Case ID: ny-st-rep_54/html/0882-01.html
Source: Caselaw Access Project
Author: {"author": "Haight, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Leonard Vogel et al., Resp’ts, v. Valentine F. Whitmore et al., Impl’d, App’lts.
    
      (Supreme Court, General Term, Fifth Department,
    
    
      Filed October 20, 1893.)
    
    Mechanics’ lien—Joint contract—Subsequent agreement between CONTRACTORS. —
    A contract for building certain houses was made with two contractors jointly, who thereafter agreed between themselves that one should do the mason and the other the carpenter work, and fixed the amount each waste receive under the contract Held, that the effect of this agreement was to sever their interests under the contract, and to make each a sub-contractor under the joint contract, and that the lien of material men who furnished supplies to either upon his sole credit, and relying on his interest in the contract, was limited to the amount coming to the contractor with whom they dealt.
    Appeal from a judgment entered upon a decision of the Monroe equity term.
    
      Abram Benedict, for app’lts; F. E. Drake, for resp’ts.
   Haight, J.

This action was brought to foreclose a mechanic’s lien.

On the 21st day of March, 1892, the defendant Jacob J. Augustin entered into a contract in writing with the defendants Isaac McNeil and John Kleinow to construct for him certain buildings upon bis premises in the city of Rochester for the sum of $11,800. Upon the making of such contract the defendants MeNeil and Kleinow agreed between themselves that Kleinow, who was a mason, should do all the mason work upon the building, and furnish the material therefor, and that he should receive out of the contract price the sum of $5,210, and the defendant McNeil, who was a carpenter, should do all of the remainder of the work, and should receive therefor the balance of the contract price. The defendants McNeil and Kleinow each performed their part of the contract, and have each been paid in full the contract price, with the exception that there still remains due and owing to the defendant Kleinow $660, and to the defendant McNeil $3,731.58, making a total of $4,391.58; which sum the defendant Augustin has-paid into court to abide the result of this action. It further appears that the defendant Kleinow purchased of the firm of Whit-more, Rauber & Vicinus materials amounting to the sum of $694.46, and of the Rochester German Brick & Tile Company materials amounting to the sum of $1,519, which he used in the construction of his part of the building, and that on the 8th of August, 1892, liens were 'duly filed by these defendants for the amount of their respective claims.

The trial court has found as facts “ that the sale of materials by the said Whitmore, Eauber & Yicinus and the Rochester German Brick & Tile Company to said Kleinow was made with them respectively without any knowledge of the terms of said contract or that said Isaac McNeil, had any interest in said contract, and relying exclusively upon the interest of said Kleinow and the amount he was to receive therefrom, and that the said Whit-more, Eauber & Yicinus and the Rochester German Brick & Tile Company in making said sales gave credit solely to the said Kleinow relying upon his interest in said contract for payment for their sales.”

It further appears that the defendant McNeil purchased of the plaintiffs, who were doing business under the firm name of Yogel & Binder, lumber, sash, doors, blinds and frames which were used by him in the building, amounting to the sum of $1,187.95; that he also purchased of the defendants Edward Goggin and John W. Knowles, who were doing business under the firm name of Goggin & Knowles, the tin and galvanized iron used by him upon the building, amounting to the sum of $825; that he also purchased of the defendants Lyman M. Otis and Charles H. Moody, doing business under the firm name of L. M. Otis & Co., materials consisting of lumber, etc., which was used in the building amounting to the sum of $1,856.07, and that upon the 9th day of August, 1892, liens were duly filed by such plaintiffs and defendants for the amount of their respective claims. The amount of the liens so filed more than exceeds the sums remaining unpaid to the defendants McNeil and Kleinow on the contract.

The trial court found as conclusions of law that the defendants, Whitmore, Eauber & Yicinus and the Rochester German Brick & Tile Company, acquired a lien to the extent of the $660 still remaining due and owing to the defendant Kleinow; and that the plaintiffs and defendants Goggin & Knowles and L. M. Otis & Co., acquired a lien to the extent of the $3,731.58 still remaining due and owing to the defendant McNeil.

From the judgment entered thereon the defendants Whitmore,, Eauber & Yicinus, and the Rochester German Brick & Tile Company, appealed to this court. They claim that inasmuch as their liens were first filed, and that the defendants McNeil and Kleinow were joint contractors, that they are entitled to have their claims* first paid in full, and that all over the $660 going to Kleinow should come out of the amount going to McNeil.

