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TITLE GUARANTY & TRUST COMPANY OF SCRANTON, PENNSYLVANIA, v. CRANE COMPANY.

ERROR TO THE CIRCUIT COURT OF APPEALS FOR THE
NINTH CIRCUIT.

No. 67. Argued December 6, 7, 1910. Decided December 19, 1910.

A vessel being constructed under contract for the United States is a public work within the meaning of the act of August 13, 1894, c. 280, 28 Stat. 278, as amended by the act of February 24, 1905, c. 778, 33 Stat. 811, and materialmen can maintain an action on the bond given pursuant to such statute by the contractor.

Whether a work is public or not, depends on whether it belongs to the representative of the public and not on whether it is or is not attached to the soil.

Where title to the completed portion of a vessel being constructed for the United States passes to the United States as payments are made, laborers and materialmen cannot assert liens under the state law, but can maintain actions on the contractor's bond given under the act of 1894 as amended by the act of 1905. United States v. Ansonia Brass & Copper Co., 218 U. S. 452.

The court will, in the absence of clear and established construction, reach its own conclusion in construing a statute, notwithstanding opinions of the Attorney General looking in the opposite direction. Held, in this case, that the suit had been properly brought, and that the United States was not necessarily a party, the suit being begun in the name of the United States to the real plaintiff's use. Although the plaintiff may not have applied for copy of the bond and

filed an affidavit that the labor and materials had been supplied, the defect was formal and not vital as the intervenors had complied with the statute in that respect.

Objections to allowing claimants the benefit of the bond given by the contractor under the act of 1894 as amended by the act of 1905, either because they had a lien or because the service was too remote, if carried to an extreme, would defeat the purpose of the act. Where a bond is under seal consideration is presumed; in this case, although the bond was not executed until ten days after execution

219 U.S.

Argument for Plaintiff in Error.

of the contract which it was given to secure, the transactions may be regarded as simultaneous.

Assignments of claims of materialmen on a public work held in this case not to have affected the remedy of enforcing the same against the surety on the contractor's bond.

In a suit to enforce claims of materialmen against surety on a contractor's bond, each claimant is entitled to a docket fee of $10.00. Although the claims are consolidated in a single suit the causes of action are distinct.

163 Fed. Rep. 168, affirmed.

THE facts, which involve the construction of the materialmen's act of August 13, 1894, as amended by the act of February 24, 1905, are stated in the opinion.

Mr. James B. Murphy, with whom Mr. C. H. Winders and Mr. M. M. Richardson were on the brief, for plaintiff in error:

The purpose of Congress in the passage of the act of August 13, 1894, 28 Stat. 278, as amended February 24, 1905, 33 Stat. 811, was to protect, first, the United States, and, second, to protect laborers and materialmen, who had no right of lien by reason of the building or work being upon the property of or belonging to the sovereign, by giving to them a right of action on the contractor's bond, substituting the bond for the building or public work. Hill v. American Surety Co., 200 U. S. 197; U. S. F. & G. Co. v. United States, 191 U. S. 416; Sica v. Kimpland, 93 Fed. Rep. 403; American Surety Co. v. Cement Co., 110 Fed. Rep. 717; United States v. Burgdorf, 13 App. D. C. 506; United States v. City Trust & Safe Deposit. Co., 21 App. D. C. 369; 123 Op. Atty. Genl. 74.

The contract in this case was neither for the erection of a "public building" or the prosecution or completion of any "public work," and further, title to the vessel under the contract not passing to the Government until its completion, delivery and acceptance, the laborer and materialman, under the statutes of the State of Washington, were

Argument for Plaintiff in Error.

219 U. S.

amply protected by its lien laws, hence the claims sought to be enforced here are not only without the terms of the act, but outside of the very scope and intent of Congress in its passage. Clarkson v. Stevens, 106 U. S. 505; John B. Ketcham, No. 2, 97 Fed. Rep. 872; Opinion Atty. Gen. Moody, Aug. 6, 1906. The rule is also announced in Benjamin on Sales, 7th ed., 298; United States v. Ollinger, 55 Fed. Rep. 959; Yukon River St. Co. v. Grotto, 69 Pac. Rep. 252 (Cal.); William v. Jackson, 16 Gray, 514; Green v. Hull, 1 Houst. 506; West Jersey Ry. Co. v. Trenton Car Co., 32 N. J. Law, 517; Etna v. Treat, 15 Ohio St. 585; Andrews v. Durant, 11 N. Y. 35; S. C., 62 Am. Dec. 55; Hawes & Co. v. Trigg Co., 65 S. E. Rep. 538.

Title to the vessel not passing to the United States until delivery and acceptance by it, under § 5953, Ballinger, Washington Code, as amended by the Laws of 1901, p. 21, the plaintiff and intervenors herein had a right of lien upon the vessel.

Where under general principles of law there is a lien there is no right of action on the bond. United States v. Hyatt, 92 Fed. Rep. 442; American Surety Co. v. Lawrenceville Cement Co., 110 Fed. Rep. 717; Laughlin Co. v. Morgan, 111 Fed. Rep. 474; Laughlin Co. v. American Surety Co., 114 Fed. Rep. 627; Bayne v. United States, 93 U. S. 643; note 29 L. R. A. 226; United States v. McGee et al., 171 Fed. Rep. 209; Surety Co. v. Guarantee Co., 174 Fed. Rep. 385.

