Fay & Co. v. Orison

Seevers, Ch. J. — The defendant, Orison, as principal contractor, entered into an oral contract with the defendant Oard to erect a building on real estate owned by the latter for the sum of $530. Orison was to furnish all the materials. Oard paid $150 at the time the contract was made, and agreed to pay the residue as the work progressed. He subsequently paid the contract price in accordance with the contract. Orison procured of plaintiffs the materials for the erection of the building and is indebted to them therefor. Within thirty days after the materials were furnished, but not until Oard had paid Orison, as above stated, the requisite statutory notice was served claiming the lien. One close question is whether Oard before making the last payments had knowledge that Orison had procured the materials of the plaintiffs. We find the fact to be that he did have such knowledge. But the evidence fails to show that the materials had been purchased on credit, and had not been paid for. This case differs from Stuart & Hayden v. Wright, 52 Iowa, 335. In that case the defendant had no knowledge of any arrangements made by the principal contractor for the materials with which the building was erected. The case before us also differs from Winter & Co. v. Hudson, 54 Iowa, 336, and Gilchrist v. Anderson, 59 Iowa, 274. In both of these cases the contract was in writing, and the right was reserved therein by the defendants to pay any mechanics liens that should be 'claimed. In the case last cited the defendant 138 did not know that material had been procured of the plaintiffs. In the case at bar the defendant did have such knowledge. In Gilchrist v. Anderson it was said: “the test question is as to whether Anderson could probably in the exercise of reasonable diligence have discovered that the plaintiffs were entitled to a lien.” That is, whether they had furnished materials within thirty days preceding the payment which were not paid for. Such being the rule, we feel constrained to say that if Oard had used ordinary care he could have obtained knowledge of plaintiffs’ claim before he made the payments subsequent to the first. Oard knew the materials had been furnished by the plaintiffs, and all he had to do was to inquire whether they had been paid for. Having failed to do this, we think the lien should be established. As the case is triable anew in this court, we have examined the evidence in relation to the amount due the plaintiffs, and find that materials of the value of $20.66 never were used in the construction of the building, and were not procured by Orison for that purpose, and as to such materials the plaintiff is not entitled to a lien. Reversed.