Mr. MCLAUGHLIN. And do I understand you to say that there would be no additional premium charged?

Mr. DOCKWEILER. I did say that in reading from my brief. I said that only because of my conversation or correspondence with the representatives of surety companies. They say there should be no extra cost, because they think today they are compelled to take care of the material men as well as the faithful performance.

Mr. MCLAUGHLIN. Under the present Heard Act?

Mr. DOCKWEILER. Under the present Heard Act. But I do not see how they could avoid paying the extra premium, because they call them two bonds.

Mr. MILLER. The rates now on the bonds are fixed by the Towner Rate Bureau, and the premium is 1 percent on highway work and 112 percent on public works?

Mr. DOCKWEILER. Yes.

Mr. MILLER. And the premium would seem to be on the basis of a certain percentage of the contract price.

Mr. MCLAUGHLIN. What I am inquiring about is whether this bill does not give rise to a situation which will require a contractor to give two bonds instead of one, each having the same penal amount as the one which he now gives; and I am inquiring further whether that would not necessarily call for an increase in premium rate? Mr. DOCKWEILER. Between you and me, I think you are right. My bill does call for two bonds. It provides that beside the regular penal bond executed in favor of the United States, in addition thereto he shall be required to furnish a good and sufficient bond in such sum as the United States designates. Now, that does not mean necessarily because the administrator in charge of a piece of construction work might think on a job costing $100,000 that a $25,000 bond on that job will be sufficient.

Mr. MCLAUGHLIN. It leaves it to his discretion?

Mr. DOCKWEILER. Yes. There might be one-fourth of 1 percent more premium.

Mr. MILLER. But do you not overlook the fact that the bond under the Heard' Act as now existing is for the benefit of the laborers, subcontractors, and materialmen, but their trouble is a procedural trouble; right now that is their main trouble-this is a procedural question. I cannot see where the premium on the bond would be increased.

Mr. DOCKWEILER. That was my understanding.

Mr. ROBSION. Well, the Government was undertaking to take care of the materialmen and the laborers, too, and that is all that you undertake to do by your bill?

Mr. DOCKWEILER. That is true.

Mr. MILLER. Your bill provides that there shall be only one suit filed by the materialmen?

Mr. DOCKWEILER. That is correct.

Mr. MILLER. And the others shall intervene in it?

Mr. DOCKWEILER. That is correct.

Mr. MILLER. Well, do you not think-what is the reason why the laborers and the materialmen, if they so desire, should not be permitted to file separate suits? In other words, suppose a materialman files a suit today and the court upon the final hearing determines that that suit was prematurely filed and dismisses it.

Mr. DOCKWEILER. Yes.

Mr. MILLER. Now, under your requirement in the bill the others have intervened; in the meantime, the statute of limitations has run, and the suit in which their intervention was filed is dismissed-and out they go.

Mr. DOCKWEILER. That is correct. Let me explain that. Of course, you know that the Heard Act provides for only one suit on the part of the materialmen.

Mr. MILLER. Yes.

Mr. DOCKWEILER. And you will observe that that bill provides for a notice to be published so many days.

Mr. MILLER. The Heard Act provides that also.

Mr. DOCK WEILER. Here is the situation: There are, we will say, four laboring men, and each of them might have a claim for only $100. And it is expensive to file a suit in the first place, and then, in most of the United States District Courts, they have different divisions.

Mr. MILLER. That is true.

Mr. DOCKWEILER. And we might have four divisions there, and the suit of each of those men might be referred to a separate division-John Doe, we will say, might have his suit referred to suchand-such division; another man would have his referred to another division, and so on.

Now, all of those suits should be consolidated, and should be heard upon the same evidence.

Mr. MILLER. Yes. The senior judge would naturally see that that was done.

Mr. DOCKWEILER. Yes. I would have no objection to saying that they may intervene in the same suit or may bring separate suits. Mr. MILLER. I think they should have that right.

Mr. ROBSION. Under this bill, if some other materialmen should intervene and the original action should go out, I do not believe that would put the intervener out of court.

Mr. MILLER. Yes; it would.

Mr. DOCKWEILER. Of course, that is another thought.

