Dale Benz, Inc., Contractors, an Arizona Corporation v. American Casualty Company of Reading, Pennsylvania

This action involves a claim by appellants (hereinafter Benz), a general contractor, against Appellee (hereinafter American), the surety of Basich Brothers Construction Company (hereinafter Basich), a subcontractor, for damages incurred as a result of the failure of Basich to complete its subcontract with Benz. It is a diversity case wherein the district court had jurisdiction pursuant to the provisions of 28 U.S.C. § 1332 , and the matter is brought here under 28 U.S.C. § 1291 .

According to the pertinent allegations contained in the complaint, on or about the 14th day of May, 1958, Benz held a general contract with the United States of America for construction of certain buildings. On said date it entered into a subcontract with Basich for the performance of work and the furnishing of materials required under the general contract, on a job at the Marine Corps Supply Center, Barstow, California. American, as surety for Basich, made and executed a Performance and Payment Bond. On January 27, 1959, Benz gave American and Basich notice that Basich was in default under the subcontract. Numerous demands were made upon Basich and American for completion of said subcontract, but they…