Benbow v. James Johns

108 P. 634, 56 Or. 554, 1910 Ore. LEXIS 203

• Court: Oregon Supreme Court
• Decided: May 10, 1910
• Status: Published

Opinion

Mr. Justice Slater

delivered the opinion of the court.

1. It is sought by the first separate defense to resist plaintiff’s right to a lien, on the ground that the boat is the property of a quasi public corporation, is necessary to the carrying out of the public purpose for which the corporation was established, and, therefore, impressed with a public use. As a general rule the property of a quasi public corporation, affected with a public use and necessary to the performance thereof, is not subject to a mechanic’s lien. 27 Cyc. 26; Am. & Eng. Enc. Law (2ed.) 296.

2. As to what constitutes a quasi public corporation, and as to when the property of such a corporation is affected by a public use, the cases are not in entire harmony. But it is strongly urged by the corporation that it is a quasi public corporation, although its corporate powers are not alleged. It says it has contracted with the city to operate the ferry in question for the accommodation of the public; that the public is to be greatly accommodated thereby, and has an interest in an uninterrupted operation of the ferry; that the city is to receive a percentage of the tolls collected; that the owner is under penalty for failure to furnish and operate the boat; and that if the lien is allowed to attach, and the boat ordered sold, the company will be renedered unable to subserve the interest of the public under its franchise, and be subjected to the penalty imposed by its contract. Whatever merit there may be in the doctrine of law relied upon to support this contention, we are clearly of the opinion that it cannot have such an unlimited application as to include the facts of this case. There is sound authority for saying that it cannot be applied at all, except so far as the property has become entirely the property of the company, divested of specific liens. When that has been accomplished, there may be reason in saying that a general creditor may not levy on or sell a part of the property of a company, which property is necessary to the carrying out of its assumed obligations to the public. That is one thing; it is an entirely different thing to say that such a lien shall not attach, when the company, by the very act of acquiring a particular article of personal property, creates either by contract, or by force of law, a specific lien in favor of the vendor or manufacturer, or would create it, unless hindered by public policy: Hill v. La Crosse & M. R. R. Co., 11 Wis. 215; Phillips, Mechanics’ Liens (3 ed.) § 182.

It has also been held that the rule does not apply to the property of a public corporation when a mechanic’s lien has attached to the property while it belongs to private individuals, and is afterwards conveyed to a city; but in such case the city takes the property subject to the lien: City of Salem v. Lane & Bodley Co., 90 Ill. App. 560, affirmed 189 Ill. 594 (60 N. E. 37: 82 Am. St. Rep. 481). In Briggs v. Lightboats, 11 Allen (Mass.) 157, three light-boats were being constructed by one Andrews, under an agreement with the United States government, to be constructed and equipped according to certain specifications and to the satisfaction of an officer of the government, and to be delivered for a gross sum, payable on delivery and presentation of a certificate of approval by the inspecting officer. After the boats had been received, and Andrews had been paid the contract price, without any knowledge by the government of plaintiff’s lien, the boats were seized under an action brought in the court of the State of Massachusetts for a materialman’s lien, it was held that the lien was valid, and that the boats were taken subject to the lien; but, as the government was npt subject to be sued in a state court, the plaintiff could not enforce the law in such court. And in The Siren, 7 Wall. 152 (19 L. Ed. 129), it was held that a prize ship, in charge of a prize master and crew, having collided with and done damage to the vessel of a private citizen, the latter had a valid lien upon the proceeds derived from the sale of the prize vessel, and that the claimants were entitled to have their damages assessed and paid therefrom, although title to the prize ship was afterwards adjudged to be in the United States.

