Board of Education Ex Rel. Breedon v. Victor N. Judson, Inc.

Henderson, J., delivered the opinion of the Court. This appeal is from judgments for costs in favor of the Aetna Casualty and Surety Company in two suits on a bond, after the court sustained demurrers, filed by the surety to amended declarations, without leave to amend. On February 14, 1952, Victor N. Judson, Inc. entered into a formal contract with the Board of Education of Montgomery County to construct an addition to, an elementary school. On the same day Aetna executed a bond in connection with the work.

Thereafter, the contractor purchased certain materials from the equitable plaintiff, Norris, and sublet all labor in connection with the plumbing work to the equitable plaintiff, Breedon, at a fixed price. These plaintiffs claim that there are unpaid balances due them, which are recoverable against the surety. The appellants contend that they are within the coverage of the bond, or at least within the coverage of the general contract incorporated in the bond. The pertinent language of the bond is as follows: “Whereas, the Principal has entered into a certain written contract * * * hereby referred to and ¹⁹⁰ made a part hereof as fully and to the same extent as if copied at length herein. “NOW THEREFORE, THE CONDITION OF THIS OBLIGATION IS SUCH, that if the Principal shall fully indemnify and reimburse the Obligee for any loss he (they, it) may suffer through the failure of the Principal to faithfully observe and perform each and every obligation and duty imposed upon the Principal by the said contract, at the time and in the manner therein specified, then this obligation to be void: otherwise to remain in full force and virtue in law.” We think it is perfectly clear that the undertaking of the bond is simply to indemnify and reimburse the obligee against loss through failure of the principal to perform.

It is not alleged that the obligee suffered any loss whatever. There is no statute imposing a lien for material or labor against a public body of this character, so that there could be no loss to it because of the alleged non-payment of the suppliers of the general contractor. Nor is there any statutory requirement that a bond be taken to protect material men and laborers. The case of Baltimore v. Casualty Co., 146 Md. 508 , is directly in point and, we think, controlling.

See also Baltimore v. Md. Casualty Co., 171 Md. 667 , declining to extend the plain language of a bond to cover claims by the