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11/03/70 Continental Casualty v. American Security

November 3, 1970

CONTINENTAL CASUALTY COMPANY ET AL

v.

AMERICAN SECURITY CORPORATION ET AL. MATHER CONSTRUCTION COMPANY ET AL., APPELLANTS, MATHER AFB HOUSING NO.



UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA CIRCUIT

Two, Inc., et al. 1970.CDC.244

Date Decided: November 3, 1970; As Amended December 10, 1970.

Petition for Rehearing Denied

APPELLATE PANEL:

MacKinnon and Wilkey, Circuit Judges, and Christensen,* U. S. District Judge, District of Utah.

PER CURIAM DECISION

Continental Casualty Company and the Fidelity and Casualty Company of New York, appellees, brought this action against the construction contractors, appellants Mather Construction Company, D & L Construction Company, and J. D. Bradley, Inc., to recover amounts escrowed with the defendant American Security Corporation for unpaid bills for labor and materials and certain unfinished landscape items on the Mather Air Force Base project. Appellees were sureties on the performance and payment bonds given in relation to a contract for the construction of 220 units of military housing under the Capehart Act. *fn1

The District Court granted summary judgment against the three appellant contracting companies, and found the appellees were entitled to the sums totaling $147,824.44 escrowed with the defendant American Security Corporation, the stakeholder who has not appealed. We affirm the summary judgment granted by the District Court.

Pursuant to Rule 56 and according to the usual practice, in support of their motion for summary judgment appellees filed a "Statement of Material Facts as to Which There Is No Genuine Issue." *fn2 This included as exhibits photostats of some thirty-five cancelled checks, representing the satisfaction of claims, of persons performing work as subcontractors or as suppliers furnishing materials, against the appellees as sureties for the three appellant contractors, as well as copies of the relevant contract and indemnity agreements. An affidavit by an Assistant Vice President of the appellee Continental Casualty Company stated that the facts set forth in the affidavit were known personally to the affiant and were reflected in the office records of Continental Casualty Company to which the affiant had access in the course of his official duties, that the "Statement of Material Facts as to Which There Is No Genuine Issue" was true, and that all claims against the appellees as sureties were paid in good faith after investigation and in the belief that appellees were liable therefor. The itemized list of claims paid totaled $409,512.43.

The appellant construction firms did not file any affidavit contradicting the affidavit of the officer of the appellee surety company, nor did the appellants attempt to contradict under oath any single claim of payment, asserted under oath as having been made by the appellee surety companies. Appellants did file one affidavit, by D. L. Bradley, which dealt in general terms with the project and recited facts which were not in dispute by either party and therefore not material to any issue in the lawsuit, e. g., that Mather AFB Housing No. Two, Inc., and Mather AFB Housing No. Three, Inc., projects were completed (with certain exceptions) and turned over to the Air Force. The important issue in the lawsuit was not about the substantial completion of the projects, but concerned unpaid materialmen and subcontractor bills left to be cleaned up by the surety companies and escrowed funds of undisbursed mortgage proceeds *fn3 which now are sought partially to reimburse the sureties.

Since the appellants had not put in issue by affidavits of their own a single material fact relied upon by the appellees in their motion for summary judgment, appellants' counsel stated at oral argument that the issue on appeal was the sufficiency of the appellees' affidavit to support the summary judgment granted by the District Court.

We find that the affidavit and the supporting documents were sufficient and formed a firm foundation for the action taken by the District Judge. This type of lawsuit, involving as it does numerous financial items, most of which are not in dispute and are susceptible of simple accounting treatment, is ideally suited for determination on summary judgment after appropriate interrogatories and other discovery processes have established that there is no genuine dispute as to any material fact. *fn4

The affidavit here was by an officer of one of the appellee companies, charged with the responsibility for the processing of claims, who made affidavit on his own personal knowledge and on the records of his surety company with which his duties required him to be familiar. *fn5 All of these records would have been admissible at trial under the Federal Shop Book Rule, *fn6 and indeed their accuracy was in no way challenged by the appellants' cross-affidavit. *fn7 On the record before him the District Judge properly granted summary judgment. *fn8

In oral argument appellants attempted to raise a question as to whether each and every dollar paid out by the surety companies was for a claim specifically related to one of the housing projects on Mather Air Force Base, and that the total claims paid on each of the projects was equal to or in excess of the amount in each escrow fund. In the posture of this case, appeal from a summary judgment, it suffices to point out that in support of their motion for summary judgment appellees' "Statement of Material Facts as to ...


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