3. The complaint states that the labor and material sued for were furnished by plaintiff between December 28, 1906, and July 1, 1907, upon a contract executed December 27, 1906, with David Herstel for himself alone, and for and on account of the partnership firm of Bilyeu & Herstel, the original contractors with J. T. Peterson, P. J. Peterson, and John Smith, copartners as Peterson Bros. & Smith, who were then the owners of the boat; that about January 29,1907, the two Petersons and Smith incorporated as the St. Johns Transportation Company, and in February following transferred the ownership of the boat to the corporation, which ratified and confirmed the previous acts of the partnership, relating to the construction of the boat, and thereafter contracted with Bilyeu & Herstel for other and different construction work and material to be used in the boat. The ordinance granting the franchise was approved by the mayor of St. Johns on January 22, 1907, and within thirty days thereafter the St. Johns Transportation Company filed with the city recorder its acceptance of the franchise.

It is not averred in the answer that, at the time plaintiff’s alleged lien attached, the boat was or had been in use as a ferryboat, under the franchise granted to the St. Johns Transportation Company, but that it was being built and completed in compliance with the ordinance granting the franchise, and was intended to be operated under the terms thereof; and that it was being so used at the time of filing the answer. The lien is created by the law, and attaches as soon as the labor or material is furnished, and is not dependent on any subsequent condition, expressed or implied: The Victorian, 24 Or. 121, 139 (32 Pac. 1040: 41 Am. St. Rep. 838); Dorr v. Waldron, 62 Ill. 221, 225. The answer, therefore, does not aver that the boat in question was in fact impressed with a public use as a ferryboat at the time the lien attached, but only that it was being constructed with an intention on the part of its owner to use it in that capacity in the future, of which intention and purpose the plaintiff had knowledge.

4. The fact that after the lien attached the boat was used as a ferryboat would not prevent plaintiff from enforcing his lien, because the subject-matter of the lien is a detached piece of personal property, which previous to the attachment of the lien thereon had not been used as a part of the public franchise pleaded, and because the consideration of the lien is, in substance a part of the purchase price thereof.

5. The jurisdiction of the state court to enforce a lien upon a boat depends upon whether the debt on which the lien is based is, in fact, for material or labor used in its construction, as distinguished from the repair of a boat while in use. The Victorian, 24 Or. 121, 139 (32 Pac. 1040: 41 Am. St. Rep. 838). Therefore, before plaintiff could enforce the lien, he must allege and show that the subject-matter of the lien was in fact being constructed for a boat at the time the lien attached. It could not, therefore, be affected or impressed with a public use under the franchise granted by the city ordinance, unless it had previously been used in such public capacity. The first separate answer is, therefore, subject to the demurrer.

6. In support of the second separate answer, it is urged that, by taking judgment against David Hertsel in the former action, it was adjudicated that the labor and material sued for was furnished at the request of David Hertsel, because it was so alleged in the complaint; and that by reason thereof plaintiff is now estopped from averring in this complaint that the same labor and material were furnished to the firm of Bilyeu & Hertsel. No estoppel by former adjudication could arise therefrom for two reasons:

First, it appears that the former action was dismissed as to the boat on plaintiff’s motion, and it is not, therefore, a party to the judgment in that action. The rights of action against the boat and against the owner, contractor, or subcontractor, are not joint, but several. That against the boat is in rem, and that against the owner, contractor, or subcontractor is in personam. The weight of authority seems to. sustain the proposition that the remedy against the vessel and the remedy against the owner cannot be united or enforced in the same action. Certainly no case has been cited, or found by the court, disputing the right of the claimant to pursue them separately: Providence Washington Ins. Co. v. Wager (D. C.) 35 Fed. 364. And although they should be considered as capable of being joined in one action, and treated as joint and several causes of action, still a voluntary nonsuit may be taken as to one, and a judgment recovered as to the other (Section 61, subd. 3, B. & C. Comp.), and afterwards an action may be maintained against the one as to whom a voluntary nonsuit had been taken: 23 Cyc. 1243; Handley v. Jackson, 31 Or. 552 (50 Pac. 915: 65 Am. St. Rep. 839); Parks v. Dunlap, 86 Cal. 189 (25 Pac. 916); Hamill v. Ward, 14 Colo. 277 (23 Pac. 330); West v. Asher, 38 Ind. 291; James v. Leport, 19 Nev. 174 (8 Pac. 47); Eikenberry v. Edwards, 71 Iowa 82 (32 N. W. 183). Judgments and decrees are conclusive evidence of facts only as between parties and privies to the litigation; and, in case of a former adjudication set up in defense, it is no bar, unless the parties to the first judgment are the same as those to the second proceeding. 2 Black, Judgments (2 ed.) § 534. The defendant boat was not a party to the judgment against Herstel, and is not bound by anything adjudicated in the action of which the judgment is the final result. When the action was dismissed as to the boat, it was as if no action had been brought against it.

