Fidelity Storage Corp. v. Trussed Concrete Steel Co.

Mr. Justice Van Orsdel delivered the opinion of the Court: At the outset we are confronted with an important legal proposition, which, we think, is sufficient to dispose of this cause. Was the notice of mechanic’s lien in compliance with the requirements of the statute? The notice reads as follows : Supreme Court, District of Columbia. No. 5379. Trussed Concrete Steel Company, Claimant, a Corporation, vs. Fidelity Storage Corporation, Owner, a Corporation. Notice of Lien. Notice is hereby given that we intend to hold a mechanic’s lien upon all that piece or parcel of land known and described as and being all of original lot numbered eighteen (18) and — 8 — the east thirty (30) feet one and one-half (1%) inches front on U street north by the full depth thereof, of original lot numbered seventeen (17) in square numbered two hundred and five (205), situate in the city of Washington, in the District of Columbia, and the buildings thereon, for the sum of forty-four hundred and fifty-seven and 84/100 (4457.84) dollars, with interest on sixteen hundred and forty-three and 88/100’ (1643.88) dollars from November 2, 1905; on sixteen hundred and forty-four and 36/100 (1644.36) dollars from November 16, 1905; and on eleven hundred and fifty-nine and 60/100 (1159.60) dollars from November 24, 1905, until paid, being amount due to claimant for labor upon and materials (steel and labor) furnished for the construction of said building under and by virtue of a contract with James L. Karrick. (Signed) Trussed Concrete Steel Company, (By Ralston and Siddons, Its Attorneys), Claimant. The statute in force in this District, authorizing the filing of a notice of mechanic’s lien, is sec. 1238 of the Code of the District of Columbia [31 Stat. at L. 1384, chap. 854], which is as follows: “Sec. 1238. Notice. — Any such contractor wishing to avail himself of the provision aforesaid, whether his claim be due or not, shall file in the office of the clerk of the supreme court' of the District during the construction, or within three months after the completion, of such building, improvement, repairs, or addition, or the placing therein or in connection therewith of any engine, machinery, or other thing so as to become a fixture, a notice of his intention to hold a lien on the property hereby declared liable to such lien, for the amount due or to become due to him, specifically setting forth the amount claimed, the name of the party against whose interest a lien is claimed, and a description of the property to be charged, and the said clerk shall file said notice, and record the same in a book to be kept for the purpose.” — 9 — It is insisted that the notice is fatally defective in that it does not contain “the name of the party against whose interest a lien is claimed.” It is apparent that, under the statute, three essential averments are necessary to constitute a valid notice. These are, first, the amount claimed; second, the name of the party against whose interest the lien is claimed; and, third, a description of the property to be charged. A mechanic’s lien had no existence at common law. Hence, in our country, it is purely a creature of statute. It is founded in equity and commercial necessity. It exists in favor of those who furnish labor and materials for the erection of a building. The landowner appropriates and uses the mechanic’s labor and furnisher’s materials, and a lien is given against the property into which the labor and material have gone, to secure priority of payment of the price of the same. The performance of the work, or the furnishing of the materials, gives merely a right to acquire a lien. The statute prescribes the steps necessary to perfect it. These reqxiirements relate to the remedy, rather than the right. Hence, it has been held by the great weight of authority that a substantial compliance with the terms of such 'a statute is sufficient. Inasmuch as the statute creates a right in derogation of the common, law, it follows that, in determining whether a right to a lien exists, the statute should be strictly construed against one claiming such right. But the statute also affords a remedy, and where the right to a lien clearly appears, and the sole question to be determined is whether the claimant has proceeded properly to acquire and establish his lien, the statute should be liberally construed in his favor. Notwithstanding these rules of construction, wo think it is essential, in order to acquire a valid lien, that there should be a compliance with all the material requirements of the statute. The act of Congress of July 2, 1884 (23 Stat. at L. 64, chap. 143), formerly in force in this District, required that the notice of lien should only set forth a description of the property and the amount claimed. It could not be contended that, under this statute, a valid lien could have been established where — 10 — ' one of these essential allegations was omitted. With the enactment of the Code, an additional requirement was inserted in the statute, to the effect that the notice should also state “the name of the party against whose interest a lien is claimed.” It will be observed that this does not require, as in the statutes of some of the states, that the notice shall, in all cases, state the name of the owner of the property. It is only required here when the lien is claimed against his interest. If the interest of the owner was the only one against which the ■lien could run, the mention of his name in the caption might be held sufficient, but 'even this, as we shall have occasion to observe later, is very doubtful. But where the lien may run against any one of three distinct interests, and the statute requires the party whose interest is assailed to be named in the notice, certainly the mere naming of the owner in the caption, without reference in the body of the notice to whose interest is sought to be held under the lien, would be insufficient even to hold the owner. On the other hand, it cannot be ascertained from the bill in this case whose interest it is intended to hold under this lien. The several defendants named therein are sued jointly, and a decree is prayed against any or all of them, with the appointment of trustees to sell the property to satisfy the lien. While we do not think this is material as affecting the validity of the notice as a warning to the public of the particular interest sought to be held for this alleged indebtedness, yet it is interesting to note that, even by the terms of the bill, the owner of the property is not the exclusive party against whose interest the lien is claimed. In many of the states, the statutes authoriaing the filing of mechanics’ liens require that the notice shall give the name of the owner or reputed owner of the premises upon which the lien is claimed. It has been held that, where a statute contains this provision, a compliance with the requirement is essential to the existence of the lien, and, in such cases, the