Case Name: WEATHERS & PERRY v. FRANCIS COX, Receiver, Grand Theater Company, et als.
Court: Supreme Court of North Carolina
Jurisdiction: North Carolina
Decision Date: 1912-10-30
Citations: 159 N.C. 575
Docket Number: 
Parties: WEATHERS & PERRY v. FRANCIS COX, Receiver, Grand Theater Company, et als.
Judges: 
Reporter: North Carolina Reports
Volume: 159
Pages: 575–578

Head Matter:
WEATHERS & PERRY v. FRANCIS COX, Receiver, Grand Theater Company, et als.
(Filed 30 October, 1912.)
Liens — Registration—Lessor and Lessee — Provisions Against Lessor’s Liability — Interpretation of Statutes.
Under a lease of lands, duly recorded, which provided that the lessees were to construct or erect on the leased premises a building at a cost to be not less than a certain sum, which shall be the property of the lessor at the termination of the lease; and that the lessor “shall not be chargeable for any contracts or liabilities, whether arising from negligence or otherwise” of the lessee: Held, a lien filed for material furnished the lessee in the construction of the building erected by him is in no wise a claim or lien on the building as against the interest of the lessor, upon the termination of the lease under a forfeiture clause contained therein.
Appeal by plaintiff from Bragcm, at April Term, 1912, of Wake.
Action beard on appeal from a justice’s court.
Tbe plaintiff filed bis complaint, amended by leave of court, stating bis cause of action and bis claim for a- lien on tbe premises, in effect as follows; “Tbat on 15 September, 1909, tbe owners of tbe property conveyed same to Grand Theater Company, by written lease, for tbe term of ten years, witb privilege of renewal for five additional years, at a stated and increasing rental per annum, witb a clause giving the landlords a lien for tbe rent and one of forfeiture in case of nonpayment. There was a provision in tbe lease tbat tbe lessees were to construct or erect on tbe premises,- for use in their business, a theater and auditorium, to cost not less than $6,000, and a covenant, on tbe part of tbe lessees, tbat, at tbe termination of tbe lease, tbe improvements on tbe property should belong to tbe lessors, tbe owners of tbe property, and tbe contract contained further tbe following stipulation: “10. It is mutually understood between tbe party of the first part and tbe party of tbe second part, tbat tbe party of tbe second part shall have leave to make improvements upon tbe auditorium building, but not to make any alterations or changes tbat will tend to decrease tbe value of or in any way damage said building; and, further, that the party of the first part shall be in no wise chargeable for any contracts or liabilities, whether arising from negligence or otherwise, of the said Grand Theater Company”; that said lease, having been duly registered according to law, the property was put in possession of the lessees, the Grand Theater Company, who proceeded to construct the auditorium and im-jorove the premises, pursuant to the terms. Plaintiffs had an unpaid claim amounting to about $100 for plastering and papering the hall, under a contract with the Grand Theater Company, and the said company, the lessees, having become insolvent, and the lease forfeited for nonpayment of rent, plaintiffs instituted this action against the lessors, the owners of the property, to recover the amount due and to enforce same as a valid lien against the landlord’s ownership and interest. A demurrer to demand, as stated, was sustained by the court, and plaintiffs excepted and appealed.
T. H. Calvert for plaintiff.
Jones & Bailey for defendant.

Opinion:
Hoke, J.
Our statute relating to the question presented (Revisal, sec. 2016) is in terms as follows: "Every building built, rebuilt, repaired, or improved, together with the necessary lots on which such building may be situated, and every lot, farm, or vessel or any kind of property, real or personal, not herein enumerated, shall be subject to a lien for the payment of all debts contracted for work done on the same or material furnished. This section shall apply to the property of married women when it shall appear that such building was built or repaired on her land with her consent or procurement, and in such case she shall be deemed to have contracted for such improvements"; and the decisions with us have uniformly held that, in order to a valid lien, under its provisions, the relation of creditor and debtor must be first established, and, applying the principle that the property of a lessor could not be held for the debt of the lessee, unless a contract to pay on the part of the lessor could be expressly shown or- reasonably inferred from the circumstances. Boone v. Chatfield, 118 N. C., 916; Nich olson v. Nichols, 115 N. C., 200; Bailey v. Rutjes, 86 N. C., 517; Wilkie v. Bray, 71 N. C., 205; Boisnot on Liens, sec. 289.
