Sands v. Stagg

Buchanan, J., delivered the opinion of the court. This is an appeal from a decree rendered in three chancery causes heard together, the object of all of them being to subject a lot and five houses thereon to the payment of mechanics’ and builders’ liens asserted by the complainants for materials furnished and work done in the erection of the houses. The first error assigned is to the action of the court in overruling the demurrer to the bills filed in the several causes. Two grounds of demurrer are relied on here. The first is that the bills fail to allege that the suits were brought within six months from the time the whole amount covered by the liens became payable. (Code of 1881, sec. 2481.) The bills do not allege when the suits were instituted, but they do allege when the amounts asserted as liens upon the property became due and payable, and the date of the process shows that the suits were brought within the time required by the statute. Where the record shows at the time the bill is demurred to that the suit was instiuted within the period fixed — 447 — by the statute, there is no good reason for requiring the bill to allege that fact, since the court will take judicial notice of when the suit was instituted, as well as of all other proceedings in the cause. 1 Elliott on Ev., sec. 57; Boisot on Mechanics’ Liens, sec. 554. The other ground of demurrer is that the bills fail to allege that the complainants gave notice of the amount and character of their claims to Mahony, the owner of the land, as required by section 2477 of the Code. The bills do not allege such notice; but the contention of the complainants, appellees here, is that they were not sub-contractors, and therefore no such notice was necessary. The decision of this question depends upon the construction of the contract between Mahony and Byan, under which the buildings on the.lot were erected. That contract is as follows: “This contract, made this 23d day of August, 1894, by and between G-. G. Byan, of the city.of Bichmond, and State of Virginia, party of the first part, and Daniel H. Mahony, of the second part, and of Philadelphia, Pa. “To-wit: That for and in consideration of the sum of $4,360.00 (four thousand three hundred and sixty dollars) each, the said party of the first part agrees to furnish all material, labor and erect and complete for the said party of the second part (2) two of the (2) two story and mansard brick tenements, according to plans and specifications made by the said party of the first part and approved and accepted by the said party of the second part. And to be built on Floyd avenue, near Morris street. “The said party of the first part agrees to allow the said party of the second part $100.00 per front for 63 feet 0 inches adjacent to the houses already described and upon which the said party of the first part proposes to build (3) three houses— duplicating those aforesaid' described, making a row of (5) five tenements. — 448 — Cost of building the above two (2) tenements...... $8,720 00 Cost of 63 feet of land at $100 per foot.......... 6,300 00 To balance in favor of the said party of the first part. $2,420 00 “First Part, G. O. Ryan. (Seal). “Second Part, DanT, H. Mahony. (Seal).” The agreement between the parties contemplated the erection of a row of five houses, 'duplicates of each other, on the lot of Mahony, built according to plans and specifications furnished by Ryan and approved by Mahony. Two of the houses (which two the contract does not designate) were to be built for Mahony. For furnishing the material and doing the work in erecting and completing these two houses, Mahony was to convey to Ryan the residue of the lot on which the other three houses were erected, at the price of $6,300.00, and in addition, pay him $2,420.00. While it may be difficult to define the precise legal relation between Mahony and Ryan, it is clear, we think, that Ryan was authorized and empowered to erect the row of five houses on Mahony’s lot. Mahony having authorized that work to be done by Ryan on his lot, the men who furnished the material and did the work in carrying out the scheme agreed to and authorized by Mahony ought not to be compelled to look alone to Ryan’s interest in the property for the payment of their claims. The fact that their contracts for material and labor were made alone with Ryan ought to make no difference when he was, in fact, carrying out the scheme entered into between him and Mahony, and Mahony’s interest in the property, as well as Ryan’s, ought to be liable for their claims. See Boisot on Mechanics’ Liens, secs. 300 to 305; Phillips on Mechanics’ — 449 — Liens’ secs. 69 to 72a; 2 Jones on Liens (3d ed.), sec. 1487; Paulson v. Manske (Ill.), 18 N. E. 275, 9 Am. St. Rep. 532; Henderson v. Connelly, 123 Ill. 98, 14 N. E. 1, 5 Am. St. Rep. 490; Hill