This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.
Facts
A subcontractor on a public works project for a women's prison in New Mexico alleged that the general contractor breached their contract by failing to pay for labor and materials. The general contractor counterclaimed, asserting the subcontractor failed to complete its obligations and pay its suppliers. The subcontractor sought to recover damages, including prejudgment interest and costs, from both the general contractor and its surety under a bond issued pursuant to the New Mexico Little Miller Act (paras 3-4).
Procedural History
- District Court of Bernalillo County: Awarded the subcontractor $28,981.22 in damages, prejudgment interest, and costs against the general contractor (para 1).
- District Court of Cibola County: Awarded the subcontractor damages against the surety but denied recovery of prejudgment interest and costs (para 2).
Parties' Submissions
- Subcontractor: Argued that it was entitled to recover the full judgment, including prejudgment interest and costs, from the surety under the bond and the New Mexico Little Miller Act (paras 2, 9-10).
- Surety: Contended that awarding prejudgment interest and costs would result in double recovery and argued that the subcontractor caused delays in the proceedings, which should preclude recovery of prejudgment interest (paras 9, 11, 14).
Legal Issues
- Was the subcontractor entitled to recover prejudgment interest and costs from the surety under the bond and the New Mexico Little Miller Act?
- Did the doctrine barring double recovery preclude the subcontractor from recovering the full judgment from the surety?
Disposition
- The Supreme Court of New Mexico affirmed the Bernalillo County District Court's judgment awarding prejudgment interest and costs against the general contractor.
- The Supreme Court reversed the Cibola County District Court's denial of prejudgment interest and costs against the surety and remanded for entry of judgment for the full award (paras 15-16).
Reasons
Per Franchini J. (Montgomery C.J. and Baca J. concurring):
The Court held that the subcontractor was entitled to prejudgment interest and costs as a matter of right under Section 56-8-3 of the New Mexico statutes because the amounts owed were fixed and ascertainable. The general contractor failed to demonstrate any countervailing equities to deny the award (paras 5-8).
The Court found that the surety bond and the New Mexico Little Miller Act required the surety to pay all sums "justly due" to the subcontractor, including prejudgment interest and costs. The bond's language and established legal principles supported the surety's liability for the full judgment (paras 10, 12-13).
The Court rejected the surety's argument regarding double recovery, noting that the subcontractor had the right to collect the judgment from either the general contractor or the surety. The subcontractor did not attempt to recover the same amount twice, so the doctrine barring double recovery did not apply (para 14).