DORR et ux. v. BANKERS' SURETY CO. [ the word "architect" wherever used in the con(No. 15801.)

(St. Louis Court of Appeals. Missouri. Feb. 3, 1920.)

1. PRINCIPAL AND SURETY 86-PROVISION OF CONTRACTOR'S BOND AS TO NOTICE OF DEFAULT CONSTRUED.

Contractor's bond requiring written notice to surety "of any act on the part of said principal, which shall involve a loss for which the said surety is responsible hereunder, immediately after the occurrence of such act shall have come to the knowledge of the duly authorized representative or representatives of the obligee herein, who shall have the supervision of the completion of said contract," refers to such defaults as delay or defective workmanship occurring during progress of building and not to defaults occurring after building is in fact completed, such as failure to pay materialmen.

2. PRINCIPAL AND SURETY 59-BONDS EXECUTED BY CORPORATION FOR COMPENSATION WILL BE CONSTRUED IN FAVOR OF OBLIGEE.

The rule of law that a surety is a favorite of the law and that a claim against him is strictissimi juris has no application where a bond is executed by a surety for a compensation and where surety is organized for the purpose of executing such bonds for hire and for a profit, such undertakings being construed strongly in favor of the obligee, notwithstanding Rev. St. 1909, § 1209.

tract had reference to owner.

Appeal from St. Louis Circuit Court; John W. Calhoun, Judge.

"Not to be officially published."

Suit by Lorenz E. Dorr and wife against the Bankers' Surety Company. From judg ment sustaining motion to set aside nonsuit, defendant appeals. Affirmed and remanded.

Plaintiffs, being husband and wife, sue upon a building contractor's faithful performance bond which was executed by the defendant, Bankers' Surety Company, a corporation, authorized to do a surety business in the state of Missouri.

both the contractor and the surety company, The suit was originally instituted against but during the progress of the trial the cause was dismissed as to the contractor. Upon submission of plaintiffs' case, the trial court announced its intention to give a peremptory instruction in favor of the defendant, whereupon the plaintiff requested leave to take an involuntary nonsuit with leave to move the court to set the same aside, which request the court granted. Afterwards the plaintiffs filed a motion to set aside the nonsuit, which motion was sustained. From this order or judgment sustaining the motion to set aside the nonsuit the defendant has perfected an appeal to this court, contending that the court below erred in sustaining the motion

3. PRINCIPAL AND SURETY 117-BUILDING and that the plaintiffs' proof failed to make

CONTRACT PROVIDING FOR FINAL PAYMENT
"WITHIN" TEN DAYS AFTER COMPLETION DID
NOT REQUIRE OWNER TO WAIT UNTIL SUCH
TIME BEFORE MAKING PAYMENT.

a case for the consideration of the jury. Plaintiffs, being the owners of a lot of ground in the city of St. Louis, entered into Where building contract provided for final a contract with W. A. Schumacher for the payment "within 10 days after completion of erection of a three-story apartment building the work," final payment made before the full according to certain plans and specifications, 10-day period had expired did not release con- and by which contract the said Schumacher tractor's surety under provision of bond requir- undertook to erect and complete said building owner to retain percentage until the full per- ing according to the terms of the contract formance of the contract, owner having had and specifications and to furnish at his exright under the contract to make the final pay-pense all labor and materials to be used in ment at any time within such 10 days and not said building. Under the terms of the conbeing required to wait until expiration thereof, for the word "within" does not mean at the end of 10 days, but any time within the 10 days. [Ed. Note.-For other definitions, see Words and Phrases, First and Second Series, Within.]

tract, Schumacher was to be paid the sum of $16,616 in installments during the progress of the work, the final payment of $3,616 to be made when the work was completed and within 10 days after the completion of said

4. PRINCIPAL AND SURETY 101(2)—NAMING work included in the contract.

OF OWNER AS ARCHITECT IN BUILDING CON-
TRACT DID NOT RELEASE SURETY ON CON-

The defendant, Bankers' Surety Company, on April 22, 1909, for a compensation, exeTRACTOR'S BOND THOUGH OWNER WAS NOT cuted the bond in suit, conditioned upon the

AN ARCHITECT.

faithful compliance of Schumacher of all the terms, covenants, and conditions of said contract, which bond was subject to the following provisions:

Where owner's name was filled in in blank space of uniform building contract for insertion of architect's name, and where owner, though not a builder or an architect, had some experience in building and was on the work daily "Provided, that said surety shall be notified during the construction of the building, the fact in writing of any act on the part of said printhat owner was not an architect was not such cipal, which shall involve a loss for which the an alteration of the terms of the contract as to said surety is responsible hereunder, immediaterelease surety; it being apparent that no really after the occurrence of such act shall have architect was intended for the work and that come to the knowledge of the duly authorized

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

(218 S.W.)

representative or representatives of the obligee herein, who shall have the supervision of the completion of said contract, and a registered letter mailed to the surety, at its principal office in Cleveland, Ohio, shall be deemed sufficient notice, within the meaning of this bond.

