Snyder v. Carson

Ladd, J. The plaintiff leased to Carson and Sebille certain premises belonging to him situated in Cedar Falls — 554 — for a term of five years beginning February 1, 1904. The lessees occupied these in carrying on the business of printing, and for that purpose kept therein presses, type, fixtures, machinery and the like. On May 1, 1905, Sebille executed .a chattel mortgage on his undivided one-half of the property to F. O. Jackson to secure the payment of a promissory note for money loaned him. Subsequently Carson sold his interest in the property to H. A. Smith, and the latter •executed a chattel mortgage thereon to H. C. Hemenway. Later Sebille and Smith sold the entire property to J. I. Eobbyn, who assumed the payment of the mortgages, but, thereafter being in failing circumstances, closed the plant. The petition was filed June 15, 1909, alleging the execution of the lease and praying judgment against Carson and Sebille for $195 with interest and for $75 with interest against Eobbyn, and a landlord’s writ of attachment was levied on the printing outfit contained in the building. Jackson filed a petition of intervention September 21, 1909, in which he alleged the execution of the mortgage by Sebille to him; that foreclosure proceedings thereon were begun June 15fch of that year and on July 15, 1909, the same sold thereunder, and a bill of sale thereof issued to the intervener; and that the title so acquired was superior, “as respects the rental of said premises accruing on and after the expiration of plaintiff’s lease, February 1, 1909.” Notice by K F. Mathews was filed July 17, 1909, in which, he alleged that, within ninety days prior to the levy of the writ of attachment and the beginning of foreclosure proceedings by Jackson, he had performed labor in the printing establishment for which wages amounting to $69.75 were owing him. A similar notice by EeEtt Pierce was filed, and both were properly served. Attached to these notices were objections by Jackson denying the correctness of same, saying that his interest in the prop-' enty was not liable for more than one-half such claims, that the entire property had been seized under plaintiff’s — 555 — writ of attachment, and praying that the matter be transferred to tbe district court for adjustment between the parties. Later he amended these objections by asserting that claimants had served no notice upon the foreclosure of Hemenway’s mortgage, hereinafter mentioned, the recording of his own mortgage, and that chapter 204 of the Acts of the Thirty-Third General Assembly is not retroactive. Otherwise these notices were not then controverted, and no answer or other pleading was interposed to the original petition or to the petition of intervention. By agreement, the issues were heard at the same time and the facts as recited stipulated. It was also stipulated that Mathews and Pierce had performed labor, and wages were due them from Dobbyn as claimed in their notices, and .■also that out of the foreclosure sale by Jackson $105.53 of the proceeds was deposited with the clerk of court at the time his objections to the labor claims were filed. Jackson .admitted priority of the plaintiff’s landlord lien over his mortgage lien to the extent of that sum, but did not concede priority to any greater amount. Thereupon Jackson amended the petition of intervention by alleging the superiority of his interest in and title to the property as respects all rents claimed by plaintiff which became due prior to February 1, 1908. Plaintiff amended the petition by saying that, since the beginning of the suit, Hemenway had foreclosed the mortgage executed by Smith and bought in an undivided half of the property attached and had transferred the same to Jackson, “who thus became, •about January 1, 1910, the entire owner thereof,” and as defendants Carson, Sebille, and Dobbyn had parted with their interest therein, dismissed the cause as to them and elected to prosecute the cause against the intervener, Jackson, and prayed “judgment establishing the rights of the several parties as follows: (1) That the plaintiff have a first lien upon said printing plant for the sum of $119.97, and that special execution issue for the sale of the attached — 556 — property to pay the amount, of such lien, with interest and costs; any sum remaining to be paid to the other parties hereto as their priorities may be adjudged.” Intervener then introduced in evidence the return of ,the foreclosure proceedings on the mortgage executed by Sebilie to him, and it was admitted he had become sole owner of the property subject to the levy of attachment and upon which the labor claimants ask liens. The parties then agreed that plaintiff should waive one-half month’s rent, and intervener should concede his right to interest, and “that plaintiff was entitled to $114 as the full amount of his claim.” Intervener’s attorney increased the amount on deposit to $114 by handing the clerk $8.11 ,and modified the amount to which the landlord’s lien was previously admitted to be superior to $114. Such are the facts, deduced from the evidence and several stipulations of the parties. The propriety of prosecuting the action in the absence of debtor's is not questioned and though the intervener, Jackson, deposited $114 with the clerk of court