Allentown National Bank v. Helios Dry Color & Chemical Co.

Opinion by William W. Pouter, J., The fund in court is the proceeds of the sheriff’s sale of the works, buildings, machinery and lease used in the business of the Helios Dry Color and Chemical Co. There are two sets of [282] claimants upon the fund. Either set will exhaust it. The first is composed of mechanic’s lien creditors; the second of labor claimants, whose claims are now held by a bank as assignee. The question for decision is, which claimants are entitled to the fund. We have before us an able opinion of the court below affirming a clear, concise and adequate report of a commissioner. The case might well be left with a formal affirmance. The question is, however, new in the form in which it now arises, and we therefore add a confirmation. Something is said, in the argument of the appellant, on the subject of the relative equities of the claims of the two classes of claimants. This subject has no place in the discussion. Each set of claimants is a preferred class. The legislature has -seen fit to give to each of them privileges which have not been conferred upon other classes of creditors. It is a pure matter of determining which is the first preferred, and involves a construction of the act of 1872 and its supplements. The act of May 12, 1891, provides, that the wages therein described shall be “preferred and first paid” out of the proceeds of the sale of such real and personal property as is therein described. It is the last supplement to the act of 1872 Section 4 of the latter, provides “ that no mortgage or other instrument by which a lien is hereafter created, shall operate to impair or postpone the lien and preference given and secured to the wages and moneys mentioned in the first section of this act. Provided, That no lien of mortgage or judgment entered before such labor is performed shall be affected or impaired thereby.” This section postpones to the labor claims even mortgages, or other instruments by which a lien is created, and the only exception is the preservation of the lien of mortgages or judgments entered before the labor was performed. This language is plain. It clearly gives the labor claimants priority over mechanic’s lien creditors. A mechanic’s lien is not a judgment, nor is it a mortgage. These are the only exceptions named in the act. Nor can the mechanic’s lien claimants ue, by any stretch of reasoning, included among the wage claimants, under the act of 1872. The former claim for work done in construction. The latter claim for work done in the conduct or prosecution of the enterprise. See opinion in Rees v. Hulings, filed this day, and cases there cited. [283] Objection is made to tbe form of tbe notice of the claims of the employees, given to the sheriff. The act requires no particular form of notice. It has certain essentials, which have been indicated in Adamson’s Appeal, 110 Pa. 459, Hall’s Estate, 148 Pa. 121, Timmes v. Metz, 156 Pa. 384, and in Hoffa v. Person, 1 Pa. Superior Ct. 357. A careful scrutiny of the form of notice used in this case, satisfies us that all the essentials have been supplied. ' The title of the bank, acquired by assignment of the labor claims for wages, has not been successfully attacked. There was here, as shown by the testimony, an actual bona fide transfer of the labor claims carrying all remedies, rights, etc., directly from the men when the money was paid to them by the bank: Riddleburg C. & I. Co.’s Appeal, 114 Pa. 58; Phila. Trust Co.’s Appeal, 2 W. N. C. 593. It was not a loan to the company with an assignment of labor claims in payment, or as security. The act limits the benefits conferred upon labor claimants. “ The claim thus preferred shall not exceed two hundred dollars.” In the schedule of claims appears that of H. S. Giles for $217.07. There is no explanation as to the manner in which this claim is made up, but the act evidently intends that claims of a character comprehended by its provisions shall be preferred to the extent of $200. The language does not indicate an intention that the wage earner, who is a creditor to an amount in excess of $200, shall be deprived wholly of preference. The claim thus referred to is properly payable with the other claims, subject to a reduction bringing it within the limitations of the act. With this modification, the judgment of the court below is affirmed.