Wyandotte Electric Supply Co. v. Electrical Technology Systems, Inc.

Michigan Supreme Court
Lansing, Michigan
Chief Justice: Justices:

Syllabus Robert P. Young, Jr. Stephen J. Markman
Brian K. Zahra
Bridget M. McCormack
David F. Viviano
Richard H. Bernstein
Joan L. Larsen
This syllabus constitutes no part of the opinion of the Court but has been Reporter of Decisions:
prepared by the Reporter of Decisions for the convenience of the reader. Corbin R. Davis

WYANDOTTE ELECTRIC SUPPLY COMPANY v
ELECTRICAL TECHNOLOGY SYSTEMS, INC

Docket No. 149989. Argued November 5, 2015 (Calendar No. 3). Decided May 3, 2016.

Wyandotte Electric Supply Company (Wyandotte) brought an action in the Wayne
Circuit Court against Electrical Technology Systems, Inc. (ETS), KEO & Associates, Inc.
(KEO), and Westfield Insurance Company (Westfield). KEO was the principal contractor for a
renovation project at the Detroit Public Library. Westfield provided a surety bond for the project
in accordance with the public works bond act (PWBA), MCL 129.201 et seq. KEO
subcontracted with ETS to provide labor and materials for the project, and ETS, in turn,
subcontracted with Wyandotte for materials. Over the course of the library project, ETS only
paid Wyandotte sporadically. Wyandotte filed a claim with Westfield, seeking to recover on the
payment bond. Westfield denied the claim, and Wyandotte subsequently brought this action.
ETS defaulted, and Wyandotte moved for summary disposition against KEO and Westfield. The
court, Robert J. Colombo, Jr., granted Wyandotte’s motion in part, concluding that there was a
valid bond claim, given that Wyandotte had complied with the notice requirements of the
PWBA, and that Wyandotte could recover a time-price differential as well as attorney fees. A
bench trial was then held on the question of damages. The court found that the unpaid balance
owed to Wyandotte was $154,343.29, that Wyandotte was entitled to a total time-price
differential of $76,403.44, and that Wyandotte was entitled to $30,000 in attorney fees.
Wyandotte moved for entry of judgment and further requested postjudgment interest under MCL
600.6013(7). The court granted the motion over the objections of KEO and Westfield and
entered a judgment in the total amount of $272,927.70. KEO and Westfield appealed. The
Court of Appeals, BECKERING, P.J., and HOEKSTRA and GLEICHER, JJ., affirmed the judgment of
the trial court in an unpublished opinion per curiam. KEO and Westfield then sought leave to
appeal. The Supreme Court granted leave. 497 Mich 958 (2015).

In an opinion by Justice BERNSTEIN, joined by Justices MARKMAN, MCCORMACK,
VIVIANO, and LARSEN, the Supreme Court held:

1. Under MCL 129.207 of the PWBA, a claimant not having a direct contractual
relationship with the principal contractor shall not have a right of action upon the payment bond
unless (a) the claimant has within 30 days after furnishing the first of such material or
performing the first of such labor, served on the principal contractor a written notice, which shall
inform the principal of the nature of the materials being furnished or to be furnished, or labor
being performed or to be performed and identifying the party contracting for such labor or
materials and the site for the performance of such labor or the delivery of such materials, and (b)
the claimant has given written notice to the principal contractor and the governmental unit
involved within 90 days from the date on which the claimant performed the last of the labor or
furnished or supplied the last of the material for which the claim is made, stating with substantial
accuracy the amount claimed and the name of the party to whom the material was furnished or
supplied or for whom the labor was done or performed. Each notice shall be served by mailing
the same by certified mail, postage prepaid. In this case, KEO asserted that Wyandotte failed to
properly serve KEO because KEO never received the 30-day notice. The plain language of the
statute, however, does not require actual receipt of the notice. Wyandotte sent the 30-day notice
through certified mail as required by the statute. When a claimant has complied with the notice
procedures set forth by the Legislature in MCL 129.207, there is no actual-notice requirement.

2. MCL 129.207 of the PWBA permits an unpaid supplier of materials or labor to sue on
the payment bond for the amount, or the balance thereof, unpaid at the time of institution of the
civil action, prosecute such action to final judgment for the sum justly due the claimant and have
execution thereon. Wyandotte sought payment based on its prior contracts with ETS: an open-
account agreement entered into in 2003, the bid Wyandotte made for the Detroit Public Library
project in 2009, and the ensuing purchase orders. Wyandotte argued that it was entitled to the
unpaid balance for the materials it had provided as well as further damages under time-price-
differential and past-due-accounts provisions in the open-account agreement. Contractual privity
is not a requirement for recovery under MCL 129.207, so the fact that KEO and Westfield did
not agree to those provisions was immaterial. The dispositive question was whether amounts
due under the time-price-differential and past-due-accounts provisions were part of the sum
justly due to Wyandotte under the statute. The sum justly due under MCL 129.207 is the amount
provided for in the claimant’s contract. At the time Wyandotte commenced this action, ETS had
already fallen behind on its payments to Wyandotte for the materials Wyandotte had provided in
connection with the library project. The time-price differential referred to in the contracts
between Wyandotte and ETS was in play, reflecting the increased cost to Wyandotte as ETS’s
bills went underpaid or unpaid. Therefore, a time-price differential was part of the amount
unpaid and due to Wyandotte when it instituted the instant action, and the trial court properly
included the time-price differential as part of the judgment in Wyandotte’s favor. The past-due-
accounts provision stated that if ETS’s account was placed into the hands of an attorney for
collection after default, ETS agreed to pay 33% of the unpaid balance for attorney fees together
with applicable costs. The open-account agreement containing the provision covered all of
ETS’s past, present, and future unpaid accounts receivable balances with Wyandotte. Thus, the
terms of the open-account agreement clearly indicated that ETS and Wyandotte intended that the
past-due-accounts provision would apply for the duration of their ongoing business relationship,
and it was not improper for the trial court to include attorney fees in its judgment as part of the
sum justly due. Accordingly, in this case, Wyandotte was entitled to the time-price differential
and attorney fees it would have received under its contracts with ETS.

3. Under MCL 600.6013(7), if a judgment is rendered on a written instrument
evidencing indebtedness with a specified interest rate, interest is calculated from the date of
filing the complaint to the date of satisfaction of the judgment at the rate specified in the
instrument. In this case, the judgment was not rendered on a written instrument. Although the
contract between Wyandotte and ETS defined the scope of the damages that Wyandotte was
entitled to seek under the PWBA, the underlying claim was not a contract claim. Wyandotte’s
cause of action did not arise directly out of its contract; it arose out of the PWBA. Therefore,
even though the contract between ETS and Wyandotte determined the extent of Wyandotte’s
recovery, judgment was rendered on Wyandotte’s statutory claim rather than on the contract
itself. Interest on the judgment should have been calculated under MCL 600.6013(8), the
general rule for interest on a money judgment in a civil case.

Court of Appeals judgment regarding sufficiency of the notice and the recovery of
attorney fees and a time-price differential affirmed. Court of Appeals judgment regarding
postjudgment interest reversed. Case remanded to the trial court for further proceedings.

Chief Justice YOUNG, concurring in part and dissenting in part, agreed with the majority
that Wyandotte complied with the notice requirements of MCL 129.207 and that a time-price
differential was recoverable under the statute, but would have held that the attorney fee award
was not integrally related to the price of the materials Wyandotte furnished, so the attorney fee
award was not recoverable as a sum justly due within the meaning of the PWBA. Chief Justice
YOUNG also dissented from the majority’s reasoning regarding the award of postjudgment
interest. MCL 129.207 only makes compensable the unpaid costs of labor or materials
furnished. Thus, the statute limits a claimant’s recovery to the contractual terms that are related
to the price of labor or materials furnished. While both the time-price-differential and the past-
due-accounts provisions were in Wyandotte’s agreement with ETS, only the former actually
related to the cost of furnishing the materials. In addition, the PWBA limits the claimant’s
recovery based on when certain price terms are triggered; to be recoverable, the price term must
be triggered before the expiration of 90 days after the last of the materials are supplied or labor
furnished. The time-price-differential provision was triggered before Wyandotte gave its 90-day
notice. Accordingly, Wyandotte could recover the time-price differential. In contrast, the
attorney fee was not closely associated with the cost of materials furnished for the library project.
The past-due-accounts provision created a penalty for collection efforts rather than determining
Wyandotte’s expectancy. Because this provision described a liquidated collection cost rather
than a cost of the materials, the attorney fees set forth in the provision were not part of the sum
justly due. In addition, the past-due-accounts provision was not triggered by the 90-day deadline
given that Wyandotte did not file suit until well after the 90-day deadline had passed. The trial
court, therefore, erred by awarding attorney fees. Finally, the majority mistakenly concluded
that the judgment was rendered on the PWBA rather than on a written instrument. The
agreement between Wyandotte and ETS was as much the basis for the trial court’s judgment as
the statute, so the judgment was rendered on a written instrument. Nonetheless,
MCL 600.6013(7) did not apply because the underlying agreement did not evidence
indebtedness. Therefore, the general interest rate set forth in MCL 600.6013(8) applied, but not
for the reason stated by the majority.

Justice ZAHRA, concurring in part and dissenting in part, agreed that the notice provided
by Wyandotte was sufficient and that MCL 600.6013(8) governed the calculation of
postjudgment interest, but disagreed with the majority’s reasoning regarding the calculation of
interest and also did not agree that Wyandotte could claim attorney fees and a time-price
differential under the payment bond. Simply because a remote subcontractor may sue on a
payment bond under MCL 129.207 does not suggest that its claim is determined by a contract to
which the principal contractor who furnished the payment bond was not a party. Under
Michigan law, a remote contractor’s claim arises solely under the PWBA, which alone forms the
basis to assess its claim. MCL 129.207 does not suggest that the principal contractor must
wholly indemnify claimants under the PWBA. MCL 129.207 provides, in regard to remote
subcontractors, that the claimant must provide notice within 90 days from the date on which the
claimant performed the last of the labor, or furnished or supplied the last of the materials, for
which the claim is made, stating with substantial accuracy the amount claimed. This notice
identifies the labor and materials that the remote contractor has supplied. The sum justly due
thus includes the labor and materials identified in the 90-day notice that the claimant has
supplied but for which the claimant has not been paid. The majority departed from the statutory
language by imposing liability for the amount provided for in the claimant’s contract, regardless
of whether the principal contractor and its surety agreed to that contract’s terms. Further, the
majority holds that judgment was rendered on Wyandotte’s statutory claim rather than on the
contract itself. This holding missed the entire point of the PWBA. MCL 129.207 expressly
provides that a claimant may sue on the payment bond, but, in this case, neither the payment
bond nor the contract between KEO and the library incorporated by the payment bond contained
a specified interest rate. Accordingly, the majority reached the correct result when it concluded
that interest on the judgment had to be calculated based on MCL 600.6013(8).

