Sheard v. United States Fidelity & Guaranty Co.

Citations

• 58 Wash. 29
• 107 P. 1024
• 1910 Wash. LEXIS 882

Syllabus

<p>Indemnity — Breach of Building Contract — Limitations—Accrual of Action. Under a contractor’s indemnity bond, in which the obligee assumes to indemnify the owner against any pecuniary loss resulting from the breach of any of the terms of the building contract, the actual substantial breach does not occur, where liens are filed for labor and material, until the liens become an established charge against the property.</p> <p>Same—Contract as to Limitations—Reasonableness. A limitation in a contractor’s indemnity bond executed July 22, to the effect that no suit shall be maintained thereon after February 22 following, is unreasonable and therefore not binding on the parties, where the bond indemnified the plaintiff from any pecuniary loss by reason of the contractor’s agreement to- build a house costing about $15,000, within 120 days, the contractors became insolvent in January following, when a receiver was appointed, who completed the house in June following, and liens for labor and material filed after the time stipulated for bringing suit were not finally established until two years later; since ascertainment of the amount of the loss was not possible until long after the limitation had expired.</p> <p>Indemnity—Contractor’s Bond—Liability — Unpaid Attorney’s Pees. A contractor’s bond indemnifying against loss by reason of the breach of the building contract being one of indemnity, recovery cannot be had for $1,000 attorney’s fees allowed in lien foreclosures, where only $250 of the same had been paid by plaintiff before commencing his action on the bond.</p> <p>Same—Damages—Liquidated Damages. Where a building contract provided stipulated damages of $10 per day for each day’s delay in completing the building, and authorized a deduction thereof from the contract price, the owner is not obliged to apply any part of such damages to the satisfaction of obligations incurred by the contractor for which an indemnity bond was given.</p> <p>Same. A surety company indemn