Case ID: abb-pr_2/html/0093-01.html
Source: Caselaw Access Project
Author: {"author": "WoodRuff, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

QUIMBY a. SLOAN.
    
      New York Common Pleas; General Term,
    
    
      July, 1855.
    MechaNXos’ Lien. — Effect of Assignment of Peemises.
    Where the owner of a building in the city of New York conveys it, with the lot, to trustees for the benefit of creditors, material men, laborers and contractors, do not, by afterwards filing notices under the Mechanics’ Lien Law, acquire any lien under the statute upon the premises, although the notices are filed before the recording of the deed. Nor do they acquire a lien as against the grantees.
    If in such case the material men, &c., do acquire an equitable lien, it is not one which can be enforced by proceedings in the Marine Court under the Mechanics, Lien Law.
    Doubtless a fraudulent conveyance, made with intent to defeat the recovery of the claims, would be set aside by an action prosecuted for that purpose.
    Appeal from the judgment of the Marine Court.
    This was an action brought in the Marine Court to foreclose a lien under the “ Act for the better security of Mechanics,” &c. It was argued in the Marine Court upon an agreed statement of facts. From this statement, it appeared that the plaintiffs, A. M. Quimby & Son, were employed in the fall of 1854 by Sloan & Leggett to attach lightning rods to certain buildings in process of erection by the latter firm. These lightning rods ran into the ground eight or ten feet, and were fastened to the building by iron spikes.
    On the 11th of January, 1855, the plaintiffs filed a notice of lien with the county clerk. About two hours afterwards an assignment of the property for the benefit of creditors by Sloan & Leggett to Wright & Purdy was recorded in the register’s office, which it was admitted was duly executed, acknowledged and delivered two days previous to its being recorded. The plaintiffs proceeded with the foreclosure of their lien, joining Wright & Purdy as assignees with Sloan & Leggett. Judgment was rendered in the Marine Court in favor of the plaintiffs, against Sloan & Leggett, and against Wright & Purdy as assignees.
    From this judgment all the defendants appealed.
    
      Shepard tfi Parsons for the appellants.
    I. Wright & Purdy were improperly made parties, and the complaint should be dismissed as against them, with costs. The assignment made and delivered before the filing of the lien, transferred the property to them absolutely free from the lien. (Burrill on Assignments, 325; Hendricks v. Robinson, 2 Johns. Ch. E., 307; Nicoll v. Mumford, 4 lb., 529. And see Kaylor v. O’Connor, 1 E. D. Smith's C. P. E., 672; Sullivan v. Decker, lb., 699).
    H. An assignment made in good faith for the benefit of, and not to hinder, delay, or defraud creditors, divests all the interest of the assignor, and is entitled to all the privileges of every deed. Every deed takes effect at common law from the time of its delivery. (Jackson v. Bard, 4 Johns. 230 ; Dickerson v. Tillinghast, 4 Paige, 221). The only exception is that created by statute in favor of subsequent purchasers in good faith, and for a valuable consideration. Such the plaintiffs are not. (Stuart v. Kissam, 2 Barb., 493 ; Coddington v. Ray, 20 Johns. 637, and cases there cited ; Dickerson v. Tillinghast, 4 Paige, 215; Tuttle v. Jackson, 6 Wend., 213; Jackson v. Chamberlain, 8 lb., 625; Jackson v. Town, 15 lb., 588; Hooker v. Pierce, 2 Hill, 613; Raynor v. Wilson, 6 lb., 47; Burrill on Assignments, 272; Bush v. Waring, 1 Bag. 190).
    III. The statute only gives a lien to the extent of the owner’s right, title and interest at the time of filing — meaning the owner with whom or whose contractor the agreement was made. (2 Eev. Stats., éthEd., 747, § 82; Sullivan v. Decker, 1 E. D. Smith's C. P. E., 699; Doughty v. Devlin, lb., 634). Sloan & Leggett had no right, title or interest in the premises at the time of filing. They had, prior thereto, assigned the premises, which divested them as against all other persons of all their right, title and interest therein. (Burrill on Assignments, 325 ; Nicoll v. Mumford, 4 Johns. Ch. E., 522; Holmes v. Renisen, lb., 486).
    IV. The plaintiffs having shown no lien, there is no foundation for the proceedings to foreclose, and there should be judgment for the defendants. (Beals v. B’nai Jeshurun, 1 E. D. Smith's C. P. E-, 654; Cronkright v. Thomson, 1 lb., 661; Gridley v. Rowland, 1 lb., 670).
    
