holding that “the majority of jurisdictions construe [a pay-when-paid] * * * provision as allowing payment under the contract to be delayed but not stopped altogether”
How later courts described this case
- holding that “the majority of jurisdictions construe [a pay-when-paid] * * * provision as allowing payment under the contract to be delayed but not stopped altogether”
- " ‘First, it is well-established that condition precedents are not favored in contract law, and will not be upheld unless there is clear language to support them.' ”
- “Where a payment bond shows on its face that it was executed in compliance with the [little Miller] Act, a court is authorized to read into the bond the provisions of the statute and to give the bond the form and effect the statute contemplated, regardless of the contents of the bond.”
- if there is no right of recovery against the principal, there is no right of recovery against the surety on the payment bond
Written by the judges who cited it.
The opinion
I dissent.
The contract between Bill Harbert Construction Company and I. Kruger, Inc., is unambiguous and plain in expression; therefore, no canon of construction warrants an interpretation the only effect of which is to relieve a party to the contract from consequences it deems hard or unfair. Ex parte Foster , 758 So.2d 516 , 519 (Ala. 1999); Lilley v. Gonzales , 417 So.2d 161 , 163 (Ala. 1982). Therefore, even if there were not a material question of fact as to whether Kruger had completely performed under the contract — and I think there was — Kruger would not be entitled to a judgment against Harbert until Harbert is paid by the Board of Water and Sewer Commissioners of the City of Mobile. It is undisputed that this has not occurred. See James E. Watts Sons Contractors, Inc. v. Nabors , 484 So.2d 373 (Ala. 1985). Because payment to Kruger is not yet due under its contract with Harbert, Harbert's surety, Federal Insurance Company, is not obligated to make payment on its bond at this time. Watts Sons , 484 So.2d at 374 .
See, Lyons, and Brown, JJ., concur.