7. Second, the matter now said to be inconsistent is not so in fact. David Herstel is alleged to be one of the firm of Bilyeu & Herstel. All contracts of the firm are contracts of each member of the firm; that is each member of the firm is personally liable for the partnership obligations. It is now alleged that the owners of the boat contracted with Bilyeu & Herstel for the construction of the boat, and that David Herstel, one of the firm, for himself and Bilyeu & Herstel, contracted with plaintiff in reference to the matter. This is not inconsistent with the averment in the former action that plaintiff contracted with David Herstel, and hence no estoppel by adjudication could in any event arise.

8. The third defense amounts to this : That whatever right plaintiff had to a lien was extinguished by taking judgment against Herstel. It is argued that the statute contemplates a lien based upon an account, and not on a judgment; but such is not the purport of the statute. The lien is given “for all debts due to persons by virtue of a contract, expressed or implied,” etc. Section 5706, B. & C. Comp. The proceeding is for the purpose of subjecting the security to the payment of the debt. It would seem upon principle and authority that nothing other than the payment of the debt by satisfaction of the judgment would extinguish the right to enforce the claim against the security: Marean v. Stanley, 5 Colo. App. 335 (38 Pac. 395); Kirkwood v. Hoxie, 95 Mich. 62 (54 N. W. 720: 35 Am. St. Rep. 549); Anderson v. Huff, 49 N. J. Eq. 349 (23 Atl. 654).

9. The fourth defense is practically the same as the third. It is that the plaintiff had the right to but one of two remedies; an action in personam against the person contracting for the work and material, and one in rem against the boat.

10. The above contention is based upon a construction of the following words of the statute: “Any person having a demand as aforesaid, instead of proceeding for the recovery thereof against the master, owner, agent, or consignee of the boat or vessel, may, at his option, commence an action against such boat or vessel by name.” Section 5708, B. & C. Comp. Particular emphasis is- laid upon the words “instead of” and “at his option.” If Hers-tel, against whom plaintiff obtained judgment, came within the class of persons named in the section of the statute above quoted, the question presented would be difficult to overcome; but he was not the master, owner, agent, or consignee of the boat or vessel. It is argued that the liability of the vessel is made to rest upon the theory of agency, and that Herstel, in contemplation of the law, is an agent; but it will be noticed that in declaring the lien Section 5706 of the statute makes use of these words: “For all debts due to persons by virtue of a contract, expressed or implied, with the owners of a boat or vessel, or with the agents, contractors, or subcontractors of such owner.” Here contractors and subcontractors are expressly mentioned as a class distinct from the agents, and there is nothing in the statute to indicate that it was intended that they should be considered as agents of the owner. The latter,- therefore, must evidently mean an agent in fact, and not one implied by law, as in the mechanic’s lien law. But in the section of the statute on which the argument is based contractors and subcontractors are not mentioned, and we therefore conclude that they are not included within the optional clause of that section.

11. If but one. remedy is given by the statute as against the parties specially named therein, the reason of the statute would appear to be that, if judgment is obtained against the owner, master, agent, or consignee, execution thereof would be available against the boat, and therefore it should be deemed a waiver of a direct proceeding against the boat; but this would not be true of a judgment obtained against a contractor or subcontractor, because neither of such persons would have any property interest in the boat subject to execution. We are satisfied, however, that a subcontractor is not precluded by the statute from having his lien upon the boat because he obtained a judgment against the original contractor, who is not an owner, master, agent, or consignee of the boat.

The judgment is, therefore, in all things reversed, and the cause remanded for a new trial, with directions to the lower court to sustain the demurrer. Reversed.