applies or consents to the application of such funds for any purpose other than the foregoing and fails to pay the claims hereinbefore mentioned is guilty of larceny and is punishable as provided by law therefor.

[H. R. 4231, 74th Cong., 1st sess.]

A BILL Extending the obligation of bonds of contractors for public buildings to include premiums for insurance

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Act entitled "An Act for the protection of persons furnishing materials and labor for the construction of public works ", approved August 13, 1894, as amended, is amended by adding the following sentence: "The obligation of any bond executed pursuant to the provisions of this Act shall extend to the payment of premiums for insurance against liability for bodily injuries to employees and other persons, and for property damage, arising out of the construction or repair of any public building or public work, and any person who furnishes such insurance shall be entitled to the benefits of this Act to the same extent and in the same manner as persons who furnish labor or materials."

[H. R. 4461, 74th Cong., 1st sess.]

A BILL To secure the payment of the claims of persons employed by contractors upon public works, and the claims of persons who furnish materials, supplies, teams, implements, or machinery used or consumed by such contractors in the performance of such works, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That every contractor, person, company, or corporation to whom is awarded a contract involving an expenditure in excess of $100 for the improvement, erection, or construction of any building, road, bridge, or other structure, excavation, or other mechanical work for the United States or any board, commission, department, or political subdivision or agency of the United States, shall, in addition to any bond required under the Act of August 13, 1894, as amended (U. S. C., title 40, sec. 270), before entering upon the performance of such work, file with the officer by whom such contract was awarded, a good and sufficient bond, to be approved by such officer, in the sum not less than one-half of the total amount payable by the terms of the contract: Provided, That whenever the total amount, payable by the terms of such contract shall be not less than $5,000,000 or more than $10,000,000, a bond in a sum not less than one-fourth of the amount payable under the terms of the contract may be accepted, and if the amount payable under any such contract exceeds the sum of $10,000,000, a bond in the sum of $2,500,000 shall be sufficient; such bond shall be executed by either two or more good and sufficient sureties or by corporate surety as provided by law, in an amount not less than the sum specified in the bond, and must provide that if the contractor, person, company, or corporation, or his or its subcontractors fail to pay for any materials, provisions, provender, or other supplies, or teams used in, upon, for, or about the performance of the work contracted to be done, or for any work or labor thereon of any kind, that the surety or sureties will pay for the same, in an amount not exceeding the sum specified in the bond, and, also, in case suit is brought upon such bond, a reasonable attorney's fee to be fixed by the court, and any penalties assessed under the law of the State in which such contract is to be performed. Such bond must by its terms inure to the benefit of any and all persons, companies, and corporations entitled to file claims under this Act so as to give a right of action to them or their assigns in any suit brought upon said bond. Said bond shall also provide that actions on it may be commenced in any court of competent jurisdiction in the State wherein the contract is to be performed. Unless such bond is filed as herein provided no claim in favor of the contractor arising under such contract shall be audited, allowed, or paid by any disbursing officer of the United States, but persons who have in good faith performed work upon such contract, or supplied materials for the execution thereof, shall, upon giving the notice prescribed in section 2 hereof, be entitled to receive as compensation the reasonable value of the labor performed or materials furnished, on proving to the satisfaction of

the public disbursing officer of the United States or of the board, commission, or department thereof whose duty it would have been to pay said contractor should said bond have been filed, that said material has been furnished or labor performed.

SEC. 2. (a) Any materialism, person, company, or corporation furnishing materials, provisions, provender, or other supplies used in, upon, for or about the performance of the work contracted to be executed or performed, or any person, company, or corporation renting or hiring teams or implements or machinery for or contributing to said work to be done, or any person who performed work or labor upon the same, or any person who supplies both work and materials and whose claim has not been paid by the contractor, company, or corporation, to whom the contract has been awarded, or by the subcon tractors of said contractor, company, or corporation, may at any time within thirty days after the completion of said contract file with the public disbursing officer whose duty it is to make payments under the provisions of such contract, a verified statement of such claims, together with a statement that the same have not been paid. A copy of said notice shall be served personally on the contractor or the superintendent of the contractor in charge of operations under the contract to be executed, and his surety, or may be served by mailing a copy of said notice to the contractor, or the superintendent of the contractor in charge of operations under the contract to be executed, and his surety.

