Royal Indemnity Co. v. Northern Ohio Granite & Stone Co.

Citations

• 100 Ohio St. (N.S.) 373

Syllabus

<p>Suretyship — Construction of contract — Ambiguous terms — Contractor’s bond — Default by principal contractor — Materialmen and laborers — Surety liable to subcontractors, when.</p> <p>1. The rule of strict construction ordinarily applied in favor of private, voluntary sureties does not apply to that class of sureties which, for a pecuniary consideration, undertakes to indemnify an owner of a construction against the defaults of the principal contractor who engages to furnish labor and materials for the construction. In such contracts, where ariibiguous terms are employed, ■ that construction should be adopted, if consistent with the purpose to be accomplished, most favorable to the beneficiary.</p> <p>2. A surety of the character described, which, by its contract, assures the faithful performance thereof by a principal who agrees to furnish labor and materials on a structure, at his own risk, cost and expense, is liable to a materialman who furnishes material, in default of the principal’s payment therefor. (Cleveland Metal Roofing & Ceiling Co. v. Gaspard et al., 89 Ohio St., 185, overruled.)</p>