A case so simple that master strategists could not possibly have planned it into complexity has inadvertently become so snarled that we must painstakingly unthread the backlash to assure the result so evidently required.

Browning-Ferris sued Petty, the prime contractor, Wilson, the subcontractor, and Indemnity Insurance, surety, on a Miller Act, 40 U.S.C.A. § 270, bond for unpaid rental charges for machinery used on a Government contract. Execution of the bond and the giving of the 90-day notice by the materialman to the prime contractor, 40 U.S.C.A. 270b(a), was admitted.1 So the area of controversy was confined to the defense that (a) the machinery was in subcontractor's hands under a lease-purchase, rather than a rental, contract, and (b) the machinery had been used on the job 5 days only rather than 38 as claimed. On the close of all of the evidence, the Court denied the motions of all parties for a directed verdict and submitted the case to the jury by a charge to which no exceptions were taken.

It was here that the trouble started. Despite his denial of all defendants' motions for directed verdict then just immediately announced, the Court in his charge instructed the jury to find for Petty, prime contractor.2 But this the jury did not do. It returned a verdict for the plaintiff, but, literally, against none.3 The final judgment under review here adjudged recovery against Wilson, the subcontractor, and the surety but in favor of Petty.4

Except for their respective motions for directed verdict, all declined, no one, up to this point, made any objection to the actions of the Trial Court. This era of contentment ended shortly when new, separate counsel appeared for the surety contending that the rendered judgment could not properly stand against the surety since the principal (Petty) had been discharged.5 These motions denied, this appeal ensued, the surety now urging that the judgment should be reformed to discharge the surety if the principal, Petty, remains discharged; that the judgment be reformed to render judgment for plaintiff against Petty, and that the surety be given judgment over against Petty and Wilson.

It is clear, indeed conceded by all except Petty, that the instruction to the jury and the judgment dismissing Petty was wrong. The suit was on the bond in which Petty was a principal obligor. If, on the factual basis, the surety was liable, so was the principal. But if wrong, what are the consequences?

The surety urges, albeit somewhat faintly and most likely as a makeweight for reformation of the judgment to hold Petty equally liable, that on a familiar rule of suretyship where the principal has been discharged, it is an automatic release of the surety.6

No contention is made here, or below, that on the facts and the jury verdict there was any real, meritorious basis for discharging the surety. The plea, thus made, is the harsh one that since the Trial Court committed patent error, we must compound it by one of our own. The law is no such strait jacket, either generally, or in a Miller Act situation specifically. That Act, and bonds furnished under it, present matters for application of federal law, Continental Casualty Company v. Schaefer, 9 Cir., 173 F.2d 5; Liebman v. United States, 9 Cir., 153 F.2d 350, the underlying approach of which is that, 'technical rules otherwise protecting sureties from liability have never been applied in proceedings under this statute,' Illinois Surety Co. v. John Davis Co., 244 U.S. 376, 37 S. Ct. 614, 61 L. Ed. 1206. Fleisher Engineering & Construction Co. v. United States, 311 U.S. 15, 61 S. Ct. 81, 85 L. Ed. 12. Justice requires that plaintiff, already long delayed in the amounts so clearly due through circumstances wholly uninvited by it, obtain the benefits of the judgment against the surety and it will be affirmed.

It seems equally plain that the judgment dismissing Petty was wrong and that the surety, whose rights are likely to be adversely affected if it stands, has taken adequate, timely steps for review by us. The point was plainly reserved in the motions for new trial and to amend and reform the judgment. The fact that the surety's counsel7 did not except to the Court's charge (footnote 2 supra) discharging Petty is not an acquiescence in the subsequent erroneous judgment, specifically excepted to, since the jury, though instructed to do so, failed to return a verdict for Petty8 and the judgment recitation is incorrect on the fact of such a verdict, or that the evidence was undisputed in favor of Petty. Disregarding all that occurred prior to the retirement of the jury, the judgment as entered was wrong in fact. The surety promptly and sufficiently pointed this out.

