McKeefrey v. Cugley

Seabury, J. This action was brought against the defendant Cugley to foreclose an alleged mechanics’ lien filed by the plaintiff against property owned by [482] Cugley. The said defendant upon furnishing an undertaking made by the appellant procured an order of the court duly cancelling and discharging the alleged lien. A supplemental complaint was thereafter served bringing in the appellant as a defendant. Upon the trial the lien was dismissed, and a personal judgment entered, in favor of the plaintiff against the defendant Cugley and against this defendant-appellant as surety upon the undertaking given. The condition of the bond was expressed as follows: “ The condition of this obligation is such that if the above bounden Josephine M. S. Cugley shall well and truly pay any judgment which may be recovered in an action to enforce the aforesaid lien, then this obligation to be void; otherwise to remain in full force and virtue.’’ This bond was not given in conformity to the provisions of the statute, and unless the defendant-appellant is liable upon it as a common-law obligation it is not liable at all. Parsons v. Moses, 40 App. Div. 58, 60; Vitelli v. May, 120 id. 448, 449; Berger Mfg. Co. v. City of New York, 206 N. Y. 24. This proposition was conceded by the learned trial justice and by counsel for the appellant. The fair interpretation of the language which expresses the condition of the bond is that the bond was given to secure any judgment decreeing the foreclosure of the mechanics’ lien which might be entered in the-action pending. The lien was upon the property, and upon giving the bond the obligation of the surety was to pay any judgment which may be recovered in an action to enforce the aforesaid lien. The judgment recovered was a personal judgment against the defendant and was not a judgment “ to enforce the aforesaid lien.” In order to render the appellant liable upon the undertaking, it was necessary to prove that if it had not been for the order discharging the lien upon [483] filing the bond a valid lien would have been enforcible out of the property against which it was filed. When the lien was dismissed the character of the action was changed and the nature of the judgment to be entered was necessarily different from what it would have been if the lien had been sustained. With the dismissal of the lien it became impossible to order the sale of the property against which the lien had been filed. The fact that a personal judgment could be recovered against the defendant in that action instead of requiring the plaintiff to commence a new action is immaterial. The judgment was not the kind of a judgment which the surety was obligated to pay. To hold otherwise would extend by implication the undertaking of the surety and make for the parties a different agreement of indemnity from that which they made for'themselves. The undertaking was predicated upon the existence of the lien, and the liability was to attach if the plaintiff recovered a judgment directing that the lien should be foreclosed. When the lien was dismissed the liability of the surety was terminated. This liability could not be kept alive by the recovery of a mere personal judgment against the defendant, because it was not against a judgment of that character that the surety agreed to indemnify the plaintiff. Nor is there merit in the attempt to hold the surety upon the theory that the bond may be enforced as a common law obligation, because the liability sought to be fastened upon the surety is not within the condition of the bond when that condition is fairly and reasonably construed. Where the words of the condition of the bond are ambiguous and do not clearly impose a liability upon the surety, these words should not be construed to impose a greater liability than the recitals of the bond indicate that the parties intended the surety to assume. [484] The recitals in the bond under consideration make it clear that the bond was given for the purpose of permitting the lien to be discharged, because the defendant Cugley desired “ to discharge said lien pursuant to the lien law of the state of New York, by giving an undertaking as provided in said lien law.” In National Mech. Banking Assn. v. Conkling, 90 N. Y. 116,120, Judge Earl said: ‘‘ The recital in such bonds, undertaking to express the precise intent of the parties, controls the condition or obligation which follows, and does not allow it any operation more extensive than the recital which is its key, and so it has been held in many cases. ’’ The judgment against the appellant is reversed, with costs, and the complaint against the appellant is dismissed, with costs. Guy and Bijur, JJ., concur. Judgment reversed, with costs.