In a Miller Act payment bond dispute in Boneso Brothers Construction, Inc. v. Sauer, Inc., 2018 WL 2387833 (N.D.Cal. 2018), a claimant asserted claims against a Miller Act payment bond surety for breach of the payment bond, breach of a subcontract, open account, and account stated. The question is why would the claimant sue the payment bond surety for breach of subcontract (when the subcontract was not with the surety), and open account and account stated. I have no clue, other than such claims appeared quite unnecessary when the claimant asserted an action on the Miller Act payment bond (which is what the surety is liable under — actions under the statutory payment bond). Such claims were dismissed. And, they should have been.
A claimant cannot navigate around an action under a Miller Act payment bond by suing the surety for breach of an underlying subcontract. Such a claim would obviate any preconditions to suing the surety under the bond and extend the surety’s exposure.
In Florida, and elsewhere, an account stated and open account are distinct causes of action.
An account stated is a claim when there is an “agreement between persons who have had previous transactions, fixing the amount due in respect of such transactions, and promising payment.” Farley v. Chase Bank, U.S.A., N.A., 37 So.3d 936, 937 (Fla. 4th DCA 2010) (quotation and citation omitted). An “account stated requires an express or implied agreement between the parties that a specified balance is correct and due and an express or implied promise to pay the balance.” Id.
An open account “is an unsettled debt arising from items of work and labor, with the expectation of further transactions subject to future settlements and adjustments.” Id. (quotation and citation omitted). In an action on an open account, the claimant must actually attach a copy of the itemized account, unlike an account stated action. Id.
The reality is none of these other claims would really apply to a Miller Act payment bond surety. Moreover, the surety naturally was being indemnified by its payment bond-principal, so it is not like the surety put itself in a position where it affirmatively acknowledged the so-called “debt” the subcontractor claimed was owed. The cuteness in trying to “throw the book” at the surety was not necessary, specifically when the subcontractor had an action on the Miller Act payment bond!
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