"Provided, further, that the obligee shall retain until the full performance of said contract, and until after limitation against liens shall have run, the percentage provided to be retained in said contract in the event of default by the principal in the terms of said contract, this instrument shall operate from the date hereof as an assignment unto said surety, for its protection, indemnification or reimbursement of all moneys earned or due, or to become due to the principal, which shall not, prior to such default, have been paid unto said principal on account of said contract," etc.

(1) That it was released by reason of plaintiffs' failure to give notice of the contractor's default as required by the bond.

(2) That it was the duty of the plaintiffs to retain the final payment under the contract for at least 10 days after the completion of the building, and that such failure released the defendant, and, if such failure did not in fact totally discharge the surety, it at least entitled the surety to a credit pro tanto to the extent of the overpayments, which was more than sufficient to cover the amount claimed by the plaintiffs.

(3) That inasmuch as the contract provided that the plaintiffs, who were the owners, should act as architects, and inasmuch as the evidence showed that they failed to do so, this was such an alteration of the contract as to release the surety.

Jeffries & Corum, of St. Louis, for appellant.

Finnegan & Finnegan, of St. Louis, for

The provision of the contract and bond over which the controversy arises is that provision of the contract which provides that respondents. the final payment when the building was completed was to be $3,616, and that this final payment "shall be made within ten days after the completion of the work included in the contract," and the bond provision regarding payment "that the obligee shall retain until the full performance of said contract, and until after limitation against liens shall have run, the percentage provided to be retained in said contract."

BIGGS, C. (after stating the facts as above). [1] As to notice, we think the point has been correctly ruled against defendant by the Kansas City Court of Appeals in the case of Hurley v. Fidelity & Deposit Co., 95 Mo. App. 88, 68 S. W. 958. The provision in the bond in the Hurley Case was exactly the same provision as is contained in the present case in regard to the question of the As the work progressed, the plaintiffs necessity of notice of default, and it was made payments to the contractor substantial-held by the court that this condition in the ly in accordance with the provisions of the bond had reference only to such acts of the contract. Two days after the building was contractor which would cause loss for which completed, the contractor, Schumacher, ap- the defendant surety would be liable, while plied to the plaintiffs for the final payment. the contract of plaintiff with defendant's At that time the plaintiffs, having been ad-principal was being performed. This seems vised by Schumacher that all claims of mate- to us to be a reasonable construction of such rialmen against the building had been paid, a provision in view of the language used, made a partial payment of $2,000 to Schu- which it will be noted required the notice macher on account of the final payment. to be given immediately after the occurrence Within a few days thereafter, Schumacher of such act or default shall have come to applied to the plaintiffs for the balance due, the knowledge of the duly authorized repbut in the meantime the plaintiffs had dis-resentative of the obligee herein, "who shall covered that there were bills in favor of materialmen against the building which were overdue and which had not been paid by Schumacher, and they thereupon declined to pay Schumacher the balance remaining unpaid under the contract.

have the supervision of the completion of said contract." This plainly refers to either the obligee personally, if he is in charge of the supervision, or to his duly employed architect, and refers to such defaults, such as delay or defective workmanship, Thereafter lien claims were established which occurs during the progress of the against the property on account of the con- building, and not to defaults that occur afttractor's failure to pay the materialmen ag-er the building is in fact completed. In the gregating the sum of $2,838.25, and the plain- Hurley Case the work had been completed tiffs in addition paid two other claims aggregating $383.60 for materials furnished to the building, which the plaintiffs contend were lienable claims, but the liens were not perfected in view of plaintiffs' promise to pay the claims.

No written notice as provided by the bond was given the defendant by plaintiffs of the default of the contractor in failing to pay these materialmen. Defendant on this appeal contends:

and there had been a default in the payment of certain notes that were given to pay for the work under the provisions of the contract. The notes were due monthly, and no notice was given to the surety company until all of them had become due and payable, although the condition of the bond required immediate notice. In the present case the building had been completed and the default of the contractor, of which the defendant claims it should have had notice, did not

[2] The rule of law that a surety is a favorite of the law, and that a claim against him is strictissimi juris, has no application where a bond like the one in suit is executed by a surety for a compensation, and where the surety is organized as the present defendant is for the purpose of executing such bonds for hire and for a profit. Such undertakings must be construed strongly in favor of the obligee. Lackland v. Renshaw & Surety Co., supra; Rule v. Anderson et al., 160 Mo. App. loc. cit. 358, 142 S. W. 358; Barton v. Guaranty & Surety Co., 192 Mo. App. 561, loc. cit. 564, 183 S. W. 694.

