Court Opinion

ID: 9719253
Source: CourtListenerOpinion
Date Created: 2023-08-26 07:46:37.396924+00
Date Added: 2024-06-11T18:24:05.491388
License: Public Domain

Martin, J.
There was a complaint filed by appellant against the appellees Hastings for foreclosure of a mechanic’s (materialman’s) lien against the real estate owned by appellees Hastings.
The issues in regard to the furnishing of material in question were found in favor of appellees Hastings and against the appellant as to the foreclosure of the mechanic’s lien here involved. The court also found that $790 tendered by appellees Hastings and paid into court as the unpaid balance due from them to John Oldenkamp should be credited upon appellant’s demand against the latter. A finding was against appellees Hastings on the cross-complaint against John Oldenkamp.
The error assigned and relied upon for reversal by the appellant is that the court overruled its motion for a new trial.
The reasons alleged in the motion for a new trial are that the decision of the court is not sustained by suffi*351cient evidence and that the decision of the court is contrary to law.
The record, when considered most favorable to the appellees and with reasonable inference against the appellant, discloses that the appellees Hastings in November, 1948, entered into a no-lien contract with one John Oldenkamp, under the terms of which he was to build a house for them on Lot Number 37 in Section “A” of Bonbrook Addition. The record shows that the appellees Hastings did not post signs on the property as required by the statute. Burns’ 1942 Replacement (1949 Supp.), §43-701.
Leroy Hastings testified that after recording this contract he had a conversation with Dean Krom at the Wilkinson Lumber Company concerning materials, in which he told Krom that he had a no-lien contract with John Oldenkamp to build a house in Bonbrook Addition; that he understood from Mr. Oldenkamp that he was to buy a part of his supplies from the Wilkinson Lumber Company. He further testified that he told Mr. Krom that he would appreciate it if he would let him know if John Oldenkamp did not keep his bills paid as he understood he (Mr. Oldenkamp) did not have very much money, to which Mr. Krom answered, “You need have no fear because we have a credit arrangement with John Oldenkamp whereby if he does not pay, we shut off his credit.” He said we had nothing to worry about as far as payment of the material between the lumber company and John Oldenkamp as he would take care of that. The following question was asked Mr. Krom with reference to the conversation with the Hastings: “Did they at any time say anything to you about not wanting any liens filed against the house that was being built?” Mr. Krom made the following answer: “They said they wanted to make sure that their house had no liens filed against it.” *352Following this date Mr. Hastings made no inquiry of the Wilkinson Lumber Company as to whether or not their account had been paid until on May 17,. 1949. Hastings further testified that on November 3rd he paid Oldenkamp $500 under the contract; that he paid Oldenkamp under this contract'on December 7, 1948, $2,000; on January 10, 1949, $3,000; on February 15, 1949, $3,000; on March 19, 1949, $1,000; on April 13, 1949, $2,000; on May 7, 1949, $500; totaling $12,000. He also paid him some extras, $197.97 on February 15th and $37.19 on April 4th. $790 had not been paid on the contract price.
The second and third paragraphs of appellees Hastings’ answer are on the theory of estoppel, relying upon a credit arrangement which the appellant had with the contractor, John Oldenkamp. 31 C. J. S., Estoppel, §67, p. 254, reads in part as follows:
“In order to constitute an equitable estoppel or estoppel in pais there must exist a false representation or concealment of material facts; it must have been made with knowledge, actual or constructive, of the facts; the party to whom it was made must have been without knowledge or the means of knowledge of the real facts; it must have been made with the intention that it should be acted on; and the party to whom it was made must have relied on or acted on it to his prejudice.”
In the case of Johnson v. Spencer (1912), 49 Ind. App. 166, 96 N. E. 1041, it is stated as follows.:
“An estoppel in pais arises when by the fault of one person another has been induced, ignorantly or innocently, to change his position for the worse. Its existence is determined by the acts, knowledge and conduct of both parties.”
*353*352Even though a materialman relies primarily upon the credit of the contractor, he does not thereby wáive, *353forfeit or estop his right to a lien when he furnishes material for a building and the material is used in the building. Clark et al. v. Huey et al. (1895), 12 Ind. App. 224, 40 N. E. 152; Johnson v. Spencer, supra; Kendall Lumber & Coal Co. v. Roman (1950), 120 Ind. App. 368, 91 N. E. 2d 187.
The statute, by its terms, gives the lien, upon proper notice filed by materialmen for materials furnished for a building, to the extent that they are used therein. Burns’ 1942 Replacement (1949 Supp.), §43-701. If the materialman furnished the materials for the building, and they "are used in it, and the improvement is being made by the authority and direction of the owner, the right to the lien attaches. Clark et al. v. Huey et al., supra.
