De La Vergne Refrigerating Mach. Co. v. Montgomery Brewing Co.

57 F. 111 | 5th Cir. | 1893

TOULMIN, District Judge,

after stating the case, delivered the opinion of the court.

The question presented to the court for its decision is whether, under the statutes of Alabama relating to the liens of material men, a lien shall be deemed lost unless all persons, as mortgagees or other incumbrancers, interested in the property charged with the lien, are made parties to the suit for the enforcement thereof within six months after the maturity of the indebtedness. The sections of the statute bearing upon the question are as follows:

“Sec. 3018. Dion Declared. Every mechanic or other person, who shall dp or perform any labor upon, or furnish any material, fixtures, engine, boiler or machinery for any building- or improvement on land, or for repairing- the same, under or by virtue of any contract with the owner or proprietor thereof, or his agent, trustee, contractor or subcontractor, upon complying with the provisions of this chapter, shall have a lien therefor on such building or improvement, and on the land on which the same is situated, to the extent in ownership of all the right, title and interest owned therein by such owner or proprietor, and in area of ihe entire lot or parcel of land if in a city, town or village.

“Sec. 3019. Priority of Lien. Such lien, as to the land, shall have priority over all other liens, mortgages or incumbrances created subsequently to the commencement of the work on the building or improvement, or repairs thereto; and, as to the building or improvement, it shall have priority over all other liens, mortgages or incumbrances, whether existing at the time of the commencement of such work, or subsequently created; and the person entitled to such lien may, when there is a prior lien, mortgage or incumbrance on the land, have it enforced by a sale of the building or improvement under the provisions of this chapter, and the purchaser may. within a reasonablo time thereafter, remove the same.”

“Sec. 3030. Parties to Such Actions. In such actions, all persons interested in the matter in controversy, or in the property charged with the lien may be made parties; but such as are not made parties shall not be bound by the .judgment or proceeding therein.”

“Sec. 3041. Limitation. Except in cases hereinafter provided, all liens arising raider this chapter shall be deemed lost, unless suit for the enforcement thereof is commenced within six months after the maturity of the entire indebtedness secured thereby.”

Our opinion is that section 3041 has no application to incumbrancers, but refers only to suits against the owner or proprietor. The proceeding as to incumbrancers is governed by section 3030, which confers upon the material man the right either to join incumbrancers or to omit them. He is authorized, but not required, to make them parties. Trammell v. Hudmon, 78 Ala. 224. If suit for the enforcement of the lien be commenced against the owner or proprietor' within six months after the maturity of the indebtedness secured by it, the lien is not lost; and our opinion is that incumbrancers may, at any subsequent time, be made parties to the proceeding. The object of making them parties is to ascertain and adjust the priorities in the property charged with the lien, and to make the judgment in the proceeding binding on them. The effect of not making them parties' is simply to exempt them from being concluded by the judgment. The statute declares, “Such as are not made parties shall not be bound by the judgment.” It seems clear to us that the effect of not making them parties is not to lose the lien.

The Illinois cases cited by the counsel for the appellees have no application here. Reference to them will show that the court was construing a statute of that state which, the court say, requires that material men shall enforce their rights against all parties (creditors or incumbrancers) having, or claiming to have, an interest in the premises, by suit to be commenced against them within •six months, and that the law means that parties having an interest shall be the parties to the suit. The statute of Alabama contains no such provision. The inchoate lien given by the statute has no force and vitality unless it is followed up by a proper filing for record, and suit commenced for its enforcement within six months after the maturity of the indebtedness, and is prosecuted to final judgment. If these steps be taken as prescribed, the lien becomes fixed ás to time and extent, and the amount of indebtedness for which it is security determined. These proceedings, however, do not bind any person interested in the property charged with the lien, unless such person is made a party to the suit. Such person is not concluded by the judgment, which is evidence of the facts it ascertains only against parties to the record. But the lien ascertained and fixed by these proceedings is no less a lien although a priority between this and other liens or incumbrances on the property may have to be settled. The suit for the enforcement of the lien must be commenced within six months after the maturity of the indebtedness, which is a condition precedent to fixing the lien, but the settlement of the priority of liens is not limited to any such period. The lien declared by the statute is on the building or other improvement put on the land, and on the land, to the extent of all right, title, and interest of the owner or proprietor; and any -decree rendered condemning the land to the satisfaction of the lien would extend to the entire property, but would be subordinate to the mortgage lien on the land, as it existed before the statutory lien attached. Wimberly v. Mayberry, 94 Ala. 240, 10 South. Rep. 157. “The mortgagee’s lien is superior and prior as to ■the property covered by the mortgage before the material man’s lien attached, and subordinate to the lien given to the material man for what he added; and so the lien of the material man is -upon the Whole property, but subordinate to the mortgage, as to-the property covered by the mortgage when his lien attached. This is the' condition of the property, and the relative rights of both, as fixed by the statute; and the only question is as to the power of a court of equity' to preserve, adjust, and enforce the respective rights of all. When the jurisdiction of a court of equity is invoked, all parties in interest may be made parties; and the court, by reason of its elastic power, has authority to so frame its orders and decrees as t.o ascertain, adjust, and protect every interest and priority.” Wimberly v. Mayberry, supra. By express provision of the statute, the lien of a material man or mechanic may be enforced in equity without alleging or proving any special ground of equitable jurisdiction. Code Ala, § 3048. The lien to be enforced is against the “owner or proprietor,” and other persons interested in the property, whether as mortgagees or other incumbrancers, are proper, but not necessary, parties. Their interests are not necessarily involved in the issue to be determined in the suit for the enforcement of the lien, and they are not necessarily to be affected by the judgment in the proceedings. The statute expressly declares that they are not bound by the judgment unless they are made parties. Id. § 3030.

We have thus disposed of the question presented by counsel in oral argument and briefs, but we notice that under the terms of the contract the entire indebtedness did not become due until the 1st May, 1891, and that, by election of the complainant, on account of the default of the brewing company in complying with the terms of its contract, the indebtedness did not become due until December 24, 1890; and as the amended hill making the mortgagee's parties was filed on May 10, 1891, the suit against the mortgagees was in fact instituted within six months after the maturity of the indebtedness.

The decree of the court below, dismissing the bill as amended, not being in accordance with (he views herein expressed, it follow's that the cause should he reversed and remanded, with instruction to overrule the demurrers, and further proceed in the cause as right and equity may require; and it is so ordered.