Pennsylvania Act 1931-321 — ACTION ON PUBLIC WORK CONTRACTS

Act text

ACTION ON PUBLIC WORK CONTRACTS
                 Act of Jun. 23, 1931, P.L. 1181, No. 321             Cl. 62
                                  AN ACT

     Authorizing persons, co-partnerships, associations, and
        corporations, who, whether as sub-contractor or otherwise,
        have furnished material or supplied or performed labor in
        connection with any public work or improvement, to intervene
        in or institute actions on certain bonds given to the
        Commonwealth or to municipal corporations in connection with
        the performance of public contracts; fixing the time within
        which such actions must be brought, and the amounts
        recoverable therein; and providing for distribution of
        amounts recovered; and prescribing procedure.

        Compiler's Note:  Section 6(c) of Act 57 of 1998 provided
            that Act 321 is repealed insofar as it is inconsistent
            with Act 57.
        Section 1.  Right to intervene in action on contractor's
     bond; copy of contract and bond to be furnished upon
     application; payment into court by surety
        In all cases where a surety bond shall be given to the
     Commonwealth of Pennsylvania, or to any county, city, borough,
     incorporated town, township, school district, poor district, or
     other municipality or incorporated district, to secure
     performance by a contractor of any public contract for the
     construction, re-construction, alteration, or repair of any
     highway or any bridge, building, or other structure, or for the
     completion of any project or performance of any other work
     whatsoever, or the supplying of any materials, which said bond
     shall include a condition for the payment of material furnished
     and labor supplied or performed in connection with such public
     work or improvement or similar provisions, irrespective of
     whether such bond or any provision therein shall have been
     required by statute, ordinance, or any other authority, and
     where no separate or additional bond conditioned for the payment
     of material furnished and labor supplied or performed in
     connection with such public contract has been taken, then and in
     such event every person, co-partnership, association, or
     corporation, who, whether as sub-contractor or otherwise, has
     furnished material or supplied or performed labor in connection
     with such public work or improvement, and who has not been paid
     therefor, shall have the right to intervene and be made a party
     to any action instituted on such bond by the Commonwealth or by
     the municipality named as obligee therein and have his, their,
     or its rights and claims adjudicated in such action and judgment
     rendered thereon for any amount due him, them, or it for such
     labor or materials, subject, however, to the priority of the
     claim and judgment of the Commonwealth or such municipal
     obligee, if any. If the amount of the liability of the surety on
     said bond is insufficient to pay the full amount of said claims
     and demands, then, after paying the full amount due the
     Commonwealth or the municipal obligee, the remainder shall be
     distributed pro rata among said interveners. If no suit be
     brought by the Commonwealth or the municipal obligee within six
     months from the completion of said contract and final settlement
     therefor, then the person or persons who have supplied the
     contractor with labor and materials shall, upon application
     therefor and furnishing affidavit to the Commonwealth or the
     municipality that labor and materials for the prosecution of
     such work have been supplied by him, them, or it, and that
     payment for the same has not been made, be furnished with a
     certified copy of said contract and bond, upon which he, they,
     or it shall have a right of action, and shall be and are hereby
     authorized to bring suit, in the name of the commonwealth of
     pennsylvania or the municipal obligee, for his, their, or its
     use and benefit against said contractor and his sureties and to
     prosecute the same to final judgment and execution. Where suit
     is instituted by any of such creditors on the bond of the
     contractor, it shall not be commenced until after the complete
     performance of said contract and final settlement thereof with
     the Commonwealth or the municipality, and shall be commenced
     within one year after the performance and said final settlement
     of said contract, and not later. Where suit is so instituted by
     a creditor or creditors, no other action shall be brought by any
     other creditor, but any other creditor may file his claim in the
     action first brought, and be made party thereto, within one year
     from the completion of the work under said contract, but not
     later. If two or more actions be brought on the same day, the
     action in which the largest claim is demanded shall be regarded
     as the first action. Any creditor who has brought an action
     within one year as aforesaid, but after suit brought by another
     creditor or on the same day, may intervene in the suit first
     brought within the year, notwithstanding the fact that the
     intervention in such case be after the expiration of the year,
     provided such intervention be made within thirty days after the
     expiration of the year. If the recovery on the bond should be
     inadequate to pay the amounts found due to all of said
     creditors, judgment shall be given to each creditor pro rata of
     the amount of the recovery. The surety on said bond may pay into
     court, for distribution among said claimants and creditors, the
     full amount of the surety's liability, to wit, the penalty named
     in the bond, less any amount which said surety may have had to
     pay to the Commonwealth of Pennsylvania or the municipal obligee
     by reason of the execution of said bond, and, upon so doing, the
     surety will be relieved from further liability. In all suits
     instituted under the provisions of this act, such personal
     notice of the pendency of such suits, informing them of their
     right to intervene, as the court may order shall be given to all
     known creditors, and, in addition thereto, notice shall be given
     by publication in some newspaper of general circulation
     published in the county or town where the contract was performed
     once a week for at least three successive weeks: Provided,
     however, That when such suit has been begun within three weeks
     of the end of the year within which suit may be brought, said
     notice by publication shall be only for the period intervening
     between the time of instituting such suit and the end of the
     year: Provided further, That where the principal contractor
     shall have for any reason failed to complete performance of his
     contract and completion of the project undertaken by the
     Commonwealth, the municipality, or the surety, either by
     themselves or by letting of new contracts, the six-month period
     before which suit may be brought and the one year period within
     which such action must be commenced by subcontractors,
     materialmen, and laborers, as above provided, shall date from
     the completion and acceptance of the project covered by the
     original contract and bond. For the purposes of such suits, the
     date of such completion shall be fixed by the officers of the
     Commonwealth or of the municipality. written notice of the date
     of such completion shall be given to all persons who shall have
     theretofore requested such notice. 1931, June 23, P.L. 1181, No.
     321, Sec. 1.
        Section 2.  Remedies extended to prior bonds
        Whenever heretofore a contractor, in connection with any
     public work or improvement, and his, their, or its surety, has
     assumed in a bond given to the Commonwealth of Pennsylvania the
     obligation to pay all lawful claims of sub-contractors,
     material-men, and laborers for labor performed and materials
     furnished in connection with such public work or improvement,
     then, in such event, the remedies as provided by section one of
     this act shall extend to every such sub-contractor, material-
     men, and laborer. 1931, June 23, P.L. 1181, No. 321, Sec. 2.
        Section 3.  Constitutionality
        The provisions of this act are severable, and if any of the
     provisions hereof are held to be unconstitutional, the decision
     shall not be construed to impair any other provision of this
     act. It is hereby declared as a legislative intent that this act
     would have been adopted had such unconstitutional provision not
     been included herein. 1931, june 23, p.l. 1181, No. 321, Sec. 3.