      Abbott Brothers for respondents.
    I. Wright & Purdy were properly joined as defendants. (Code, § 110; Clarke v. Bat-cliffe, 7 IIow. Miss. E., 162; Haggerty- v. Palmer,- 6 Johns. Ch. E., 437).
    II. The assignment by Sloan & Leggett to Wright & Purdy is subject to the plaintiffs’ right to .file a notice of lien. A Iona fide purchaser, within the meaning of the registry act, is one who has “ actually parted with his property on the credit of the estate, so as to give him an equitable claim or specific lien thereon.” (Dickerson v. Tillinghast, 4 Paige, 215, 221. And see Stuyvesant v. Hall, *-2 Barb., Ch. E., 151, 158; Inescott v. King, 6 Barb., 346. In re Howe, 1 Paige, 125, 128). Nor is it necessary that the value should be advanced at the time the lien is secured. A “ present consideration ” is a consideration advanced on the credit of the lien. (Simeon Stuart’s case, quoted in Burn v. Burn, 3 Ves. Jr., 576, 582; Delaire v. Keehan, $ Bessaussure's B., 74). In the present case, the plaintiffs are clearly within the intent of the registry acts as defined in Dickerson v. Tillinghast. They parted with their property, trusting for repayment to “ a specific lien” upon the property, a right to which was given them by statute. The assignment, not having been recorded at the time the plaintiffs’ lien was filed, is void as against them. (2 Eev. Stats., 4th Ed., 162, § 1).
    III. A mechanic’s right of lien cannot be defeated by an assignment to trustees for the benefit of creditors. As assignees, Wright & Purdy, hold subject to every equity good against the property in the hands of Sloan & Leggett. (Bac. Abr. Tit. Bankrupt; 7 Vin. Abr. 36, Tit. Creditor and Bankrupt, E. 10, lb., 73 K. 4 ; Sugden on Vendors, 364; Burrill on Assignments, 325; Grant v. Mills, 2 Ves. & B., 307 ; Thompson v. Beatson, 7 Moore, 548 ; Mitford v. Mitford, 9 Ves. Jr. 87, 100 ; Addison v. Burckmeyer, 4 Sand. Ch. E., 498, 501; Wad-dington v. Yredenbergh, 2 Johns. Cas., 227, 231; Slade v. Yan Yechten, 11 Paige, approved, Bay v. Birdseye, 5 Benio, 619 ; Haggerty v. Palmer, 6 Johns. Ch. E. 437 ; Twelves v. Williams, 3 Whart., 485). The cases to which the appellants refer are all cases in which a deed or mortgage to a bona fide purchaser for a valuable consideration was held entitled to a preference over the lien of a judgment, mortgage, or even deed, (4 Paige, 215), given as security for the payment of a precedent debt. The principle established by the cases which they quote is, that one who has advanced value on the credit of the land itself, is entitled to priority over a general creditor who has obtained a lien, or even an absolute title to the land, merely as security for the payment of a precedent debt. Thus, though in form Wright & Purdy hold by purchase, and plaintiffs by a simple lien, yet when the nature of their respective claims is analyzed, it is clear that it is the plaintiffs who are entitled to be protected as bona fide purchasers, while the assignees stand in the position of general creditors, claiming security for antecedent debts.
    IY. The rule contended for by the appellants, would entirely defeat the mechanics’ lien law. If the assignment in the present case defeats the plaintiffs’ lien, then, all that the owner of a building has to do, to protect it from liens, is, to assign it to a friend before the work is completed, (previous to which time the mechanics cannot file their notice), and let the title so stand until six months from the completion of the work shall have elapsed. He need not take the trouble to find a purchaser, nor would it even be necessary that the as-signee should pay or pretend to pay a consideration. Nor need the assignment even be put on record. Thus the act might be easily and completely avoided, and by means which could not be called illegal or even fraudulent.
   WoodRuff, J.

The proceeding in this case in the Marine Court, was had under the mechanics’ lien law of 1851, and was instituted to foreclose an alleged lien upon certain buildings erected by the defendants, Sloan & Leggett, to which the plaintiffs have attached lightning rods, inserted some eight or ten feet in the ground, and fastened to the buildings by iron spikes. After the rods were attached, and before the notice prescribed by the statute was filed with the county clerk, the owners, Sloan & Leggett, conveyed the buildings and lots of ground to the defendants, Wright & Purdy, in trust for creditors by deed duly executed, acknowledged and delivered, but such deed was not placed upon record until about two hours after the plaintiffs filed their notice to create a lien. The grantees, Wright & Purdy, are made parties defendant, and on tbe trial below, tbe Court rendered judgment against all of tbe defendants for tbe sum of $62 87, (tbe amount claimed,) witb costs.

