In the circumstances of this case, in which two different suits
under the Miller Act were brought in two different District Courts
by the same subcontractor against the same general contractor and
its surety, based on separate projects in the two Districts,
Federal Rule of Civil Procedure 13(a) did not compel a
counterclaim, which involved a payment that had not been allocated
as between the projects, to be made in whichever of the two suits
the first responsive pleading was filed. Its assertion in the later
of the two suits, to which the general contractor, not without
reason, considered it more appurtenant, did not violate Rule 13(a).
Pp.
371 U. S.
57-61.
93 F.2d 493, reversed in part and case remanded.
PER CURIAM.
Southern Construction Company, one of the petitioners here, was
the prime contractor on contracts with the United States for the
rehabilitation of certain barracks at Fort Campbell, Tennessee, and
Fort Benning, Georgia. There were three contracts covering the
Georgia project and one covering the Tennessee project. Pursuant to
the provisions of the Miller Act, 49 Stat. 793, as amended, 40
U.S.C. §§ 270a-270d, Southern furnished performance and payment
bonds, with Continental Casualty Company, co-petitioner here, as
surety. The plumbing and heating
Page 371 U. S. 58
subcontractor on both projects was the respondent Samuel J.
Pickard, doing business as Pickard Engineering Company. Pickard's
primary supplier on both projects was the Atlas Supply Company.
In December, 1955, Pickard's men left the Tennessee job before
it was fully completed, and shortly thereafter left the Georgia
project. Atlas, Pickard's supplier, claimed that $34,520 was due it
for materials furnished on the Tennessee job and $104,000 for
materials furnished on the Georgia project. Following a conference
in August, 1956, between Southern officials and representatives of
Atlas, Southern paid Atlas $35,000 in exchange for a complete
release of all liability of Southern on Pickard's accounts with
respect to both the Georgia and Tennessee projects. [
Footnote 1]
In December, 1956, acting under the provisions of the Miller
Act, Pickard brought suit, in the name of the United States, in the
United States District Court for the Middle District of Georgia
against Southern and Continental for recovery of amounts allegedly
owing on both the Georgia and Tennessee jobs. In January, 1957,
Southern filed an answer and a counterclaim in which it alleged
that Southern had paid out more than the contract price on both
jobs and in which recovery of the excess was sought. The $35,000
payment to Atlas was at that time included in the counterclaim.
The Miller Act, however, requires that suits instituted under
its provisions
"shall be brought . . . in the United States District Court for
any district in which the contract was to be performed and executed
and not elsewhere. . . ."
40 U.S.C. § 270b(b). Since this statute appeared to prohibit an
action in the Georgia District Court on the Tennessee project,
Pickard, in April, 1957,
Page 371 U. S. 59
filed the present action against petitioners in the United
States District Court for the Middle District of Tennessee relating
to the Tennessee project only, and, by amendment, eliminated this
part of his claim from the Georgia action.
The Georgia action proceeding to trial in 1959, and, according
to the findings of the District Court in the present case, the
$35,000 payment to Atlas was "dropped" prior to trial from the
counterclaim originally asserted in that action. The Georgia suit
has not yet proceeded to final judgment, the Georgia District Court
in September 1961 having granted Southern's motion for a new trial
on its counterclaim.
In the Tennessee action here involved, Southern included the
$35,000 payment as part of its counterclaim for affirmative relief,
and Pickard answered that the counterclaim was barred by "
res
judicata." Southern later waived any claim to affirmative
relief in this action and sought only a credit of $34,520 against
Pickard's contract claim on the Tennessee project. This figure was
the precise amount that had been claimed by Atlas to be due it for
materials supplied on this job.
The District Court, in deciding that Pickard was not entitled to
any recovery, allowed this $34,520 item as a credit against
Pickard's claim, but, on this point, the Court of Appeals for the
Sixth Circuit reversed. 293 F.2d 493. It held that, since there had
been no allocation of the $35,000 payment as between the Georgia
and Tennessee projects the item, under Rule 13(a) of the Federal
Rules of Civil Procedure, was a "potential compulsory counterclaim"
in either of the two suits; [
Footnote 2] that, when the responsive
Page 371 U. S. 60
pleading in the Georgia suit was filed the counterclaim was not
the subject of any other pending action, and was therefore
"compulsory" in that suit; and, accordingly, that such counterclaim
could not later be asserted in the present action. We granted
certiorari to consider the applicability of Rule 13(a) in these
unusual circumstances. 368 U.S. 975.
We accept for present purposes the ruling below that the $35,000
payment had not been allocated as between the Tennessee and Georgia
projects, and that it therefore could have been asserted in either
action. Nevertheless, we do not believe that Rule 13(a) operates to
prohibit its use in the later Tennessee action. The requirement
that counterclaims arising out of the same transaction or
occurrence as the opposing party's claim "shall" be stated in the
pleadings was designed to prevent multiplicity of actions and to
achieve resolution in a single lawsuit of all disputes arising out
of common matters. The Rule was particularly directed against one
who failed to assert a counterclaim in one action and then
instituted a second action in which that counterclaim became the
basis of the complaint.
See, e.g., United States v. Eastport
S.S. Corp., 255 F.2d 795, 801-802.
It is readily apparent that this policy has no application here.
In this instance, the plaintiff-respondent, who originally sought
to combine all his claims in a single suit, correctly concluded
that he was required by statute to split those claims and to bring
two separate actions in two different districts. The fragmentation
of these claims, therefore, was compelled by federal law, and the
primary defendant in both actions was thus for the first time
confronted with the choice of which of the two pending suits
Page 371 U. S. 61
should be resorted to for the assertion of a counterclaim common
to both. Under these circumstances, we hold that Rule 13(a) did not
compel this counterclaim to be made in whichever of the two suits
the first responsive pleading was filed. [
Footnote 3] Its assertion in the later suit, to which
Southern, not without reason, considered it more appurtenant (pp.
371 U. S. 58-59,
supra), by no means involved the circuity of action that
Rule 13(a) was aimed at preventing. Accordingly, the judgment of
the Court of Appeals insofar as it related to this counterclaim is
reversed, and the case is remanded to that court for further
proceedings consistent with this opinion.
It is so ordered.
[
Footnote 1]
Under the Miller Act, 40 U.S.C. § 270b, Southern as a prime
contractor was secondarily liable to suppliers of the
subcontractor.
[
Footnote 2]
Rule 13(a) provides:
"(a)
Compulsory counterclaims. A pleading shall state
as a counterclaim any claim which at the time of serving the
pleading the pleader has against any opposing party, if it arises
out of the transaction or occurrence that is the subject matter of
the opposing party's claim and does not require for its
adjudication the presence of third parties of whom the court cannot
acquire jurisdiction, except that such a claim need not be so
stated if at the time the action was commenced the claim was the
subject of another pending action."
[
Footnote 3]
We are informed that, after certiorari was granted in the
present case, Southern filed an amended counterclaim in the Georgia
action which included the $35,000 item involved here. Further
proceedings in the Georgia action, however, are awaiting our
decision in this case. Of course, once this counterclaim has been
adjudicated in one of the actions, it cannot be reasserted in the
other.