©2016 State of Michigan
 Michigan Supreme Court
Lansing, Michigan
Chief Justice: Justices:

OPINION Robert P. Young, Jr. Stephen J. Markman
Brian K. Zahra
Bridget M. McCormack
David F. Viviano
Richard H. Bernstein
Joan L. Larsen

FILED May 3, 2016

STATE OF MICHIGAN

SUPREME COURT

WYANDOTTE ELECTRIC SUPPLY
COMPANY,

Plaintiff-Appellee,

v No. 149989

ELECTRICAL TECHNOLOGY SYSTEMS,
INC.,

Defendant/Cross-Defendant,

and

KEO & ASSOCIATES, INC.,

Defendant/Cross-Plaintiff-
Appellant,

and

WESTFIELD INSURANCE COMPANY,

Defendant-Appellant.

BEFORE THE ENTIRE BENCH

BERNSTEIN, J.
 This case concerns several facets of the public works bond act (PWBA),

MCL 129.201 et seq. First, it poses the question of whether actual notice is required for a

sub-subcontractor to recover on a payment bond when that sub-subcontractor has

complied with the notice requirements set forth in MCL 129.207. Second, the case raises

the question of whether a PWBA claimant may recover a time-price differential and

attorney fees that were provided for by the claimant’s contract with a subcontractor, but

were unknown to the principal contractor holding the payment bond as well as the

principal’s surety. Finally, we consider what postjudgment interest is appropriate under

the PWBA. We hold that the PWBA contains no actual notice requirement for claimants

that comply with the statute, that the trial court properly awarded a time-price differential

and attorney fees on past-due invoices to plaintiff Wyandotte Electric Supply Company

(Wyandotte), and that the trial court erred in awarding postjudgment interest under

MCL 600.6013(7). Accordingly, we affirm the judgment of the Court of Appeals with

regard to the first two issues and reverse with regard to the third. We remand this case to

the trial court for further proceedings consistent with this opinion.

I. FACTS AND PROCEDURAL HISTORY

In 2009 and 2010, the south wing of the Detroit Public Library was renovated.

Defendant KEO & Associates, Inc. (KEO) was the principal contractor for this project.

Defendant Westfield Insurance Company (Westfield) supplied KEO with a payment bond

worth $1.3 million, as required by the PWBA. KEO was identified as the principal

contractor and Westfield as the surety on the bond. KEO subcontracted with defendant

Electrical Technology Systems, Inc. (ETS) to provide labor and materials for electrical

2
work. The agreement between KEO and ETS included a pay-if-paid clause, obliging

KEO to pay ETS only after KEO had been paid for the relevant portion of work

performed.

ETS in turn subcontracted with Wyandotte for materials and supplies, making

Wyandotte a sub-subcontractor from KEO’s perspective. ETS and Wyandotte first

formed a relationship in 2003, when they entered into an “open account” agreement that

governed ETS’s purchases from Wyandotte. Under this agreement, ETS was to pay a

“[t]ime price differential” of 1.5% per month (18% per annum) on invoices unpaid after

30 days. 1 For the Detroit Public Library project, ETS solicited a quote from Wyandotte.

On August 13, 2009, Wyandotte submitted a quote that included the 1.5% time-price

differential provision. On February 19, 2010, ETS accepted the quote by issuing a

purchase order totaling $143,613.25. Wyandotte first delivered materials to ETS for the

project on March 3, 2010. Over the course of the project, ETS paid Wyandotte only

sporadically and the unpaid balance grew. Initially, Wyandotte supplied materials on

credit and credited ETS’s payments to the oldest outstanding balance, but eventually

Wyandotte began to ship materials only for cash on delivery. The last shipment with an

1
The term “time-price differential” refers to the difference between the current cash price
of an item and the cost of purchasing the item with credit. A payment made with cash is
immediate; a payment made with credit is not. Thus, when a payment is made with
credit, the seller is burdened by a cash-flow interruption. A time-price differential
compensates for the increased cost to a seller for credit. It reflects the difference between
the credit price and the cash price. Price Bros Co v Charles J Rogers Constr Co, 104
Mich App 369, 377; 304 NW2d 584 (1981), citing Silver v Int’l Paper Co, 35 Mich App
469, 470; 192 NW2d 535 (1971). Despite the contract provision, Wyandotte’s business
practice was to wait 60 days to pursue the time-price differential.

3
unpaid balance was delivered on or about July 22, 2010; Wyandotte continued making

deliveries on a cash basis until September 30, 2010.

On March 3, 2010, when it began work on the library project, Wyandotte sent

letters to KEO and Westfield asking for a copy of the payment bond related to the library

renovation project. The letter, on Wyandotte’s letterhead, referred to the “Detroit Public

Library South Wing with [ETS.]” According to Wyandotte, KEO provided a copy of the

payment bond the next day. One week later, on March 10, 2010, Wyandotte sent KEO a

30-day “Notice of Furnishing” in accordance with MCL 129.207, explaining that it was

one of ETS’s suppliers. Wyandotte also sent copies of the letter to Westfield, the library,

and ETS. As specified by MCL 129.207, Wyandotte sent these notices by certified mail.

Additionally, Wyandotte sent the notices with return receipts requested. The notices to

Westfield, ETS, and the library were all received. It is unclear what happened to the

notice sent to KEO—United States Postal Service tracking indicated that it was at the

Detroit Post Office on March 13, 2010, but it apparently never reached its destination.

KEO states that it never received the 30-day notice. Again in accordance with the

requirements of MCL 129.207, Wyandotte provided a 90-day notice of furnishing on

November 1, 2010, to KEO, Westfield, ETS, and the library, stating that its last day of

furnishing materials had been September 30, 2010.

Throughout the renovation project, KEO made progress payments to ETS totaling

more than $248,000, 2 but ETS was not fully paying Wyandotte. KEO claims not to have

2
KEO claims to have paid more than it owed; ETS claims that KEO failed to pay what it
owed to ETS. In any case, Wyandotte undisputedly did not receive full payment.

4
been aware of Wyandotte’s involvement in the project before receiving the 90-day notice

in November 2010. After receiving the 90-day notice from Wyandotte, KEO requested

information from ETS confirming payments in the form of a sworn statement. According

to KEO, ETS provided a falsified sworn statement averring that Wyandotte had been paid

$80,000. In January 2011, KEO terminated its subcontract with ETS, citing an

abandonment of the project.

On January 28, 2011, Wyandotte filed a claim directly with Westfield to recover

on the payment bond. Westfield denied the claim, asserting a lack of liability.

Consequently, on March 14, 2011, Wyandotte filed suit against ETS, KEO, and

Westfield. KEO filed a cross-claim against ETS on March 29, 2011. ETS had apparently

gone out of business and its president had declared personal bankruptcy, so it failed to

appear and was defaulted. Wyandotte continued to pursue claims against KEO and

Westfield on the basis of the surety bond. 3

On September 7, 2011, Wyandotte moved for summary disposition under

MCR 2.116(C)(10), which tests the factual sufficiency of a complaint. The trial court

heard oral argument on whether there was a valid bond claim when KEO had not

received the 30-day notice of furnishing and whether Wyandotte could recover the 1.5%

time-price differential and attorney fees on a bond claim. On November 4, 2011, the trial

court granted Wyandotte’s motion in part, concluding that there was a valid bond claim

because Wyandotte had complied with the notice requirements, and that Wyandotte could

3
Because KEO and Westfield’s financial interests with respect to this project are aligned,
they have filed joint arguments in this appeal. We refer to them jointly as “defendants”
throughout this opinion.

5
recover the time-price differential as well as attorney fees. The only remaining issue was

the amount of damages, and a bench trial was held on that narrow question. The trial

court found that the unpaid balance owed to Wyandotte was $154,343.29, that Wyandotte

was entitled to a total time-price differential of $76,403.44, and that Wyandotte was

entitled to $30,000 in attorney fees. 4 Wyandotte moved for entry of judgment and further

requested postjudgment interest under MCL 600.6013(7). The trial court granted the

motion over defendants’ objections and entered a judgment in the total amount of

$272,927.70. 5 The Court of Appeals affirmed the judgment in an unpublished opinion.

II. NOTICE UNDER THE PWBA

Defendants first contend that Wyandotte did not have a cause of action against

them because KEO did not receive Wyandotte’s 30-day notice. We review a trial court’s

summary disposition order de novo. Debano-Griffin v Lake Co, 493 Mich 167, 175; 828

NW2d 634 (2013). Likewise, questions of statutory interpretation are subject to review

de novo. Elba Twp v Gratiot Co Drain Comm’r, 493 Mich 265, 278; 831 NW2d 204

(2013). When interpreting a statute, our foremost rule of construction is to discern and

give effect to the Legislature’s intent. Aroma Wines & Equip, Inc v Columbian

Distribution Servs, Inc, 497 Mich 337, 345; 871 NW2d 136 (2015). Because the

language chosen is the most reliable indicator of that intent, we enforce clear and

4
The attorney fees award was agreed to by the parties and was less than the attorney fees
provided for in the contract.
5
The final award also included, under MCR 2.403(O), $12,180.97 for fees and costs
arising out of defendants’ rejection of a case evaluation.

6
unambiguous statutory language as written, giving effect to every word, phrase, and

clause. Id. at 345-346.

