INTERFIRST BANK DALLAS, N.A.,FROM A DISTRICT COURT APPELLANT, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, APPELLEE

 
COURT OF APPEALS
FIFTH DISTRICT OF TEXAS
AT DALLAS
NO. 05-88-00597-CV
INTERFIRST BANK DALLAS, N.A.,FROM A DISTRICT COURT
 
        APPELLANT,
 
v.
 
UNITED STATES FIDELITY
AND GUARANTY COMPANY,
 
 
        APPELLEE. OF DALLAS COUNTY, TEXAS
 
 
 
BEFORE JUSTICES STEWART, ROWE, AND BURNETT
DISSENTING OPINION BY JUSTICE BURNETT
JULY 10, 1989
        I dissent. I arrive at a different result by relying on controlling Texas law. The majority's reliance on the equitable principles enunciated in Trinity Universal Inc. Co. v. Bellmead State Bank, 396 S.W.2d 163 (Tex. Civ. App.-- Dallas 1965, writ ref'd n.r.e.), is misplaced because USF&G's right to equitable subrogation did not arise until payment. Thus, for the reasons discussed herein, it is second in time to NCNB's perfected legal right.
        In Trinity Universal, the surety took over the project when the contractor became financially unable to continue. As a public relations matter, the contractor continued to issue checks to the subcontractors. However, the account on which the checks were drawn was funded by the surety. Prior to the surety's deposits, the contractor contacted the owner and released its claim to all rights to amounts due under the contract, assigned its interests to the surety and requested that the owner pay the surety. Thus, the owner made progress payments to the surety instead of the contractor. Before the final progress payments and retainages were disbursed to the surety, Bellmead State Bank, as a creditor of the contractor, served the owner with garnishment papers seeking the funds still held by the owner. Interestingly, the contract between the owner and contractor specifically provided "[n]o payments shall be due while the [contractor] is in default in respect of any of the provisions of this proposal." Trinity Universal, 396 S.W.2d at 166. Thus, pursuant to the contract, upon default the contractor had no entitlement to the funds pursuant to the express language of the contract.
        Bellmead State Bank asserted that the surety must rely on the unfiled assignment from the contractor which was subordinate to the bank's status as a judgment lien creditor under article 260-1 (the predecessor to the present Texas UCC). However, the court disagreed and stated as follows:
        The stipulation [of facts] expressly provided that the fund herein involved represented the retained percentages due under the contract. When the stipulation is reviewed within its four corners, we think there was such a default on the part of the contractor as contemplated by the agreement and that the Surety's independent rights to the fund is founded on its suretyship relationship as such. The rights of the surety in this case, as revealed by the stipulation of facts, does not depend upon an independent assignment, . . . therefore we are not here concerned with the application of [the UCC].
Trinity Universal, 396 S.W.2d at 168. Thus, the court expressly refused to apply the predecessor to the UCC and appears to have relied upon the express contract language under which the contractor forfeited any rights to money after a default despite any partial performance.
        However, the Trinity Universal court then went on to discuss a surety's "independent right growing out of its relationship as such to require the retainage to be applied to contract obligations." Id. As noted by the majority, the court justified its decision in favor of the surety by stating:
                The rights of the Surety in this case are based upon its payment of the debt of another . . . . Simply stated, the right of subrogation of the Surety is founded solely upon the equitable principle of having paid, pursuant to a bound obligation so to do, what in equity should have been paid by the contractor.
 
 
Trinity Universal, 396 S.W.2d at 168. It is this dicta upon which the majority so heavily relies. However, the facts in Trinity Universal reveal that the surety had expended the funds before Bellmead State Bank's interest attached. Thus, the "equitable principle of having paid" found in that case requires that NCNB's interest take priority over USF&G's claim for the reasons further discussed herein.
        Equitable subrogation is the substitution of one party in the place of another, so that he who is substituted succeeds to the rights of the other in relation to the debt. McBroome-Bennett Plumbing, Inc. v. Villa France, Inc., 515 S.W.2d 32, 36 (Tex. Civ. App--Dallas 1974, writ ref'd n.r.e.); 53 TEX. JUR. 3D Subrogation §1 (1964). Texas courts in particular have been partial to this "pure equity" and have often stated:
        The doctrine of subrogation is always given a liberal interpretation and is broad enough to include every instance in which one person, not acting voluntarily has paid a debt for which another was primarily liable and which in equity and good conscience should have been discharged by the latter.
 
