241 Pa. 444 | Pa. | 1913
Opinion by
One C. M. McFadden, a building contractor, had undertaken to erect twelve dwellings answering a certain description, upon a lot of ground owned by Richard McDugall within the limits of the City of Philadelphia. With the details of the agreement between these parties we are not at present concerned. The Standard Tile Company, whose representatives are here appellants, proposed to McFadden to furnish and put in place for
“Crowl holds title to said premises, houses and lots of ground, in trust for the use and benefit of the Hamilton Trust Company, to sell the same and pay and apply the proceeds derived from such sale to said Hamilton Trust Company to reimburse said company for any and all loss, damage or expenses which it has been put to or has sustained, or may be put to or sustain by reason of having made advances of money on account of said operation, or guarantees the erection and completion of said houses,” etc.
Thus we have disclosed not only Crowl’s position in the case but the interest of the Hamilton Trust Company in the enterprise as well. The proposal of the Standard Tile Company with respect to the furnishing and placing of the tile required in the construction of the houses having been approved, in order to induce the tile company to enter upon the work, the Hamilton Trust Company executed and delivered the following declaration under date of 2 March, 1907:
“Philadelphia, 2d March, 1907.
^Standard Tile Company, Land Title Bldg;, Philadelphia:
“Gentlemen: W. Sherwood Crowl, of the City of*447 Philadelphia, holds title to premises 4520 Walnut street, Philadelphia, and C. F. McFadden has arranged with him that this property shall be security for indebtedness to be incurred by C. F. McFadden, because of the work and materials estimated for by you and accepted by Mr. McFadden. This company will see that this property is made available to you, by payment of your bill out of the proceeds on sale, by conveyance to you, or else by a mortgage in the amount of your bill against Mr. McFadden, if the latter should fail to pay your bill. The property shall not be encumbered beyond the mortgage mentioned by Mr. Crowl in his acknowledgment under date of February 27, 1907, in impairment of the rights you are hereby given against-it.
“Yours very truly,
“Hamilton Trust Co.,
“Wm. R. Bricker, Title Officer.”
McFadden at once entered upon the construction of the buildings and by the fall of 1907 had completed six, when, for some reason not appearing here the operation failed, at least so far as McFadden was concerned. The tile company had furnished the tile for the houses that had been completed, put them in place, and had furnished considerable tile to be used in the uncompleted buildings. When McFadden failed there was due the tile company, according to its claim, $2,792.67, for the material and work furnished. The lot that was to be made available to the tile company as security for its claim remained at this time unimproved, or improved but slightly. McFadden having defaulted in payment to the tile company, the latter, after repeated demands on McFadden, insisted that the trust company should comply with one or other of the alternative stipulations in the declaration above referred to, viz: either pay the claim of the tile company out of the proceeds of the sale of lot No. 4520 Walnut street, or convey the lot to the tile company, or give a mortgage on the lot in the amount of the claim. The trust eompany not complying
“Therefore, upon the facts it appears that at this date in July, 1907, there was the amount due, according to plaintiff’s claim, of over $2,700 to McFadden, and, therefore, if the property 4520 Walnut street was to be available at that time, it must be shown in this case that there was a value to the plaintiff of at least that amount of money, in order that the plaintiff could secure it from these premises. In that respect there has been a*449 failure of proof, because it has not been shown you that at the date of July 1, 1907, there was, over and above the encumbrances on the property at the time, sufficient in the way of equity, by proceeds of sale, mortgage or conveyance from which to collect the amount of the plaintiff’s claim. Therefore, I grant this motion and direct a verdict for the defendant.”
To this action of the court exception was taken and it is also assigned as error. The question thus presented is a very narrow one. The burden was on the plaintiff to show actual loss. Whether or not it sustained such loss depended on the value to the plaintiff of the security for which it had contracted. If in point of fact it afforded no security whatever, because existing liens so far exceeded the value of the lot as to leave no possible equity remaining, then plaintiff lost nothing by defendant’s failure. But, as of what date was that value to be determined? The learned trial judge held that it was to be determined as of July, 1907, when McFadden abandoned his contract for the erection of buildings, owing the plaintiff $2,792.67, and because it was not shown that at that date the value of the property exceeded the amount of the encumbrances thereon he directed a verdict for the defendant. We fail to see anything in the contract to warrant this ruling. When McFadden abandoned his contract owing the plaintiff $2,-792.67, the liability of the trust company on its obligation of 2 March, 1907, whatever that was, was then fixed; but it by no means follows from this that the condition of the lot with respect to its improvement at that time measured the extent of the plaintiff’s equity. The date when McFadden abandoned the contract is without other significance than determining the amount due from him to the plaintiff. The undertaking of the defendant company contemplated the securing of this indebtedness to whatever extent the equity in the lot would accomplish it. The fact that the liability of the defendant company was then fixed, had nothing what
The assignment of error which complains of the binding instructions for the defendant is sustained, and judgment is reversed, and a venire facias de novo awarded.