(b) Within twenty days after receipt of said notice the contractor, his superintendent, or agent, or the surety, may file a notice of dispute with the public disbursing officer with whom the stop notice has been filed, setting forth the grounds on which the claim is disputed, which notice shall be verified and a copy thereof sent to the claimant, his heirs, or assigns, at the address given at the stop notice. If no notice of dispute is filed with the public disbursing officer within twenty days he shall pay to the claimant the amount of said claim, together with any accrued penalties, provided by the laws of the United States or State in which the contract is performed, of which he shall have notice, and payment thereof shall be credited as a payment on the balance due the contractor and constitute a complete acquittance for the amount so paid. It shall be mandatory that the public disbursing officer within ten days after the completion of any contract or structure or work of improvement provided for in this Act, or within ten days after there has been a cessation from labor thereon for a period of thirty days, file for record in the office of the county recorder of the county or counties where the property is situated, a notice setting forth the date when the same was completed or on which cessation from labor occurred, together with the name, title, and address of the public disbursing officer whose duty it is to pay the contractor, a description of the property or public work or structure sufficient for identification, the name of the contractor or contractors, and the names of the sureties, if any; which notice shall be verified by said public disbursing officer, and in case such notice be not so filed, it will be presumed that the date of completion was the date of actual use or occupancy of such improvement or structure in the manner for which said structure or improvement was intended, and any stop notice filed under the provisions of this section must be filed within the thirty days next succeeding the filing of said notice of completion, or if said notice be not so filed, within sixty days after the actual use or occupancy of the improvement structure in the manner for which it was intended. Actions brought under this section shall be prosecuted with due diligence, and in case of failure to prosecute, defendants may apply to the court for a dismissal on these grounds, and if dismissal be granted, money so withheld shall be paid to the parties to whom they are due.

(c) When a notice of dispute has been filed and a copy thereof served on claimant as provided, an action must be commenced by the claimant, his heirs, or assigns, within thirty days thereafter or action on such stop notice shall be forever barred. Actions may be brought in any court of the State that would have jurisdiction of the parties if an officer of the United States were not a party thereto and shall include as defendants the public disbursing officer whose duty it is to make payments to the contractor, the contractor and his surety, if known.

(d) Judgments when recovered under the provisions of this Act shall be entered against the contractor and/or his surety, and shall direct the defendant public disbursing officer to pay the judgment-creditor the amount of said judgment with costs and accruing costs, and such payments shall be charged against

the balance due the contractor and will be a complete acquittance for the amount so paid.

(e) Any number of persons who have given such stop notices may join in the action and when separate actions are commenced the court first declaring jurisdiction may consolidate them. Upon the demand of the public disbursing officer the court shall require all claimants to be included in such action to the end that the respective rights of all parties may be adjudicated and settled therein. There shall be no priority between such claimants except as provided by the law of the State in which said contract is to be executed.

(f) No assignment by the contractor of the whole or any part of the money due him or to be due him under the contract, or for "extras" in connection therewith, whether made before a verified claim is filed as provided for herein or after said claim is filed, shall be held to take priority over claims filed under this section and such assignment shall have no binding force insofar as the rights of the claimants who filed claims hereunder, or their assigns, are concerned: Provided, That nothing in this section shall be construed to prohibit the payment of any money to the contractor or his assigns so long as no verified claims are on file prior to the time the disbursing officer shall have actually surrendered possession of the warrant, checks, bonds, or money, nor prohibit the payment to said contractor or his assigns of any money due him or his assigns over and above the total amount of the claims filed at that time plus such interest penalties and court costs as might be reasonably anticipated in connection with said claims.

(g) Suit against the surety or sureties on the bond of the contractor required under section 1 hereof may be brought by any claimant or his assign at any time after the claimant has ceased to perform labor or furnish material or both and until the expiration of six months after the period in which verified claims may be filed as provided herein. The filing of a verified claim shall not be a condition precedent to the maintenance of such action against the surety or sureties on the bond and an action on such bond may be maintained separately from and without the filing of an action against the public disbursing officer whose duty is to pay the contractor. Upon the trial of any action, under the provisions of this Act, the court shall award to the prevailing party a reasonable attorney's fee, to be taxed as costs, and to be included in the judgment therein rendered.