Traditionally, public property cannot be the subject of a lien unless a statute

specifically permits it. Knapp v Swaney, 56 Mich 345, 347; 23 NW 162 (1885). The

Legislature enacted the PWBA to protect contractors and suppliers working on public

projects who, unlike their private-works counterparts, have no recourse when other

contractors default on their obligations. Adamo Equip Rental Co v Mack Dev Co, Inc,

122 Mich App 233, 236; 333 NW2d 40 (1982), citing Ford v State Bd of Ed, 166 Mich

658; 132 NW 467 (1911). While contractors and suppliers can place mechanics’ liens on

private projects, the PWBA protects those workers on public projects by requiring the

principal contractor on a public project valued at $50,000 or more to obtain a payment

bond. MCL 129.201. Payment bonds serve to protect subcontractors in privity with a

principal contractor, as well as remote sub-subcontractors like Wyandotte, who are not

fully compensated for their contributions to a public project. MCL 129.203. The

principal contractor who obtains the bond, as well as the principal’s surety if applicable,

is liable to compensate suppliers of labor or materials. Id.

MCL 129.207 provides for recovery under a principal contractor’s payment bond,

but prescribes a two-step notice procedure for a remote party from the principal

contractor’s perspective, that is, one lacking a direct contractual relationship with the

principal contractor:

A claimant not having a direct contractual relationship with the principal
contractor shall not have a right of action upon the payment bond unless
(a) he has within 30 days after furnishing the first of such material or
performing the first of such labor, served on the principal contractor a
written notice, which shall inform the principal of the nature of the

7
 materials being furnished or to be furnished, or labor being performed or to
be performed and identifying the party contracting for such labor or
materials and the site for the performance of such labor or the delivery of
such materials, and (b) he has given written notice to the principal
contractor and the governmental unit involved within 90 days from the date
on which the claimant performed the last of the labor or furnished or
supplied the last of the material for which the claim is made, stating with
substantial accuracy the amount claimed and the name of the party to whom
the material was furnished or supplied or for whom the labor was done or
performed. Each notice shall be served by mailing the same by certified
mail, postage prepaid, in an envelope addressed to the principal contractor,
the governmental unit involved, at any place at which said parties maintain
a business or residence.

Defendants’ argument is that there can be no liability under the PWBA because

KEO never actually received the 30-day notice—i.e., there was a failure of service. 6 In

essence, defendants ask us to read an actual notice requirement into MCL 129.207. We

decline to do so. First, we consider the plain language of the statute. Because “served”

in this context is a technical word with a specific meaning in the law, we refer to that

technical meaning. MCL 8.3a. “Serve” means “[t]o make legal delivery of (a notice or

process)” or “[t]o present (a person) with a notice or process as required by law[.]”

Black’s Law Dictionary (10th ed). Therefore, the word “served,” as used in this statute,

in itself does not implicate any substantive requirements; it merely compels compliance

with the relevant law.

Furthermore, service of notice is mandatory under MCL 129.207, because the

statute declares that a party “shall not have a right of action upon the payment bond

unless” the two notices are provided and states that the two notices “shall inform” the

6
Defendants do not argue in this Court that Wyandotte failed to serve the 90-day notice
required by MCL 129.207.

8
specified parties of certain information. However, the Legislature did not specify that

actual receipt of notice is a requirement of the PWBA, although it has done so in other

statutes. Some statutes mandate that a party provide service by taking actions

“reasonably calculated to give actual notice . . . .” See, e.g., MCL 125.2335(3);

MCL 445.1539; MCL 487.3224(1). Others expand upon delivery directions, requiring

that mailed notice be sent return-receipt demanded or that some additional step be taken

to prove that notice was given. See, e.g., MCL 168.711 (requiring service by “registered

or certified mail, with a return receipt demanded”); MCL 213.181 (requiring service by

“registered mail, and a return receipt demanded”); MCL 500.2034 (requiring “the return

postcard receipt for” a statement served under the statute as proof of service);

MCL 290.725(3) (“The verified return of service shall be proof of the service . . . .”).

The Legislature elected not to impose such a burden in MCL 129.207.

Defendants ask us to overlook the fact that Wyandotte sent its 30-day notice of

furnishing via certified mail, return-receipt requested, and render a decision based on the

fact that KEO did not receive that notice. 7 The rules of statutory construction demand

that this Court “ ‘give effect to every word, phrase, and clause and avoid an interpretation

that would render any part of the statute surplusage or nugatory.’ ” People v

7
At oral argument, defendants additionally suggested that service with return-receipt
requested was not in conformity with MCL 129.207. We do not find compelling
defendants’ contention that Wyandotte failed to comply with the statute when it took the
additional precaution of sending its correspondence return-receipt requested. The plain
language of MCL 129.207 does not require a return receipt, and we decline to read such
language into the statute. But we also do not believe that a party that requests a return
receipt when sending notice by certified mail is not entitled to a right of action on a
payment bond under MCL 129.207.

9
Cunningham, 496 Mich 145, 154; 852 NW2d 118 (2014), quoting State Farm Fire & Cas

Co v Old Republic Ins Co, 466 Mich 142, 146; 644 NW2d 715 (2002). In addition to the

portions of the statute requiring notice, MCL 129.207 specifies that “notice shall be

served by mailing the same by certified mail, postage prepaid . . . .” To accept

defendants’ argument would render that phrase nugatory. In order to give effect to this

phrase, we must conclude that service is accomplished when a complainant mails the

required information to the proper destination by certified mail within the required time

frame.

This Court previously considered the notice requirements of the PWBA in Pi-Con,

Inc v A J Anderson Constr Co, 435 Mich 375; 458 NW2d 639 (1990). Defendants

maintain that this Court held in Pi-Con that the PWBA contains an actual notice

requirement. In Pi-Con, a supplier of materials and services to a subcontractor on a

public works project sent its notice of furnishing to the principal contractor via ordinary

first-class mail rather than, as required by statute, by certified mail. Id. at 378-380. The

Pi-Con Court reviewed the United States Supreme Court’s construction of the Miller Act,

40 USC 3131 et seq., the federal analog to the PWBA, in Fleisher Engineering & Constr

Co v United States ex rel Hallenbeck, 311 US 15; 61 S Ct 81; 85 L Ed 12 (1940), in

which the Supreme Court observed:

We think that the purpose of this provision [notice by certified mail
requirement] as to manner of service was to assure receipt of the notice, not
to make the described method mandatory so as to deny right of suit when
the required written notice within the specified time had actually been given
and received. In the face of such receipt, the reason for a particular mode
of service fails. It is not reasonable to suppose that Congress intended to
insist upon an idle form. Rather, we think that Congress intended to

10
 provide a method which would afford sufficient proof of service when
receipt of the required written notice was not shown. [Id. at 19.]

Guided by the analysis in Fleisher, the Pi-Con Court concluded that service by first-class

mail does not preclude recovery under the PWBA as long as the plaintiff can prove the

defendant’s actual receipt of the notice by a preponderance of the evidence. Pi-Con, 435

Mich at 378.

Defendants refer to the following portion of Pi-Con to support their contention

that the PWBA contains an actual notice requirement:

First, a claimant must prove that the principal contractor actually received
notice. Second, the notice must relate “the nature of the materials being
furnished or to be furnished, or labor being performed or to be performed
and identify[] the party contracting for such labor or materials and the site
for the performance of such labor or the delivery of such materials . . . .”
Third, the notice sent must have been written. Fourth, the notice must have
been received within the time limits prescribed by the statute. [Id. at 382
(citation omitted; alteration in original).]

But the factual underpinnings of Pi-Con are dissimilar to those in this case, and those

dissimilarities affect our approach to the PWBA’s notice requirements. Pi-Con and the

other Michigan cases that have previously addressed the notice requirement of

MCL 129.207 all involved parties who failed to employ the statutorily prescribed

delivery method—certified mail. See, e.g., Pi-Con, 435 Mich at 380 (notice sent by

ordinary first-class mail); Thomas Indus, Inc v C & L Electric, Inc, 216 Mich App 603,

605-608; 550 NW2d 558 (1996) (no notice mailed but all required information included

on packing slips with shipments of materials). In this case, by contrast, the parties do not

dispute that Wyandotte sent notice via certified mail, although KEO apparently did not

11
receive it. In this situation, Wyandotte complied with the statute, which contains no

actual notice requirement.

We reaffirm the continuing application of Pi-Con’s rule in cases in which a

would-be PWBA claimant fails to comply with the particular method of service specified

in MCL 129.207. To deny a PWBA claim when a preponderance of the evidence

demonstrates that notice was actually received would improperly “elevat[e] form over

substance.” Pi-Con, 435 Mich at 385. Similarly, it would be more than passing strange

to penalize a claimant for complying with the notice provisions outlined in the statute, as

Wyandotte has done here. We conclude that, when a claimant has complied with the

notice procedures set forth by the Legislature in MCL 129.207, there is no actual notice

requirement.

III. RECOVERABILITY OF A TIME-PRICE DIFFERENTIAL
AND ATTORNEY FEES 8

In prevailing on its PWBA claim, Wyandotte was awarded a judgment in the trial

court that included a time-price differential and attorney fees, which had been provided

for in its contract with ETS. To the extent that this issue is one of statutory interpretation

of the PWBA, we review it de novo. Elba Twp, 493 Mich at 278. To the extent that it

involves interpreting the contract between Wyandotte and ETS, this is also a question

8
We acknowledge that there may be an issue with regard to whether the “attorney fees”
requested by Wyandotte are appropriately referred to as such. In this case, the term
“attorney’s fees” arises out of a “PAST DUE ACCOUNTS” provision in ETS’s open-
account agreement with Wyandotte and differs from a traditional attorney fees provision.
For the sake of simplicity, we follow the language used in the contract, and by the parties
and the Court of Appeals, in continuing to use the term “attorney fees.”

12
subject to review de novo. Rory v Continental Ins Co, 473 Mich 457, 464; 703 NW2d 23

(2005). Our goal in contract interpretation is to give effect to the intent of the parties, to

be determined first and foremost by the plain and unambiguous language of the contract

itself. Id. at 468.

The PWBA permits an unpaid supplier of materials or labor to “sue on the

payment bond for the amount, or the balance thereof, unpaid at the time of institution of

the civil action, prosecute such action to final judgment for the sum justly due him and

have execution thereon.” MCL 129.207. Wyandotte sought payment based on its prior

contracts with ETS: the open-account agreement enacted in 2003, the bid Wyandotte

made for the Detroit Public Library project in 2009, and the ensuing purchase orders.

