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U.S. Supreme Court

Morley Construction Co. v. Maryland Casualty Co., 300 U.S. 185 (1937)

Morley Construction Co. v. Maryland Casualty Co.

No. 325

Argued January 8, 1937

Decided February 1, 1937

300 U.S. 185


1. A wrongful purpose is not an element of a cause of action for exoneration. P. 300 U. S. 189.

Page 300 U. S. 186

2. The right of a surety to be exonerated from obligations of the principal does not entitle the surety to custody or control of the fund directed to be used for the purpose. P. 300 U. S. 192.

3. In the absence of a cross-appeal, the appellee, to support the decree, may urge argument contradictory of the reasoning of the lower court, or may adduce matter in the record which the court overlooked or ignored, but cannot attack the decree to enlarge his own rights under it or to lessen his adversary's. P. 300 U. S. 191.

4. The fact that findings, if against the weight of the evidence, may be revised on appeal in equity at the instance of an appellant does not mean that they may be revised at the instance of an appellee, at least where their revision would carry with it as an incident a revision of the judgment. P. 300 U. S. 191.

5. A surety on a bond to secure the performance of a public construction contract and payment of laborers and materialmen, made a supplementary contract with the contractor to advance money for use in carrying on the work, to be deposited in a special joint account, under their joint control, in which also the contractor was to deposit all payments received from the Government. The contractor having failed to deposit its final payment from the Government (the warrant for which was impounded) the District Court held that the surety, being itself partly in default, could not have specific performance of the supplementary agreement, but was entitled, apart from agreement, to be exonerated from present liabilities, and it therefore decreed that the proceeds of the warrant be placed in a bank to be chosen by the contractor, as a special trust fund for the payment of bills for labor and material, no provision being made for any control in the surety. Upon the contractor's appeal, the Court of Appeals made its own finding that the surety's default was innocent and unsubstantial and directed that a decree of specific performance be substituted for the decree of exoneration. Held that the appellate court had exceeded its power. P. 300 U. S. 192.

84 F.2d 522, 526, reversed.

Certiorari, 299 U.S. 529, to review a decree directing that a decree of the District Court for exoneration of a surety be modified to a decree for specific performance of a supplementary agreement between the surety and its principal.

Page 300 U. S. 187

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