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Will H. Hall & Son v. Capitol Indemnity Corp.

Court of Appeals of Michigan
677 N.W.2d 51 (2003)


Facts

Will H. Hall & Son, Inc. (Hall) (plaintiff) was the general contractor for a construction project. Ace Masonry Construction, Inc. (Ace) (defendant) was a subcontractor on the project. Capitol Indemnity Corporation (Capitol) (defendant) provided a performance bond for Ace. Ace failed to perform. Hall sued Ace for breach of contract and brought a claim against Capitol for recovery on the performance bond. The trial court granted Capitol’s motion for a directed verdict on Hall’s performance bond claim. After the directed verdict was entered, Hall and Ace stipulated on the record to the release and dismissal of any claims they had against each other. Hall then appealed the directed verdict in favor of Capitol, which was reversed. On remand, the trial court granted Capitol’s motion for summary disposition, finding that the release of the principal obligor (Ace) by the obligee (Hall) also discharged the surety (Capitol). Hall appealed.

Rule of Law

Issue

Holding and Reasoning (Murphy, J.)

Dissent (Levin, J.)

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