Wyandotte argued, and the lower courts agreed, that Wyandotte was entitled to the

unpaid balance on the materials and supplies it had provided as well as further damages

based on the following two provisions that appeared in the open-account agreement:

TIME PRICE DIFFERENTIAL Time price differential charges of
1-1/2% per month (18% per annum) are calculated on all invoices that are
not paid and past due 30 days or more. You will be issued a separate
invoice detailing these (finance) charges.

* * *

PAST DUE ACCOUNTS Accounts that are past due will be taken
off open account and placed on C.O.D. until their account is brought back
into current status. In the event your account is placed in the hands of an
attorney for collection after default, the customer agrees to pay 33% of the
unpaid balance for attorney’s fees together with applicable costs.

The time-price differential provision also appeared on the quote for the library project.

As an initial matter, defendants maintain that they cannot be liable for either type

of fee because they were not in contractual privity with Wyandotte and never agreed to

13
pay these fees. This privity argument is unpersuasive. Contractual privity is plainly not a

requirement for recovery under MCL 129.207, which specifically allows a “claimant not

having a direct contractual relationship with the principal contractor” to seek recovery on

the payment bond. Defendants’ privity argument would strip away the PWBA’s

protection of remote contractors.

The dispositive question here is rather the meaning of “sum justly due” in

MCL 129.207. The statute merely states that a complainant may sue “on the payment

bond for the amount, or the balance thereof, unpaid” and that a final judgment may be

rendered for the “sum justly due . . . .” MCL 129.207. Neither of these phrases explicitly

informs us whether the Legislature intended to encompass additional contractual

provisions, such as time-price differential fees or attorney fees, as part of the sum justly

due. 9

9
We recognize Chief Justice YOUNG’s argument in his partial dissent that MCL 129.207
limits a claimant to recovery of a sum “integrally related to the cost of labor or materials
furnished for the project.” We find no statutory support for this conclusion. Contrary to
his reading of MCL 129.207, the language “[a] claimant who has furnished labor or
material in the prosecution of the work provided for in such contract” merely serves to
identify who may make a claim under the PWBA—a party who has furnished labor or
materials. It does not by its plain language place a limit on what such a claimant may
seek to recover.

Moreover, we discern little reason for distinguishing between (1) the materials
price itself; (2) the time-price differential provision, which is related to the materials
price; and (3) the attorney fees provision, which also constitutes part of the contract bid.
Wyandotte’s decision to actually price materials at a particular level in the contract bid
was presumably a function of all the other contract provisions, including those pertaining
to the time-price differential and attorney fees. That is, Wyandotte presumably adjusted
its materials price downward, at least to some degree, on the assumption that all contract
provisions would be given effect, and it would likely have quoted a higher materials price
in the bid if it did not have the reasonable assurance that it would be reimbursed at a
certain rate for delinquent payments (time-price differential) or for litigation required to

14
 The Court of Appeals considered the scope of the phrase “sum justly due” under

the PWBA in Price Bros Co v Charles J Rogers Constr Co, 104 Mich App 369; 304

NW2d 584 (1981). The plaintiff in Price Bros was retained by a contractor on a public

works project to provide sewer pipe for installation. The two contracts at issue related to

the sewer pipe project and contained the following clause:

Payment shall be due 30 days after the date of the
statement. A service charge of 1-1/2 percent per month on
the unpaid balance will be due on all amounts unpaid for 30
days after the due date. A 5% cash discount is applicable if
paid within 30 days of the date of statement providing no
other indebtedness to Price Brothers Company is delinquent.
[Id. at 376.]

The Court of Appeals considered whether the service charge constituted a separate

extension of credit or a “flexible price factor employed to reflect plaintiff’s increased

costs when its bills are not paid promptly.” Id. at 377. The Price Bros Court concluded

that the service charge fell into the latter category and was recoverable under the PWBA

as an “integral part of the cost of the transaction” and an “integral part of the contract

satisfy outstanding debt (attorney fees). Accordingly, the attorney fees provision is not
detached from the materials price; rather, it and the materials price are interrelated, just as
the time-price differential provision and the materials price are interrelated. Given that
Wyandotte is entitled to recover the materials price and the time-price differential, we
believe Wyandotte is entitled to recover attorney fees as well.

We also note that our conclusion is consistent with how several federal circuits
have interpreted the Miller Act. See United States ex rel Maddux Supply Co v St Paul
Fire & Marine Ins, 86 F3d 332, 336 (CA 4, 1996) (“The Miller Act does not, by its own
terms, provide for attorney’s fees or interest. Several circuits have held, however, that
interest and attorney’s fees are recoverable if they are part of the contract between the
subcontractor and supplier.”).

15
between [the parties].” Id. at 377, 379. However, the Price Bros Court did not provide

any justification for the use of this standard or consider other approaches to

understanding the term “sum justly due.” We therefore do not find it clarifying in this

case.

Wyandotte’s position, and that adopted by the Court of Appeals, is that the sum

justly due for PWBA purposes is the amount provided for in the claimant’s contract,

regardless of whether the principal contractor and its surety have agreed to that contract’s

terms. An alternative position is to use the value of the labor or materials. We conclude

that the former approach is more consistent with the plain language of the PWBA, which

refers to the “amount . . . unpaid” at the time of institution of the action and does not

expressly state (or limit) what kinds of damages are recoverable. This phrase implies a

previous expectation of payment of a certain sum. In the absence of any further direction

from the Legislature regarding how the amount unpaid ought to be determined, the most

logical recourse is to the claimant’s underlying contract, which best illustrates the intent

and expectations of the parties to the contract. The Legislature does not differentiate the

amount unpaid from the sum justly due, and we understand that sum to be determined

based on the trial court’s fact-finding as to the amount unpaid.

Because we use the contract to determine the sum justly due, we must ascertain

what actually constituted the contract in this case. There were multiple written

instruments evidencing the agreement between Wyandotte and ETS: the open-account

agreement dating back to 2003, the quote for the library project, and the purchase orders

related to the project. In our recent opinion in Beck v Park West Galleries, Inc, 499 Mich

___; ___ NW2d ___ (2016), we acknowledged the general rule that separate agreements

16
are treated separately. However, when parties enter into multiple agreements relating to

the same subject-matter, we must read those agreements together to determine the

parties’ intentions. Culver v Castro, 126 Mich App 824, 826; 338 NW2d 232 (1983),

citing Reber v Pearson, 155 Mich 593; 119 NW 897 (1909). Although the initial open-

account agreement does not relate specifically to the library project, all of these

agreements are directed to the same end—Wyandotte’s provision of materials to ETS.

Further, by its terms, the open-account agreement covered all “past, present and future

unpaid accounts receivable balances” between Wyandotte and ETS. Together, these

agreements demonstrate that Wyandotte and ETS intended to enter into an ongoing

business relationship and they define the scope of that relationship. We therefore

conclude that these agreements should be considered together.

The open-account agreement includes provisions regarding both a time-price

differential and attorney fees. The later quote for the library project reiterated the time-

price differential provision but was silent regarding attorney fees. But because the quote

did not contradict the attorney fee clause present in the initial agreement, we conclude

that the documents are not inconsistent and the later quote and purchase orders did not

supersede the initial agreement. See Culver, 126 Mich App at 828. Accordingly, both

the open-account agreement and the subsequent agreements relating specifically to the

library project apply here.

We do not believe that a PWBA claimant’s recovery is limited to the terms of a

contract or contracts relating to the provision of labor and materials for a specific public

works project when additional contracts also govern the parties’ relationship with regard

to that project. To the extent that the PWBA refers to public works project contracts, it

17
refers to the primary contract between a principal contractor and a governmental unit.

For example, MCL 129.201, which obliges a principal contractor to obtain a payment

bond, only discusses this primary contract. Similarly, MCL 129.203 provides:

The payment bond shall be in an amount fixed by the governmental
unit but not less than 25% of the contract amount solely for the protection
of claimants, as defined in [MCL 129.206], supplying labor or materials to
the principal contractor or his subcontractors in the prosecution of the work
provided for in the contract. [Emphasis added.]

See also MCL 129.202. As with MCL 129.201, the phrase “the contract” in

MCL 129.203 must refer to the primary contract between a principal contractor and a

governmental unit. MCL 129.203 directs the principal contractor to obtain a payment

bond; in stating that the payment bond shall be in an amount not less than 25% of the

contract amount, the statute clearly indicates that the term “the contract” refers to the

primary contract, because the principal contractor does not obtain separate payment

bonds for each lesser contract with a subcontractor. Therefore, the discussion in

MCL 129.207 of “[a] claimant who has furnished labor or material in the prosecution of

the work provided for in such contract in respect of which payment bond is furnished

under the provisions of [MCL 129.203]” refers to that primary contract yet again. It does

not limit a PWBA claimant’s reasonably expected recovery when the claimant is a sub-

subcontractor.

A sub-subcontractor is, by definition, not a party to the primary contract. Given

that the PWBA does not require a sub-subcontractor to be in privity of contract with the

principal contractor in order to obtain relief, we hold that the PWBA allows a sub-

subcontractor to rely on the terms of the agreement or agreements that govern its

18
relationship with a subcontractor. There are, of course, scenarios in which a contract

predating the specific public works project would properly be disregarded under the

PWBA: namely, when the prior contract is limited in scope and has no bearing on either

the public works project or any continuing contractual relationship between the involved

parties. However, where, as here, the language of an earlier contract indicates that ETS

and Wyandotte intended it to govern their ongoing business relationship, we consider it

alongside the specific contracts relating to the public works project.

At the time Wyandotte commenced this action, ETS had already fallen behind on

its payments to Wyandotte for the materials it had provided in connection with the library

project. The time-price differential referred to in the contracts between Wyandotte and

ETS was in play, reflecting the increased cost to Wyandotte as ETS’s bills went

underpaid or unpaid. Therefore, a time-price differential was part of the amount unpaid

and due to Wyandotte when it instituted the instant action against defendants. The trial

court properly included the time-price differential as part of the judgment in Wyandotte’s

favor.