SEC. 3 This Act shall take effect upon the expiration of sixty days after the date of its enactment, but it shall not apply with respect to any contract (or any bond relating thereto) awarded pursuant to any invitation for bids issued on or before the date it takes effect.

SEC. 4. Such provisions of the Act entitled "An Act for the protection of persons furnishing materials and labor for the construction of public works", approved August 13, 1894, as amended (U. S. C., title 40, sec. 270), as relate to the additional obligation for the payment to persons supplying labor or materials and to the enforcement of such obligation, are hereby repealed, except that such provisions shall remain in force with respect to contracts (or any bond relating thereto) for which invitations for bids have been issued on or before the date this Act takes effect.

[H. R. 5054, 74th Cong., 1st sess.]

A BILL To amend an Act approved August 13, 1894, entitled "An Act for the protection of persons furnishing materials and labor for the construction of public works "

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Act entitled "An Act for the protection of persons furnishing materials and labor for the construction of public works", approved August 13, 1894, is hereby amended so as to read as follows: "That hereafter any person or persons entering into a formal contract with the United States for the construction of any public work, or for repairs upon any public building or public work, shall be required before commencing such work to execute the usual penal bond to the United States, with good and sufficient sureties, and that in addition thereto he shall be required to furnish good and sufficient bond in such sum as the United States shall designate, not to exceed, however, the estimated cost of such work or improvement, nor less than 50 per centum of the estimated cost, which said bond shall be made to inure to the benefit of any and all mechanics, materialmen, subcontractors,

artisans, machinists, builders, teamsters, draymen, and all persons and laborers of every class performing labor upon or bestowing skill or other necessary services or furnishing materials, provisions, provender, or other supplies to be used or consumed in or furnishing appliances, teams, or power contributing to the performance of such public work or improvement, and shall provide that if the contractor, company, or corporation to whom said contract was awarded fails to pay for any materials furnished for said work or improvement, or for any work or labor done thereon, or for such skill, services, appliances, teams, power, provisions, provender, or other supplies, that the sureties will pay the same to an amount not exceeding the penal sum of said bond; and any person, company, or corporation who has furnished labor or materials, or such skill, services, appliances, teams, power, provisions, provender, or other supplies used in the construction or repair of any public buildings or public work and payment for which has not been made shall have the right to prosecute in his own name an action on said bond, which said action shall be instituted in the District Court of the United States in the district in which said contract was to be performed and executed, irrespective of the amount in controversy, and not elsewhere: Provided, That the person or persons supplying the contractor with labor or materials, or such skill, services, appliances, teams, power, provisions, provender, or other supplies, shall, prior to the commencement of said action, furnish an affidavit to the department under the direction of which said work has been prosecuted that labor or materials, or such skill, services, appliances, teams, power, provisions, provender, or other supplies, for the prosecution of said work, has been supplied by him or them and payment for which has not been made, and shall thereupon be furnished with a certified copy of said contract and bond upon which he or they have a direct right to action: Provided further, That where suit is instituted by any of such creditors on such bond, it shall not be commenced until ninety days after the complete performance of the contract under which said creditor furnished such labor and material and under which he claims payment has not been made, and in no event shall such action be commenced more than one year after the completion of the said work and/or improvement as a whole: And provided, however, That in the event performance by the original contractor of such contract for the construction of public work be abandoned by such original contractor or such original contractor shall cease work thereon for any cause or be removed therefrom by the United States, or any agency thereof, and work under such contract shall thereupon cease for a period of six months, then such cessation from labor upon said original contract shall, at the end of said six months' period, be the equivalent of complete performance of said contract for the purpose only of the preceding provision, and action upon said labor and material bond may be instituted by any such creditor in such event at any time after ninety days after the constructive completion of such contract resulting from such cessation from labor thereon for said six months' period, and in the event of such constructive completion arising in the manner aforesaid, then in no event shall such action be commenced upon said labor and material bond more than one year after the constructive completion of such contract as aforesaid: And provided further, That if suit is so instituted by a creditor or creditors only one action shall be brought, and any creditor may intervene in such action and be made a party thereto within the time herein allowed for the commencing of such action.