as the amount due on plaintiff’s claim for rent, there is nothing in the record to indicate that because of this the levy of the writ of attachment was released, or that plaintiff waived his landlord’s lien on the attached property. See section 2992 et seq., Code. i. Landlord and tenant: labor But such lien did not exclude the wage claims of Mathews and Pierce. Section 4019 of the Code provides that: “. . . When the property of any person shall be seized upon by any process of any court . „ . . . lor the purpose of paying or securing the payment of the debts ... of such person, the debts owing to employees for labor performed within ninety days next preceding the seizure or transfer of such property, to an amount not exceeding $100 to each person, shall be a preferred debt and be paid in full.” The next section defines the procedure in presenting such a claim, and declares that, “unless objection be made thereto — 557 — as provided in the following section, such claim shall be allowed and paid to the person entitled thereto,” out of the proceeds of the property. Section 4021 provides for contesting such claims by any person interested, and section 4022 reads: “Claims of employees for labor, if not contested, or if allowed after contest, shall have priority over ail claims against or liens upon such property, except prior mechanics’ liens fon labor in opening or developing coal mines as allowed by law.” Such claims are superior to the landlord’s lien for rent. Stuart v. Twining, 112 Iowa, 154. a. Same. And as the language employed should be given a fair construction, they are also superior to the lien of a chattel mortgage. The intervener did not acquire the property by foreclosure until after the property was seized under the writ of attachment,' so that his title through the respective foreclosures is subject to the preference given labor claims by this statute. Wells v. Kelley, 121 Iowa, 577, contains nothing to the contrary. That decision went no farther than to say that section 4019 of the Code, prior to its amendment by chapter 204 of the Acts of the Thirty-Third General Assembly, did not authorize the assertion of preference to labor claims upon foreclosure of a chattel mortgage by notice and sale; that this could only be done when seized under process of court or in the hands of receiver, trustee, or assignee. Mathews and Pierce, then, were entitled to be first paid their claims for wages earned, and there was no error in directing them to be paid from the funds in the hands of the clerk. What remained also, was rightly applied on the amount conceded to be owing plaintiff for rent; but this left $105.47 thereof unpaid. On what theory can it be said that this should not be made out of the property attached ? The payment of an insufficient amount into court certainly did not have the effect of dissolving the levy. Nor did the establishment of the labor claims as preferred de — 558 — prive plaintiff of the right to enforce his lien against such of the attached property as remained after satisfying these. The mortgages foreclosed against the property were inferior to the lien of the levy of the writ of attachment, so that the intervener’s title thereto was subject to such lien, and it was stipulated tibat “plaintiff was entitled 'to $114 as the full amount of his claim.” 3. Same: parties. There was nio controversy, then, as to the amount owing plaintiff as rent, nor as to this being a lien on the attached property, and the denial of relief must have been on the ground that the debtors were not . . . parties to the action; it having been dismissed as to them. Had they any interest therein which might be adversly affected there would be much • in this suggestion, for it is fundamental that a person may not be divested of his property in a proceeding to which he is not a party. Moore v. Held, 73 Iowa, 538; Tod v. Chrisman, 123 Iowa, 693. Here the amount of indebtedness is conceded, and the only con-: troversy is whether the lien of plaintiff or rent is prior and superior to intervener’s interest in the property acquired under the chattel mortgage foreclosures, and this may be adjudicated in the absence of the debtors. First National Bank v. Jasper County Bank, 11 Iowa, 486. See, also, Hubbard v. Ellithorpe, 135 Iowa, 259. If the lien is established prior to such interest, the debtors may have their indebtedness satisfied; but this merely would afford an advantage to them which they would hot be in a situation to insist upon, and the mere fact that a benefit may accrue to any one does not render such person an essential party to the litigation. Moreover, the point that the debtors were not continued as parties does not appear to have been raised in the trial court or in appellee’s 'argument in this court; it being assumed that the money in court was the only property in controversy. There might be much in this had the property been purchased under foreclosure — 559 — sales by parties other than the intervener in this action. T-Ti.q manipulation thereof, however, could not well obviate the issues being litigated, and we think decree should have been entered establishing plaintiff’s lien on the property for itihe sum of $105.47'and directing special execution to-issue for the satisfaction thereof and costs. — Reversed. Deemer, J., dissenting.