Builders' Bonds and Materialmen

Abstract

In cases where a building contractor gives to the owner and obligee a surety bond securing the performance of the builder's contract and protecting the owner against the liens of laborers and materialmen, there is a good deal of apparent conflict as to whether or not the laborers and materialmen are beneficiaries of the contract and can maintain suit against the bondsmen for sums due them from the contractor. If they can sue at all, it is clear that they must sue as thirdparty beneficiaries of a contract to which they themselves are not parties. The question, on which the seeming conflict exists, is as to whether or not they are in fact third-party beneficiaries.