Southern Surety Co. v. Bank of Lassen County

This is an action brought upon contract. Upon trial by the court, judgment was rendered against each of the defendants in the sum of $3,371.82. The appeal is taken from the judgment.

The facts are undisputed. Baxter Creek Irrigation District and Tule Irrigation District were and are irrigation districts organized 'under the laws of California. Their water supply is owned jointly by the two districts, and is derived from the Eagle Lake Water System. During the year 1924, certain work was done under contract to improve this water system, but through faulty engineering, little benefit was derived therefrom. At that time, bond interest coupons, due July 1, 1924, were unpaid, and warrants of both districts were then outstanding and unpaid.

On October 11, 1924, one Edward Whaley submitted to the boards of directors of the two irrigation districts, a bid for the construction of certain proposed works at Eagle Lake, to remedy the defects in the prior work. This bid or proposal contained the following provision: “The districts shall, before the final execution of said contract, furnish to the undersigned satisfactory assurances in writing that any and all district warrants that may be…