averment of ownership must appear in the body of the notice as an integral part or portion of the declaration of right, and it is — 11 — not sufficient that the name of the owner shall appear in the caption of the notice. Spragg Invest. Co. v. Mouat Lumber & Invest. Co. 14 Colo. App. 107, 60 Pac. 179; Reindollar v. Flickinger, 59 Md. 469; McElwee v. Sandford, 53 How. Pr. 89. In the case of White v. Mulline, 3 Idaho, 434, 31 Pac. 801, where the statute provided that the name of the owner or reputed owner should appear in the notice, a notice was filed without stating the name of the owner , in the body thereof, but in the caption it was stated to be filed against “B. J. Bledsoe, Contractor, and B. G-. Mullins, Owner.” The court said: “Under a statute almost identical with that of Idaho, the supreme court of Nevada, in Matter v. Falcon Min. Co. 18 Nev. 209, 2 Pac. 50, held that, while the statute should be liberally construed, every material requirement should be complied with, and that, where a direct and unequivocal allegation of the name of the owner is wanting in the notice of the lien, such notice is radically defective, and no lien can be founded thereon. It can hardly be claimed that the descriptio personas at the head of the notice, to wit, ‘White and Mallison, Subcontractors and Plaintiffs, v. B. J. Bledsoe, Contractor, and B. G. Mullins, Owner,’ is a direct and unequivocal allegation of the name of the owner.” In Hoffman v. Walton, 36 Mo. 619, where the court was considering a statute requiring that the notice should contain the names of both the owner and the principal contractor, it was said: “Now, the law under consideration requires that the statement filed shall include a true account, with all just credits given; a description of the property, so that it can be identified, with the name of the owner or contractor, or both if known; and that it shall be verified by affidavit. These all constitute the elements essential to securing the lien. We cannot say that one of the constituent parts is more matter of substance than another. The language seems plain and unambiguous, a.nd we are not permitted to impair its force or frittér away its meaning by construction.” The requirement that the party against whose interest a lien — 12 — is claimed shall be named in the notice is a material requirement of the statute. The reason for this declaration in the notice can be easily gleaned from the context. Sec. 1237 of the Code [31 Stat. at L. 1384, chap. 854] permits a lien to be asserted against a lessee for a term of years or a vendee in possession under a contract of sale. Thus a lien may be filed against the interest of a person having a less estate in the property than the owner. Since the Code provides for a sale of the interests of persons other than the owner, it becomes imperative that the party should be named in the notice against whom the lien is claimed. The reason for placing this requirement in the statute becomes quite apparent when considered in connection with the context. The notice in the present case contained the requirements of a notice under the act of 1884, and no more. To hold it sufficient under the present statute would be to declare that these sections of the Code add nothing to the former act, and that Congress, in enacting the present statute, did a vain thing. Inasmuch as this notice is filed for the benefit of the public, it becomes .highly important that it should, on its face, clearly state the interest sought to be held under the lien. The notice of lien in this case states that the amount claimed is due for labor and materials furnished “under and by virtue of a contract with James L. Karrick.” It might well be inferred, from the notice, that Karrick was “the party against whose interest a lien is claimed.” The rule is well settled that a compliance with the statutory requirements is necessary in order to secure a valid and enforceable lien. This court in a very recent case (James B. Lambie Co. v. Bigelow, October term, 1909, ante, 49), in construing the sections of the Code relating to mechanics’ liens, speaking through Mr: Justice Robb, said: “A mechanic’s lien has no existence outside the statute creating it. It was not recognized at common law, nor was it allowed in equity. It is founded upon the just and natural consideration that a party who has enhanced the value of property by contributing thereto labor and materials shall be entitled to a preferred claim on such — 13 — property to the extent of his contribution. While the statute creating such a lien is to be reasonably construed so as to effectuate, if possible, the legislative intent, we are not at liberty to excuse those who would claim its protection from the performance of precedent conditions. As was said by Mr. Justice Field in Davis v. Alvord, 94 U. S. 549, 24 L. ed. 285: ‘Whilst the statute giving liens to mechanics and laborers for their work and labor is to be liberally construed, so as to afford the security intended, it cannot be too strongly impressed upon them, thát they must not only bring themselves by their notices, as was done in this case, clearly within the provisions of the statute, but they must be prepared, if the priority of their liens be disputed, to show a compliance with those provisions, and to fix, with certainty, the commencement and completion of their work.’ ” In Maryland, the statute required the party claiming a lien to make a duplicate copy of the bill of particulars under oath, one to be delivered to the clerk of the county court, to be filed and recorded, and the other copy to be furnished to the party owing the debt. The statute further specifically provided that, “when such an amount is filed .and recorded, it shall be deemed sufficient diligence to secure the lien herein provided.” Notwithstanding this express provision as to the filing and recording being sufficient to secure the lien, the court, in holding that a failure to furnish the debtor with a copy of the bill of particulars was fatal, said: “The acts required to fix and secure the lien under the statute are in the nature of an ex parte proceeding to fix and fasten a lien upon a man’s property, not created by express contract, and therefore every requisite of the statute must be at least substantially complied with, and a failure to thus comply upon the part of the lien holder is fatal to the same. It follows from this construction of the act, that the party who asserts the lien must, before he is entitled to a foreclosure of the same, show by competent evidence a compliance with the statute in recording the bill of particulars, and delivering a copy thereof to his debtor.” Lee v. Phelps, 54 Tex. 367. — 14 — In the present case there has been such a total failure to comply with the express requirements of the statute that the notice must be held insufficient to create án enforceable lien. The decree of the court below is reversed, with costs, and the court is instructed to enter a decree dismissing the bill. . Reversed.