 
McBroome-Bennett, 515 S.W.2d at 36; Independence Indemnity Co. v. Republic Nat'l Bank & Trust Co., 114 S.W.2d 1223 (Tex. Civ. App.--Dallas 1938, writ dism'd); Constitution Indemnity Co. v. Ambrust, 25 S.W.2d 176, 180 (Tex. Civ. App.--San Antonio 1930, writ ref'd); Galbraith-Fox Lumber Co. v. Long, 5 S.W.2d 162, 167 (Tex. Civ. App.--Dallas 1928, writ ref'd). Courts apply equitable subrogation on behalf of an insurer to prevent an injustice such as double recovery for an insured. Ortiz v. Great Southwestern Fire and Casualty Ins., 597 S.W.2d 342, 343 (Tex. 1980).
        However, it is undisputed that under Texas law, this right of equitable subrogation, which is not dependent on an assignment or contract clause, arises upon payment by an insured under indemnity insurance. See, e.g., Ortiz, 597 S.W.2d at 344 (fire insurance); Thoreson v. Thompson, 431 S.W.2d 431, 347 (Tex. 1968)(fire insurance); Employers Casualty Co. v. Transport Ins. Co., 444 S.W.2d 606, 610 (Tex. 1969)(public liability insurance); State Farm Fire & Casualty Co. v. Leasing Enterprises, Inc., 716 S.W.2d 553, 555 (Tex. App.--Houston [14th Dist.] 1986, writ ref'd n.r.e.)(property insurance); Allstate Ins. Co. v. Clarke, 471 S.W.2d 901, 907 (Tex. Civ. App.--Houston [1st Dist.] 1971, writ ref'd n.r.e.)(uninsured motorist insurance); Campbell v. Jefferson, 453 S.W.2d 336, 338 (Tex. Civ. App.--Tyler 1970, writ dism'd)(automobile comprehensive insurance); Wolff v. Commercial Standard Ins. Co., 345 S.W.2d 565, 568 (Tex. Civ. App.--Houston 1961, writ ref'd n.r.e.)(title insurance); Morales v. Roddy, 250 S.W.2d 225, 226-27 (Tex. Civ. App.--Eastland 1952, no writ)(property insurance); Hudson Underwriters Agency v. Ablon, 203 S.W.2d 584, 585 (Tex. Civ. App.--Dallas 1947, writ dism'd)(theft insurance); American General Ins. Co. v. Fort Worth Transit Co., 201 S.W.2d 869, 870 (Tex. Civ. App.--Fort Worth 1947, no writ)(automobile collision insurance); Republic Nat'l Bank v. Maryland Casualty Co., 184 S.W.2d 496, 499 (Tex. Civ. App.--El Paso 1944, writ ref'd w.o.m.)(fidelity insurance); New Amsterdam Casualty Co. v. First Nat'l Bank, 134 S.W.2d 470, 475 (Tex. Civ. App.--El Paso 1939, writ dism'd judmt. cor.)(fidelity insurance); Co-Operative Furniture Co. v. Southern Surety Co., 264 S.W. 201, 203 (Tex. Civ. App.--Beaumont 1924, no writ)(plate glass insurance).
        Assuming in the instant case that USF&G has an equitable right to subrogation, under controlling Texas law, it arose upon payment. The majority concedes that USF&G's claim to subrogation is not contractual and therefore did not arise by virtue of the Master Surety Agreement executed prior to the Bank's loan. In the stipulated facts before the trial court, USF&G admitted that the Bank had loaned the money to Wallace and perfected its lien before USF&G paid any of the materialmen. Thus, USF&G's subrogation claim would be second in time to the Bank's right to payment secured by its interest in Wallace's accounts receivable. Accordingly, the Bank should prevail under the "first in time is the first in right" rule. See United States v. City of New Britain, 347 U.S. 81, 85 (1954); Diversified Mortgage Investors v. Lloyd D. Blaylock General Contractor, Inc., 576 S.W.2d 794, 807 (Tex. 1978). It is also well established that as between competing legal and equitable claims, the legal claim generally prevails. See Anderson v. Waco State Bank, 92 Tex. 506, 49 S.W. 1030 (1899). (A prior equitable right does not prevail over a subsequently acquired legal claim provided