45 W. Va. 490 | W. Va. | 1898
Lead Opinion
On the 10th day of February, 1897, the Improvement, Loan and Building Association of Martinsburg, a corporation under the law's of the State of West Virginia, A. C. Nadenbousch, trustee, and Harvey T. Cushwa and Harry S. Cushwa, partners trading under the firm name of H. T. Cushwa & Bro., appeared in open court in the circuit court of Berkeley County, and filed their bill in chancery against the Auburn Wag-on Company, a corporation, U. S. G. Pitzer, trustee, and others, in which, among- other things, they alleged that on February, 18,1896, the defendant the Auburn Wag-on Company, a corporation under the laws of Pennsylvania, and a citizen of said state, was the-owner in fee of a lot of ground in the town of Martins-burg, Berkeley County, W. Va., containing two acres, three roods, and ten poles, and on that date executed a deed of trust to said Nadenbousch, trustee, on said lot,
The Auburn Wagon Company excepted to the commissioner’s report so far as it audited as a first lien on its property the claim of said Cushwa & Bro. for the sum of four thousand one hundred and two dollars and ninety-one cents: (1)Because the testimony shows that said wagon company on the 15th of August, 1896, made a settlement with said Cushwa & Bro., in which it gave to them its three negotiable notes each for the sum of one thousand one hundred and sixty dollars and thirty-one cents (in all, three thousand four hundred and eighty dollars and ninety-three cents), which were accepted by said firm in full payment of said claim, and full discharge of the contract under which the said claim arose, except as to the mailing office mentioned in said agreement, to be supplied by the said claimant for the sum of four hundred and seven dollars and forty-seven cents. (2) Because the pleadings and testimony show that, prior to the time the said claimant furnished any work or materials for the improvements upon which the said mechanic’s lien set up is founded, the said claimants had notice of a contract in writing of the wagon company with the loan and building association whereby the said association agreed to advance the sum of money mentioned in the bill, in the manner therein stated, and which are audited as a second lien on said wagon company’s property, and also the agreement evidenced by the said contract to secure the payment of the said sums of money in the manner set out in said bill, and audited as aforesaid, by deed of trust on said property, which should be a first lien thereon. Depositions were taken and filed, and a decree was rendered on the 9th of November, 1897, sustaining the exception of said wagon company to said commissioner’s report, so far as it held the mechanic’s lien claimed by H.' T. Cushwa & Bro.. amounting to four thousand one hundred and two dollars and ninety-one
Counsel for the appellees claim that the appellants acquired no mechanic’s lien, for the reason that during the progress of the work payments were made on account of said wagon company to H. T. Cushwa & Bro. by the loan and building association, through H. T. Cushwa, its president, by his checks as such, and on the completion of the contract a settlement'was made between said wagon company and appellants, and an ascertained balance of three thousand four hundred and eighty dollars and ninety-three cents was settled “in full for contract and extras, except mailing- office,” by the acceptance of three negotiable notes, each for one thousand one hundred and sixty dollars and thirty-one cents, executed on the 15th of August, 1896, by the Auburn Wagon Company,’payable to H. T. Cushwa & Bro., four, five, and six months, respectively, from their date. Now, while it is true said notes were executed as above stated, and a receipt given on the same day in the following words: “Received of Auburn Wagon Company, Mai'tinsburg, W. Va., three thousand four hundred and eighty dollars and ninety-three cents, ($3,480.93), for bill August 13, in full for contract and extras, except mailing office. [Signed] H. T. Cushwa & Bro.” — yet this receipt was merely frima facie evidence of the fact therein stated. Upon this question we find the law thus laid down in 1 Greenl. Ev. (15th Ed.) s. 305 : “In regard to receipts, it is to be noted that they may be either mere acknowleg-ments of payment or delivery, or they may also contain a contract to do something to the thing delivered. In the the former case, and so far as the receipt goes only to acknowledge payment or delivery, it is merely frima facie evidence of the fact and not conclusive, and therefore the fact which it recites may be contradicted by oral testimony.” So, also, 2 Tayl. Ev. s. 1124, say: “Therefore, except in some few special cases, a receipt, so far as it as a mere admission, is not conclusive evidence of the payment therein acknowledged, but the party signing it may