Not only do tbe facts in tbe present case fail to sbow any contract on tbe part of tbe lessor or any conduct from wbicb sucb a contract could be equitably and reasonably inferred, but, in tbe lease itself, duly registered under tbe requirements of law, Revisal, sec. 980, there appears a provision expressly negativing any and all liability on tbe part of tbe landlord for tbe contracts or liabilities of tbe lessee. Speaking to tbis question, in Bailey v. Rutjes, supra, Ruffin, J., said: "But in tbe 'Case at bar, tbe defendants, if tbeir testimony is tu be believed, bad leased tbe premises to Rutjes for five years, and be bad undertaken to bave tbe improvements made wbicb called for tbe use of tbe lumber furnished by tbe plaintiff. They were therefore absolutely without tbe power either to give or to withhold tbeir sanction to its delivery and use, and ought not to be required to pay for it, unless they knew, or bad reason to believe, that tbe plaintiff was looking to them for pay for bis lumber, and allowed him to deliver it under that expectation and without objection on tbeir part." And tbe case of Boone v. Chatfield is an authority decisive against plaintiff, on tbe facts stated in the complaint. Tbe lease having been avoided under a forfeiture clause contained in the instrument for nonpayment of rent, and there being no contract shown, on tbe part of tbe lessor, expressed or implied, tbe interest of tbe owners may not' be subjected to plaintiff's claim. 2 Jones on Liens, sec. 1273, in which it is said: "A mechanic's lien attaches to a lessee's leasehold estate, subject to all tbe conditions of tbe lease, although tbe lessee has made valuable improvements, wbicb are to become tbe property of tbe lessor at tbe end of tbe term or which are to revert to him upon his failure to perform tbe covenants of the lease. TJpon tbe lessee's default, tbe property reverts to tbe lessor, free from the lien of mechanics, unless these are in some way protected by the statute."
We were referred by counsel to numerous authorities in wbicb a mechanic's or material man's lien, arising by reason of a contract for improvements, through or with tbe lessee, bad been enforced against the interest of tbe lessor, but all of these, so far as examined, were on statutes which in terms provided for such a liability or were on contracts in which the lessee was held to have contracted as agent for the lessor. Thus, in Haus v. Amusement Co., 236 Ill., 458, the lien was given by statute "where the contract for improvements was made with the owner or with one whom the owner has authorized or knowingly permitted to contract for such improvements," etc., and in Burke v. Harper, 79 N. Y., 273, the statute made provision for the lien on the property "where the contract for repairs, etc., was made by the owner or his agent or . with any person
permitted by the owner to build, repair, or improve the same." But, on a different statute, substantially similar to our own, the New York Court held that a lien for improvements, made under contract with the lessee, could not be enforced against the interest of the landlord. Knapp v. Brown, 45 N. Y., 207. In Kremer v. Walton, 11 Washington, 120, it was held that under the terms of the lease the contract for improvemtents was made for the lessor, and the lien was therefore enforcible against his interests; but, under a lease like this now before us, the same Court, Mills v. Gordon, 8 Washington, held: "That the liens of mechanics and material men, for labor performed and -material furnished in the alteration and repair of buildings, at the instance of the lessee' thereof, attached only to the leasehold interest, and do not bind the owner in the absence of authority to the lessee to act as his agent."
In the present lease, as we have heretofore shown, the improvements were to be made by the lessee, and any and all liability of the owners therefor is expressly negatived. There is no error, and the judgmentt sustaining the demurrer is
Affirmed.