Unless we are satisfied that tbe views we have heretofore entertained of tbe proper construction of tbe law, under wbicb this proceeding was taken, and of tbe nature of tbe proceeding itself, are wholly erroneous, and that most of tbe decisions we have made since tbe law was enacted are wrong, we cannot sustain this judgment.

I. Tbe defendants Wright & Purdy are in no sense, legally or equitably, debtors to these plaintiffs. Whether tbe property conveyed to them was liable to be affected by this alleged lien or not, they did not, by accepting tbe conveyance, become personally liable for tbe debt, and there is nothing in tbe statute, or in any view of tbe equities of tbe parties, to countenance such an idea. Tbe statute in terms applies and only applies to cases in wbicb tbe building is erected under a contract witb tbe owner, and it is as an owner contracting that be or bis property can be subjected to tbe proceeding, and we have held heretofore, and are still of opinion that where tbe owner is not personally liable by contract to tbe plaintiff himself (as where the claim is by a sub-contractor), no judgment can be ordered against tbe owner personally ; still less can such judgment be sustained against a grantee of tbe owner, who is a party to no contract with tbe plaintiff, relating to tbe matter.

II. Even against tbe defendants Sloan & Leggett, the judgment, if the plaintiffs showed themselves entitled to any judgment, should have been against their right, title, and interest in tbe premises at tbe time when tbe notice of lien was filed. That was precisely what was bound by tbe lien, wbicb it was the purpose of this proceeding to foreclose. Tbe proceeding is a proceeding in rem, and its primary object is to enforce tbe lien as such. Whether if tbe lien be established, and tbe defendant be shown to be liable personally for tbe debt to the plaintiff, a decree over may be made to cover a deficiency, it is not necessary to decide. Such does not appear By tbe return to have been tbe judgment in this case.

III. The question chiefly discussed, however, is whether the plaintiffs had, in fact, any lien to foreclose; and this question in its application to the present case divides itself into two questions:

1. Whether the plaintiffs had any lien upon which they could proceed in the Marine Court for a foreclosure, or to compel the application of the property bound thereby to its payment, for if not, then that court had no jurisdiction of the subject matter, and could render no judgment in the plaintiffs’ favor.

2. Whether upon any equitable principles the plaintiffs had a lien, as vendors, for the purchase money, which gave them priority over the rights acquired by Wright & Purdy, grantees, under the deed above mentioned, and which might have been enforced in a court having general equity jurisdiction, and on a complaint framed for the purpose of establishing such an equitable lien.

Although this latter question has been discussed at some length by the counsel for respondent, I do not think it necessary to the determination of this appeal. The action here is a statutory action, and though equitable in its nature, it is founded solely on the statute, and seeks the enforcement of rights given by statute. Some considerations connected with this branch of the inquiry may, however, be suggested in what follows.

First, then, Did the plaintiffs establish a lien which could be foreclosed in the Marine Court? I feel constrained to answer this question in the negative. That court has no jurisdiction to enforce equitable liens. It has no equity jurisdiction except such as this very statute confers upon it. Actions to recover or enforce claims to real property, or a right or title or interest therein, legal or equitable, must be brought in other courts. The statute in question has given the Marine Court jurisdiction in specific cases under that statute, and we have held and are still of opinion that this clothed that court with all the jurisdiction necessary to carry the provisions of this statute into full effec^ and on. a foreclosure of the lien given by the statute, to order the premises to be applied to the satisfaction of the lien. But the plaintiff, inorder to obtain such a judgment in that court, must establish a lien under the statute, for it is that lien and that only which can be enforced in that court. All that counsel have urged in regard to a vendor’s lien for purchase-money, or the lien of a material man upon the structure into which his materials have entered, founded in the general principles of equity, may be laid out of view. That is not a lien of which the Marine Court can take jurisdiction for the purpose of enforcing it. The question is, therefore, had the plaintiffs a lien upon the premises under the statute % If not, the action must fail altogether, for the proceeding being a statutory proceeding, is based on an alleged lien. That is the very foundation upon which the plaintiffs must stand in court, and we have repeatedly held that if no lien is established, there can be no recovery in any form under this proceeding. Having called the defendant into court in a peculiar mode prescribed by the statute, for a particular purpose only'applicable to a specified claim, if the lien fails the plaintiff cannot convert his proceedings into an ordinary action for the recovery of money upon a personal contract and insist upon the defendant’s personal liability.