the legal claim holder was without notice of the pre-existing equitable right). Contrary to the majority's assertions, an injustice would occur if USF&G prevailed in this case under a misapplied theory of equitable subrogation. The proper logic is simple--the Bank expended its funds first and perfected its lien. USF&G could have protected its position by insisting that the mechanics and materialmen file liens as a prerequisite to payment, whether or not such liens were required by contracts with Wallace. This would have insured a right of recourse against the owner of the property. Instead, USF&F seeks to gain an advantage in equity after failing to protect its rights at law. In recognizing the obligations of an insurance company, the Texas Supreme Court has stated that "the loss should be borne by the insurer for that is a risk the insured has paid it to assume." Ortiz, 597 S.W.2d at 334.
Performance Under the Contract by Wallace
        In its first point of error, the Bank asserts that the trial court erred in concluding that, since the Wallace companies did not pay certain claims of subcontractors on the projects, Wallace committed a material breach under its contracts with the prime contractors and therefore had no entitlement to the funds which remain owed to Wallace under those subcontracts to the extent which subcontractors were not paid. Thus, the trial court held that the Bank, as assignee of a security interest in Wallace's accounts receivable, had no interest in those funds. I agree with the Bank's contention that the trial court erred in concluding that Wallace, and thus its assignee Bank, had no claim to the funds. Accordingly, I would sustain point of error number one for the following reasons.
        It is established that as the assignee of a perfected security interest in the accounts and proceeds of a contractor, a lender is entitled to the same right to the funds as his assignor. See TEX. BUS. & COM. CODE ANN. § 9.106 (Vernon Supp. 1988). However, such an assignee cannot take greater rights than his assignor. See TEX. BUS. & COM. CODE ANN. § 9.318(a) (Vernon Supp. 1988).
        USF&G argues that the trial court properly found that Wallace's failure to pay certain of its subcontractors on each of the projects constitutes a material breach and that therefore, Wallace had not substantially performed. On each project, Wallace's contract with the respective prime contractor expressly required payment of all subcontractor supplier bills as a condition of completion of the contract obligations. However, similar contract language was construed in Corpus Christi Bank and Trust v. Smith, 525 S.W.2d 501, 505-06 (Tex. 1975), where the Texas Supreme court held that such a retainage provision was intended to provide incentive for the contractor to finish the project, provide completion funds in case the contractor abandons the project, and provide funds to remedy defects. Corpus Christi, 525 S.W.2d at 504-05. The Corpus Christi Court determined that the retainage provision did not, as argued by USF&G, make the materialmen third party beneficiaries or deprive the contractor of an interest in the retainage. Thus, the bank's secured claim was not defeated. Id. at 505; See Citizens Nat'l Bank v. Texas & Pacific Ry. Co., 150 S.W.2d 1003, 1007 (Tex. 1941); East Texas Bank and Trust Co. v. Mid-South Contractors, Inc., 451 S.W.2d 782 (Tex. Civ. App.--Tyler 1970, no writ); Scarborough v. Victoria Bank & Trust Co., 250 S.W.2d 918 (Tex. Civ. App.--San Antonio 1952, writ ref'd).
