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BENDIK v. UNIONTOWN S.R. CO. (06/28/62)

June 28, 1962

BENDIK, APPELLANT
v.
UNIONTOWN S.R. CO., INC., APPELLANT.



Appeals, Nos. 216, 217, March T., 1961, and No. 6, March T., 1962, from judgments of Court of Common Pleas of Fayette County, Sept. T., 1958, No. 751, in case of Joseph J. Bendik and Arthur J. Bendik, partners trading and doing business as Bendik Construction and Engineering Company, v. Uniontown S.R. Co., Inc. and Sommer Bros. Construction Co., Inc. Judgments reversed at Nos. 216 and 217; appeal at No. 6 dismissed; reargument refused July 25, 1962.

COUNSEL

Herman M. Buck, with him Ray, Buck & John, for plaintiffs.

Henry R. Beeson, for defendants.

Before Bell, C.j., Musmanno, Jones, Cohen, Eagen and O'brien, JJ.

Author: O'brien

[ 408 Pa. Page 67]

OPINION BY MR. JUSTICE O'BRIEN

These appeals arise from a construction contract for the erection of a commercial building in Uniontown. Essentially the controversy resolves itself about the interpretation of a section of the contract wherein the defendants (Appellants at Nos. 216, 217 March Term, 1961) are denominated "the first party" and the plaintiffs (Appellants at No. 6 March Term, 1961) are "the second party".

The defendants maintain the contract is a "no lien" contract while the plaintiffs contend the language used does not deny them the right to file a mechanic's lien. The paragraph of Article XXI is as follows: "In the event at any time any obligations incurred by the second party in connection with or as the result of the performance of this subcontract are unpaid, whether due or to become due, the first party is authorized to make such payment direct out of any moneys payable

[ 408 Pa. Page 68]

    to the second party, and the first party may at any time if it so desires, make direct payment to the labor employed by the second party, and the second party for itself and its sub-contractors, materialmen and employees, hereby expressly waives the right to file any lien or claim against the premises or money earned by the first party; and further, that if in violation hereof, the second party shall file any such lien ... or other claim for moneys due or to become due for which if established, the first party might be liable, and which would be chargeable to the second party, the first party shall have the right to bond said lien or claim or otherwise discharge the same and to retain out of any payment then due or thereafter to become due, an amount sufficient to completely indemnify it against such lien or other claim with interest together with the expense incident to discharging such lien or claim or defending suit to enforce such lien or other claim, including any premiums charged for a bond and any attorney's fees and disbursements all of which the second party agrees to pay. Should the first party give the second party notice of any unpaid claim for obligations by second party, the second party shall be estopped from disputing liability for any such claim unless within three days after such notice it indicates to the first party in writing by registered mail that there is some sum different than that demanded owing, or that there are no sums owing. And should there prove to be any claim after all payments are made, the second party shall refund to the first party all moneys that the latter may be compelled to pay in discharging and defending the same. Any lien or other claim, until satisfied or withdrawn, shall preclude any and all claim or demand for any payment whatever under or by virtue of this contract." (Emphasis supplied).

The court below, in opinion of the Court en banc, said: "We construe this whole paragraph as relating

[ 408 Pa. Page 69]

    to the subject of protection of the defendants against liens or obligations which are ...


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