We have so often expressed our views of the essential requisites of the statute lien, that it is unnecessary to enlarge upon them here. The statute gives to the material man a, lien itpon:filing the notice with the county clerk, prescribed in section 6 of the act. It is then, and not until then, the lien is acquired. And to make this act the very creation of the lien by terms that should be so specific that no doubt could exist on the subject, the effect of filing such notice is stated to be that the claimant shall have a lien upon the right, title, and interest, of such owner existing at the time of sueh filing — as if the legislature not only intended that the statute lien should not only take effect from that time, but also to exclude the idea of the party’s “having’’ any legal or equitable lien before such filing.

Clearly here is no “ inchoate lien” given by the statute, to operate from th<^ time when the materials are furnished, and unless it exists by force of the statute, and may be enforced under and in the mode pointed out by the statute, then this action cannot be sustained upon the ground that any such “ inchoate lien” existed. Indeed, I should be very reluctant to say, that in any case, in any court (where no fraud is alleged to have been contrived by the parties to prevent a lien, which might become the ground of relief in equity, under a distinct head of equity jurisdiction), when a statute has prescribed a particular mode of obtaining a lien for materials, and how it shall be acquired, and from what time it shall take effect; the party may, upon any general view of his equities, claim a lien from an earlier moment, and upon interests which the statute has not declared shall be bound thereby. If it was equitable that the material man should have a lien upon the building into which his materials had entered, from the time he parted with those materials, were not the legislature sufficiently conscious of this equity ? They were, it is to be presumed, fully aware of all the considerations which have led courts of equity to sustain liens for purchase money and the like, and it would have been quite easy to say that such liens shall exist from the time the materials were used, had they intended any such result, and yet they fix the time when the lien shall take effect. This, to my mind, excludes any claim to what counsel call an inchoate lien, to operate at any earlier period. And as before remarked, it is the actual lien, the statute lien, the commencement of which is fixed by statute, with which alone we have anything to do in this action.

Besides, I apprehend if anything in the nature of a lien is to be accorded to the material man, upon the general principles of equity as recognized in the cases of vendor and purchaser, ship-builders and mechanics adding labor and materials to personal property, or those claiming under an equitable charge upon an estate, such as are cited by the respondent’s counsel, that lien would be confined to the building itself into which the materials have entered. The lot of ground would not, as it is under the statute, be bound thereby.

But to return, in order to the acquisition of the statute lien, the statute itself must be strictly pursued, and there is in this no inequity. The plaintiff claims the benefit of a right not existing at the common law. ITe claims the benefit of a summary proceeding for the enforcement of that right. He has his own option at any time within six months to secure himself by filing his notice. If he allows the time to pass until the owner has sold the property he cannot complain, he still has his action for the debt. He only fails, by his own delay, to secure the benefits of the statute.

When fraudulent transfers are made to cheat contractors or material men, as intimated by counsel, there will be time to consider their effect in an action in the appropriate court, and in a proper action to set aside the fraudulent conveyance so far as it operates to defeat the lien.

Under these views, how stands the present case ? On the eleventh day of January, 1855, the plaintiffs filed their notice. If the contracting owner had then any right, title, or interest in the building and lot whereon the same -was erected, the plaintiffs acquired a lien thereon upon that filing; assuming, of course, for the purpose of that remark, that one who attaches lightning rods to a building, is one “ who performs work and labor, or furnishes materials in building the house or other building, &c.,” within the meaning of the statute, a question not raised by the counsel on this appeal. (McDermott v. Palmer, 4 Seld., 383).

Before that day the contracting owners had conveyed the property to third persons in trust for creditors. Their title was gone. There was nothing in them to which the lien could attach. The return does not show that there was in them even the hope of a surplus of proceeds after paying creditors, or that the conveyance was not absolute in all respects as to them, or even that the conveyance, although in trust, was not upon valuable consideration, though in trust for creditors, as beneficiaries under the conveyance. Had it appeared that there was a reservation in the deed under which the grantors had a remaining equitable interest which could be bound by the statute, possibly it might be secured in this mode, but even that is questionable when the whole legal title is gone. And if, as seems to be assumed in the argument, the plaintiffs are themselves provided for as creditors in the deed itself, then they will obtain satisfaction, if the property is adequate, and as to them there can be no such residuary interest until their whole claim is paid.

I incline to the opinion that the terms right, title and interest in the statute are to be taken, in construing the statute, to mean legal right, title and interest, and not a mere equity. But it is not necessary to pass upon that question, for it cannot avail any thing to the plaintiffs in this cause. •

My conclusion is, therefore, under this branch of the inquiry, that the plaintiffs acquired no lien under the statute. They delayed too long the filing of their notice. The fact, that the deed was not recorded until two hours afterwards, does not alter the case. The plaintiffs acquired no lien while the owners had any right, title, or interest. That had passed to the grantors, and passed effectually whether the deed was recorded or not. Had the foreclosure been instituted against the owners, a judgment been had, and a sale been made to a Iona fide purchaser under the judgment who paid his money and received his deed, then the recording acts would have been material, and such a purchaser without notice would, I think, have held title against these grantees, if his title was acquired before their deed was recorded. But here no such question arises; and as between these parties, the deed was effectual to pass the owner’s right, title, and interest whether recorded or not.

