school board was not intended to benefit a use plaintiff.
A compensated surety on a public works bond is not relieved of liability by an extension of payment time granted by a materialman, as the rules governing accommodation parties on negotiable instruments do not apply to compensated sureties. Attorney's fees may be awarded only by statute or by contract between the parties seeking and agreeing to pay them; since the attorney's fee provision in the school board contract was intended for the school board's protection and not for a use plaintiff's benefit, such fees cannot be recovered by the use plaintiff against the surety.
“The position of a compensated surety is not the same as that of an accommodation party on a negotiable instrument.”
Establishes that rules applicable to negotiable instrument sureties do not apply to compensated sureties on public works bonds.
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Join FLexlaw to unlock all legal intelligenceRose-Saxon Lumber Co. supplied materials to a prime contractor working on a school board project. The surety (Pan American Surety) was required under …
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PEARSON, Judge.
The plaintiff brought an action on a statutory public works bond, required under Section 255.05, Fla.Stat., F.S.A., against the surety. The complaint was amended pursuant to leave of court to include a claim for attorney’s fees for plaintiff’s attorney. This amendment was allowed under the theory that a provision in the contract between the School Board and the prime contractor authorized the assessment of this fee. The defendant moved to strike this amendment and the motion was denied. The surety filed defenses based essentially on the theory that the use plaintiff, Rose-Saxon Lumber Co., had extended the time of payment for the materials furnished by it to the contractor, and that such extension of time relieved the defendant of liability. Motion to strike the defense was filed and in effect was granted by the trial judge; in that he refused to admit evidence proffered in support of the defense. The plaintiff recovered a judgment which included an attorney’s fee. The defendant appeals and urges error; first by the court’s refusal to admit proffered testimony in support of the defense above set out, and second by the inclusion of an attorney’s fee in the judgment.
The appellant failed to support its proposition that the surety was prejudiced by the extension of time for payment of the materials furnished. Nor has it furnished us with authority upon which it could be held that the extension of time released the surety. An analysis of the cases cited by appellant reveals that the only authority for its position is found in cases dealing with personal sureties on negotiable instruments. The position of a compensated surety is not the same as that of an accommodation party on a negotiable instrument. Gibbs v. Hartford Accident & Indemnity Co., Fla.1952, 62 So. 2d 599; 50 Am.Jur., Suretyship §§ 320-322 (1944).
Therefore we must reject appellant’s contention that negotiable instrument cases apply. The court should have stricken the defenses on motion, and therefore the refusal to admit evidence under them was not error. Since attorney’s fees can be allowed only by statute, or in the enforcement of a contract between parties stipulating for their payment, that portion of the judgment must be reversed. Brite v. Orange Belt Securities Co., 133 Fla. 266, 182 So. 892; Main v. Benjamin Foster Co., 141 Fla. 91, 192 So. 602, 126 A.L.R. 1434; Union Indemnity Co. v. Vetter, 5 Cir., 1930, 40 F. 2d 606. There is no provision for attorney’s fees in the contract between the use plaintiff and the prime contractor. The contractor’s performance bond is silent as to an obligation to pay attorney’s fees. The bond does, however, incorporate by reference the entire contract between the school hoard and the prime contractor. This latter contract contains a stipulation for payment of legal services.1 The stipulation in this contract is not intended for the benefit of a use plaintiff, but rather for the protection of the school board in the event they are required to secure an attorney on account of a breach. The cause is remanded with directions to enter an amended final judgment by striking from the present judgment the amount assessed as attorney’s fees.
Affirmed in part and reversed in pa,rt.
CARROLL, CHAS., C. J., and HORTON, J., concur. . The contract between the general contractor and the school board provided that the “Instructions to the Bidders and General Conditions” shall be a part of the contract between the parties as if they were copied in full therein. Article A-16 of said included document provided: “In case of default on the part of the contractor, actions for all expenses incident to ascertaining and collecting losses under the bond, including both Architectural and Legal services, shall lie against Bond.”
Cases With Similar Vibessemantic neighbors from the corpus
Citator
Cited By
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Cancilla v. Parkleigh House, Inc., 108 So. 2d 626 (Fla. 3d DCA 1959)…PER CURIAM. Affirmed upon authority of the rule stated in Brite v. Orange Belt Securities Co., 133 Fla. 266, 182 So. 892; Pan American Surety Co. v. Board of Public Instruction, Fla.App.1958, 99 So. 2d 890. CARROLL, CHAS., C. J., and HORTON and PEARSON, JJ., concur.…
Authorities Cited
- Brite v. Orange Belt Sec. Co., 133 Fla. 266 (Fla. 1938)
- Elwin R. Main & Am. Sur. Co. of N.Y. v. Benjamin Foster Co., 141 Fla. 91 (Fla. 1939)
- Gibbs v. Hartford Accident & Indem. Co., 62 So. 2d 599 (Fla. 1952)
- Roland v. State, 140 Fla. 692 (Fla. 1939)
- Union Indem. Co. v. Vetter, 40 F.2d 606 (5th Cir. 1930)