Oliver v. Davy

Vanderbuegh, J. The plaintiffs seek to enforce a mechanic’s lien against the real estate described, and claim that the same should be adjudged superior to a purchase-money mortgage held by defendant Davy upon the same premises. The record shows that on the 16th day of October, 1883, Davy, then being the owner thereof, agreed to sell and convey to defendant Peterson the premises in question; and the purchase was consummated between them, in accordance with the terms of the agreement, on the second day of November following, by delivery of the deed to Peterson, and the mortgage by her to him for the purchase-money. The deed has not been recorded, and the mortgage was not recorded till January 17, 1884, which was subse [294] quent to the filing of a claim of lien upon the premises by plaintiffs. The materials for which such lien was filed were furnished by plaintiffs under a contract with Peterson, and used in the erection of a store building on the premises, between the date of her purchase and December 2, 1883. Plaintiffs had no notice of the existence of the mortgage prior to the filing of their account and claim of lien, but had actual notice of the existence of the unrecorded deed. Plaintiffs’ lien bound only the interest of defendant Peterson in the land. Gen. St. 1878, c. 90, § 1. If it accrued prior to the deed, and while she held possession under the agreement or contract of purchase, it would, of course, be subordinate to the rights of the vendor. She was then the equitable owner, subject to the payment of the purchase-money. Upon the delivery of the deed she became the legal owner, subject to the purchase-money mortgage. Davy’s equity is therefore intrinsically superior to that of plaintiffs, and the case is not within the recording act. The statute (Gen. St. 1878, c. 40, § 21) does not include mechanics’ liens; but if the language were to be extended by construction so as to include them, and give them the same effect as judgments or attachment liens, as the plaintiff insists, yet it will be remembered that by the terms of the statute such liens can only take preference where the debtor’s title actually ap-joears of record. The fact that plaintiffs had learned of the existence of the deed is not enough. Third parties might rely on the statute. Dickinson v. Kinney, 5 Minn. 332, (409.) It would be enough in such case that the mortgage was recorded as soon as the deed was recorded. If, then, defendant Davy was not by law required to record his mortgage sooner, as against such liens, his mere omission to do so cannot be construed into a waiver or estoppel so as to subordinate his lien to that of plaintiffs. And no other act or omission on his part is complained of, and there is no finding of any waiver or estoppel in the case. It is admitted that the plaintiffs had learned from Peterson of the existence of the unrecorded deed prior to the delivery of the greater part of the materials furnished by them, though the complaint alleges that her contract therefor was made prior to the deed. But they investigated the title no further, and the case does not appear to differ [295] essentially from that of ordinary creditors who have sold goods to a purchaser on the supposition that he owned unincumbered property, and was responsible. Spring v. Short, 90 N. Y. 538; Strong v. Van Duersen, 23 N. J. Eq. 369. Order reversed.