Defendant's counsel in the present case say that the courts, in deciding the foregoing proposition that the doctrine of strictissimi juris does not apply to a compensated surety, have overlooked in deciding these cases section 1209, R. S. of 1909, which says: "Such surety company may be released from its liability, on the same terms and conditions as are by law prescribed for the release of individuals-it being the true intent and meaning of section 1209 to 1211 to enable corporations created for that purpose to become surety on any bond, recognizance or other writing in the nature of a bond, in the same manner that natural persons may, subject to all the rights and liabilities of such persons."

(218 S.W.)

to make the final payment at any time with-contention made by the defendant that the in 10 days after the completion of the work. The word "within," as used in the provision, does not necessarily mean at the end of 10 days, but, as it plainly says, payment can be made within 10 days, which means at any time within 10 days.

The contract contained this provision:

"If at any time there shall be evidence of any lien or claim, for which, if established, the owner of said premises might become liable, and which is chargeable to the contractor, the owner shall have the right to retain out of any payment then due, or thereafter to become due, an amount sufficient to completely indemnify him against such liens or claims. Should there prove to be any such claims after all payments are made, the contractor shall refund to the owner all moneys that the latter may be compelled to pay, in discharging any lien on said premises, made obligatory in consequence of the contractor's default."

This provision indicates to us that it was not the intention of the parties that there was to be retained by the plaintiffs any percentage of the contract price.

contract was materially altered by the plaintiffs making payments at different times and in different amounts than that called for by the contract appears to be without merit. This is clear when you keep in mind the rule that strictissimi juris has no application to a bond of the character of the one in suit.

Finding no reversible error in the record, the commissioner recommends that the judgment be affirmed and the cause remanded.

LATHAM v. HARVEY. (No. 15874.)

3, 1920.)

1. MUNICIPAL CORPORATIONS ~~706 (6)—
WHETHER INJURED STREET SWEEPER WAS
STANDING IN
FULL VIEW, OR STEPPED IN
FRONT OF DEFENDANT'S AUTOMOBILE FROM
BEHIND STREET CAR, HELD FOR JURY.

In an action by a street sweeper for personal injuries, whether plaintiff was standing in full view of defendant, who was driving an automobile, or stepped from in front of a car directly in front of the automobile, too late to allow defendant to stop before striking him, held for the jury.

[4] It is next contended by defendant that there was such an alteration of the terms of (St. Louis Court of Appeals. Missouri. Feb. the contract as to release the surety, in this, that the contract provided that the plaintiffs, who were the owners, should act as architects, and inasmuch as the evidence shows that the owners did not act as architects, that this should release the surety. Upon a reading of the contract as a whole, it is plain that it was not the intention of the parties here that there should be a third person who should act as architect. The contract, which was of the uniform building contract type, had a blank space for the insertion of an architect's name, and in many particulars refers to an architect; but in this blank space the word "owner" was inserted instead of "architect." It appeared from the evidence that the contractor drew the original plans, and the evidence shows In an action by a street sweeper for injuthat the plaintiff Dorr was on the work dai-ries sustained when run down by défendant's ly during the construction of the building automobile, where plaintiff pleaded that he was and had some experience in building, al- standing in the street when struck, and testified though he did not pretend to be a builder that he was standing midway between a street or an architect. It is plain that no real arcar track and the curb when struck, positively chitect was intended for this work, and that affirming that he had not been on the street car track an instruction authorizing a recovery the word architect was to mean owner. front of a street car" and that at the time plainon a finding that "plaintiff stepped from in tiff "was stepping" from in front of the car defendant saw, or by the exercise of ordinary care could have seen, him in time to have stopped, was too broad and was prejudicial.

The contract provided for the payments to be made as heretofore stated as the work progressed, for instance, a certain amount when the first floor joists were on, and when the third floor joists were on, and when the roof was on the building. Those payments were made by the plaintiffs after it was determined that the work had so far progressed, and when you consider that the contract allowed for extra work it does not appear that there were any excess payments made by the plaintiffs, and consequently the

2. APPEAL AND ERROR 1066-TRIAL

252 (8)-INSTRUCTION PERMITTING RECOVERY BY INJURED STREET SWEEPER CONSTRUED AS TOO BROAD AND PREJUDICIAL.

