Heagney v. Hopkins

Beekman, P. J. It appears from the record that one William Engel, the owner of certain property, entered into ia contract with the defendants Hopkins and Roberts, under which the latter agreed to do certain work towards the erection of a building upon said premises, and they in turn contracted with the plaintiff in this action to do the plumbing and gasfitting work. Liens were subsequently filed by Hopkins and Roberts and by the plaintiff in this action respectively, and thereafter the former instituted an action for the foreclosure of their lien against Engel, making the plaintiff a party defendant. Such proceedings were thereupon had that after a trial of that action judgment was rendered against the owner, under which both of the liens were fully established, and the usual directions given for the sale of the property and the payment of such liens out of the proceeds. Before the commencement of such 'action the lien of the plaintiff herein was discharged, pursuant to the statute, upon the execution and delivery of a bond to the clerk of the city 'and county of Hew York by Hopkins and Roberts, as prin — 610 — cipals, and the defendants Adler and 'Donges, as sureties. The condition of the bond was that if “Le Boy Hopkins and John B. Boberts, their heirs, executors or administrators, shall well and truly pay any and all judgments which may' be rendered against said property in favor of said Eugene E. Heagney, his legal representatives or assigns, in any action or proceeding to enforce his alleged lien, then this obligation shall be void, otherwise to remain in full force and virtue.” The judgment was rendered on the 10th day of July, 1896, and on the 19th day of August of the Same year an appeal was taken therefrom by the owner to the Appellate Division, and on the same day an undertaking was given by him: in Such form as to stay execution of the judgment so appealed from. Subsequently, and before the hearing and determination of such appeal, this action yas brought upon the bond which had been given for the purpose of discharging plaintiff’s lien upon the premises.. The defendants have answered, setting up, among other things, the pend-ency of the 'appeal and the giving of the undertaking thereon. Upon !the trial the court dismissed the complaint upon the merits. The General Term of the City Court modified the judgment, striking .out the.words “ upon the merits,” but as so modified affirmed it,, apparently, as disclosed by their opinion, on the ground that the condition of the .bond contemplated a final judgment against the property, and that as the judgment in the foreclosure proceedings had been appealed from, which appeal was still pending, the judgment was not final and the plaintiff’s action had been prematurely brought. The counsel for the defendánts urges the further point that no action can be separately maintained upon such a bond, but that the sureties should have been made parties to the foreclosure action, and he cites in support df his claim 'the case of Morton v. Tucker, 145 N. Y. 244. It is, 'however, unnecessary to enter upon any discussion of the question in view of the fact that the Appellate Division in this department in. the case of Ringle v. Matthiessen, 10 App. Div. 274, has held otherwise. By that decision we .are bound, and the question is, therefore, no longer an open one,here. We are thus left to consider only two questions which the record presents for discussion: (1.) Whether the undertaking on. appeal ‘in the foreclosure proceedings operated as ;a stay of any proceedings for the enforcement of the bond; (2) the construction to be given to the condition of the bond. . At the outset it is necessary to call attention to the fact that the bond in this case was not given by the owner, Engel,- but by the principal contractor. ; This — 611 — is no longer permissible under the provisions of the Lien -Law as it now stands (chap. 418, Laws of 1897, § 18), but at the time the bond in question was given and the hen discharged the statute was broad enough to include the contractor, and a bond given by him as the moving party, seeking a discharge of ¡the hen, was held to be "within the purview of the statute. N. Y. Lumber & Woodworking Co. v. Seventy-third Street Building Co., 22 N. Y. St. Repr. 314. Where the bond is executed by the owner, he still continues chargeable, so to speak, with respect to the hen by the substitution of his personal engagement for the land, and the sureties who-join in the execution of the bond are sureties for him and entitled to resort to him for reimbursement if they are compelled to pay upon a breach of the condition. There is, therefore, an obvious distinction between such a bond and one given by the contractor. In the latter case the contractor becomes the principal, and the sureties are sureties for him and bound only to the performance by him of the obhgation which they have entered into. The importance of this distinction in its bearing upon the question under examination, will be apparent. Where the lien is discharged upon the owner’s bond, he is necessarily interested in any attempt to enforce it; and where the method adopted is by first obtaining a judgment in foreclosure proceedings, establishing the lien against the property, and then prosecuting the bond, there is considerable force in the claim that the latter action is one brought to secure the fruits of the foreclosure judgment, and, therefore, subject to the stay of execution affecting that judgment. That judgment, While against the property, in one sense, is so only as a matter of form; that.is, while it determines that the lien was a valid and enforcible one; it stops there and declines to enforce it because of its discharge. It simply establishes a right without providing means for its enforcement. Where, then, the owner has appealed from the judgment of foreclosure and has obtained ¡a stay of proceedings pending the appeal in the maimer provided by law, the argument is certainly a very persuasive one that, during its continuance, it operates to prevent any action ,upon the bond given by the owner upon a discharge of the lien. It has been held that such a stay is effectual against any proceeding “ to enforce the plaintiff’s rights under the original judgment, or to obtain the fruits of it.” Morey v. Tracey, 92 N. Y. 581. While suggesting the force of this contention, we do not propose to pass upon it in view .of the fact that in the case before us the lien was discharged and the bond given not by the owner but by the con — 612 — tractor. The suit which has-been brought upon the bond is against the contractor and his sureties, and not against the owner, to whom it is a matter of indifference whether there is a recovery upon it or not. The stay which he has obtained is for'his own benefit, intended as a protection to him against proceedings to his hurt under or on the footing of the judgment while the appeal is pending; and as this action is not for the enforcement of the original judgment or to secure the fruits of it as against Jii/in 'it cannot be properly claimed that it comes within the operation of the stay. There áre certain features of the case which at this