Jasper Construction Inc. v. University Casework Systems Inc.

Opinion

CHRISTIAN, J.

Appellant University Casework Systems, Inc. entered into a subcontract (worth $751,331.25 after several change orders) on a project to build a science laboratory at San Jose State University. Respondent Jasper Construction, Inc., the prime contractor, undertook to

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remit monthly to appellant 90 percent of the sums received from the state for labor and material furnished by appellant; the remaining 10 percent would be retained by respondent until the work had been completed and approved.

Serious delays and cost overruns were encountered, and the parties fell into contention regarding the completion of the work. Appellant filed a stop notice on January 31, 1972, claiming that labor, material and services had been furnished totaling in value the entire subcontract price (see Civ. Code, §§ 3103, 3181-3187) of which $271,230.58 remained unpaid. About the time the stop notice was filed, appellant abandoned the project.

Pursuant to Civil Code section 3186, the state withheld $271,230.58 from money due respondent under the prime contract. Respondent then filed with the Department of Public Works a surety bond in the amount of 125 percent of $271,230.58, and obtained the release of the withheld money pursuant to section 3196 of the Civil Code. Disputing the amount claimed in the stop notice, respondent commenced a “summary proceeding” to decrease the amount of the bond. (See Civ. Code, §§ 3197, 3205.)

The underlying issues involved in the contract dispute between the parties were submitted to arbitration as provided by the contract; our record does not disclose the result. Meanwhile, the court considered affidavits submitted by the parties and made an order reducing the bond to 125 percent of $81,144.68; the subcontractor appealed. We have concluded that the order complained of is not subject to review by an appeal.

In addition to other procedures generally available for the enforcement of contracts, special remedies have been provided by statute to protect the interests of those to whom the prime contractor may incur debts in connection with a public works project. (See generally Civ. Code, §§ 3179-3214.) Such special provision was made because there can be no mechanics’ or materialmen’s liens upon public property.