It is contended that the debt due or to become due to the Improvement, .Roan and Building-Association, secured by the trust deed, for thirty-seven thousand four hundred and ninety-seven dollars was entitled to priority over said mechanic’s lien. Is this position correct? In considering this question, we notice first the fact that on February 18, 1896, a written contract was entered into between the Auburn Wagon Company and H. T. Cushwa & Bro., with elaborate specifications thereto annexed, for the- erection of certain building-s on its lots in the town of Martinsburg, in accordance with said specifications, with certain minor exceptions, for the sum of twenty-one thousand nine hundred and fifty dollars, which exceptions were to be paid for as extras, which was, and must be considered, an entire contract. It is shown by the testimony that EL T. Cushwa & Bro. began the work under this contract on February 10, 1896, and completed it September 4, 1896. The work was pushed right along, and said Cushwa, when asked what amount of work and material in money was done and furnished prior to March 9, 1896, answered that they were excavating and building the foundation during that time, which was a part of the contract. The deed of trust in favor of the building association above mentioned was admitted to record in Berkeley County on the 9th of March, 1896. Did the fact that this trust deed was executed and recorded after the appellants had commenced work under said contract entitle said trust deed to priority over said mechanic’s lien? If such be the case, the mechanic’s lien law affords very little protection to the contractor in this State, since the party who employs him to erect buildings upon his lands can defeat his lien, when the work is almost completed, by executing a deed of trust on the property. The rig-ht to execute and record such trust deed one day or one month, as in this case, after the work has commenced under the contract, implies the right to create such trust deed, and take priority over the mechanic’s lien, at any time while the work is in process of completion. Our statute (Code, p. 652, s. 2) provides that every mechanic, etc., who shall perform any work or fur
In the case of Manufacturing Co. v. Brockmyer, 18 W. Va. 591, Green, Judge, delivering the opinion of the Court, says: “The statute itself provides expressly that such lien shall have priority over every lien created by deed or otherwise on such house,” etc,, ‘subsequent to the time when such labor shall be performed, and material furnished.’ This would, it seem to me, by its clear language, give a lien from the time when the labor commenced on the buildings, or the matarial commenced being furnished, though, by the third section, thirty days after the labor ceased, or the material has ceased to be furnished?
Now, as between the Auburn Wagon Company and Cush-wa & Bro., the mechanic’s lien of the latter surely attached from the time they commenced performing the contract, and after that said wagon company could only convey the property to a trustee subject to the mechanic’s lien, as they could only convey the property as they held it. In 15 Am. & Eng. Enc. Law, p. 191, it is said : “Mechanic’s and laborers asserting a lien upon real property for their work, and claiming priority over mortgagees and others who have acquired interests in the property, must furnish strict proof of all that is essential to the creation of the lien; and this rule requires them to prove when the work was commenced, the character of the work, and when it was completedciting Bank v. Winslow, 3 Minn. 87, [Gil. 43) and Davis v. Alvord, 94 U. S. 545, in which last named case Justice Field, speaking of the mechanic’s lien law, says ; “The statute was designed to give security to those who, by their labor, skill, and materials, add value to the property by a pledge of the interest of their employer for their payment; and for that purpose it subordinates all other interests acquired subsequent to the commencement of their work, although no notice that a lien may even be claimed is required, except within sixty days after the work is completed.” See Bank v. Dashiell., 25 Grat. 616.