Regarding attorney fees, defendants correctly argue that Michigan follows the

American rule, which provides that attorney fees are not to be awarded unless specifically

provided for by a statute, rule, or contractual provision. Watkins v Manchester, 220 Mich

App 337, 342; 559 NW2d 81 (1996). Defendants rely heavily on the fact that the PWBA

does not expressly provide for an award of attorney fees, but fail to note that the open-

account agreement did in fact have an attorney fees provision. 10 And, as noted

10
As noted earlier in this opinion, the open-account agreement states that “[i]n the event
[ETS’s] account is placed in the hands of an attorney for collection after default, [ETS]

19
previously, the agreement covered all of ETS’s “past, present and future unpaid accounts

receivable balances” with Wyandotte. Thus, the terms of the open-account agreement

clearly indicate that ETS and Wyandotte intended that the attorney fee clause would

apply for the duration of their ongoing business relationship. Therefore, it was not

improper for the trial court to include attorney fees in its judgment as part of the sum

justly due. 11

We conclude that, because the underlying contract is the source by which we

determine what relief a PWBA claimant may seek, Wyandotte is entitled to the time-price

differential and attorney fees it would have received under its contracts with ETS.

IV. INTEREST ON THE JUDGMENT

The trial court awarded, and the Court of Appeals affirmed, postjudgment interest

to Wyandotte under MCL 600.6013(7), which provides:

agrees to pay 33% of the unpaid balance for attorney’s fees together with applicable
costs.”
11
Even though the parties have not raised this issue, in his partial dissent Chief Justice
YOUNG contends that the attorney fees provision was not triggered before Wyandotte sent
its 90-day notice to defendants and, therefore, Wyandotte cannot claim attorney fees. He
argues that MCL 129.207 limits a claimant’s potential recovery to the amount unpaid 90
days after supplying the last of the labor or materials in question. This argument
fundamentally misunderstands the 90-day provision of MCL 129.207, which merely
creates a notice requirement. It does not purport to preclude claimants from recovering
damages that accrue after the 90-day notice is served. Chief Justice YOUNG’s partial
dissent implicitly recognizes this point by agreeing that the time-price differential is
recoverable under the statute—including the amounts that accrued after Wyandotte sent
its 90-day notice to KEO on November 1, 2010. This conclusion is made emphatically
clear by the first sentence of MCL 129.207, which allows a claimant to seek “the amount,
or the balance thereof, unpaid at the time of institution of the civil action,” not the amount
unpaid 90 days after the claimant ceased performance.

20
 For a complaint filed on or after July 1, 2002, if a judgment is
rendered on a written instrument evidencing indebtedness with a specified
interest rate, interest is calculated from the date of filing the complaint to
the date of satisfaction of the judgment at the rate specified in the
instrument if the rate was legal at the time the instrument was executed. If
the rate in the written instrument is a variable rate, interest shall be fixed at
the rate in effect under the instrument at the time the complaint is filed.
The rate under this subsection shall not exceed 13% per year compounded
annually.

Defendants contend that this was not the proper section under which to calculate

interest on the judgment. We review this question of statutory interpretation de novo and

seek to effect the Legislature’s intent, turning first to the plain language of the statute.

See Elba Twp, 493 Mich at 278.

MCL 600.6013(7) applies when certain criteria are met: the judgment must be

“rendered on” a written instrument, the instrument must evidence indebtedness, and there

must be a specified interest rate. This issue may be resolved based upon the first

criterion. “Render” means, in relevant part, “to cause to be or become” and “to hand

down (a legal judgment).” Merriam-Webster’s Collegiate Dictionary (11th ed). To the

extent that “render” is a technical legal term, to render means “to deliver formally,” when

undertaken by a judge. Black’s Law Dictionary (10th ed). 12 This restrictive term

requires the written instrument to be the actual basis of the judgment for

MCL 600.6013(7) to apply.

12
Because both the lay and legal dictionary definitions of “render” are substantially
similar, we need not determine whether it is a legal term of art or a common term. See
Brackett v Focus Hope, Inc, 482 Mich 269, 276; 753 NW2d 207 (2008).

21
 The judgment here was not rendered on a written instrument. Regardless of

whether the documents evidencing the contract between Wyandotte and ETS can even be

said to constitute a written agreement for purposes of interest on the judgment, the

judgment in this case was not rendered on them. Although the contract between

Wyandotte and ETS defined the scope of the damages that Wyandotte was entitled to

seek under the PWBA, the underlying claim was not a contract claim. 13 Wyandotte’s

cause of action did not arise directly out of its contract; it arose out of the PWBA.

Without the legislatively provided remedy of the PWBA, Wyandotte would not have had

a claim against defendants. Therefore, even though the contract between ETS and

Wyandotte determined the extent of Wyandotte’s recovery, judgment was rendered on

Wyandotte’s statutory claim rather than on the contract itself. Because judgment was not

rendered on a written instrument at all, we need not address whether the written

instrument in this case evidenced indebtedness at a specified interest rate. Interest on the

judgment should instead be calculated under MCL 600.6013(8), the general rule for

interest on a money judgment in a civil case.

V. CONCLUSION

We conclude that MCL 129.207 did not require actual receipt of notice by the

principal, that a time-price differential and attorney fees were part of the sum justly due

to Wyandotte under its contracts, and that interest on the judgment should have been

13
By contrast, Wyandotte’s action directly against ETS, which ended in a default
judgment, was a breach of contract claim. A judgment in such a case could be said to be
rendered on the contract.

22
calculated under MCL 600.6013(8) rather than MCL 600.6013(7). Accordingly, we

affirm in part and reverse in part the judgment of the Court of Appeals and remand to the

trial court for entry of a judgment consistent with these holdings.

Richard H. Bernstein
Stephen J. Markman
Bridget M. McCormack
David F. Viviano
Joan L. Larsen

23
 STATE OF MICHIGAN

SUPREME COURT

WYANDOTTE ELECTRIC SUPPLY
COMPANY,

Plaintiff-Appellee,

v No. 149989

ELECTRICAL TECHNOLOGY SYSTEMS,
INC.,

Defendant/Cross-Defendant,

and

KEO & ASSOCIATES, INC.,

Defendant/Cross-Plaintiff-
Appellant,

and

WESTFIELD INSURANCE COMPANY,

Defendant-Appellant.

YOUNG, C.J. (concurring in part and dissenting in part).

This case addresses the issue of whether a claimant under the public works bond

act (PWBA) 1 may recover a time-price differential and attorney fees that were permitted

by its contract with a subcontractor, but were unknown to both the principal contractor

1
MCL 129.201 et seq.
and its surety. MCL 129.207 of the PWBA allows claimants to recover a sum justly due

for labor and materials furnished on a public project. I concur in Parts I and II of the

majority opinion. As to Part III, I agree with the majority opinion that the time-price

differential is recoverable under the statute, but I would hold that the attorney fee award

is not integrally related to the price of the materials Wyandotte Electric Supply Company

(Wyandotte) furnished, so it is not recoverable as a sum justly due within the meaning of

the PWBA. Accordingly, I dissent from Part III and would reverse that portion of the

holding of the Court of Appeals that permitted plaintiff to recover attorney fees. Finally,

while I agree with the ultimate conclusion, I also dissent from the majority’s reasoning in

Part IV regarding the award of postjudgment interest. Wyandotte argues under

MCL 600.6013(7) that the interest rate specified in its contract with Electrical

Technology Systems, Inc. (ETS) applies, while defendants argue that the general interest

rate in MCL 600.6013(8) controls. I disagree with the majority’s reasoning, but I

nonetheless concur with the majority’s conclusion that the general interest rate under

MCL 600.6013(8) applies.

I. FACTS AND PROCEDURAL HISTORY 2

Defendant KEO & Associates, Inc. (KEO) was the principal contractor on a

renovation project at the Detroit Public Library in 2009. As required under the PWBA,

defendant Westfield Insurance Company (Westfield) supplied a payment bond and stood

as surety on the bond.

2
Though I concur in the majority’s statement of the facts, I restate the most relevant facts
here for the sake of clarity.

2
 KEO subcontracted with defendant ETS to provide labor and materials for

electrical work on the renovation project. ETS then subcontracted with plaintiff

Wyandotte for materials and supplies, making Wyandotte a sub-subcontractor in relation

to KEO. ETS and Wyandotte had been in an open-account agreement since 2003, and

this contract also governed ETS’s purchases from Wyandotte during the library

renovation. The contract specified that ETS would pay Wyandotte a time-price

differential of 1.5% per month (18% per annum) on invoices unpaid after 30 days. This

provision represented an interest rate for purchases ETS made on credit. The contract

also specified that ETS would pay 33% of any unpaid balance as an attorney fee if

Wyandotte had to pursue collection litigation after a default.

Wyandotte submitted a quote to ETS that included the time-price differential

provision. ETS accepted this quote by issuing a purchase order to Wyandotte on

February 19, 2010. Wyandotte began delivering materials to ETS on March 3, 2010, and

made its last delivery on September 30, 2010. Over the course of the project, ETS

became increasingly behind in its payments to Wyandotte. Eventually, ETS stopped

payment altogether and went out of business. Though KEO claims it paid ETS all that

was owed, Wyandotte never received full payment from ETS. As required by the

PWBA, Wyandotte sent notice to KEO and Westfield on November 1, 2010, claiming it

was owed $150,762.33 for electrical materials furnished to ETS and the time-price

differential. Wyandotte filed a claim with Westfield on January 28, 2011, to recover on

the payment bond. Westfield denied the claim.

Wyandotte filed a PWBA suit against ETS, KEO, and Westfield on March 14,

2011, and moved for summary disposition. The trial court granted the motion in part,

3
holding that the bond claim was valid and that, under its contract with ETS, Wyandotte

could recover both the time-price differential and attorney fees. A bench trial was held

on the issue of damages. The trial court held that Wyandotte was owed a balance of

$154,343.29, a time-price differential of $76,403.44, and attorney fees of $30,000.

Wyandotte requested postjudgment interest under MCL 600.6013(7), which the trial

court granted. The Court of Appeals affirmed this judgment in an unpublished opinion.

