Court Opinion

ID: 9661429
Source: CourtListenerOpinion
Date Created: 2023-08-23 22:38:58.070457+00
Date Added: 2024-06-11T18:14:28.482106
License: Public Domain

Ed. F. MoF addin, Justice (concurring). To the majority opinion and the dissenting opinion, I desire to add this concurring opinion, to explain why I think the majority has reached the correct conclusion on the issue discussed in the dissenting opinion. On February 4, 1952, Mr. Stewart executed a mortgage to Mr. Hughes for $10,000.00. Of this amount, the sum of $4,500.00 was used to retire indebtedness then owed by Stewart; and the sum of $5,500.00 was agreed to be paid by Hughes to Stewart when, as, and if Stewart built certain cabins on the mortgaged lands. The Hughes mortgage was recorded on February 7,1952. Payment of the $5,500.00 was made in installments in April, May, July, and August, 1952. Beginning on February 20, 1952, Ashdown Hardware Company (hereinafter called “Ash-down”) furnished materials to Stewart for use in the construction of the four cabins; and, primarily, this is a suit to determine the superiority of the mortgage lien of Hughes over the materialman’s lien of Ashdown. As to the $5,500.00 advanced in the course of the construction, the majority holds that the Hughes mortgage is superior. I agree with that holding; and I understand the dissenting opinion does not disagree with such result. It is as to the $4,500.00 which Hughes paid to Stewart on February 4, 1952, that the dissent arises. The majority holds that the Hughes mortgage for the $4,500.00 is superior to Ashdown’s lien; and the dissenting opinion is of the opposite view, relying largely on the case of Peoples B. & L. Ass’n v. Leslie, 183 Ark. 800, 38 S. W. 2d 759, a case not discussed in the majority opinion. Independent of the principle of subrogation, I think the majority is correct in holding the. Hughes mortgage lien to be superior to Ashdown on the $4,500.00 item, because the case of Peoples B. & L. Ass’n v. Leslie Lbr. Co., supra — relied on in the dissenting opinion — has facts which clearly distinguish it from the case at bar. In the cited case, Peoples B. & L. Ass’n had sold property to Ish for $500.00 cash and a vendor’s lien for $19,500.00, and in addition had reqtdred Ish to make certain improvements which resulted in the lien of Leslie Lumber Company. This Court held that Peoples B. & L. Ass’n required that the improvements be made, and that such requirement was the point that differentiated the Peoples-Leslie case from the general rule stated in Gunter v. Ludlam, 155 Ark. 201, 244 S. W. 348. Here is the language of this Court on this point, as found in the Peoples-Leslie case: “ ‘The statute (C. & M. Dig., § 6911) gives priority to liens for labor or material only against other incumbrances created after the commencement of the improvement, and in effect subordinates the lien to prior incumbrances by way of mortgage or otherwise. ’1  “The. contract for sale in the instant case expressly provided that the improvements should be made, and this was a part of the consideration. The appellant authorized the improvements itself, required them to be made, and according to its own testimony, knew that the improvements were being made and knew that Parker was doing the work. . . . “If a sale of the place had been made by appellant to Ish and no improvements authorized by the appellant, and the purchaser had thereafter made improvements without any authority from the vendor to do so, under the principle announced in Gunter v. Ludlam, supra, the vendor’s lien would have been prior to the mechanic’s liens; but when the owner contracts to sell the place and expressly requires the improvements to be made for its own benefit, it cannot then claim that its lien is superior to the lien of persons furnishing labor or material.” In the case at bar, Hughes did not require Stewart to build any of the four cabins that resulted in the lien claim of Ashdown: rather Hughes merely obligated himself to furnish the $5,500.00 to Stewart when, as, and if the cabins were built. The mere fact that Hughes agreed to make further advances — as Stewart might require — should not defeat the superiority of Hughes’ mortgage for the $4,500.00 that he advanced to Stewart before any materials were furnished by Ashdown. I do not understand that the case of Peoples B. & L. Ass’n v. Leslie Lbr. Co. goes to such an extreme. Of course, under § 51-605 Ark. Stats., Ashdown might have enforced a prior lien on the cabins — if they were removable from the land. Imboden v. Citizens Bank, 163 Ark. 615, 260 S. W. 734; Fine v. Dyke, 175 Ark. 672, 300 S. W. 375, 58 A. L. R. 907; Morrilton Lbr. Co. v. Groom, 176 Ark. 520, 3 S. W. 2d 293. But the issue of removing the cabins from the land is not involved in this case. For the reasons herein stated, I agree with the result reached in the majority opinion; and I am authorized to state that Mr. Justice Robinson joins in this concurrence.   C. & M. Dig. § 6911 is now § 51-607 Ark. Stats.