Appeal from St. Louis Circuit Court; John W. Calhoun, Judge.

Action by Robert Latham against William J. Harvey. Judgment for plaintiff, and defendant appeals. Reversed and remanded.

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
218 S.W.-26

Bryan, Williams & Cave, of St. Louis, for that plaintiff's injuries were due to his own appellant.

Edw. W. Foristel and Eagleton & Habe nicht, all of St. Louis, for respondent.

ALLEN, J. This is an action to recover damages for personal injuries sustained by plaintiff by being struck by an automobile belonging to the defendant and driven by him. The trial below, before the court and a jury, resulted in a verdict and judgment in favor of plaintiff in the sum of $5,000, from which the defendant prosecutes this appeal.

At the time of plaintiff's injury he was in the employ of the city of St. Louis as a street sweeper and engaged in this work on Delmar avenue, a street extending east and west in the city of St. Louis, at a point a short distance east of Euclid avenue, a street extending north and south, intersecting Delmar avenue. He was struck and injured by defendant's automobile as it was being driven in an easterly direction along the south side of Delmar avenue.

negligence directly contributing thereto, in that plaintiff negligently remained in a dan gerous place, on said Delmar avenue, in front of a moving street car, until the same was directly upon him, and then negligently stepped into the path of defendant's automobile, without looking and listening for the same.

Plaintiff testified that he was standing on the south side of Delmar avenue, about 30 or 40 feet east of the east side of Euclid avenue, "cleaning up some dirt out of the street," at the time when he was struck by defendant's automobile; that when struck he was about midway between the street car track and the south curb of Delmar avenue, facing toward the northeast, with his back to the southwest. On cross-examination he reiterated this testimony, in substance, and further said:

"Just immediately before the accident I had not been on the street car track, and I was not coming off the track at the time I was struck. I come from the curb there and was sweeping that stuff up."

The testimony of plaintiff that, when struck, he was standing in the street, about midway between the street car tracks and the south curb, with his back to the approaching automobile, is corroborated by the testimony of two other witnesses.

The defendant, called by plaintiff as a witness, testified that at the time of the casualty he was driving his automoble east on the south side of Delmar avenue; that a street car was proceeding east on said Delmar avenue, and that he was "following it" (though driving between the street car tracks and the south curb) until he reached the west side of Euclid avenue; that the street car proceeded perhaps 25 or 30 feet east of Euclid avenue crossing "when it slowed down for something." And defendant said:

The petition alleges that on the day of plaintiff's injury, to wit, July 25, 1916, while plaintiff "was lawfully standing on the south side of Delmar avenue at or near its intersection with Euclid avenue," he was violently struck, knocked down, and run over by defendant's automobile, operated by defendant, and which was being driven eastwardly on Delmar avenue. The negligence assigned is that the defendant failed to use the highest degree of care that a very careful person would have used, under like or similar circumstances, in operating and controlling an automobile, in that defendant operated the automobile at an excessive and dangerous rate of speed, and negligently failed to stop or attempt to stop the automobile when he knew, or by the exercise of due care on his part would have known, the danger of the automobile striking and injuring plaintiff, in time, by the exercise of due care on his part, to have stopped the same and avoided striking and injuring plaintiff; that defendant "As I got to the end of the car this man negligently failed to keep a vigilant watch (plaintiff) stepped off, backed off the track; for persons on Delmar avenue, and particu-backed right into the path of my machine.” larly plaintiff, and failed and neglected to operate the brakes and other devices on the automobile in such way as to enable him to stop it quickly, or to turn quickly aside upon the first appearance of danger to plaintiff; and that defendant negligently failed to sound any horn or to give other warning to plaintiff of the approach of the automobile. The answer, after denying generally the allegations of the petition, alleges that Delmar and Euclid avenues were at the time in question much used by vehicles and dangerous for travel by pedestrians at any place other than their intersection; admits that plaintiff was struck and injured by an automobile owned and operated by defendant on Delmar avenue near Euclid avenue; but avers

Defendant further testified that in his opinion the automobile was about 12 or 15 feet from plaintiff when the latter stepped from the street car track; that he immediately sounded his horn, and set his brakes, both emergency brake and foot brake, as soon as he could, and as "hard" as he could; but that the automobile struck plaintiff and dragged him a few feet.

The testimony of defendant that plaintiff stepped from in front of the street car, into the path of the automobile, is corroborated by that of a witness who was an occupant of the automobile with defendant.

[1] It is unnecessary, as we view the case on this appeal, to set forth the evidence in