Court Opinion

ID: 6747523
Source: CourtListenerOpinion
Date Created: 2022-07-20 23:59:27.90833+00
Date Added: 2024-06-11T16:02:08.266080
License: Public Domain

ROSS, J.,
dissenting:
I cannot concur in the conclusion of the majority of the court that the evidence shows that the entire amount of money paid to Nellie E. Robbins was used in paying off legal claims against the particular building covered by the mortgage upon which the Loan Association depends for its priority.
It does appear that part of this money was used to further the construction of the building, but it also appears that Nellie E. Robbins received $2586.89, which is wholly unaccounted for. Mrs, Robbins stated:
“Judge Ross: Did you spend any; part of that money for anything else?
The .Witness: You mean personally?
Judge Ross: Yes.
The Witness: No, sir, I never got. anything out of any of that money.
Q. You don’t know wnich houses this money was used for do you? Yhu don’t know what jobs the money was paid out on?
' A: Well, there were a few houses going at the sanie time.
*252.Q. There were three, weren’t there?
A. I believe there were three.
Q. You don’t know which jobs this money went to?
A. No.
Q. You did not keep track of it?
A. What do you mean, I didn’t keep .track of it?
Q. You didn’t have any record?
A. No, I didn’t have any books.”
In the trial court, which evidence is before this court by stipulation, Mrs. Robbins stated:
> “Q. You don’t know where that money went or to whom?
A. Yes, I stated to pay bills.
Q. To who?
A. For small bills, people who worked on the job, carpenters, laborers.
Q. Can you name one who got the money?
A. I couldn’t. You will have to ask Mr. Robbins.”
And, again:
“Q. Did you have charge of the books on these jobs?
A. No.
Q. Who took care of the books?
A. We didn’t have books, but Mr. Robbins took care of bills and all that.
Q. Did he have a separate account for each job?
A. You will have to ask him that; I don’t know.”
It is obvious that the witness does not know whether the money she received was used for the buildings covered by the mortgage or not. All she does know is that she personally did not use it for her' own purposes.
Sec. 8323-8 GC, provides:
“This act (§§8310 to 8323-10 GC) is hereby declared to be a remedial statute and to be construed liberally to secure the beneficial results, intents, and purposes thereof;-' and - a substantial compliance with its several provisions shall be sufficient for the validity of the hen or liens hereinbefore provided for and to give jurisdiction to the court to enforce the same.”
There appears to be no question in this case as to the perfection of the Lumber Company’s lien. Therefore, the case of Constance & Sons v Lay et, 122 Oh St 468, has no application.
It does not seem unreasonable, in view of the priority extended to construction mortgages, that those seeking such priority should comply with both the letter and spirit of the statutes securing such priority. Certainly, it does not seem to be placing an unreasonable burden upon the mortgagee to require that it be both alleged and proved that the consideration for the mortgage was used to pay for material or labor used in the construction of the building covered by the mortgage.
Some reliance is placed upon a paragraph of §8321-1, reading as follows:
“The mortgagee shall not be responsible for a mistake of the owner in determining priorities, or for any failure of the payee to properly distribute funds paid on the written order of the owner.”
What is meant by the statement that the “mortgagee shall not be responsible for”, is to say the least ambiguous when considering priorities involving the mortgagee and other lien holders, whose liens are secured by statutes of equal dignity with that of §8321-1. The instant controversy does not involve a dispute between the mortgagor and mortgagee. Possibly in such a situation, the paragraph quoted might have application. It can have no application in depriving a lien holder of a lien which is secured by the statutes of Ohio, which have not been directly or inferentially repealed.
Such being the case, it is my opinion that the mortgage should be postponed in priority to the extent of the money received by Mrs. Robbins ($2,586.39), and which she is unable to state was used, as is required by the statute, in the construction of the buildings.