        Under Texas law, when a contractor has substantially performed, he is entitled to recover the full contract price less the cost required to remedy the defects. However, the burden is on the contractor to introduce evidence which may be used to measure the amount of the deduction. Vance v. My Apartment Steak House, 677 S.W.2d 480, 481-82 (Tex. 1984); BPR Construction & Engineering, Inc. v. Rivers, 608 S.W.2d 248, 249-50 (Tex. Civ. App.--Dallas 1980, writ ref'd n.r.e.). In the instant case, Wallace has substantially performed and the Bank makes no claims to contract funds used to complete the projects or remedy defects.
        With regard to the Four Allen Center Project, the stipulated facts reveal that Wallace performed all of its contract obligations with the exception of the air balancing work. However, the parties did not stipulate nor is there any evidence in the record that any funds were expended to remedy this alleged defect. The balance remaining in the Wallace contract was $121,144.47. Of this total, the Bank does not claim priority to the portion used to pay the $772 mechanics' and materialmen's lien filed against the project. However, under the theory of substantial performance, I would hold that Wallace and therefore the Bank as its assignee, is entitled to the difference of $120,372.47 which was paid to USF&G by the prime contractor on September 12, 1985. Likewise, on the Buena Vista project, Wallace had fully performed its contract obligations. Thus, the Bank as Wallace's assignee is entitled to the entire contract balance of $88,053.48 which was paid by the prime contractor to USF&G.
        On the Farmer's Project, Wallace had not completed certain items of contract, warranty or correction work. The stipulated facts reflect that the prime contractor incurred $31,030.25 in expenses in completing Wallace's contract obligations. The amount of the contract balance after deducting these costs of completion was $297,588.50. The Bank does not claim priority to the $79,588 which was expended to satisfy the claims of the perfected materialmen's lien claimants. I would hold that the Bank, by virtue of its perfected security interest in Wallace's accounts receivable, is entitled to $218,000.50, which includes the $110,194.50 held in escrow.
        Similarly, on the Ohio State Project, Wallace substantially completed its subcontract obligations subject to certain contract, corrective and warranty work. The stipulated facts reveal that the prime contractor expended $33,844.52 to finish the job. After deduction of completion costs, the balance remaining on the contract was $142,234.50. The Bank does not claim the $53,003.88 paid to satisfy the perfected mechanics' and materialmen's lien claimants. I would hold that under the substantial performance doctrine, the Bank is entitled to the remaining balance, $89,425.12 of which was paid to USF&G and $9,805.50 which is held in the escrow account.
        All the work required under the contract with the prime contractor was performed by Wallace on the International Project. Neither the prime contractor nor USF&G expended any funds for completion. The contract balance due totals $299,854.55 after deduction of the $27,700 paid by USF&G to release a perfected mechanic's lien. I would hold that the Bank has a right to the $299,854.55 balance remaining by virtue of its full performance. Thus, I would hold that the Bank has priority over USF&G to that amount as the holder of a perfected security interest.
 