It is clearly shown in this case that the work was commenced under this contract more than a week before the deed of trust was recorded. By commencing the work, Cushwa & Bro. acquired a vested right, which could not be overthrown or superseded by said deed of trust. To hold otherwise would be to hold that a deed of trust executed and recorded one day before the work was completed would take priority over the contractor’s entire claim. I therefore hold that our statute must be construed to intend that the lien attaches when the performance of the work commences. In view of the authorities above cited,
Dissenting Opinion
(dissenting) :
I respectfully dissent from the majority of the Court in this case, for the reason that they hold, in effect, by point 5 of the syllabus, that the clause in section 2, chapter 75, of the Code, to-wit: “The liens authorized by this and the next preceeding section shall have priority over any lien created by deed or otherwise on such house or other structure and the lots on which the same are erected subsequently to the time when such labor shall have been performed or material or machinery furnished,” is equivalent to the words, “The hen created by this act shall be preferred to every other lien or incumbrance which shall have attached upon said property subsequent to the time at which the work was commenced or the material furnished, and no incumbrance upon the land created after the making of the contract for the erection of a building upon such land shall operate upon the building erected until the lien in favor of persons doing the work or furnishing the materials shall have been satisfied,” contained in the statutes of Virginia, Minnesota, and Montana, and I might add Missouri, New Jersey, Maryland, and Connecticut, and other states and territories haying similar provisions to the Virginia statute. Some states begin the lien from the making of the contract. Bell v. Cooler, 26 Miss., 650. Statutes have changed from time to time in
Section 2, chapter 75, Code, provides, in its first clause, that “every mechanic, builder, artisan, workman, laborer, or other person who shall perform any work or labor upon or furnish any material or machinery for constructing, altering, repairing or removing a house, mill, manufactory or buildings, appurtenances, fixtures, bridge or other structure, by virtue of a contract with the owner or his authorized agent, shall have a lien to secure the payment
In the present case the Improvement, Loan and Building Company had a prior equitable lien on the property involved, of which Cushwa & Bro. had actual notice, the object of such lien being for the purpose of securing money to pay for building on the property. With full knowl-dge of such lien, Cushwa & Brother contracted to put up such-buildings, and this lien is referred to, and certain provisions made in relation thereto in the contract. They did a small amount of work in getting out stone for the foundation, when, on the 9th of March, 1896, the prior equitable lien became • effective by recordation. They went on and completed their contract by the 1st of September. It amounted, including extra work, to twenty-two .thousand nine hundred and eighteen dollars and ninety-five cents, on which they received, pi esumably out of the money furnished by the improvement company, nineteen thousand and thirty dollars and fifty-three cents, leaving a a balance unpaid, which was really not due until the 1st of August, of three thousand eight hundred and eighty-eight dollars and forty cents, and which, with interest added, will probably eat up the whole sum for which the lot and buildings sold, and leave nothing to be applied on the large debt of nearly forty thousand dollars due and coming- to the improvement company; and 'this Court, in giving a strained and unwarranted construction to the statute, permits this to be done, although plainly unjust and inequitable. The only excuse given for this is that the rights of the mechanic must be protected, although subsequent, both in equity and in law, to the person who furnishes the money, without which no building could have been built, or
In the amendment of the Court’s opinion in this case since the rehearing was applied for, attention is, with some dqgree of exultation, directed to the dictum of Judge Green, in the case of Manufacturing Co. v. Brockmyer, 18 W. Va. 591, in which he says, in commenting on a similar statute: “This would, it seems to me, by its clear language, give a lien from the time when the labor commenced on the buildings, or the material commenced being funiished, though, by the third section, thirty days after the labor ceased or the material has ceased to be furnished are given within which to record the lien. Thus for a time it is a'secret lien. The mechanic’s lien begins from the day the work is begun, according to what I think is its plain meaning. Similar statutes have been generally so construed. See Wells v. Canton Co., 3 Md. 234.” It is undoubtedly true that the lien begins when the woi-k commences but it only extends so as to cover the work and labor actually performed and material furnished, and as performed and furnished, and does not extend to cover the whole contract in advance of its performance. If this is the meaning of Judge Green — and his language plainly
There is another matter which detracts greatly from the equity of the conclusion reached in this case. H. T. Cushwa, one of the membersof the firm of Cushwa & Bro., was president of the Improvement, Loan and Building Association on the 10th day of December, 1895, and as such president he entered into and signed a contract with T.C. Wood; president of the Auburn Wagon Company, which contract was acknowledged by said Cushwa on the 17th day of January, 1896, and by which the said building association agreed to loan said wag-on company the sum of forty thousand dollars, to secure which the deed of trust in controversy was afterwards given and recorded. This contract was also recorded on the 13th day of March, 1896, before any considerable proportion of the work had been done by Cushwa & Bro., on their contract, and the part for which they now claim a lien was not completed until pionths afterwards. This contract contains the following provision, to-wit: “The said party of the first part hereby covenants and agrees to and with the said party of the second part that it will loan to said party of the second part the sum of forty thousand dollars in installments as follow : Five thousand dollars on thel5th day of February, J.896, less the dues on said four hundred shares of stock from the 16th day of December, 1895, and the sum of one thousand dollars advanced by the said party of the first part to pay the purchase money to W. T. Stewart, guardian, etc., for the pracel of land in said city of Martinsburg, ly
Reversed.