Yarhola v. Long-Bell Lbr. Co.

Opinion by STEPHENSON, C. An association of several people in the city of Weleetka, undertook the construction of a hotel. The company was incorporated as the ’‘Legion. Hotel,” and undertook to sell stock to finance the building. About $24,000 worth of the stock was subscribed for by numerous persons. S. N. Ornig was the manager of the Long Bell Lumber Company at Weleetka. Mr. Craig also was associated with the people who proposed to build the hotel, and took an active part in promoting the enterprise. Hill Moore1 and H. A. Dolan were the duly appointed and acting iguardians of Cussehta Yalrhola, an incompetent. The hotel company borrowed $36,000 from the estate of che incompetent, which was used in financing the construction of the hctiel. The payment of the indebtedness was secured by a mortgage on the property. About $7,500 of tbe money borrowed from the estate of Yarhola was paid to the Lclng-Bell Lumber Company for material. About $8,000 remained unpaid t<> the lumber, company for material, and tbe company filed its mechanic’s lien against the property. The Long-Bell Lumber Company commenced an action to foreclose its mechanic’s lien .against the hotel company, m which Cussehta Yalrhola was joined as a defendant. The latter filed a cross-action for the purpose of causing his mortgage to be declared a first .and prior lien on the property. The trial of the cause resulted in the mortgage ai Yarholai being declared1 inferior to the lien of the plaintiff. The de fendant has perfected his appeal and assigns several errors for reversal of the judgmenc. The plaintiff in error relies upon an agreement with S. N. Craig, the manager of the plaintiff company, for declaring the me- *11 chanie’s lien of the latter inferior to that of the appellant. The determination of the question of prioricy between the parties musí be rested on the alleged agreement, anL proof in support thereof. The question off priority was an issue of fact involved in the trial of the cause, and was found against the plaintiff in error. If the judgment of the court is not against the dear weight of the evidence, it will not be necessary to pass upon the several questions of law presented by the plaintiff in error. It appears to- be the contention of the plaintiff in error thac S. N. Craig was an officer in the hof-tel company, and also the manager of the plaintiff corporation. The plaintiff in error contends that the lumber company, through its manager, agreed to treat and consider the mortgage of the plaintiff in error as a firsc mortgage. The plaintiff in error apparently assumed thait all the conditions happened,' which were agreed upon, for treating the plaintiff in error’s mortgage as a first lien. Hill Moore, one of the guardians who made the loan, testified in this cause as to the conditions upon which the loan was made. The guardian testified in part as follows, in relation to the proposal of Craig: “Mr. Craig and myself discussed how much the hotel would cost, and I did not want to loan more thaln 50 per cent, of the value, and I figured up the amount of thei stock subscribed, and he made the statement that if he collected the stctek and gox $36,-000 loan, he would carry a second mortgage for the balance.” H. A. Dolan, the other 'guardian, in relation to the agreement with S. N. Craig, testified as follows: “Just a general discussion as to whether these bills were being taken care; of or not; it came up at one of the meetings at which I was present, and they insisted on getting money right then, so they icould go a-hdad and pay the lumbeij bill, and we asked for a bond, and as I remember, Craig said 'they would take care of the amount over the loan, and over the amount that was subscribed, and carry it themselves.” Two other witnesses testified in substance ta similar statements of (Craig, The amount of stock subscribed for was $24,000. There was only abctat $3,000 paid into the company on the stock. According to the evidence introduced by the plaintiff in error, S. N. Craig agree/d that his company would carry a second mortgage for that part of the indebtedness and cotet of '¿he hotel remaining after the $24,000 received from stock, plus the loan, had been applied in payment of the indebtedness. The .judgment of the court, which denied the mortgage of the plaintiff in error the effect of a first lien, is not against the clear weight of the evidence. This court will weigh the evidence in a case of purely equitable cognizance, but will not reverse the judgment unless it be icleairly against the weight of the testimony. Orth v. Gregory, 98 Okla. 229, 223 Pac. 385. The judgment is affirmed. By the Court: It is so ordered.