II. ATTORNEY FEES

MCL 129.207 of the PWBA reads as follows:

A claimant who has furnished labor or material in the prosecution of
the work provided for in such contract in respect of which payment bond is
furnished under the provisions of [MCL 129.203], and who has not been
paid in full therefor before the expiration of a period of 90 days after the
day on which the last of the labor was done or performed by him or
material was furnished or supplied by him for which claim is made, may
sue on the payment bond for the amount, or the balance thereof, unpaid at
the time of institution of the civil action, prosecute such action to final
judgment for the sum justly due him and have execution thereon.[3]

When contractors are not fully paid after providing labor or materials for a public

project, this statute permits them to sue on the payment bond for the amount unpaid at the

time the civil action is instituted. The extent of defendants’ statutory liability is the “sum

justly due.” 4 As the majority opinion correctly states, the phrase “amount . . . unpaid” 5

implies a “previous expectation of payment of a certain sum.” Because the statute gives

3
Emphasis added.
4
MCL 129.207.
5
Id.

4
no further direction on how to calculate the sum justly due, we examine the underlying

contract to determine the parties’ expectations. In this case, the open-account agreement

from 2003, Wyandotte’s quote for the library project, and ETS’s purchase orders for the

project collectively constitute the basis for determining Wyandotte’s contractual

expectations. 6 I concur with the majority’s analysis of the time-price differential and

attorney fee issues up to this point and with the majority’s conclusion that the trial court

properly awarded Wyandotte the time-price differential.

I dissent from the majority opinion as to its further analysis of, and conclusion

regarding, the attorney fee provision. The majority holds that, merely because the

attorney fee provision was part of the open-account agreement with ETS, the trial court

appropriately included the attorney fee in its judgment. This approach treats the PWBA

as if it creates a statutory breach of contract claim. I respectfully disagree. The statute

only makes compensable the unpaid costs of labor or materials furnished. Thus, the

statute limits a claimant’s recovery to the contractual terms that are related to the price of

labor or materials furnished. While both the time-price differential and the attorney fee

provision are listed in Wyandotte’s agreement with ETS, only the former actually relates

to the cost of furnishing the materials, so the trial court should not have awarded

Wyandotte an attorney fee.

6
Because each instrument was related to the same subject matter (i.e., Wyandotte’s
provision of materials to ETS), we read these instruments together, as required under
Culver v Castro, 126 Mich App 824, 826; 338 NW2d 232 (1983), citing Reber v
Pearson, 155 Mich 593; 119 NW 897 (1909). Furthermore, the PWBA allows sub-
subcontractors, like Wyandotte, to rely on agreements that govern a continuing
contractual relationship with a subcontractor, like ETS.

5
 I would hold that MCL 129.207 requires us to consider whether a provision of an

underlying contract used to determine the expectancy of the unpaid contractor is

integrally related to the cost of labor or materials furnished for the project. MCL 129.207

allows a claimant to sue on the payment bond for the amount unpaid and recover the sum

justly due him. The statute defines the amount unpaid in terms of the cost of labor and

materials provided on the project, stating that “[a] claimant who has furnished labor or

material . . . and who has not been paid in full therefor . . . may sue on the payment bond

for the amount, or the balance thereof, unpaid . . . .” 7 In other words, the PWBA entitles

a claimant to full payment for the labor or materials furnished; a claimant is not entitled

to full damages that might otherwise be available for a breach of contract claim.

Therefore, we should hold the principal contractor and surety liable for only those terms

that are integrally related to the cost of labor or materials supplied, not for any and all

collateral terms in the underlying contract. The majority erred by limiting its review

simply to whether Wyandotte’s claimed damages were allowed by the contract.

Furthermore, the PWBA limits the claimant’s recovery based on when certain

price terms are triggered. MCL 129.207 states:

A claimant who has furnished labor or material in the prosecution of
the work . . . and who has not been paid in full therefor before the
expiration of a period of 90 days after the day on which the last of the labor
was done or performed by him or material was furnished or supplied by
him for which claim is made, may sue on the payment bond for the
amount, or the balance thereof, unpaid at the time of institution of the civil
action, prosecute such action to final judgment for the sum justly due him
and have execution thereon. A claimant not having a direct contractual

7
MCL 129.207.

6
 relationship with the principal contractor shall not have a right of action
upon the payment bond unless . . . he has given written notice to the
principal contractor and the governmental unit involved within 90 days
from the date on which the claimant performed the last of the labor or
furnished or supplied the last of the material for which the claim is made,
stating with substantial accuracy the amount claimed and the name of the
party to whom the material was furnished or supplied or for whom the labor
was done or performed.[8]

MCL 129.207 repeatedly refers to a 90-day period after supplying the last of the

labor or material for which the claim is made. Based on this language, Wyandotte’s

“claim is made” for labor or materials furnished for which Wyandotte “has not been paid

in full therefor before the expiration of a period of 90 days after the day on which the last

of the . . . material was furnished or supplied . . . .” 9 In other words, we must examine the

price terms in the contract that came due by that 90-day deadline but were not paid in

full, for which the claimant may then proceed against the payment bond.

Under this interpretation, Wyandotte’s claim is for the cost of materials furnished,

limited to the price terms under the contract that came due by the 90-day deadline.

Notably, the statute required Wyandotte to notify KEO and Westfield of its claim,

“stating with substantial accuracy the amount claimed . . . .” 10 Wyandotte is then entitled

to sue “for the amount, or the balance thereof, unpaid at the time of institution of the civil

action . . . .” 11 When a claimant receives partial payment between its 90-day notice and

8
Id. (emphasis added).
9
Id.
10
Id.
11
Id.

7
the institution of its action under the PWBA, the amount unpaid will be less than the

amount originally claimed in the notice. In the present case, Wyandotte was paid nothing

between its 90-day notice and the time it filed its PWBA suit, so the amount unpaid is the

entire amount owed, based on the price terms in its contract with ETS that triggered by

the 90-day deadline. 12

The majority claims that the plain language of the statute does not support this

interpretation. However, the majority only cites a portion of the statute for this

contention rather than reading the provision as a whole. The majority fails to analyze the

full portion of MCL 129.207 quoted in this opinion, namely that “[a] claimant who has

furnished labor or material . . . and who has not been paid in full therefor . . . may sue on

the payment bond for the amount, or the balance thereof, unpaid . . . .” Thus, the statute

plainly states that the claimant may only sue for the amount unpaid for labor and

materials the claimant supplied, thereby limiting the claimant’s recovery to the cost of

labor and materials supplied. The majority opinion is internally inconsistent because,

although the majority acknowledges that Wyandotte’s claim against defendants is not a

contract claim and does not arise directly out of the contract, the majority uses the

entirety of the contract as a measure of Wyandotte’s damages. Instead, the PWBA

12
The majority misconstrues my argument, stating, “He argues that MCL 129.207 limits
a claimant’s potential recovery to the amount unpaid 90 days after supplying the last of
the labor or materials in question.” The 90-day deadline does not cap the amount of
damages that a claimant may recover. Instead, the deadline merely determines which
price terms have triggered and, therefore, which categories of damages may be included
in the claimant’s recovery. For example, when a time-price differential or similar
provision is applicable, the amount unpaid may increase between the time the claimant
gives its 90-day notice and the time the civil action is instituted, as in the present case.

8
instructs us to use the contract only to establish Wyandotte’s expectancy regarding the

cost of labor or materials Wyandotte furnished but was not paid for. 13

The time-price differential is inextricably related to the cost of materials furnished

for the library project and the provision triggered before Wyandotte gave its 90-day

notice: it is a part of the price term of the agreement with ETS and the provision applied

to invoices that went unpaid after 30 days. In Wyandotte’s contract with ETS, the time-

price differential provision states, “Time price differential charges of 1-1/2% per month

(18% per annum) are calculated on all invoices that are not paid and past due 30 days or

more.” This provision created an interest rate for purchases ETS made on credit, which

compensated Wyandotte for delayed payment. Wyandotte included this amount in the

quote it submitted to ETS as a cost of materials. The Court of Appeals adequately

explained in Price Bros Co v Charles J Rogers Constr Co why such a cost differential is

closely related to the expectancy that is properly considered as the sum justly due under

the PWBA:

[T]he differential is an integral part of the cost of the transaction. If the
buyer pays cash, the seller receives the money immediately and no burden
is placed on him. If the buyer elects to purchase on credit, the seller is

13
I am not persuaded by the majority’s argument, citing United States ex rel Maddux
Supply Co v St Paul Fire & Marine Ins, 86 F3d 332 (CA 4, 1996), that certain federal
circuit courts have interpreted the Miller Act, 40 USC 3131 et seq., to allow recovery of
attorney’s fees. In Maddux Supply Co, the Fourth Circuit specifically noted that allowing
recovery of attorney’s fees was consistent with its prior rulings “that contractors and their
sureties are obligated to pay amounts owed by their subcontractors to suppliers.” Id. at
336. The PWBA does not require a general contractor or its surety to pay the amount
owed by a subcontractor to a sub-subcontractor. Instead, as I have explained, the PWBA
explicitly limits recovery to the amount unpaid for labor or materials furnished. See
MCL 129.207.

9
 burdened by the interruption to its cash flow, and so the buyer may pay a
“price” for the benefit of receiving the materials without paying for them
immediately.[14]

Accordingly, the time-price differential is an integral part of the sum justly due for

materials Wyandotte supplied on the renovation project because it establishes an interest

rate that directly relates to the price of the materials Wyandotte furnished when ETS paid

on credit.

In contrast, the attorney fee is not closely associated with the cost of materials

furnished for the library project. The attorney fee provision in the contract states, “In the

event your account is placed in the hands of an attorney for collection after default, the

customer agrees to pay 33% of the unpaid balance for attorney’s fees together with

applicable costs.” The language of this provision indicates that attorney fees are

unrelated to the cost of materials because, unlike the time-price differential, they bear no

relation to the cost of supplying labor or materials. The attorney fee provision creates a

penalty for collection efforts rather than determining Wyandotte’s expectancy—i.e., the

price ETS owed for materials Wyandotte supplied. Indeed, it does not appear to be an

attorney fee provision at all, because it does not define itself in terms of actual or

reasonable attorney fees. It is, in fact, a liquidated damages clause that plaintiff could

invoke if it placed an overdue debt into the hands of a collecting attorney. 15 Because this

14
Price Bros Co v Charles J Rogers Constr Co, 104 Mich App 369, 377; 304 NW2d 584
(1981) (emphasis added).
15
See UAW-GM Human Resource Ctr v KSL Recreation Corp, 228 Mich App 486, 508;
579 NW 2d 411 (1998) (“A liquidated damages provision is simply an agreement by the
parties fixing the amount of damages in case of a breach.”). In this agreement, if ETS
breaches by defaulting on its payments and Wyandotte must litigate to recover the

10
provision describes a liquidated collection cost rather than a cost of the labor or materials

themselves, it is not part of the sum justly due.

