32 Wis. 362 | Wis. | 1873
This is an appeal from an order of the circuit court of St. Croix county denying a motion of the defendants to vacate an injunctional order previously made by the judge at chambers. The chamber order was made on application of the plaintiff in this' action, and upon the facts set forth in an affidavit made by him for that purpose. No complaint appears to have been filed in the action at the time the chamber order was granted, nor when the motion to vacate was made, so that the case stood there and is presented here upon the facts alone contained in the affidavit. The chamber order was made on the 8th of August, 1872, and the order from
The defendants Fowler, White & Jones and Birch, are also lien creditors of their codefendant Hinckley, in respect of materials respectively furnished by them and used in the construction of the same building. The liens of the latter were perfected by judgments severally obtained by them under the lien law in May, 1872. The date of the filing of their respective petitions for a lien does not appear, but it is shown that their actions were all commenced on the same day, April 13, 1872, and that judgment was rendered in each at the following May term of the court. Each judgment was in the form prescribed by the statute giving the lien, and declared the same to be a lien upon the building and lots before any other lien which originated subsequent to the commencement of the building, which was adjudged to have been on the 11th day of July, 1871. The demands or accounts upon which the judgments were so respectively obtained, accrued as follows: that of Fowler between July 17th and October 2d; that of White & Jones between August 4th and September 5th ; and that of
This action was commenced on the same day the affidavit and injunctional order were made, August 8, 1872 ; and the object of it, as stated in the affidavit, is to foreclose the lien of the plaintiff, and to obtain a decree compelling the application of the proceeds of the sale of the building and of the right, title and interest of the defendant Hinckley in and to the lots, to the payment of the lien of the plaintiff before any application thereof to the payment of the liens of the defendants, and to restrain the sale of the building and lots under and by virtue of the executions. The plaintiff avers in the affidavit that his lien is equitably prior to the liens of the defendants, and of right ought to be first satisfied from the proceeds of the sale of the building and lots.
It will be seen, from the above statement' of facts, that the plaintiff claims precedence of the lien creditor defendants because the first item of his account for materials furnished is of earlier date than any of theirs; and also that he claims the right to work out and foreclose his lien by this proceeding in equity, instead of enforcing it by the appropriate action at law given by the statute conferring the lien. The questions thus presented under the statute entitled “ Of the lien of mechanics and others” (R. S., ch. 153; 2 Tay. Stats., 1761), are not only important, but are new in this court, except so far as they were incidentally considered in the early cases of Dobbs v. Green, 2 Wis., 228, and Dobbs v. Enearl, 4 Wis., 451. The authority of those decisions, so far as they go, is certainly very strongly against both positions here assumed by the plaintiff. In the last named case the court is reported to have said that “ the lien is created by the filing of the petition.” This was
Although contrary to our first impression, and we presume, likewise, to that which has generally obtained in the minds of the profession, a careful examination has satisfied us of the correctness of the view thus early taken of the statute, and that it should be sustained. The impression, though certainly not well settled or defined, has existed with us, and we doubt not more or less with the profession, that, as between the lien holders themselves, there was no priority under the statute, but that the lien of each had relation to the commencement of the building, so that all must share alike or pro rata in the proceeds of the sale, as being the result of the contributions of all, in the proportion of the value of the labor performed and materials furnished by each. This doctrine of equitable distribution or equality among the lien holders, the reason and justice of which are so well presented by Judge Thurman in a like case (Choteau v. Thompson, 2 Ohio St., 128, 129), finds no express
The first section of the statute in terms provides that the lien of the mechanic or material man shall take precedence of any other lien which originated subsequent to the commencement of the building; but in all other respects it is entirely silent on the question of priority. It does not say that there shall or shall not be priority of right or of payment as between the lien holders themselves. So far as any such priority exists, or when or how it may be acquired or enforced, the matter is left entirely open to judicial determination upon consideration of the whole language of the statute and of all its various provisions. If the question had arisen upon the language of the first section alone, or if upon the language of that section with a further provision that the lien should be foreclosed by suit in equity, the maxim of that court, that equality is equity, might then have been held applicable ; from which it would have followed that the proceeds of the sale were to be distributed among the lien creditors proportionately to the amounts of their respective demands. With the equitable remedy provided, or with no specific remedy, in which case that in equity must have been preferred and adopted, the doctrine of equality of lien and equal right of payment might have prevailed, unless there was something in the statute expressly forbidding it. In that case all the lien creditors must have been made parties to the suit; and, there being but one sale under the direction of the court of chancery, there could have been no difficulty in ascertaining the share of each creditor, and in dividing the proceeds.
But in determining this question of equality of payment, or, if it be found the legislature did not so intend, then the question of priority of lien, or when and how such priority arises, reference must be had not alone to the section of the statute
It results very clearly, we think, from this examination of the statute, that, except under special circumstances, disclosing particular grounds for equitable interference, equity has no jurisdiction to enforce or foreclose the lien, and consequently that the rule of equality, which is the creature of that court and is incapable of application in a court of law, was not intended by the legislature. It follows also very clearly, as it seems to us, that equity has no power to interfere with or arrest the proceedings of a lien creditor in an action prosecuted by him in pursuance of the provisions of the statute. The language of the statute is clear and peremptory, that he shall have such right without making the other lien creditors parties, and that he shall have judgment, may issue execution and sell, and the effect of the sale is positively declared. Under these circumstances it can hardly be said, as it sometimes has been under other lien laws less explicit in terms, that there are two principles coming in conflict; the one, that equality is equity ; the other, that he who is first in time is better in right. McCullom v. Richardson, 2 Handy, 277. The statute, taken as a whole, is not ambiguous upon this point, but plainly indicates that the latter principle was intended and must prevail.
It being settled that the principle of equality must be rejected, and that priority of right must or may exist in favor of some one or more of the lien creditors as against the others, the question arises, how or upon what circumstances such priority is to be determined. Counsel for the plaintiff contend that the creditor furnishing the first material, or who commences first in point of time to do so, or who performs the first
And the remarks of the same court respecting the equitable remedy of a subsequent lien holder, alleging fraud, mistake or illegality in a prior lien, are no doubt equally applicable to cases of the kind arising under our own statute. The court say: “A subsequent lien holder, finding alleged prior liens (of which he necessarily had notice by the very fact of their being filed), if he can aver their illegality, set up a higher equity in his own favor, impeach their amount, or charge fraud or collusion therein to his prejudice, may undoubtedly file his complaint in equity, and, upon the general principles of equity, claim an investigation of their merits, and have them set aside or postponed; and if, with constructive notice of their existence, he does not interfere, it is no injustice to him to say that neither the owner nor the court are bound to invite him to come and contest them.”
The order appealed from must be reversed, and the cause remanded for further proceedings in accordance with this opinion.
By the Court.— It is so ordered.