point it is proper to refer to. The validity of the lien of the plaintiff is dependent upon the determination of the question whether the owner owed the defendants, Hopkins and Roberts, the principal contractors anything; otherwise it was not the- subject of dispute. The controversy was entirely with respect to the indebtedness of the owner to Hopkins and Roberts and the validity of their lien, which had .not been bonded and discharged. The judgment passed in their favor, and provided for a sale of the property to satisfy the amount of their claim, so that there was a sufficient reason in this fact alone for the securing by the owner of a stay of proceedings pending his appeal. While it is true that the judgment apparently makes provision for the payment of the plaintiff’s claim out of the proceeds of the sale, it is- none the less to be treated as in that respect merely formal Certainly the plaintiff, having brought his action on the bond, the-consideration of which was the discharge of the hen, could not be allowed to take any other position. It is thus apparent that the only person who might be in a position to claim the application of the stay to this action is not a party to it nor apparently interested in its event. The contractors who in this action are seeking the benefit of the stay are those against whom it is leveled, ,who are themselves subject to its restraining force, and who are the respondents on the appeal, there contending that the judgment is irre^versible for error and should stand, while the sureties are strangers to the owner and bound not for the payment by him, but by the contractors of any judgment rendered against the property in favor of the plaintiff, tinder the peculiar facts of this case we conclude, therefore, that the existence of the stay in question is not available as a defense in this action. • The contention that there has been no breach of the condition of the bond, because, by reason of Ithe appeal, the; judgment lacks the attribute of finality, and that this action has, therefore; been — 613 — prematurely brought, is also untenable. It will be observed that the condition is very broad in its terms, binding the'parties to the payment of “ any and all judgments which may be rendered against the property” in favor of the plaintiff. Of course, this imports that the judgment so rendered must be final as distinguished from an interlocutory judgment, but there is no claim made here, nor could there be any that the judgment in question is not final in that sense. It is .a complete determination of the rights of the parties to the suit with respect to its subject-matter, leaving no further question or direction for future determination, except such as may be necessary to carry it into effect. 12 Am. & Eng. Enc. of Law, p. 63; Morris v. Morange, 38 N. Y. 172. In the latter case the court held that a judgment of foreclosure of a mortgage was a final judgment, and as the action to foreclose a mechanic’s lien is by statute assimilated to one for the foreclosure of a mortgage, the case is an authority here. It is true that, the words “ final judgment ” are often used to designate a judgment which is irreversible on appeal, or one from which no appeal will lie, and where the case is one in which it is apparent that the words were used in that sense, effect must be given to them accordingly. But there is nothing in the case before us to justify such an extreme construction. The language here used is “ any and all judgments which may be rendered against the property,” and the judgment in question responds clearly and naturally to that description. The word “-final ” is not used, and there is not, therefore, the possible suggestion which might then have arisen that as the judgment of foreclosure would have been final in the legal acceptation of the term without such a characterization, the employment of the word tended to show that the ■ parties had in contemplation something more, namely, a judgment final in the sense that it was to be beyond the reach of reversal. We do hot think that the terms of the bond call for any such construction. So to hold would be to impose a special and limited meaning upon the language used narrower than its ordinary and natural import, which, if intended, could have been aptly expressed in appropriate terms. It would also result in difficulties and embarrassments in the enforcement of such obligations which would be quite' opposed to the spirit of the Mechanics’ Lien Law, the object of which is to secure a certain and speedy method of satisfying the demands for which such liens are given, and which is required to be liberally construed to that end. The mere pendency of an appeal does not affect the validity or effect of the judgment pending the — 614 — appeal. Storrs v. Plumb, 30 Hun, 319, 320. An .action may still be maintained upon such' a 'judgment, provided its enforcement has not been actually stayed ‘while the appeal is pending (Faber v. Hovey, 117 Mass. 107; Clark v. Child, 136 Mass. 344; Taylor v. Shew, 39 Cal. 536; Merchants’ Ins.. Co. v. De Wolf, 33 Penn. St. 45; Suydam v. Hoyt, 1 Dutch. [N. J.] 230); and notwithstanding it is appealed from, it may Still be pleaded as a bar while it remains ünreversed. Harris v. Hammond, 18 How. Pr. 123, Sup. Ct., Gen.Term. It is plain, therefore, that a judgment does not lose its character or abate in any of its essential attributes, because it has been ap- . pealed from, so long as it is unreversed: so that, in the case at bar, the mere fact that an appeal had been taken did not diminish or suspend the obligation which the defendants entered into to pay the judgment. which had been rendered in plaintiff’s favor. In other words., it was no defense to the action. It is urged that this involves great hardship, and would result in a denial of justice should the judgment be ultimately reversed after a recovery has- been had in this, action. Such is at times the effect of the application of legal principles under the .constraint of formal methods adopted for the orderly administration • of justice. But it may be said that the court is not .entirely without power to deal with such a situation. It was held by the Court of King’s Bench (Cristie v. Richardson, 3 Term Rep. 78), that the court would stay the proceedings in an action! on a judgment pending á writ of error brought to reverse that judgment; and in Suydam v. Hoyt, 1 Dutch. (N. J.), 230, it is said .that the granting of such a stay is in the discretion of the court in which the action is brought. , While in the present case' the action, strictly speaking, is not upon the judgment, the reason for the- rule would -seem to justify its extension to such a case as this. The defendants, however, have not sought such relief, but rest upon the matters alleged as a legal defense to the action. As they do not' constitute such a defense, it follows that the court, erred in dismissing the complaint, and the judgment must, therefore, be reversed. Judgment reversed and a-new trial ordered, with costs to the .appellant to abide the event. Gildebsleeve and Giegebioh, JJ., concur. Judgment reversed and a new trial ordered, with costs to appellant to abide the event. .