Defendants in error having a right of lien, being fully protected thereby, are wholly without the scope and intent of the act. Claimants are also clearly estopped from asserting any claim as against the bond.

The Puget Sound Engine Works having been adjudged a bankrupt prior to the institution of this action, under § 3466, Rev. Stat., claims due the United States in such cases are given preference. In re Stover, 127 Fed. Rep. 394; Smith v. United States, 92 U. S. 618; In re Huddell,

219 U. S.

Argument for Plaintiff in Error.

47 Fed. Rep. 206; United States v. Barnes, 31 Fed. Rep. 705; In re Strassburger, 4 Wood, 558; S. C., Fed. Cas. No. 13.

The mere fact that the Government might hold collateral or security does not require it to resort thereto before enforcing its direct remedy. Cases supra and 'Chemical National Bank v. Armstrong, 59 Fed. Rep. 375; Merrill v. National Bank, 173 U. S. 140; Childs v. N. P. Carlston Co., 76 Fed. Rep. 86; Doe v. N. W. Coal & Trans. Co., 78 Fed. Rep. 62; Wheeler v. Walton &c. Ry. Co., 72 Fed. Rep. 967; Levey Bros. v. Chicago Nat. Bank, 42 N. E. Rep. 131; Storey, Eq. Jurisp., § 614.

If the surety pays the debt of the Government, it is entitled to be subrogated to its preference right. Beaston v. Delaware Bank, 12 Pet. 102; Hunter v. United States, 5 Pet. 172; Field v. United States, 9 Pet. 182; In re Huddell, 47 Fed. Rep. 206; United States v. Barnes, 31 Fed. Rep. 705; Federal Cases, Nos. 7843, 7731, 9682, 17,668.

The contract for building the vessel was not only without the scope of the act, but also without its express terms. A vessel is not a public work. That term "public works" includes only fixed works and does not include a sea-going vessel. Penn Iron Co. v. Trigg, 56 S. E. Rep. 329; Hawes v. Trigg Co., 65 S. E. Rep. 538; United States v. Perth Amboy Shipping Co., 137 Fed. Rep. 689; 23 Am. & Eng. Ency. of Law, 2d ed., 459; United States v. Ollinger, 55 Fed. Rep. 959; Ellis v. Grand Rapids, 123 Michigan, 567; S. C., 82 N. W. Rep. 244; Winters v. Duluth, 82 Minnesota, 130; S. C., 84 N. W. Rep. 788; 23 Op. Atty. Genl. 174; 20 Op. of Atty. Genl. 454; Op. Solicitor General Hoyt, approved by Attorney General Moody, August 3, 4, 1906.

The United States should be made a party in case of the insolvency of one engaged in the performance of a contract entered into with the United States Government.

Argument for Plaintiff in Error.

219 U.S.

The claim of the Government is prior and paramount to that of all other creditors, and general statutes of limitation do not cut off the Government from asserting its claim. § 3466, Rev. Stat. 2314; In re Stover, 127 Fed. Rep. 394; Smith v. United States, 92 U. S. 618; In re Hubbell, 47 Fed. Rep. 206; United States v. Barnes, 31 Fed. Rep. 705; In re Strassburger, 4 Wood, 558; S. C., Fed. Gas. No. 13; Bain v. United States, 93 U. S. 643; United States v. McGee et al., 171 Fed. Rep. 209; Hill v. American Surety Co., 200 U. S. 197.

The statute provides that this suit can only be instituted upon the performance of certain conditions, which have not been complied with. United States v. Freeman, 3 How. 556.

No affidavit was filed by the plaintiff or by intervenors, and no certified copy of the bond procured, and this action was not based upon a certified copy of such bond. Even if valid, the bond is not liable for cartage, towage, wharfage and patterns from which castings are made. United States v. Hyatt, 92 Fed. Rep. 442; S. C., 34 C. C. A. 445; McAllister v. Fidelity & Deposit Co., 83 N. Y. Supp. 752; McLaughlin v. Surety Co., 114 Fed. Rep. 627; Laughlin Co. v. Morgan, 111 Fed. Rep. 474; Am. Surety Co. v. Cement Co., 110 Fed. Rep. 717; Rhine v. Guilfoil, 13 Washington, 373; Webster v. Real Estate Imp. Co., 6 N. E. Rep. 71; Wilson v. Nugent, 57 Pac. Rep. 1008 (Cal.); United States v. Morgan, 111 Fed. Rep. 474; United States v. Conkling, 135 Fed. Rep. 508.

Many of the claims are not claims for material or for labor entering into and becoming a part of the public work, and are not such claims as are contemplated by the statute. Standard Oil Co. v. Trust Co., 21 App. D. C. 639; United States v. City Trust Co., 23 App. D. C.'153; United States v. Mehl, 25 Kansas, 205; Basshor v. B. & O. Ry. Co., 65 Maryland, 99; United States v. Kimpland, 93 Fed. Rep. 403; United States v. Simon, 98 Fed. Rep. 73;

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