II. Much that I have above said, bears upon the inquiry, whether the proceeding might be sustained upon the facts before us as an equitable lien either apart from the statute or considered as an incident to the statute in a court of general equity jurisdiction ?

We are referred to cases in which an artisan has a lien upon a specific chattel entrusted to him for repairs, or upon a chattel manufactured by himself, and other like cases, in which a lien upon personal property exists, so long as the mechanic retains the possession of the chattel itself, and no longer; and to cases in which the vendee of real estate is treated, to the extent of the unpaid purchase money, as trustee for the vendor, and the land charged with the payment; and although there may be found cases in which a court of equity in marshalling assetts has recognized the builder of a house for a bankrupt as having a higher equity, and therefore, entitled to a preference over creditors at large, I apprehend that no case can be found in which, upon the mere fact that they had contributed labor or furnished materials towards a building, a court of equity have admitted the laborers and various contributors to the erection to a lien thereon, and on the lot whereupon it stands, for the payment of the respective sums due to them. If there be such cases, they proceed upon the ground of the insolvency of the owner, or fraud, or other ground for equitable interposition which is not the frame or ground of the present proceeding.

Besides, if the plaintiff relies upon a lien of this nature, there is no warrant whatever for extending it beyond the very article which he furnished, so long as that remains entire, and capable of distinct identification and separation. Even if the statute brings the plaintiff within its purview, his equities, if any, apart from the statute, would be satisfied by giving him a lien upon the fixture he has attached to the building. I apprehend, however, as before suggested, that those who attach the various fixtures to a house designed for use in connection therewith, such as lightning rods, ranges, and the like, have in the absence of fraud no such lien unless it be found in the statute itself.

But without pursuing the inquiry, when or how far courts of equity will, upon grounds of peculiar equity cognizance, re. cognize and enforce the lien of mechanics, I am clear that no such ground will avail to sustain a purely statutory proceeding founded alone on the lien given by the statute itself.

I cannot admit the force of the suggestion that the credit is given upon the faith of the contemplated lien in such a sense as to give to the plaintiffs any higher equity. If he contemplated the lien when he delivered or furnished his work and materials, he contemplated taking the proper steps to acquire it, and within the proper time, and without such delay as might prevent his acquiring it at all; i. e. he contemplated just such a condition of things and just such a lien as the statute provides for, and no other.

In my opinion, the judgment must be reversed. It might perhaps have been enough to say that if the plaintiffs claim a lien under the statute, they have failed to gain a lien according to its provisions; and if they claim a lien upon equitable grounds existing independently of the statute, (if any such exist), they have not selected the court nor the mode of proceeding in which such a claim can be enforced.

Judgment reversed. 
      
      
         The language of the return was as follows :—
      “ Upon this statement of facts, after hearing the attorneys of the respective parties, I rendered judgment in favor of the plaintiffs, and against the defendants, Thomas J. Sloan and Samuel Leggett, and against the defendants Wright & Purdy, as assignees of Sloan & Leggett, for the said sum of $63 87, with costs.”
     
      
       This question was not discussed, for the reason that the counsel on both sides considered that the rods in question, being fastened to the building by iron spikes, &c., were clearly embraced within the term “ appurtenances” in the act of 1844, repeated in the act of 1851, under which this action was brought. That act allows a lien for labor and materials furnished in'“building, altering, or repairing any house or other building, or appurtenances to any house or other building, in the city and county of New York.” (Laws of 1844, 339 — ch. 220, $ 1; Laws of 1851, 953 — ch. 513, § 1; 2 Rev. Stats 4 Ed. 747, § 82). The case of McDermott v. Palmer above referred to, was a proceeding instituted under the act of 1830, (which allowed a lien only for work done towards the erection, construction, or finishing of buildings), to foreclose a lien claimed for work done in flagging the side-walks, yards, and areas of certain houses. The Court of Appeals held that the plaintiff having chosen to proceed under the act of 1830, could not establish a lien, the flagging of sidewalks, &c., not being a part of the construction, &c., of the building. But they intimated (p. 387), that had the plaintiff proceeded under the act of 1844, he might have been entitled to a lien, on the ground that the side-walks, &c., were appurtenances to the building.