The appellants would doubtless be entitled to have this disposition made of the funds were it not for the subsequent agreement-made between the defendants McNeil and Kleinow, and the equities of others that have come into existence thereunder. Pell v. Baur, 133 N. Y., 377; 45 St. Rep., 241.

But we think the circumstances of this case call for the application of a different rule. If A. should contract with the owner to construct a house upon his premises, and should sub-let the mason work to B. and the carpenter work to C., material-men supplying B. could acquire no lien upon the premises for more than the amount coming to him. They could not acquire a lien upon that which was going to C. Carman v. McIncrow, 13 N. Y., 70; Lumbard v. S., B. & N. Y. R. Co., 55 id., 491; Crane v. Genin, 60 id., 127 ; French v. Bauer, 134 id., 548 ; 48 St. Rep., 333; Larkin v. McMullin, 120 N. Y., 206 ; 30 St. Rep., 902; Hagan v. American Baptist Home Mission Society, 14 Daly, 131; 6 St. Rep., 212.

- The defendants McNeil and Kleinow entered into the contract with Augustin to construct the buildings. They thus became joint contractors, each liable to Augustin for the - proper performance of the contract. They were not, however, co-partners or agents for each other so that one could bind the other. The appellants were not parties to the contract, nor have they any contractual relation with either of the parties thereto, excepting Kleinow. After the execution of the contract with Augustin, McNeil and Kleinow entered into a further agreement by which Kleinow was to do the mason work, and McNeil the other work called for by the contract, fixing the ’amount that each should have therefor. The effect of this agreement was to sever their interests under the contract and to make each a sub-contractor under the joint contract.

The appellants furnished their material to Kleinow without any knowledge of the terms of the contract with Augustin or of the interest that McNeil had therein, and gave their credit solely to Kleinow relying upon his interest in the contract, and, under the rule to which we have referred their liens are limited to the amount that is coming to him under the contract. To hold otherwise would be inequitable and deprive the other lienors of rights which the statute intended to protect. Ordinarily the mason work has to be completed first before the carpenter can put in the woodwork. There is, therefore, no difficulty about the mason’s first acquiring a lien. If they can extend their liens so as to cover that which under the agreement" is reserved for the carpenters, the carpenters will stand but a poor show under our lien law. Wern ay assume that the plaintiffs and the defendants Goggin & Knowles and L. M. Otis & Co., who trusted the defendant McNeil for the material furnished to him to enable him to perform his part of the contract, knew of the contract with Augustin and of the subsequent contract with Kleinow by which it was agreed that McNeil was to have all of the contract price over and above the $5,210 going to Kleinow, and thus knowing his interest in the contract and relying thereon furnished him with the material with which to perform it. ,

We do not think that it was within the contemplation of the statute that the creditors of Kleinow should acquire a superior lien to the creditors of McNeil upon the funds going to him.

The case of Pell v. Baure, supra, has been pressed upon us as sustaining the appellant’s contention. We think, however, that ease is distinguishable. The mason and the carpenter submitted separate bids, but when the contract came to be drawn they requested “ that their several agreements be merged into one joint -contract between them and the owner.” There was no subsequent agreement between them by which they could be regarded as subcontractors. The material for which the lien was filed was furnished with the knowledge and consent of both parties, and the contest in that case was as between the lienor and the joint contractors. Whilst in this, the question is as to the rights of the lienors of the respective contractors.

We have carefully examined the evidence and are satisfied that the findings of facts by the trial court are amply sustained. The equities are with the respondents. It appears that the members of the firm of Whitmore, Rauber & Vicinus are" also stockholders and officers of the corporation, the Rochester German Brick & Tile Company; that their offices are together and one person keeps the books of the corporation and of the firm; and that the collector of. the firm also collects for the corporation: that Kleinow paid to the collector the sum of $1,800, the greater portion of which was money derived under the Augustin contract. . This money, instead of being applied upon the material furnished for the Augustin buildings, was credited upon an old indebtedness in violation of the rights of McNeil and his lienors.

The judgment should be affirmed, with costs.

Dwight, P. J., and Lewis, J., concur.