Nordyke & Marmon Co. v. Hawkeye Woolen-Mills Co.

Eothrook, J. 1. mechantoe^fioas*-" crty. prop It appears from the evidence that the Hawk-eve Woolen Mills Co. is the owner in fee of the land upon which the mill is situated. Stadtlander, Derby & Bowers leased the mill by a verbal lease for five years. The building had originally been used as a woolen mill. All of the machinery had been taken out when the verbal lease was made, excepting the steam engine and boiler. The plaintiffs furnished the necessary machinery for a flour and feed mill, and it was put in the mill by Stadtlander, Derby & Bowers, and operated by the engine which was in the building at the time the lease' was made. The machinery was put in with the expectation that it should remain there and be used in operating the mill during. the lease. The greater part of the machinery was furnished on [524] the 27th day of August, 1877. The last was furnished on Nov. 19,1877. The mill was put in operation, and on Feb. 14, 1878, plaintiffs filed their claim for a mechanic’s lien in the cleric’s office. The mortgage to the intervenors was executed Dec. 24, 1877, and in January, 1878, Stadtlander, Derby & Bowers were adjudged bankrupts upon their own petition. If the Hawkeye Woolen Mills Company had purchased the machinery of the plaintiffs, ind put it into the building and attached it to the engine, and used it for the jmrpose to which it was adapted, the machinery would have been part of the realty and upon a conveyance of the real estate would have passed to the grantee. Ottumwa Woolen Mill Company v. Hawley, 44 Iowa, 57. In such case the plaintiffs would have had an undoubted right to enforce a mechanic’s lien. Section 3 of chapter 100 of the laws of the Sixteenth General Assembly expresssly provides for a lien for machinery and fixtures for any building, erection, or other improvement. It is urged, however, that the machinery in question is no part of the realty, because the verbal lease was void, and the said Stadtlander c% Co. were mere tenants at will, with the right to remove the machinery, and that a mechanic’s lien cannot be established upon mere chattels, but must be upon the building, erection, or other improvement, and land uj>on which the same is situated. It is doubtless correct that, as between the lessor and lessee, the latter would have the fight to remove the machinery at the exjfiration of the lease, and that as to them it was no part of the realty. The rights and obligations of the parties as to fixtures are very different fromi those arising between grantor and grantee, or heir and executor. See Ottumwa Woolen Mill Company v. Hawley, supra. But can it be said that the verbal lease was void? Sections 3663 and 3664 of the Code provide that contracts for the creation or transfer of any interest in lands, excejff leases for a term not exceeding one year, can only be proved by á writing signed by the party to be charged. Section 3665 [525] provides that this rule, of evidence shall not apply when the vendee, with the actual or implied consent of the vendor, has taken and held possession of the land under and by virtue of the contract, and by section 3666 the regulations contained in the preceding sections relating to the proof of contracts do not prevent the enforcement of those which are not denied in the pleadings. The Woolen Mills Company, the lessor in this case, made no •appearance to the action, but made default. The plaintiff prayed not only that its lien be established on the machinery and fixtures, but as against “ the defendant’s interest in said real estate.” It is undisputed that Stadtlander, Derby & Bowers entered upon the possession of the land under the verbal lease for five years, and put in the machinery and fixtures and operated the mill under the lease. It follows that they had a valid, subsisting interest in the mill property, the same being a leasehold estate for five years. We think it was the right of the plaintiff to enforce a mechanic’s lien against this interest, and against the machinery and fixtures in the mill owned by the defendants. The law authorizes the establishment of a mechanic’s lien against leasehold interests. Section 4, chapter 100, acts of Sixteenth General Assembly. If the plaintiff sought merely to establish a lien upon the machinery and fixtures, aside from the interest of the defendants in the real estate, the rule might be different. In that case it might with propriety be said that-plaintiff could have been fully protected by chattel mortgage, or by retaining title to the machinery. The plaintiff’s right as the holder of a lien was fixed by the situation of the parties and the property when the machinery was delivered and placed in the mill, and if the claim for a lien was filed within the proper time plaintiff lost no right by reason of subsequent incumbrances, or the bankruptcy of the defendants. In our opinion the learned circuit judge correctly held that the plaintiff was entitled to a mechanic’s lien on the premises and improvements thereon superior to the rights or liens of [526] any of the intervenors. The amount found to be due the plaintiff exceeds the amount for which the property sold, and the plaintiff, under the agreement, is entitled to the wholé proceeds of the sale. It is not disputed that the plaintiff’s claim for a lien was filed within ninety days from furnishing the last of the machinery, and if the lien be held valid there seems to be no question as to its priority. The question as to the jurisdiction of the court to determine whether the mortgage is a fraud upon the bankrupt law has been argued at length by counsel for the respective intervenors. It is not necessary to determine that question. When we find, as we do, that plaintiff’s mechanic’s lien is valid and superior to the rights of the intervenors, we have determined all there is in the case. Affirmed.