v. Hall, 40 Minn. 441, 42 N. W. 294; Oleary v. Roe, 45 Mo. App. 567; Hilton v. Merrill, 106 Mass. 528. We are of opinion, therefore, though the question is not entirely free from difficulty, that the complainants should be held to be general contractors within the meaning of sections 2475 and 2476 of the Code, and that it was not necessary for them to give Mahony notice of their claims, as provided by sections 2477 of the Code. The commisioner, who was directed to ascertain and report the liens on the property sought to be subjected, and their priorities, reported, among other things, that there were no liens upon the two houses which Mahony had selected and retained under his agreement with Eyan; that the first lien upon the three houses which Mahony had conveyed to Eyan by deed, delivered in escrow, was a debt due Mahony from Eyan for money which Mahony had, in effect, furnished to enable Eyan to complete the erection of the houses; that the second liens were the claims of the complainants and another mechanic’s lien claimant, who had come into the cause by petition to assert his claim; and that Anderson, one of the appellants, to whom Eyan had conveyed one of the three houses, took it subject to those liens. The mechanic’s lien claimants did not except to the commissioner’s report. The appellants excepted to it, but their exceptions were overruled by the court. One of their exceptions was that the commissioner erred in reporting in favor of complainant Stagg’s claim, instead of rejecting it entirely. The action of the court in overruling that exception is assigned as error. — 450 — Without discussing the facts upon which the commissioner based his finding and the depositions taken subsequent to the filing of the report we are of opinion that Stagg’s claim is a valid one, and that his lien had been perfected in the manner required by the statute. The appellants also excepted to the report of the commissioner because he reported the' claim of Daniel H. Mahony for $3,000 as the first lien upon the three houses of Ryan. The action of the court in overruling that exception is assigned as error. While Ryan was engaged in building the five houses it became necessary for him to borrow money to complete them. To enable him to do this, John Mahony, who lived in Richmond, at the request and as the agent of Daniel Mahony, who lived in Philadelphia, endorsed Ryan’s note for $3,000, upon which he borrowed that sum, which was- used in completing the houses, with the understanding that it was to be paid by Ryan before he would become entitled to a deed from Daniel Mahony, his vendor. Ryan having failed to pay it, and becoming-insolvent, John Mahony paid it as the agent of his brother, Daniel Mahony, and the commissioner reported it as a debt due the latter. Under the agreement between Daniel Mahony and himself Ryan had no right to a conveyance of the legal title to that portion of the lot on which his three houses were built until he had complied with the terms of the agreement of August 23, 1894, and to secure the performance of which Mahony had retained such title. Anderson, to whom Ryan had conveyed one of his three houses, only acquired such interest in the property conveyed as Ryan had; and not having acquired by his deed the legal title, Anderson took the property, subject to all the equities between Ryan and Mahony growing out of the agree — 451 — ment betwen them, one of which was • the right of Mahony to .have the $3,000, furnished to complete the houses, repaid before he could be required to part with the legal title. The commissioner was, therefore, clearly right in reporting Mahony’s claim •of $3,000 as having priority over Anderson’s purchase from Ryan. Lewis v. Caperton, 8 Gratt. 148, 163-’4; Yancey v. Mauck, 15 Gratt. 300, 306-’8; 2 Min. Inst. (4th ed.), 220; 3 Pom. Eq. Jur., sec. 1260. The remaining assignment of error is to the action of the •court in overruling the exception of Sands, trustee, to the commisioner’s report, because he did not report that the deed of trust of May 9, 1895, was a prior lien on all the property embraced in that deed. The grounds upon which it is claimed that the deed of trust ought to have been reported as the first lien upon the property embraced in it are that the bills of the complainants are demurrable; that the liens asserted by those doing work and furnishing material were invalid; and that Mahony had no lien for the $3,000 debt asserted by him. As each of these grounds of objection to the court’s action has been considered in discussing the other assignments of error, and decided against the contention of the appellants, it follows that this assignment of error must also be overruled. We are of opinion, therefore, that there is no error in the ■decree appealed from to the prejudice of the appellants, and that it should be affirmed.