Harry Newton, Inc. v. Broaddus , 1963 Tex. App. LEXIS 1810 ( 1963 )

HUGHES, Justice

(dissenting).

The only authority cited to sustain the majority opinion is General Casualty Co. of America v. United States, 205 F.2d 753, Circuit Court of Appeals, 5th Circuit (1953). This case is not a venue case, hence its details need not be stated. The Court held that the claim of the United States was for taxes and not “wages” for which reason Art. 5160 V.A.C.S. had no application. The Court, however, made this further statement:

“Further, the appellee did not comply with the provision of Article 5160 of the Civil Statutes of Texas (Footnote 1, supra) with reference to the filing of an itemized sworn claim with the County Clerk of Guadalupe County, Texas. That provision was not a mere statute of limitation, but was a substantive condition precedent to the existence of a cause of action against the surety. See Fidelity & Deposit Co. of Md. v. Big Three Welding Equipment Co., Tex.Sup., 249 S.W.2d 183."

The Big Three case merely holds that a claimant not filing their claims as required by Art. 5160 cannot recover.

These cases construe Art. 5160 prior to its amendment in 1959. I quote the present provisions of this Article which have any bearing on the proper venue of this case:

“B. Every claimant who has furnished labor or material in the prosecution of the work provided for in such contract in which a Payment Bond is furnished as required hereinabove, and who has not been paid in full therefor, shall have the right, if his claim remains unpaid after the expiration of sixty (60) days after the filing of the claim as herein required, to sue the principal and the surety or sureties on the Payment Bond jointly or severally for the amount due on the balance thereof unpaid at the time of filing the claim or of the institution of the suit; provided:

“(a) Notices Required for Unpaid Bills, other than notices solely for Re-tainages as hereinafter described.

“Such claimant shall have given within ninety (90) days after the 10th day of the month next following each month in which the labor was done or performed, in whole or in part, or material was delivered, in whole or in part, for which such claim is made, written notices of the claim by certified or registered mail, addressed to the prime contractor at his last known business address, or at his residence, and to the surety or sureties, * * *

“(b) Additional Notices Required of Claimants Who Do Not Have a Direct Contractual Relationship With the Prime Contractor.

“Excepting an individual mechanic or laborer who is a claimant for wages, no right of aption shall be legally enforceable, nor shall any suit be maintained under any provision of this Act by a claimant not having a direct contractual relationship with any prime contractor for material furnished or labor performed under the provisions of this Act unless such claimant has complied with those of the following additional requirements which are applicable to the claim: * *

Sections (1), (2) and (3) follow in which are stated the circumstances under which 36 day and 45 day notices are to he given.

Sec. (c) provides for 90 day notices for claims of unpaid retainages.

See. G, entitled Venue, reads, in part:

“G. All suits instituted under the provisions of this Act shall be brought in a court of competent jurisdiction in the county in which the project or work, or any part thereof, is situated. No suit shall be instituted on the performance bond after the expiration of one (1) year after the date of final completion of such contract. No suit shall be instituted by a claimant on the payment bond after the expiration of one (1) year after the date suit may be brought thereon under the provisions of Section l.B. hereof.”

This suit was brought in the County in which roads were constructed under a contract between Harry Newton Inc. and the State Highway Department. Appellee furnished materials and services to a subcontractor under Newton and he was not paid for them. Appellee alleged in his original petition:

“Repeated demands were made by Plaintiff upon Defendant, Harry Newton, Inc., for the payment of said sum, however, Defendant, Harry Newton, Inc. failed and refused to pay the same or any part thereof. By reason of said failure and refusal, Plaintiff, on or about the 15th day of January, 1963, by Affidavit, notified Harry Newton, Inc. and Defendant, Commonwealth Insurance Co. of New York, of its claim as aforesaid, said notification being given pursuant to the Provisions of Article 5160, et seq, Revised Civil Statutes of the State of Texas, 1925, as Amended.

“III.

“Plaintiff is advised that Harry Newton, Iric., as prime Contractor, on the aforescribed State of Texas — -Texas Highway Department Project furnished a payment Bond in accordance with the requirements of Article 5160, Revised Civil Statutes of the State of Texas, 1925, as Amended, and that such payment Bond was furnished by Commonwealth Insurance Co. of New York and Plaintiff here alleges and claims that said Defendant, Commonwealth Insurance Co. of New York, is liable to Plaintiff by reason of said furnishing of materials as aforesaid.”

This petition was filed March 30, 1963.

It is obvious to me that this suit was instituted under the provisions of Art. 5160 and that the mandatory and exclusive venue provisions of that act should control.

Whether or not notices were given in proper time or in proper form are questions which are defensive in nature and are not pertinent to venue hearings. See 43-B Tex.Jur. Venue, Sec. 152, p. 365, Ulmer v. Dunigan Tool and Supply Co., 163 S.W.2d 901, Eastland Civil Appeals.

The record here discloses that notices required by Art. 5160 were not timely given. These statutory provisions are in essence statutes of limitation.¹

As such, they are, under Rule 94, T.R.C.P., and Heldt v. Martin, 368 S.W.2d 9, Austin Civil Appeals, writ dism., w. o. j., of a purely defensive character.

The fact that Art. 5160 provides that a claimant shall have the right to sue the principal and surety on a payment bond “provided” he has given certain notices within prescribed times or that it states that “no right of action shall be legally enforceable, nor shall any suit be maintained under any provision of this Act” unless certain other notices are timely given does not alter their defensive nature. Most limitation statutes prohibit the bringing of a cause of action after a stated period of time. Arts. 5524, 5526, 5527, V.A.C.S. are examples. Art. 5472b-1, V.A.C.S., provides, in part, that “no action shall be brought on such bond” (bond for release of lien fixed by Art. 5472a) after the expiration of six months from its date of filing. No stronger prohibitory language could be used yet it is nothing but a statute of limitations. Employers’ Liability Assurance Corp., Ltd. v. Young County Lbr. Co., 122 Tex. 647, 64 S.W.2d 339.

That a suit cannot be brought or maintained or successfully brought or maintained are matters which go to the merits of the controversy. They are not matters which relate to venue under Art. 5160 which only requires a showing that the suit be instituted under its provisions.

The venue of actions is of utmost importance. The Legislature has clearly indicated that laborers and materialmen should have the right to bring and prosecute suits of this nature in the County where the labor was performed or the materials furnished were used.

In spite of this exclusive, mandatory and plain statutory language fixing the venue of suits brought on bonds given to comply with Art. 5160, the majority has converted this small and relatively simple suit from one trial in Milam County where the road was built, as the Legislature directed, into three trials, one on venue in Milam County, one on the merits in Dallas County and one on the merits in Young County. To this «tion, I respectfully dissent.

1 . “Any law which creates a condition of the enforcement of a right to be performed within a fixed time is a statute of limitations.” 34 Am.Jur., Limitations of Actions, p. 15, footnote 1, citing Hay v. City of Baraboo, 127 Wis. 1, 105 N.W. 654, 3 L.R.A.,N.S., 84, 115 Am.St.Rep. 977.