Surety's Rights as Subrogee to Owner
        In its second point of error, the Bank argues that the trial court erred in holding that as subrogee to the prime contractors, USF&G, as surety, has a superior right to the balance owed on the Wallace subcontracts to the extent necessary to pay Wallace's material and labor claimants, whether or not they possessed valid mechanic's liens. I would sustain point of error number two for the reasons discussed herein.
        Federal cases have long held in favor of the surety on an equitable subrogation theory. These cases involve United States government contracts and performance bonds required by federal statutes on federal government jobs. FN:1 The federal cases stress various viewpoints which are not relevant to private litigants in a state justice system. FN:2 One such viewpoint is that the surety ought to win because it directly helped the United States by completing construction work under a government construction contract, whereas the Bank was but a money lender whose only equity arose when it could show its money was actually used to pay labor and materials which discharged obligations for which the surety would otherwise have been liable.
        The federal cases hold that in paying labor and materialmen, the surety becomes subrogated to their rights. However, these cases do not recognize that those laborers and materialmen had no legal rights against the United States as owner. Under state law, contractors who deal with individuals or private entities may seek protected status through compliance with mechanics' and materialmen's lien statutes. See, e.g., TEX. PROP. CODE ANN. ch. 53 (Vernon 1984). Unlike a situation where a government entity is the owner, a contractor or subcontractor on a private project who has properly perfected a lien may demand payment from the owner of the property. Id. at § 53.083. Under the Federal Miller Act, the labor and materialmen only had rights against the payment bond surety and against the contractor, whose payment the surety had guaranteed.
        The Federal cases also hold that by completing the performance of a defaulting contractor, the surety became subrogated to the contractor's rights. However, these cases do not recognize that the defaulting contractor had only the conditional right to receive sums earned under the contract from the owner and that the contractor may have made a valid assignment of those sums under state law. The federal courts also have held that the surety, by performing under its bond, became subrogated to the rights of the United States, as owner. These holdings stretch the equitable subrogation theory rather thin in view of the fact that the purpose of the surety bond was to comply with the federal Miller Act. The purpose of that Act was to give laborers and materialmen protection which they would not otherwise have had under state mechanics' lien statutes because the United States government is immune from the execution of state liens. These holdings further ignore the fact that the United States, as owner, had the right under government construction contracts to receive performance by the contractor and, under the surety's bond, had the right to have the contractor's performance guaranteed by the surety. Additionally, the United States, as owner, had only the duty to pay money for performance but had no right to receive money to which right the surety could, by performing the contractor's duties, become subrogated.
        Under Texas law a contractor who enters a public works contract with the state must obtain specific performance and payment bonds. TEX. REV. CIV. STAT. ANN. art. 5160 (Vernon 1987). Pursuant to article 5160, any such contractor who abandons performance forfeits any claim to further proceeds under the contract until the contractor pays all costs of completion. Id. at sec. E. Thus, courts have held that a bank with a perfected security interest in the contractor's accounts receivable likewise has no claim to any progress payments or retained percentages which remain unpaid when the contractor abandons the project. First Hutchings-Sealy Nat'l Bank v. Aetna Casualty, 532 S.W.2d 114 (Tex. Civ. App.--Houston 1975, writ ref'd n.r.e.); Deer Park Bank v. Aetna Ins. Co., 493 S.W.2d 305 (Tex. Civ. App.--Beaumont 1973, no writ); Travelers Indemnity Co. v. Snyder Nat'l Bank, 361 S.W.2d 926 (Tex. Civ. App.--Eastland 1952, writ ref'd n.r.e.).
        This statute has been strictly construed to allow a surety, as subrogee to the owner, to prevail over a bank with a security interest even if the surety signs a subordination agreement with the bank. Travelers Indemnity, 361 S.W.2d at 926. However, as with the Federal Miller Act, the purpose of this article is to protect laborers and materialmen who had worked on or supplied materials for construction of public improvements and whose valid claims could not be enforced by procuring a lien upon the property. Allis-Chambers Mfg. Co. v. Curtis Elec. Co., 259 S.W.2d 918, 921 (Tex. Civ. App.--Austin 1953), reversed in part on other grounds, 264 S.W.2d 700 (Tex. 1954).
        Accordingly, despite urging by USF&G, I would decline to follow federal precedent or apply article 5160 to private projects. Instead, I consider it in the best interest of the law of the State of Texas to decide the issues in this case based on our understanding of controlling state law as discussed with regard to point of error one. Accordingly, I would sustain the Bank's second point of error.
Surety's Rights as Suborgee to Materialmen
        In its third point of error, the Bank maintains that the trial court's judgment was in error because USF&G, as subrogee to the rights of the materialmen and labor claimants, does not have a superior right to the subcontract balances by virtue of a trust or equitable lien on the funds. In order for an express trust to be created, the settlor must manifest an intention to create a trust in reasonably certain terms. TEX. TRUST CODE ANN. § 112.002 (Vernon 1986). None of the various Wallace subcontracts contain any evidence of intent to create trusts for the benefit of the mechanics and materialmen. In the absence of such intent, a court should not impose a trust. Spiritas v. Robinowitz, 544 S.W.2d 710, (Tex. Civ. App.--Dallas 1976, writ ref'd n.r.e.).
        Alternatively, USF&G also urges that a statutory trust arose in favor of the mechanics and materialmen. Under Texas law,
 