Thus far it is simple-- the judgment for Petty was wrong and must be reversed. The serious question is whether we can now order the Trial Court to do what ought to have been done or must we send it back for a new trial as to Petty?

We cannot direct the entry of such a judgment on the theory that the Trial Court, upon the plaintiff's motion for directed verdict, should have done so below, for there are issues of fact requiring jury decision. That is not decisive, however, since we think that there has already been a jury verdict adverse to Petty on all of the issues he was entitled to have submitted. It must be remembered that the liability here asserted is that on the bond to respond for unpaid claims against subcontractors. Petty's liability flowed therefore from that imposed on Wilson, the subcontractor. Where a subcontractor is involved, as here, the liability of the prime contractor, as principal, is derivative and the issues to be submitted, whether specially or by general verdict, relate only to the subcontractor.9 As framed by the pleadings and as made by the evidence, the controversy was narrowed to the simple one of whether Wilson had purchased rather than rented, and if rented, the extent of the use on the federal job site.

Had the Trial Court, therefore, not given the erroneous direction freeing Petty, there would have been nothing submitted not already in the charge. It would have been precisely as it was concerning the surety, since under the form of instructions used the jury was not charged, nor was it necessary to do so, to find for the plaintiff and against the surety. Considering the broad scope of the Trial Court's discretion and the elastic flexibility of the form of submission of a case to the jury, the charge of the Court and the verdict returned constitute, in a very real and practical sense, an adequate special verdict, or a general one with special interrogatories under Rule 49(a), (b) revealing on their face consistency between the general and the special, and clear-cut, categorical answers on the crucial ultimate fact issues.10

Assuming that Petty can still insist that he was entitled to a jury trial which he induced the Court not to give him, that right was related to the situation presented and whether submitted generally or specially, the issues were, and had to be, those actually determined by the jury. On the basis of the implied finding of a rental, not a sales, agreement, the jury found, with precision, the actual use on the job site for 38 days and the agreed daily rental of $50.00. Petty, on this record, could have requested no others and these specific findings, together with the general finding for the plaintiff, demonstrated that on all issues the jury found adversely to Wilson. That was the equivalent of a finding against Petty. So viewed, we treat it as though the verdict spelled out by name the parties and all of the issues of dispute which were necessarily and unavoidably determined. See Bolan v. Lehigh Valley R. Co., 2 Cir., 167 F.2d 934; Gulf Refining Co. v. Fetschan, 6 Cir., 130 F.2d 129. Petty has had, in effect, a jury trial.11 He is not entitled to another one.

The surety also urges that the Trial Court should have permitted the filing of a cross claim, F.R.C.P. 13(g). That this comes after judgment would not bar action since Rule 15(b) gives substantial latitude to amend even then. We mean always to infuse vitality in Rule 15. Copeland Motor Co. v. General Motors, 5 Cir., 199 F.2d 566; Grandey v. Pacific Indemnity Co., 5 Cir., 217 F.2d 27; Gifford v. Wichita Falls, 5 Cir., 224 F.2d 374. We cannot hold, however, that the judge's refusal exceeded his permissible discretion since, unlike Petty's position vis-a-vis the plaintiff in which all issues open to Petty were resolved by the existing verdict, the issues, if any, solely between surety and principal were no part of the case either in evidence, submission, or verdict.12 Additionally, the surety will have this opportunity on remand.

Accordingly, the judgment in favor of the use plaintiff, Browning-Ferris Machinery Company, against Joe J. Wilson and the surety, Indemnity Insurance Company of North America, is affirmed; so much of the judgment dismissing John A. Petty is reversed and remanded with direction to the Court to enter judgment against John A. Petty; and in those proceedings below the surety, upon payment to the plaintiff, may, if it sees fit, file in its answer a cross claim against Petty for exoneration and indemnity and for such further and other proceedings consistent herewith, United States for Use and Benefit of Wheeler v. American Surety Co., 2 Cir., 142 F.2d 726.

Affirmed in part; Reversed and remanded in part, with directions.