Cahoon v. Fortune Mining & Milling Co.

72 P. 437, 26 Utah 86, 1903 Utah LEXIS 9

Opinion

McCARTY, J.,

after stating the facts, delivered the opinion of the court.

The controlling and decisive question involved in 1 this case is, did the court err in holding that the last bill of lumber, amounting to $27.45, and shipped by plaintiffs on January 29,1901, to defendant Fortune Mining & Milling Company, was not furnished under the same contract upon which the bulk of the material was delivered? It is contended by appellants that there was only one contract entered into by them and the Fortune Mining & Milling Company for the furnishing of material, and that such contract did not terminate until the last load was delivered, January 29, 1901; ‘ ‘ that it was practically a continuous transaction. ’7 Respondents contend that plaintiffs’ contract to furnish material for the construction of the mill was completed July 18, 1900, which they claim was about the time the mill was finished.

Section 1386, Revised Statutes 1898, so far as material in this case, provides that “every original contractor, within sixty days after the completion of his contract, and every person save the original contractor claiming the benefit of this chapter, must, within forty days after furnishing the last material . . . file for record with the county recorder of the county in which the property, or some part thereof, is situated, á claim in writing containing a notice of intention to hold and claim a lien . . . with a statement of the terms, time given, and conditions of his contract specifying the time when . . . the first and last material was furnished . . The foregoing provisions of the statute are plain and free from ambiguity. It will be observed that a subcontractor has forty days from the time of the furnishing the last material in which to file a notice of intention to claim a lien, and an original contractor has sixty days from the time of the completion of his contract. It therefore becomes important’ to determine when the mill in question was completed, as the terms of the contract under consideration were that plaintiffs should furnish the lumber necessary to build the mill. "When the mill was completed, plaintiffs ’ contract for furnishing material terminated, and they had sixty days thereafter in which to file their notice of intention to claim a. lien for whatever balance was due them under the contract. While there is some apparent conflict in the testimony on this point, we think the great preponderance of the evidence shows that the mill was completed long before plaintiffs made their last two shipments of material. When the mill was put in operation, in July, 1900, the mechanics who constructed'it and put the machinery in place all quit work and left, except one, who -was retained to make impairs and such changes and alterations as are usually necessary and incident to the starting of new machinery. The mill stopped running in December, 1900, at which time a few repairs were made, the building closed tend locked up, and a watchman put in charge of it. Mr. Bamberger, one of the respondents, testified that he was at the mill in June or July, when the carpenters and builders were there, and saw it again after they quit work and left, and when the mill was in operation; that the building was complete; and that there were no particular changes made after the mill started, except to adjust the machinery. Mr. Hill, the president and business manager of the mill and mine, and the party who made the contract in question for the company, was sworn in behalf of the plaintiffs, and testified, in part, as follows: ‘ The building of the mill progressed satisfactorily from January 23d [1900] to the time it was completed and went into operation, about the 15th of July [1900]. It began turning out its products, subject to such delays as a new mill might ordinarily ha,ve. The machinery was pretty hearly all installed, and the mill was all inclosed. The ore bins were made later — the bins for the concentrates. The ore bins at the mill were constructed in June, July and August, and in fact never were finished yet.” This witness also stated in general terms that the mill was not completed in July, and then proceeded to explain in what respect it was incomplete, as follows: ‘ ‘ The boxes for carrying the ore through the mill were put in with no grade to amount to much, and we had to fake them all out. Some changes were necessary to be made all along from time to time after the mill started. The ore would wear those boxes away, and we had to renew them, and we had always to see where we could, change them and make them better. Alterations were necessary to be made in and about the mill after it started, and we made them from time to time as it became necessary.” And again he says: “Repairs have been going on at the mill. It has been closed up tight and a watchman there. There has been fixing all the time, more or less — getting the tanks soaked np, cleaning up around the mill, and fixing different things around the bins; fixing up around the pumps covering up the pipes to keep them from freezing.” It will readily he observed that the changes, alterations, and repairs spoken of by the witness had no connection with the building of the mill in the first instance, and the material furnished for such alterations and repairs did not come within the scope and terms of plaintiffs ’ original contract for the furnishing of material. “Occasional repairs subsequently made cannot be added to work doné months before, so as to render the whole work one continued performance, for which a single lien can be claimed within sixty days after the last repairs. ’ ’ Phillips on Mechanics’ Liens, 827; Davis v. Alvord, 94 U. S. 545, 24 L. Ed. 283; Appeal of Harman et al. (Pa.), 17 Atl. 140.

The last order for material was handed to John P. 2 Oahoon, one of the plaintiffs, by Mr. Hill, the president and general manager of the Fortune Mining & Milling Company, at the company’s office, one or two days before the shipment was made. Plaintiffs’ attorney, with whom John P. Cahoon had been talking about the account with the company, was present at the time. This incident, together with the fact that the order was for lumber not needed at the mill, and the further fact that the plaintiffs were willing to thus ex-, tend additional credit to a company that had shown itself to be either unwilling or financially unable to pay its obligations, and thereby add to an account long past due, and one which their own testimony shows they re-regarded as somewhat doubtful — one of them having made one or two ineffectual attempts to collect money on it — tends to give color to the contention of the respondents that the order was given and filled for the purpose of enabling plaintiffs, one of whom was a stockholder in the company, to revive and extend the time of filing their notice of intention to claim a lien, and not for the purpose of discharging any mutual ob ligation growing ont of the contract of November, 1899, that the parties were nnder to each other. To permit a contractor, long after the completion of his contract, to revive or keep alive his right of lien by tacking on and adding to his account by filling additional orders for labor or material not contemplated by his original contract, would throw open wide the doors to fraud and collusion, and in many cases defeat the very purpose and object of the statute, as it would enable the favored creditor to keep alive indefinitely his right to a lien, and at the same time prevent the property subject to lien from being reached by other lienholders whose contracts were entered into subsequent to that of his qwn. “It is particularly as regards the rights-of bona fide purchasers and incumbrancers that the claimants of this lien are held to the strictest compliance with the statutory provisions as to the time of its enforcement. Mechanics and materialmen, it is said, should understand that any unreasonable delay in giving public notice of their intention to hold a lien is dangerous, as the public, in purchasing the property, have nothing to warn them after the building is substantially completed, and the statutory period of filing the notice of lien has expired. ’ * Phillips, Mech. Liens, 327a; Flint v. Raymond, 41 Conn. 510; Sanford v. Frost, Id. 617.

In this case, while the Salt Lake Hardware Company was foreclosing and subjecting the property in question to the payment of its- claim, the plaintiffs stood quietly by, without filing any notice of their intention to claim a lien, and permitted the property, by virtue of such proceedings, to pass into the hands of an innocent purchaser. Under these circumstances, to permit the plaintiffs to establish a right to a prior Hen by tacking onto their account an additional item five or six months after the completion of their contract, and calling it all “one-continuous transaction,” would not only be in contravention of the statute, but contrary to every principle of justice and equity.

The judgment of the lower court is affirmed; costs of this appeal to he taxed against the appellants.

BASKIN, 0. J., and BARTCH, J., concur.