The lien is not the creature of the contract, but of the law. It is the law, and not the contract, which gives the lien. Clark et al. v. Huey et al., supra; Shilling et ux. v. Templeton (1879), 66 Ind. 585; Vail et ux. v. Meyer (1880), 71 Ind. 159.
It- has not been the policy, of the courts to require from the mechanics and materialmen more than the statute itself demands. These statutes are entitled to a liberal construction in favor of the lien-holder. Clark et al. v. Huey et al., supra.
It is our opinion that the materialman does not lose his lien simply because he furnishes the materials for the house upon the order and credit of the contractor, and not upon the credit of the house, even if this latter fact was made to appear. Where the contractor is himself, by the terms of his contract with the owner, to furnish the materials, he buys them, and, unless he pays cash, is necessarily bound for them. He is primarily and personally liable therefor to the materialman. If he fails to pay, and a lien is *354taken and paid by the owner, he may deduct the amount from any sum due the contractor, or he may sue the contractor therefor if necessary. Clark et al. v. Huey et al., supra.
In the case of Johnson v. Spencer, supra, the court quoted with approval from Clark et al. v. Huey et al., supra, as follows:
“ ‘When the work is done on the building for the contractor of the materials furnished to him to be used in that particular building, and they are so used, the laborer or materialman is entitled to a lien upon filing'the proper notice at the proper time, subject to his power to waive the lien by contract, or to estop himself from asserting it by acts which would create an estoppel in any other case; but simply furnishing the goods or doing the work on the order and credit of the contract or without' any present intention of creating a lien is not a waiver nor an estoppel.’ ”
In 155 A. L. R., §62, p. 350, we find the following language:
“The doctrine of equitable estoppel or estoppel in pais is said to be founded upon principles of morality and fair dealing and to be intended to sub-serve the ends of justice. It always presupposes error on one side and fault or fraud upon the other and some consequent change of position of which it would be inequitable for the party against whom the doctrine is asserted to take advantage. The consideration upon which estoppel of this character proceeds is that the author of a misfortune shall not himself escape the consequences and cast the burden on another. Accordingly, it holds a person to a representation made or a position assumed where, otherwise, inequitable consequences would result to another who, having the right to do so, under all the circumstances of the case, has in good faith relied thereon and been misled to his injury.
“The essential elements of an equitable estoppel have been said to be as follows:
“(1) Conduct of the party estopped which amounts to a false representation or concealment *355of material facts, or, at least, which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert;
“(2) Intention on his part that such conduct shall be acted upon by the other party, or at least expectation that it will be acted upon by him;
“(3) Knowledge on his part of the real facts;
“(4) Lack of knowledge on the part of the party claiming the estoppel and of means of knowledge of the truth as to the facts in question;
“(5) Reliance upon the conduct of the party estopped; and
“(6) Action based on such reliance of such a character as to change his position prejudicially.”
The question in controversy' is whether or not the acts and representations are such as to constitute the basis for estoppel. The burden of proof of such estoppel was upon appellees Hastings. The Indiana Statute requires that, in order for an owner to be free from materialmen’s liens for material furnished in erection of a building on such owner’s land under a no-lien contract with the contractor, the building contract must be filed in the County Recorder’s office and a sign placed conspicuously upon the premises, announcing that the work is being performed under a no-lien contract. Burns’ 1942 Replacement (1949 Supp.), §43-701.
The above act made it imperative that there be both a recording of the contract and the posting of the notice as prescribed by the statute. In this case there was a recording of the contract but no compliance with the posting of the sign on the property.
Mechanic’s lien statutes must be strictly construed in regard to performance of designated acts whereby the owner may relieve his property from a laborer’s or materialman’s'lien.
*356The appellee admits that the appellees • Hastings did not comply with the statute in regard to the placing of signs on the real estate in question. The purpose of the no-lien statute was to provide the owner a way of escape by following the statutory requirements for exemption.
The substance of the conversation relied upon by the Hastings for an estoppel, according to appellees Hastings, was, that Leroy Hastings told appellant’s local agent, Dean Krom, that Hastings had a no-lien contract with John Oldenkamp to build the house here involved; that Hastings would appreciate it if Krom would let him know' if Oldenkamp did not keep his bills paid up; that Krom answered, “you need have no fear because we have a credit arrangement with John Oldenkamp whereby, if he does not pay, we shut off his credit.” Krom further stated that Hastings had nothing to worry about as far as payment of the material between the lumber company and John Oldenkamp was concerned, that Krom would take care of that. Mrs. Hastings added to the foregoing that Krom said: “I will take care of it and will let you know.” Nothing was. said about appellant not filing a lien for its claim.
Assuming appellees. Hastings’ version of this conversation was correct, it was not sufficient to support an estoppel in pais, as against appellant.
