59 Def. Counsel J. 60 (1992)
Annual Survey of Fidelity and Surety Law, 1991 - Part I

handle is hein.journals/defcon59 and id is 70 raw text is: ANNUAL SURVEY OF FIDELITY AND
This roundup of recent cases covers public and private construction bonds,
fidelity and financial institution bonds, and sureties' remedies

A. Miller Act Bonds
1. Procedural Issues
Time to sue runs from date contract ter-
minated, not date last work was performed.
A second-tier subcontractor agreed to supply
earth-moving equipment and personnel to the
subcontractor for work on a Navy installation.
The first-tier subcontractor fell out with the
general contractor and left the job. The sec-
ond-tier sub likewise was unable to perform
any work, although the general and the first-
tier sub continued to negotiate. The subcon-
tract later was terminated. The second-tier sub
filed suit more than one year after he had
stopped performance but less than one year
after the subcontractor was terminated.
In an opinion more noted for sympathy than
logic, the Ninth Circuit held that the suit was
timely. The Miller Act requires that the suit be
filed within one year from the day on which
the last of the labor was performed or material
was supplied. The court reinterpreted that lan-
guage to mean the date the equipment was last
available for use on the project. Pippin v. JR.
Youngdale Construction Co.'
2. Substantive Issues
No recovery allowed in Miller Act case
for breach of covenant of good faith.
The continuing controversy about whether a
claimant under the Miller Act can include

1. 923 F.2d 146 (9th Cir. 1991).
2. 755 F.Supp. 906 (E.D. Calif. 1991).

The Annual Survey of Fidelity and Surety
Law is a project of the IADC Fidelity and Surety
Law Committee and is published in two parts.
This is Part I of the 1991 survey; Part 1I will
appear in the July 1992 issue of Defense Coun-
sel Journal.
Public Construction Bonds was prepared
by Ronald A. May of the Little Rock firm of
Wright, Lindsey & Jennings. He is the Imme-
diate Past Chair of the IADC Fidelity and
Surety Law Committee. He was educated at
the University of Iowa (B.S. 1950) and
Vanderbilt University (J-D. 1953).
Private Construction Bonds was prepared
by G. Steven Ruprecht, a partner in the Kan-
sas City office of Husch & Eppenberger. He is
a graduate of the University of Missouri (B.S.
1970) and the University of Missouri-Kansas
City (J.D. 1973).
Fidelity and Financial Institution Bonds
was prepared by Paul R. Devin of Boston's
Peabody and Arnold. He was graduated from
Boston College (1962) and Boston University
Sureties' Remedies was prepared by Rob-
ert E. Leslie of Leslie, Powell & Morey of San
Francisco. He holds B.A. (1955) and LL.B.
(1960) degrees from the University of Califor-
nia at Berkeley.
The material was edited by Charles W.
Linder Jr., a partner in the Indianapolis firm
of Linder & Hollowell. He holds an A.B. from
Columbia University (1958), a J.D. from the
University of Indiana (1962), and he has taught
at Northwestern University, the University of
Tulsa and Loyola University.
claims for breach of the covenant of good faith
and fair dealing got some further elaboration
in Ehmcke Sheet Metal Works v. Wausau In-
surance Cos.2 The Ninth Circuit has held that
the Miller Act does not preempt such an ac-
tion, and in Ehmcke a California federal dis-
trict court judge was required to determine
whether California common law provides such
a remedy against a prime contractor's surety.

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