Southern Heaters Corp. v. New York Casualty Co.

SCOTT (Robert H.), J. pro tem. Defendant appeals from an adverse judgment awarding damages upon a contractor’s surety bond. It states that the facts are not in dispute.

John R. Donaldson was doing- business at 600 Bast Front Street in Ventura, California, under two fictitious firm names as sole owner: (1) Allison Supply Company, and (2) Traveling Mechanics. Under the name Traveling Mechanics he entered into a contract as subcontractor with Hal B. Hayes Construction Company, the general contractor, to furnish and install all plumbing at the Edwards Base Housing Project. The Hayes Company required completion bonds and Donaldson secured one G. Vella as an individual indemnitor for Donaldson individually and doing business under both of his fictitious names, Traveling Mechanics and Allison Supply Company, and that agreement being signed by Donaldson and Vella. He also secured a bond executed by defendant, as surety, which secured payment of claims for labor and materials used in the work in which Traveling Mechanics was named as principal and defendant was named as surety in favor of the Hayes Company and signed by defendant and by “Traveling Mechanics by John R. Donaldson.”

John R. Donaldson, using his fictitious name of Allison Supply Company, placed an order with the sales agent of plaintiff for 550 water heaters and 550 magnesium rods. These were charged to Allison Supply Company but each invoice was carefully marked for the “Muroc” (Edwards Base) job. These heaters went directly to the job site from plaintiff’s plant in Compton in a truck driven by Donaldson’s only truck driver,' Charles Henderson. This truck driver and all other employees of Donaldson were paid by him under the name Traveling Mechanics. Allison Supply Company had no payroll.

When Donaldson was billed for payment under the name Allison Supply Company his bookkeeper would bill Donaldson under the name Traveling Mechanics at a price markup. Donaldson’s bookkeeper testified that this markup was the [379]difference between the manufacturer’s price per unit of $31 and the wholesale price per unit of $47 resulting in a profit of $16 per unit. No cheeks passed between Traveling Mechanics and Allison Supply Company for this Edwards Base job but there were cheeks from the above named Gf. Vella received on this account.

The heaters and rods were installed on the Edwards Base job and were paid for in part. Plaintiff filed and recorded a mechanic’s lien for the balance and served on defendant a notice of furnishing said materials. The judgment aivarded plaintiff the amount of its claim for the unpaid balance of the purchase price.