Smith v. Baily

Joseph F. Daly, J. The right of a sub-contractor to file notice of claim, and acquire a lien and the right to payment out of moneys due the contractor, is not cut off by an assignment for the benefit of creditors made by the contrac [130] tor before the filing of the lien (Oates v. Haley, 1 Daly, 338 ; Mandeville v. Reed, 13 Abb. Pr. 173 [Ct. App.]). But the assignee has the right to contest the validity of the lien upon every ground available to the owner of the premises. The contractor has the right to show its invalidity for failure to comply with the statutory requirements. Although, on failure of the lien, a-personal judgment may be rendered in the action against him, and in favor of the sub-contractor, for the debt, such judgment cannot be satisfied out of the moneys due him from the owner, unless a valid lien upon them has been acquired. In the absence of a lien the judgment is to be collected by execution against the contractor in the ordinary manner. The fund is subject to the lien, not to the mere claim or debt. The contractor having the right to contest the lien, his assignee has the same right. The objections taken by the assignee to the lien are :— • I. That it does not state that the materials were purchased to be used in the construction of the building. This seems to be unfounded. The lien notice states expressly that '“J. B. Smith & Co., the claimants, were to furnish ready to be put up certain portions of the trim, sash, doors and blinds for the new house then being erected by said Baily & Eldred ” (the contractors) “ hereinafter described, under a contract between them ” and “ the owner of said building to do all the carpenter work and furnish materials therefor on said building,” &c. II. That the lien does not state that the amount demanded is one existing after deducting all just credits and offsets. The lien notice states that “the bill hereto annexed contains a correct statement of the work done and the moneys paid an'd;the balance due.” This was held to be sufficient in Farley v. Heimburg (G. T. Com. Pleas, April, 1878, affirming the special term). The court held, in effect, that if tkere'were no just .credits and offsets to the claim, or, if the amount stated in the notice were in fact the amount due after deducting all just credits and offsets, no specific statement of either .fact would be necessary. [131] This decision disposes of another objection to the lien, viz.:— III. That the notice of lien does not state whether the contract between the claimant and the contractor was in writing. From the reasoning in Farley v. Heimburg (supra), it would follow that if there were no written contract it was not necessary to state that fact, since the lien act only requires that if the “contract or any part thereof is in Avriting a copy of such writing must be filed Avith and made part of the claim.” (L. 1875, c. 379, § 5, last paragraph.) IV. The remaining objection is, tlia-t the lien notice does not state that all tlie materials for which the claim is made have been actually furnished, and if not, how much has been furnished. The lien laAV requires the notice to contain a statement “ Avhether all the Avorlc or materials for which the claim is made has been actually performed or furnished, and if not, how much of it.” The lien notice in question, after stating the contract for work and materials, states that “ all the Avork and materials for which said claim is made has been done,” and the claim is stated to be “ for Avork, labor and materials done, performed and furnished,” and the terms of employment were that “ the Avork and materials was to be paid for in cash as delivered.” These statements, taken together, amount to this, that the contract for Avork in making and delivering the “ trim, sash, doors and blinds read)'" to be put up,” as quoted above, was fully performed, and the work delivered Avlien the lien was filed. This satisfies the requirement of section 5 of the statute. The objection that the complaint sIioavs that the lien Avas not filed Avithin 30 days after the work Avas done and materials furnished (Grates v. Buddensieck, N. Y. Com. Pl. Spl. T. Oct., 1878), is overcome by allowing the amendment asked for by plaintiff, by Avhieh the complaint is conformed to the proof that the work and material Avere done and furnished Avithin 30 days before the filing of the lien. It very clearly appeal's from the evidence (Mr. Eldred’s [132] testimony) that $70 60 of Baily & Eldred’s claim against J. B. Smith & Co. was credited by the latter on a bill for work in 26th Street to the same amount, and that this was satisfactory. The balance of Baily & Eldred’s claim, viz. : $83 35, was all that was left to be deducted from J. B. Smith & Co.’s work on the premises against which the lien was filed. Credit having been given for it, the lienors are entitled to judgment for the full amount of their lien with costs against the estate of the assignor. Judgment for plaintiffs.