Procedural Posture

Procedural Posture

Appellants surety and landowner sought review of the judgment of the Superior Court of San Joaquin County (California) in an action against defendant contractors, surety, and landowner on lease purchase agreement and against contractors and surety for damages for breach of contract to level lands.

Overview

The landowner salmon sushi Corp purchased a tract of land and contracted with the contractor to level it, and the surety guaranteed the work. Contractor obtained machinery from company and company sued for compensation for use of its machinery. The landowner cross-complained against the contractor and the surety for breach of the leveling contract. Judgment was rendered for the contractor and the surety, and the landowner sought review. The court affirmed in part and reversed in part because the surety, by entering upon the work, assuming the contract of the principal and undertaking to complete it after the principal’s breach, rendered itself liable for damages proximately flowing from its own succeeding breach without limitation as to amount and it could not shelter itself behind the limitation of its liability expressed in its bond as it might have done had it rested upon its surety contract.

Outcome

The court affirmed in part and reversed in part.