 
                Construction payments are trust funds... if the payments are made to a contractor or subcontractor or to an officer, director, or agent of a contractor or subcontractor, under a construction contract for the improvement of specific real property in this state.
TEX. TRUST CODE ANN. § 162.001 (Vernon 1984). However, this chapter expressly does not apply to a lender. TEX. TRUST CODE ANN. § 162.004(a) (Vernon Supp. 1986); RepublicBank Dallas, N.A. v. Interkal, Inc., 691 S.W.2d 605, 607 (Tex. 1985). In the absence of an ambiguity, we must follow the clear language of the statute. Id. Consequently, under the plain language of the statute, the Bank's priority over the materialmen as a secured creditor is not defeated.
        Since the contracts themselves do not manifest an intent to create a trust and the statutory trust contemplated in section 162.004 does not apply to a lender, I conclude that no trust arose in favor of Wallace's mechanics and materialmen. A subrogee has no greater rights in relation to a debt than his subrogor. Insurance Co. of North America v. Fredonia State Bank, 469 S.W.2d 248, 252 (Tex. Civ. App.--Tyler 1971, writ ref'd n.r.e.). Accordingly, USF&G as subrogee to the mechanics and materialmen, cannot properly assert a superior claim to the funds by virtue of a trust or equitable lien. I would sustain point of error three.
Kirk Williams and Kahoe Air's Liens
        In point of error four, the Bank asserts that there is insufficient evidence to determine and therefore, USF&G failed to prove, that Kirk Williams had timely filed and perfected a valid mechanic's lien on the Farmers Project and that Kirk Williams and Kahoe Air timely filed and perfected valid mechanics' liens on the Ohio State Project. The only issue involved pertains to the existence of properly filed and perfected mechanics' liens on projects in Ohio.
        The parties do not dispute that Ohio law applies as to the perfection of these liens. See Duncan v. Cessna Aircraft Co., 655 S.W.2d 414, 420-21 (Tex. 1984). Ohio law requires strict compliance with the procedural steps necessary to create a mechanic's lien. M. J. Kelly Co. v. Haendiges, 397 N.E.2d 416, 417-18 (Ohio Ct. App. 1978). Also, the party which seeks the benefit of the lien bears the burden to plead and prove compliance with the procedures. See Seybold v. Pitz, 136 N.E.2d 666, 669 (Ohio Ct. App. 1955). The Ohio mechanic's lien statute states that specific information must be included in the affidavit including the amount due, property description, name of the owner, and names and addresses of the lien claimant and prime contractor. The affidavit must also be verified. This affidavit must be filed within a specified time and endorsed by the recorder with the date and hour of filing. The statute expressly provides that no exemptions apply to the recording provision. OHIO REV. CODE ANN. § 1311.06 (1988).
        A thorough review of the record reveals that none of the liens through which USF&G claims an interest were in evidence. Although the parties stipulated that Williams and Kahoe Air filed liens, there is insufficient evidence for us to conclude that their liens are valid under the Ohio law. Thus, these lien claimants are general unsecured creditors of Wallace who have no priority over the Bank. I would sustain point of error four.
Relationship of Surety Bonds and Subcontracts
        In point of error five, the Bank maintains that the trial court was in error when it concluded that the terms of USF&G's payment bonds are "read into and incorporated in" the Wallace subcontracts, that the failure to pay for all labor and materials was a material default under the bond terms and that therefore, Wallace had no interest in the contract balances to which the Bank's lien could attach.
        Under general contract principles, the primary concern of the courts is to give effect to the intentions of the parties as expressed in the instruments. Ideal Lease Service, Inc. v. Amoco Production Co., 662 S.W.2d 951, 952-53 (Tex. 1984). In the face of an unambiguous provision, the court must give effect to the contract as written. Id.; Sun Oil Co. v. Madeley, 626 S.W.2d 726, 728 (Tex. 1981).