There is no evidence in the record that the Hastings relied upon Krom’s statements and for that reason did not place a sign upon the property in question |in.d also for that reason were induced by said statements to make the payments to Oldenkamp. “The rule is well established that one who insists upon the acts or admissions of another working an estoppel must show that he acted upon and was influenced by such acts or ad*357missions to do some act which would result in an injury if the other is permitted to withdraw or deny the act.” Evans v. Odem (1902), 30 Ind. App. 207, 212, 65 N. E. 755.
“An essential element in every estoppel is that the representation or concealment shall have been relied upon, and the conduct of the person to whom it is made thereby induced.” Fuelling v. Fuesse (1909), 43 Ind. App. 441, 87 N. E. 700, 702.
Taking the Hastings’ version of the evidence into consideration, they were in no way prevented by Krom’s statements from protecting themselves under the no-lien statute. Under the statute, the mere fact that the materials were furnished on the credit of the contractor would not be an extinguishment, waiver or estoppel of the plaintiff’s lien. Here there is no pretense of an agreement to waive, nor are there any facts which would create an estoppel.
The rule is that an estoppel must be specially pleaded, and that strictness in pleading it is essential. No ihtendments are made in favor of a plea of estoppel, and it is incumbent upon the pleader to fully plead all the facts essential to the existence of an estoppel. Troyer et al. v. Dyar, Commissioner of Drainage (1885), 102 Ind. 396, 399, 1 N. E. 728; Sims v. The City of Frankfort et al. (1881), 79 Ind. 446, 452; Stewart v. Beck et al. (1883), 90 Ind. 458, 459.
In so pleading and proving, the pleader must state and prove present, existing facts upon which the estoppel is supposed to rest, and’ not allegations as to future conditions or performances; This requirement was not here met.
The only statement here attributed to Dean Krom which related to a present existing fact was, “You need have no fear because we have a credit arrangement *358with John Oldenkamp.” In our opinion that statement alone was not sufficient to create an estoppel.
The other statements attributed to Dean Krom did not relate to the present, but looked wholly to the future. They pertained to shutting off Oldenkamp’s credit if he did not thereafter pay his bills; that Krom “would take care of” Oldenkamp’s payments for mate-rial and “would let” the Hastings know if Oldenkamp did not pay promptly. These were not assertions of present, existing facts, and therefore could not be the basis for an estoppel. Roose v. McDonald (1864), 23 Ind. 157, 161; Mitchell et al. v. Fisher (1883), 94 Ind. 108, 110.
In the case of Roose v. McDonald, supra, the court said: “The declarations and statements complained of were as to the future conduct of the plaintiff, and not • in relation to any existing fact at the time. The matters set up are not sufficient to create an estoppel in pais.”
The other defense advanced by the appellees Hastings was the denial of the validity of the lien as not being - filed in time. The evidence shows that* the mate-
rialman’s lien was dated and filed September 13, 1949. Exhibit 158, the evidence. shows, was issued and delivery made on July 18, 1949, while the exhibit with the complaint shows this item as being dated June 19,1949. Appellees having made no objection to the introduction of Exhibit 158 on the ground of variance between the date stated therein when offered in evidence and the exhibit to the complaint, such objection will be considered waived. Taylor v. State (1891), 130 Ind. 66, 69, 29 N. E. 415; Kruger v. State (1893), 135 Ind. 573, 35 N. E. 1019; Latshaw v. State, ex rel. (1901), 156 Ind. 194, 205, 59 N. E. 471; Bradley v. State (1905), 165 Ind. 397, 402, 75 N. E. 873, 875.
*359*358Aside from the correctness of August 2, 1949, as the *359date on Exhibit 159, Exhibit 158 shows a date of July-18, 1949. Since appellant’s lien was filed September 13, 1949, it was taken 57 days after the material, shown by Exhibit 158, was delivered and was well within the statutory period. Even if appellees’ contention as to Exhibit 159 be conceded, the lien was filed within the time required by law. The evidence introduced, not the exhibit filed with the complaint, controls as to the proper date of Exhibit 158. Lucas v. Smith et al. (1873), 42 Ind. 103, 105; Davis et al. v. Doherty et al. (1879), 69 Ind. 11, 14.
As any variance between the complaint and Exhibit 158 as filed could be amended at the trial, it will, on appeal, be deemed to have been so amended. Allen v. Hollingshead (1900), 155 Ind. 178, 181, 182, 57 N. E. 917.
In our opinion the record herein leads inescapably to the conclusion that the judgment of the trial court denied appellant the relief to which it' was entitled under the law, therefore, the judgment is reversed with instructions to sustain appellant’s motion for a new trial and for further proceedings not inconsistent with this opinion.
Achor, J., dissenting, with opinion.