Mr. MCLAUGHLIN. May I ask this fundamental question? Is the purpose of your bill merely to shorten the length of time within which a materialman or laborer may institute action to secure payment of his claim, or does it increase the liability of the surety or give increased protection to the Government and materialmen and laborers, taken together?

Mr. DOCKWEILER. I think it would increase protection to the laborers and the materialmen.

Mr. MCLAUGHLIN. In any other way than by shortening the time within which he can bring his action?

Mr. DOCKWEILER. And in the fact that the administrator of the Federal Department will then say, in effect, "I think, Mr. Contractor, that you have given a bond for $50,000 out of this $100,000, to take care of the materialmen and laborers, because this is a job that is going to be mostly labor and material." Do you see? Mr. MCLAUGHLIN. Yes; I see your point.

Mr. DOCKWEILER. In other words, the administrator for the job for the Federal Government, if he uses his discretion merely in favor of the public-works job that is let-he can exercise his discre

tion in such a way as to take better care of the materialmen and laborers; whereas the present bond is a mixture of both, for the protection of both the Government and the materialmen; and the United States might take all the money and the laborer would get nothing, as he would only get whatever residue there was left. Mr. MCLAUGHLIN. Yes; I see.

Mr. DOCKWEILER. Now, the administrator may say, "This is practically all labor and material."

All right-we should have a bond for, say, $75,000 to protect these fellows so that we are sure that they are going to be paid for their labor and material. My bill is an added protection for the materialman and the laborer. It gives them better machinery and easier facilities

Mr. ROBSION (interposing). Not only that, but they are singled out and given special protection, just like the Government is given special protection?

Mr. DOCKWEILER. Yes.

Mr. ROBSION. You are doing for the laborers and materialmen just as this other bill did for the Government?

Mr. DOCKWEILER. Yes, I am sure of that; and that they will benefit from every angle.

Mr. MCLAUGHLIN. Well, if the new bond is provided under this bill, and there are two bonds to take the place of the one bond under the Heard Act, affording the laborers and the Government combined more protection than was afforded under the Heard Act bond, then is it not true that necessarily sureties are held to a greater accountability, in that there is a greater liability imposed upon the sureties?

Mr. DOCKWEILER. Yes; I do not think you can escape that conclusion.

Mr. MCLAUGHLIN. Now, if that is true, how can it be true that there is no additional premium charge?

Mr. MILLER. We will get to that question later.

Mr. DOCKWEILER. Well, when you resolve the question down in the manner you have, I think somewhere along the line there will be an additional premium, because the simple fact is that they are executing two separate instruments.

Mr. MILLER. I think that is true.

Mr. DOCKWEILER. While that would not be an argument for giving the laborer protection-and I think the contractor will have to weave that into his proposed charges.

Mr. ROBSION. Did not the Heard Act have it in mind to protect the Government, the materialmen, and the laborers?

Mr. DOCKWEILER. That is correct.

Mr. ROBSION. Now, I do not understand why the Government, in making a contract, could not do that, because if they would take a sufficient bond, that purpose would be accomplished, would it not? Mr. DOCKWEILER. Do you mean under the present law?

Mr. ROBSION. Yes.

Mr. DOCKWEILER. Then the Congressman's suggestion is that you have not got the proper procedure for the materialmen and laborers to follow. They have got to wait not only for completion, but for the final settlement on the part of the United States, which, in the case that I suggested, represented 4 years.

Mr. ROBSION. Well, of course, if he would take an adequate bond, it would be different.

Mr. DOCKWEILER. Well, there might be an adequate bond and that difficulty would arise.

Mr. ROBSION. He would take an adequate bond and modify the language and not require the laborer and materialmen to wait for the completion-would not the same purposes be served?

Mr. DOCKWEILER. I am really revising the language of the Heard Act. If the Congressmen here feel that they just want to revise the Heard Act to accomplish that purpose, I would be content. I just want results-I want results for the laboring man and the materialman.

Mr. ROBSION. You want protection for the laborer and the materialman; and then a procedure that would permit them to get their money before this final settlement with the Government?

Mr. DOCKWEILER. That is it, exactly.

Mr. MCLAUGHLIN. How far does your bond give protection? Does it extend to subcontractors as well as contractors?

Mr. DOCKWEILER. I really had included in my language, in the language of my bill, I think, the subcontractor, so that it will include anybody who has furnished anything on the job.