Furthermore, the attorney fee provision did not trigger by the 90-day deadline. In

its 90-day notice to KEO and Westfield, dated November 1, 2010, Wyandotte claimed

that the amount owed included the cost of materials furnished to ETS and the time-price

differential. Wyandotte did not claim that it was owed an attorney fee because the

provision had not yet triggered—Wyandotte did not sue ETS, KEO, and Westfield until

March 14, 2011, which was well after the 90-day period that began to run on September

30, 2010. Thus, Wyandotte’s “amount claimed” 16 does not include an attorney fee

because not only is the attorney fee provision not a price term related to the cost of

amount owed, the attorney fee provision fixes Wyandotte’s damages: Wyandotte may
recover the unpaid balance plus an additional 33% of that unpaid balance. In regard to
attorney fee provisions and liquidated damages clauses, Williston on Contracts states:

It is a common provision in promissory notes, and an occasional
stipulation in other kinds of contracts, especially mortgages, that in case of
breach, the promisor will pay an attorney’s fee, the percentage or amount of
which is sometimes stated, for enforcing the obligation. There seems no
occasion to distinguish between mortgages and other contracts with
reference to such a provision, which is clearly in the nature of a liquidated
damages provision.

* * *

The contract sometimes makes no provision concerning the amount
of the stipulated fee; sometimes it fixes a sum, either by stating a
percentage of the principal debt or by stating a lump sum. [24 Williston,
Contracts (4th ed), § 65:23, pp 319-324 (emphasis added; citations
omitted).]
16
MCL 129.207.

11
materials Wyandotte furnished, as already explained in this opinion, but the provision

also did not trigger by the 90-day deadline.

Therefore, while I agree with the majority that the time-price differential was

properly included in Wyandotte’s award, I would hold that Wyandotte is not entitled to

the attorney fee award because it is not directly related to the cost of materials it supplied.

The attorney fee provision also triggered after the 90-day deadline created by the statute.

III. POSTJUDGMENT INTEREST

There are two relevant statutes on postjudgment interest in this case. Defendants

argue that postjudgment interest should have been calculated under the default formula

given in MCL 600.6013(8). 17 Instead, the trial court awarded Wyandotte postjudgment

interest under MCL 600.6013(7), which states:

For a complaint filed on or after July 1, 2002, if a judgment is
rendered on a written instrument evidencing indebtedness with a specified
interest rate, interest is calculated from the date of filing the complaint to
the date of satisfaction of the judgment at the rate specified in the
instrument if the rate was legal at the time the instrument was executed. If
the rate in the written instrument is a variable rate, interest shall be fixed at
the rate in effect under the instrument at the time the complaint is filed.

17
MCL 600.6013(8) states:

Except as otherwise provided in subsections (5) and (7) and subject
to subsection (13), for complaints filed on or after January 1, 1987, interest
on a money judgment recovered in a civil action is calculated at 6-month
intervals from the date of filing the complaint at a rate of interest equal to
1% plus the average interest rate paid at auctions of 5-year United States
treasury notes during the 6 months immediately preceding July 1 and
January 1, as certified by the state treasurer, and compounded annually,
according to this section.

12
 The rate under this subsection shall not exceed 13% per year compounded
annually.[18]

MCL 600.6013(7) only applies when the judgment is rendered on a written

instrument. According to the majority, this means MCL 600.6013(7) only applies if the

written instrument is the actual basis of the judgment. However, I believe that the

majority mistakenly concludes that the judgment was rendered on the PWBA rather than

on a written instrument. As noted in the majority opinion and earlier in this opinion,

although the PWBA creates Wyandotte’s cause of action, the trial court must examine the

underlying agreement between Wyandotte and ETS to determine what sum is justly due.

The agreement here is as much the basis for the trial court’s judgment as the statute itself,

so the judgment is rendered on a written instrument. Therefore, I believe it is most

accurate to say the trial court’s judgment is rendered pursuant to the statute, but it is

rendered on the underlying contract.

But there is an even more compelling reason to reject MCL 600.6013(7) as the

basis for determining postjudgment interest. MCL 600.6013(7) does not apply because

the underlying contract does not evidence indebtedness. MCL 600.6013(7) only applies

“if a judgment is rendered on a written instrument evidencing indebtedness with a

specified interest rate . . . .” 19 In this case, the agreement between Wyandotte and ETS

did not evidence indebtedness for the simple reason that ETS did not owe plaintiff

anything on the construction project at the time they entered into the agreement. Rather,

18
Emphasis added.
19
Emphasis added.

13
the agreement merely provided structure for calculating a potential future debt. The plain

language of MCL 600.6013(7) requires that the written instrument provide evidence of an

existing debt, not evidence of a potential debt. “Evidence of indebtedness” is a term of

art. 20 Indeed, when our statutes use the phrase “evidence of indebtedness,” they do so in

contemplation of debt-bearing contracts or notes. 21 I therefore concur with the majority

that the general interest rate under MCL 600.6013(8) applies, but I do so because the

underlying contract does not provide evidence of indebtedness as required by

MCL 600.6013(7).

IV. CONCLUSION

I do not believe Wyandotte is entitled to attorney fees. The so-called attorney fees

specified in Wyandotte’s agreement with ETS are not related to the price of the materials

20
See MCL 8.3a (“[T]echnical words and phrases, and such as may have acquired a
peculiar and appropriate meaning in the law, shall be construed and understood according
to such peculiar and appropriate meaning.”).
21
See Const 1963, art 9, § 31 (“The limitations of this section shall not apply to taxes
imposed for the payment of principal and interest on bonds or other evidence of
indebtedness . . . .”); MCL 12.272(d) (“ ‘Bond’ means a bond, note, financial instrument,
or other evidence of indebtedness or obligation issued by the authority under this act.”);
MCL 41.284 (“In lieu of borrowing money and issuing bonds or other evidence of
indebtedness . . . .”); MCL 120.15 (“[T]he commission is authorized and empowered to
issue notes, bonds or other evidences of indebtedness which shall be a lien upon the
property to be acquired . . . .”); MCL 207.634 (“Bonds, obligations, or other evidences of
indebtedness of the local governmental unit . . . .”); MCL 324.50102(3) (“ ‘Bond’ means
a bond, note, or any other instrument issued to evidence indebtedness.”);
MCL 388.981b(1) (“The state administrative board may authorize and approve an interest
rate exchange or swap, hedge, or similar agreement or agreements in connection with the
issuance of bonds, notes, or commercial paper issued under this act or in connection with
outstanding bonds, notes, or commercial paper, or other obligations or evidence of
indebtedness of this state under this act.”).

14
Wyandotte furnished nor did the provision trigger by the statute’s 90-day deadline.

Therefore, I would hold that attorney fees are not recoverable as a sum justly due and

reverse the Court of Appeals on this issue. Furthermore, I do not agree with the

majority’s reasoning regarding the award of postjudgment interest. Nevertheless, I

concur with the majority’s conclusion that postjudgment interest should have been

calculated under MCL 600.6013(8) rather than MCL 600.6013(7).

Robert P. Young, Jr.

15
 STATE OF MICHIGAN

SUPREME COURT

WYANDOTTE ELECTRIC SUPPLY
COMPANY,

Plaintiff-Appellee,

v No. 149989

ELECTRICAL TECHNOLOGY SYSTEMS,
INC.,

Defendant/Cross-Defendant,

and

KEO & ASSOCIATES, INC.,

Defendant/Cross-Plaintiff-
Appellant,

and

WESTFIELD INSURANCE COMPANY,

Defendant-Appellant.

ZAHRA, J. (concurring in part and dissenting in part).
This case primarily addresses a single statute, MCL 129.207, under the public

works bond act (PWBA). 1 I agree with my colleagues that this statute does not require a

claimant to provide actual notice of his or her claim to the principal contractor. A

claimant need only provide notice “by mailing the same by certified mail, postage

1
MCL 129.201 et seq.
prepaid, in an envelope addressed to the principal contractor . . . .” 2 Wyandotte Electric

Supply Company satisfied the statutory requirements of notice in this case. I therefore

agree with Part II of the majority opinion. I write separately because I disagree with

majority’s conclusion that Wyandotte may claim attorney fees and a time-price

differential under the payment bond. And while I agree that MCL 600.6013(8) should

govern the calculation of postjudgment interest in this case, I disagree with my

colleagues’ reasoning for rejecting use of MCL 600.6013(7).

I. ATTORNEY FEES AND THE TIME-PRICE DIFFERENTIAL

My disagreement with the majority arises under the first sentence of

MCL 129.207, which states:

A claimant who has furnished labor or material in the prosecution of
the work provided for in such contract in respect of which payment bond is
furnished under the provisions of section 3, and who has not been paid in
full therefor before the expiration of a period of 90 days after the day on
which the last of the labor was done or performed by him or material was
furnished or supplied by him for which claim is made, may sue on the
payment bond for the amount, or the balance thereof, unpaid at the time of
institution of the civil action, prosecute such action to final judgment for
the sum justly due him and have execution thereon.[3]

The majority views the “sum justly due” under this statute as “the amount

provided for in the claimant’s contract, regardless of whether the principal contractor and

2
MCL 129.207.
3
Under, MCL 129.206, the term “claimant” means “a person having furnished labor,
material, or both, used or reasonably required for use in the performance of the contract.”
For purposes of this opinion, a claimant who lacks a direct contractual relationship with
the principal contractor, such as plaintiff Wyandotte, is referred to as a “remote
subcontractor” while a claimant who has a direct contractual relationship with the
principal contractor is referred to as a “subcontractor.”

2
its surety have agreed to that contract’s terms.” 4 The majority adopts this view not based

on the language of the statute, but rather the “the absence of any further direction from

the Legislature regarding how the amount unpaid ought to be determined . . . .” 5 The

majority then compensates for this supposed Legislative shortcoming by imposing its

own view that “the most logical recourse is to the claimant’s underlying contract, which

best illustrates the intent and expectations of the parties to the contract.” 6

The majority’s analysis rests on a false premise. The principal contractor, KEO &

Associates, Inc., was not a party to the claimant’s underlying contract. The contract

between subcontractor Electrical Technology Systems, Inc. (ETS) and remote

subcontractor Wyandotte can only illustrate the intent and expectations of ETS and

Wyandotte. Indeed, KEO did not contractually agree to pay any of its subcontractors,

including ETS, a time-price differential or attorney fees, and there is no basis from which

to conclude that KEO would have agreed to pay a time-price differential or attorney fees

to a party with whom it had no contractual relationship.