"If the recovery on the bond shall be inadequate to pay the amounts found due to all creditors, judgment shall be given to each creditor pro rata of the amount of the recovery. The surety on said bond may pay into court, for distribution among the claimants and creditors, the full amount of the penal obligation on said bond, and in so doing the surety shall be relieved from further liability: Provided, That in all suits instituted under the provisions of this Act such personal notice of the pendency of such suits, informing them of their right to intervene as the court may order, shall be given to all known creditors, and in addition thereto notice of publication in some newspaper of general circulation, published in the State or town where the contract is being performed, for at least three successive weeks, the last publication to be at least three months before the time limited therefor."

[H. R. 6018, 74th Cong., 1st sess.]

A BILL To require public contractors to furnish performance bonds for the protection of the United States and payment bonds for the protection of persons furnishing labor and materials, and for other purposes

66

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That (a) before any contract, exceeding $2,000 in amount, for the construction, alteration, or repair of any public building or public work of the United States, is awarded to any person, such person shall furnish the following bonds, which shall become binding upon award of the contract to such person (hereinafter referred to as contractor"): (1) A performance bond, with a surety or sureties satisfactory to the officer awarding such contract, and in such amount as he deems adequate for the protection of the United States, guaranteeing to the United States complete performance of such contract. No action shall be commenced on such bond after the expiration of one year after the date of final settlement of such contract.

(2) A payment bond, with a surety or sureties satisfactory to such officer, and in such amount as he deems adequate for the protection of all persons who supply labor or materials for such performance, guaranteeing to the United States for the use of each such person payment in full for such labor or material.

(b) The contracting officer in respect of any contract is authorized to waive requirement of a performance bond and payment bond for so much of the work under such contract as is to be performed in a foreign country if he finds that it is impracticable for the contractor to furnish such bonds.

(c) Nothing in this section shall be construed to limit the authority of any contracting officer to require performance bonds or other security in cases other than those specified in subsection (a) of this section.

SEC. 2. (a) Any person who supplies labor or material for the performance of any contract in respect of which a payment bond is furnished under this Act and who has not been paid in full therefor before the expiration of a period of ninety days after the day on which the last of such labor or material was supplied by him shall, if he has made written demand upon the contractor for such payment before the expiration of such period, specifying the amount owed, and if the contractor has failed to comply therewith before the expiration of such period, be entitled to sue on such bond for such amount, or the balance thereof unpaid at the time of institution of such suit. In case the labor or material was not supplied by such person in performance of a contract, express or implied, between such person and the contractor, such written demand shall include the name and address of the individual, association, partnership, or corporation with which such person contracted to furnish such labor or material. Such demand upon the contractor shall be served by such person in any manner in which the United States marshal of the district in which the contractor resides or does business is authorized by law to serve a summons, or by mailing such demand by registered mail, postage prepaid, in an envelop addressed to the contractor at his last known place of business or residence or to any surety on such payment bond at the last known place of business or residence of such surety.

(b) In case any person institutes suit under this section on any payment bond, any other person or persons entitled to sue on such bond may intervene therein, and if the full amount of liability of the sureties on such bond, or the amount of liability remaining on such bond, is insufficient to pay the sums awarded to such persons by the court, the court shall prorate such amount among such persons.

(c) Suits instituted under this section shall be brought in the name of the United States for the use of the person suing, in the United States district court for any district in which the contract is performed, and not elsewhere, irrespective of the amount in controversy, but no such suit shall be commenced after the expiration of one year after the date of final settlement of such contract. The United States shall not be liable for the payment of any costs or expenses of any such suit.

SEC. 3. The Comptroller General is authorized and directed to furnish, to any person making application therefor who submits an affidavit that he has taken the action required by this Act to enable him to sue on any payment bond or that he is being sued on any such bond, a certified copy of such bond and the contract for which it was given, which copy shall be prima facie evi