O & G Industries, Inc. v. American Home Assurance Co.

Citations

• 204 Conn. App. 614

Syllabus

The plaintiff, a concrete supply company, sought to recover payment under certain surety bonds issued by the defendant, claiming that it had not been paid the amount it was owed for supplying concrete and other materials to the bonds' principal, M Co. M Co. entered into a subcontrac- tor agreement with C Co. to deliver and pour concrete for a construction project. C Co. then engaged the plaintiff to supply concrete materials to C Co. to comply with its subcontractor agreement. After receiving a joint credit agreement and lien waiver from M Co., the plaintiff began supplying concrete and sent invoices directly to M Co., which paid the plaintiff in full. C Co. was unhappy with this arrangement and, thereafter, the plaintiff opened an account with C Co., albeit for a different project. Subsequently, the plaintiff continued to provide C Co. with concrete and charged C Co. directly; however, C Co. did not pay the plaintiff. The plaintiff informed M Co. of C Co.'s nonpayment and M Co. provided payment to C Co. to forward to the plaintiff, but C Co. failed to do so. After C Co. defaulted, the plaintiff sent the defendant a notice of claim under the payment bond, and recorded a mechanic's lien against the owner of the construction project. The defendant issued a substitute bond, as a surety, which the plaintiff accepted as a substitute for its mechanic's lien. Thereafter, M Co. issued a response to the defendant in which it denied that the plaintiff's claim had any merit. The defendant refused to pay the plaintiff under the payment bond or the substitute bond, and the plaintiff brought the present action against the defendant. The defendant asserted nine special defenses against the plaintiff, alleg- ing, inter alia, that the plaintiff acted in bad faith and was reckless in its dealings with C Co. Held: 1. The trial court did not err in finding that the defendant failed to sustain its burden of proof in showing that the plaintiff conducted its business with C Co. recklessly