Mr. MILLER. Do you not think really, in view of the construction that the courts have placed upon material and labor used in projects— do you not think that you have a surplus of language there, Mr. Dockweiler?

Mr. DOCKWEILER. That may be true; yes.

Mr. MILLER. It was more a precaution, of course, and you did not want to leave out anything.

Now, we have several other gentlemen here.

Have you completed your statement, Mr. Dockweiler?

Mr. DOCKWEILER. Yes; I have. I should like to leave a few letters with the committee.

Mr. MONTAGUE. You provide in your bill for two separate obligations?

Mr. DOCKWEILER. That is correct.

Mr. MONTAGUE. One for the Government and one for the materialmen?

Mr. DOCKWEILER. Yes.

Mr. MONTAGUE. With the requirement of two suits, one by the Government and one by the materialmen?

Mr. DOCKWEILER. That is right.

Mr. MONTAGUE. Now, the suits could be filed in the district courts? Mr. DOCKWEILER. In the United States district court wherever the job is done.

Mr. MONTAGUE. It is possible, then, that you may find two suits, one for the protection of the laboring man and one for the protection of the Government, in different courts

Mr. DOCKWEILER. No; they would be in the Federal courts.

Mr. MONTAGUE. I know they would be in the Federal courts, but in different courts.

Mr. DOCK WEILER. Do you mean in different divisions of the court? Mr. MONTAGUE. Yes.

Mr. DOCKWEILER. But not in different districts. It is just like we have four subdivisions of our Federal district court in Los Angeles,

bill.

Calif.; and the Government case might be before Judge So-and-So, and the materialman's case might be before Judge So-and-So; but they would be in the same district, as I understand it, under my Mr. MONTAGUE. But before two different judges? Mr. DOCKWEILER. Yes; in that case. But I think the cases could be consolidated by whoever has charge of the assignment of the calendar in the United States district court.

STATEMENT OF HON. THEODORE CHRISTIANSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MINNESOTA

Mr. MILLER. Mr. Christianson, we apologize to you for not having heard you on H. R. 4231. Now, in view of the fact that your bill does not touch exactly the subject that we have got launched into hearing today, the question of additional bond for the protection of laborers and materialmen on these public works, it has been suggested that we postpone hearing you on your bill until we complete this subject. And I feel that I ought to make that statement now, so that you do not need to stay unless you prefer to do so.

Mr. CHRISTIANSON. I just wanted to say that this brief is so extended that it does not require any additional statement. I would be willing to have the bill reported without your hearing from me; that would be entirely satisfactory to me.

Mr. MILLER. I do not say that we will report the bill; but, as soon as we get through these other bills, we then will take your bill up. Mr. CHRISTIANSON. Well, when you take my bill up, you need not send for me unless you think it necessary, because I think this brief [indicating], together with the bill, is self-explanatory.

Mr. MONTAGUE. It is a self-evident bill?

Mr. CHRISTIANSON. Yes; it is a self-evident bill.

Mr. MILLER. Well, there is one thing that recommends it-it is short. [Laughter.]

Now, we will hear from Mr. Cushman.

Mr. TAYLOR. Before you do that, Mr. Chairman, I would like to say in connection with what has been said by the gentleman from California [Mr. Dockweiler], that I think my bill meets the very objections that are raised here. My bill was primarily designed for the protection of the laborers and materialmen, and they have a right of action regardless of the completion of the contract. other words, they can introduce their action 90 days after the work is performed or 90 days after the material is furnished. Mr. MCLAUGHLIN. Or after it has been abandoned

Mr. TAYLOR. Within 90 days after it is furnished.

Mr. MCLAUGHLIN. Within 90 days after it is furnished, regardless of the completion?

Mr. TAYLOR. Yes.

Now, Mr. Chairman, I would like to present Mr. Edward H. Cushman, of the Philadelphia and Washington Bars. Mr. Cushman is the author of The Law of Mechanics' Liens in Pennsylvania, a work of recognized authority, and he has also compiled the statutes of the various States regarding contracts for public works, and bonds for the protection of materialmen; and I would like to leave with the committee a copy of that, as it is very valuable.

(Mr. Taylor passed around to members of the committee copies of a printed pamphlet.)