        Each of the Wallace subcontracts specifies what documents form the contract and the bonds are not included in the list. Additionally, each subcontract contains a clause which states that the subcontract constitutes the entire agreement of the parties. I would conclude that the agreements are unambiguous and thus the bond provisions are not incorporated into the Wallace subcontracts. I would sustain point of error five.
International Project - Costs and Expenses
        In point of error six, the Bank maintains that with respect to the International Project, there is no evidence to support the trial court's decision that USF&G is entitled to $30,000 in expenses for the settlement of the claims under the bonds, together with costs and expenses incurred to recover the contract funds. The stipulated facts provide that the amount of expenses incurred by USF&G was $30,000. With regard to entitlement to that amount, USF&G relies on an indemnity clause from the master surety agreement executed by Wallace and the prime contractor before the Bank acquired its security interest.
        I would hold that this claim for fees in the Louisiana suit is premature because the suit is still pending. Additionally, under my analysis USF&G would not prevail in this lawsuit. Thus, I would hold that the evidence is insufficient to support the award of attorney's fees. I would sustain the Bank's sixth and final point of error.
        I would reverse the trial court's judgment and render judgment for the Bank. As the prevailing party, I would hold that the Bank is entitled to the stipulated attorneys' fees in the amount of $74,043.06.
        In summary, in accordance with my dissenting opinion, I would reverse the judgment of the trial court in favor of appellee United States Fidelity and Guaranty and render judgment that appellant NCNB, recover from appellee United States Fidelity and Guaranty Company as follows:
1. The principal sum of $674,285.87 inclusive of the amount held in escrow by agreement of the parties;
2. prejudgment interest at the annual rate of ten percent (10%) from July 30, 1986 to March 21, 1988, the date of the trial court's judgment;
3. stipulated attorneys' fees in the amount of $73,043.06; 4. costs incurred by appellant in the trial court and of this appeal; and,
5. post-judgment interest at the annual rate of ten percent (10%) per annum on the above principal, interest, fees and costs from March 21, 1988, the date of the trial court's judgment, until paid.
        With regard to the balance which is held by the prime contractor on the International Project in Louisiana, I would grant appellant's request for declaratory relief and hold that NCNB has priority over Unites States Fidelity and Guaranty Company to the balance due Carl P. Wallace of Louisiana on August 6, 1984, less any costs expended to complete Wallace's obligations under the subcontract and less the amount necessary to release any perfected mechanics' and materialmen's liens on the project by Wallace's subcontractors.
        July 10, 1989
 
 
                                                  
                                                  JOE BURNETT
                                                  JUSTICE
 
 
PUBLISH
TEX. R. APP. P. 90
 
88-00597.DF
 
FN:1 The Miller Act, 49 Stat. 794 (1935), 40 U.S.C. § 270a-d (1958) amended 73 Stat. 279 (1959), 40 U.S.C. § 270a-d (Supp. IV 1959-1962) (current version at 40 U.S.C. §270a-d (1982) and the predecessor Heard Act, 28 Stat. 278 (1894), as amended 33 Stat. 811 (1905).
FN:2 E.g., Pearlman v. Reliance Ins. Co., 371 U.S. 132 (1962); McKenzie v. Irving Trust Co., 323 U.S. 365 (1945); In re Gleason Co., 452 F.2d 1219 (8th Cir. 1971); National Shawmert Bank v. New Amsterdam Casualty Co., 411 F.2d 843 (1st Cir. 1969).
File Date[01-02-89]
File Name[880597D]