There is no dispute among my colleagues that MCL 129.207 provides a remote

subcontractor with a right of action on the payment bond even though it lacks a direct

contractual relationship with the principal contractor. However, simply because a remote

subcontractor may sue on the payment bond under MCL 129.207 does not suggest that its

claim is determined by a contract to which the principal contractor who furnished the

4
Ante at 16.
5
Ante at 16.
6
Ante at 16.

3
payment bond was not a party. The only contract mentioned by the Legislature in

MCL 129.207 is the “contract in respect of which payment bond is furnished,” which

necessarily cannot include a remote subcontractor. Under Michigan law, a remote

contractor’s claim arises solely under the PWBA, which alone forms the basis to assess

its claim.

Further, MCL 129.207 does not suggest that the principal contractor must wholly

indemnify claimants under the PWBA. Rather, MCL 129.207 refers to the extent of a

principal contractor’s liability under the payment bond by identifying the claimant’s

“labor or material in the prosecution of the work,” for which the claimant “has not been

paid in full therefor before the expiration of a period of 90 days after the day on which

the last of the labor was done or performed by him or material was furnished or supplied

by him for which claim is made . . . .” This provision identifies the labor and materials

that form the basis of the “amount, or the balance thereof, unpaid at the time of institution

of the civil action” that the claimant may bring such action for “the sum justly due

him . . . .” While a subcontractor has an actual contract with the principal contractor to

determine the labor and materials it may seek to recoup under the payment bond, a

remote contractor does not have a direct contractual relationship with the principal

contractor. For this reason, MCL 129.207 provides, in regard to remote subcontractors,

that the claimant must provide notice “within 90 days from the date on which the

claimant performed the last of the labor or furnished or supplied the last of the material

for which the claim is made, stating with substantial accuracy the amount claimed and the

name of the party to whom the material was furnished or supplied or for whom the labor

was done or performed.” This notice, as in this case, identifies the labor and materials

4
that the remote contractor has supplied. The “sum justly due” thus includes the labor and

materials previously identified in the 90-day notice that the claimant has supplied but for

which the claimant has not been paid. The only other statutory basis to impose liability

on the payment bond is MCL 129.206, which provides that “ ‘[l]abor and material’

includes that part of water, gas, power, light, heat, oil, gasoline, telephone service or

rental of equipment directly applicable to the contract.” That the Legislature expressly

provided for recovery of these incidental expenses, and these incidental expenses alone,

strongly suggests that incidental expenses not expressly identified are not recoverable as

“labor and material.” 7

To the extent that attorney fees and a time-price differential may even be

considered incidental damages, as opposed to remote damages, they are simply not

recoverable. Further, and perhaps more telling, is that even expenses expressly identified

cannot be recovered unless they are “directly applicable to the contract.” 8 Again, the

only contract mentioned in MCL 129.207 is the “contract in respect of which payment

bond is furnished . . . .” No real argument can be made that attorney fees are directly

related to the contract in respect of which payment bond is furnished. 9 And while a

7
Under the doctrine of expressio unius est exclusio alterius, the express mention in a
statute of one thing implies the exclusion of other similar things. In re MCI Telecom
Complaint, 460 Mich 396, 415; 596 NW2d 164 (1999). As applied to statutory
interpretation, the doctrine reflects, “among other things, a legislative intent not to create
liability outside the extent to which the legislature has acted.” 22 Mich Civ
Jurisprudence, Statutes, § 194.
8
MCL 129.206.
9
On this point, I am in agreement with Chief Justice YOUNG’s partial concurrence and
dissent. As he states, ante at 10-11:

5
colorable argument can be made that a time-price differential is directly applicable to the

contract, a time-price differential is not identified by the Legislature as “[l]abor and

material” costs that may be recovered. 10

Further, MCL 129.203 provides:

The payment bond shall be in an amount fixed by the governmental
unit but not less than 25% of the contract amount solely for the protection
of claimants, as defined in [MCL 129.206], supplying labor or materials to
the principal contractor or his subcontractors in the prosecution of the work
provided for in the contract.

The principal contractor’s liability to remote contractors under the PWBA is solely

based on the payment bond. The amount of the payment bond is fixed by the

governmental unit at no less than 25% of the contract. If a claimant successfully sues on

the payment bond and exhausts the payment bond, which may represent as little as 25%

of the contract, a remote contractor that later sues no longer has no legal recourse to

recover against the bond furnished by the principal contractor. Remote subcontractors

The language of [the attorney fee provision] indicates that attorney fees are
unrelated to the cost of materials because, unlike the time-price differential,
they bear no relation to the cost of supplying labor or materials. The
attorney fee provision creates a penalty for collection efforts rather than
determining Wyandotte’s expectancy—i.e., the price ETS owed for
materials Wyandotte supplied. Indeed, it does not appear to be an attorney
fee provision at all, because it does not define itself in terms of actual or
reasonable attorney fees. It is, in fact, a liquidated damages clause that
plaintiff could invoke if it placed an overdue debt into the hands of a
collecting attorney. Because this provision describes a liquidated collection
cost rather than a cost of the labor or materials themselves, it is not part of
the sum justly due.
10
See MCL 129.206.

6
only have a right to sue the principal contractor on the bond because the PWBA permits a

suit despite the absence of a direct contractual relationship. Significantly, any awards

received under the PWBA cannot cumulatively exceed the amount of the payment bond.

This limitation of the principal contractor’s liability to remote subcontractors is

precisely the reason that the PWBA does not provide for remote subcontractors to seek to

enforce any and all collateral terms in the underlying contract. If a single claimant or

several claimants exhaust the payment bond through an award of a time-price differential

and attorney fees, another remote contractor may not be able to recoup the actual labor

and materials it supplied for the public project. By green-lighting the recovery of remote

damages found in the underlying contracts between subcontractors and remote

subcontractors, the majority arbitrarily countenances the shortchanging of other remote

contractors. In my view, this effectively thwarts the Legislature’s intent that the payment

bond be used “solely for the protection of claimants . . . .” MCL 129.203. The majority

has clearly departed from the statutory language by imposing liability for the amount

provided for in the claimant’s contract, regardless of whether the principal contractor and

its surety have agreed to that contract’s terms.

II. POSTJUDGMENT INTEREST

The trial court awarded Wyandotte postjudgment interest under MCL

600.6013(7) 11 at the time-price differential rate specified in the contract between

11
MCL 600.6013(7) provides:

For a complaint filed on or after July 1, 2002, if a judgment is
rendered on a written instrument evidencing indebtedness with a specified
interest rate, interest is calculated from the date of filing the complaint to

7
Wyandotte and ETS. Because I disagree that Wyandotte is entitled to a time-price

differential under the PWBA, I would reverse the trial court’s award of postjudgment

interest on that basis alone. The majority concluded MCL 600.6013(7) does not apply

here because the judgment was not rendered on a written instrument. Accordingly, the

majority concluded that postjudgment interest must be calculated under the general

statute for determining interest on a money judgment in a civil case, MCL 600.6013(8). I

agree with the majority that MCL 600.6013(8) should govern the calculation of

postjudgment interest, but I disagree with the majority that “[t]he judgment here was not

rendered on a written instrument.” 12

The majority holds that judgment was rendered on Wyandotte’s statutory claim

rather than on the contract itself. This holding misses the entire point of the PWBA.

MCL 129.207 expressly provides that a claimant “may sue on the payment bond . . . .” 13

The payment bond provides that KEO and Westfield Insurance Company

are held and firmly bound unto Detroit Public Library . . . as Obligee . . .
for the use and benefit of claimants . . . in the amount of . . .
$1,302,040.00 . . . for the payment whereof [KEO] and [Westfield] bind
themselves, their heirs, executors, administrators, successors and assigns,
jointly and severally, firmly by these presents.

the date of satisfaction of the judgment at the rate specified in the
instrument if the rate was legal at the time the instrument was executed. If
the rate in the written instrument is a variable rate, interest shall be fixed at
the rate in effect under the instrument at the time the complaint is filed. The
rate under this subsection shall not exceed 13% per year compounded
annually. [Emphasis added.]
12
Ante at 22.
13
Emphasis added.

8
 The payment bond expressly incorporates the contract between KEO and the

library, and then provides:

THE CONDITION OF THIS OBLIGATION is such that if [KEO] shall
promptly make payment to all claimant, as defined in [the PWBA], who
have complied with all the provisions of the [PWBA], for labor and
materials used in the performance of the Contract, then this obligation shall
be void; otherwise it shall remain in full force and effect.

The payment bond is clearly an “instrument” in that it is a “written legal document

that defines rights, duties, entitlements, or liabilities . . . .” 14 But regardless of whether a

payment bond that secures future payment may be considered a written instrument

“evidencing indebtedness,” neither the payment bond nor the contract incorporated by the

payment bond contain “a specified interest rate.” 15 Therefore, while I disagree with my

colleagues’ reasoning on this issue, 16 I nonetheless agree with the result reached that

interest on the judgment should be calculated based on MCL 600.6013(8).

III. CONCLUSION

I agree with the majority that a claimant need not provide actual notice to the

principal contractor under the PWBA. I disagree with the majority however that the

PWBA entitles a claimant to the amount provided for in the claimant’s contract,

regardless of whether the principal contractor and its surety have agreed to that contract’s

14
Black’s Law Dictionary (10th ed).
15
MCL 600.6013(7).
16
I also disagree with Chief Justice YOUNG that the agreement between Wyandotte and
ETS was as much the basis for the trial court’s judgment as the statute itself.

9
terms. Rather, a claimant’s recovery is limited to labor and materials under the PWBA,

and does not include incidental expenses not provided for by the PWBA, such as time-

price differentials and attorney fees. Finally, I agree with the majority’s conclusion that

interest on the judgment should be calculated based on MCL 600.6013(8). Under the

PWBA, judgment is rendered on the payment bond, which is a written instrument

evidencing indebtedness. But because this bond contained no specified interest rate,

MCL 600.6013(7) does not apply.

Brian K. Zahra

10