Division of Labor Law Enforcement v. Siskiyou Mills

229 Cal. App. 2d 105
CourtCalifornia Court of Appeal
DecidedAugust 11, 1964
DocketCiv. No. 10751
StatusPublished

This text of 229 Cal. App. 2d 105 (Division of Labor Law Enforcement v. Siskiyou Mills) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Division of Labor Law Enforcement v. Siskiyou Mills, 229 Cal. App. 2d 105 (Cal. Ct. App. 1964).

Opinion

229 Cal.App.2d 105 (1964)

DIVISION OF LABOR LAW ENFORCEMENT, Plaintiff and Respondent,
v.
SISKIYOU MILLS, Defendant and Appellant.

Civ. No. 10751.

California Court of Appeals. Third Dist.

Aug. 11, 1964.

Tebbe & Correia and J. P. Correia for Defendant and Appellant.

Samuel S. Berman, Leon E. Gold and Douglas M. Phillips for Plaintiff and Respondent. *107

FRIEDMAN, J.

Defendant W. H. Rasor & Sons, Inc., was a logging contractor which undertook to conduct logging operations in Siskiyou County for defendant Siskiyou Mills. On July 28, 1962, Rasor ceased operations, owing $4,153.24 to its employees for services performed in cutting Siskiyou's logs. The employees assigned their wage claims to the Division of Labor Law Enforcement of the State Department of Industrial Relations. On August 9, 1962, the division filed the present action in the Siskiyou County Superior Court, seeking foreclosure of loggers' liens pursuant to Civil Code sections 3065 and 3065a. [fn. 1] Both W. H. Rasor & Sons, Inc., and Siskiyou Mills were named as defendants. *108

At the termination of Rasor's logging operations and at the commencement of this suit, cut logs remained in the woods where they had been felled in more than adequate quantity to cover the wage claims. The logs remained where felled at least through August 22, 1962, when a notice of attachment was served on an employee of Siskiyou Mills. The sheriff, however, did not take physical possession of the logs or place a keeper in charge. During the fall and winter of 1962 and before trial of the action Siskiyou Mills cut the logs into lumber, which was then shipped out of Siskiyou County.

The trial court found that Siskiyou Mills was the owner of the logs at the time the work was done; that all plaintiff's assignors were entitled to loggers' liens; that suit had been filed within the 30-day period prescribed in section 3065a; that by cutting the logs and shipping the lumber out of the county Siskiyou Mills had destroyed the liens, made them worthless and unjustly enriched itself at the expense of the lien claimants. Siskiyou Mills appeals from a joint and several money judgment against it and W. H. Rasor and Sons, Inc.

On appeal, Siskiyou Mills' theory is that section 3065a contemplates termination of loggers' liens when the logs or lumber are removed from the county, whether removal occurs before or after commencement of a lien foreclosure action; that the remedy of the lien claimant is purely in rem; that the claimant may preserve his lien by preventing removal of the logs through an attachment; if he does not attach, the owner of the logs incurs no personal liability by processing the logs and shipping the lumber in the ordinary course of business. The Division of Labor Law Enforcement makes no claim that its attempted levy amounted to a valid attachment. *109

Common law liens and some kinds of California statutory liens are dependent upon the lienor's possession of the subject matter. (See 31 Cal.Jur.2d, Liens, 8, pp. 236-237.) [1] The logger's lien provided by Civil Code section 3065 does not depend upon possession or notice. Section 3065a gives the logger's lien an initial lifetime of 30 days from cessation of work and while the logs or products remain in the county where the work was performed. Institution of a foreclosure suit before expiration of 30 days renews the life of the lien, extending it timewise to final determination of the lawsuit. [2] Quite plainly, if the owner ships the logs or lumber out of the county before a foreclosure action is commenced, the lien is lost. (Morehouse v. Shipman Lumber Servaes Co., 168 Cal.App.2d 135, 138 [335 P.2d 496]; see also, Virden v. Neese, 66 Cal.App.2d 724, 730 [152 P.2d 761].) The statute does not clearly indicate whether the products' continued presence in the county of origin is a necessary condition of lien continuance once suit is instituted.

[3] Determination of that question is not necessary to our decision. Whichever way the statute is construed, the logs on which plaintiff's assignors had worked were still in Siskiyou County when this foreclosure action was commenced. Thus they remained subject to plaintiff's liens, which were extended in time by commencement of the action. Section 3065 declares that a logging contractor is the owner's agent for the purpose of burdening the logs with wage liens. Siskiyou Mills put the contractor to work on its timber, thus voluntarily subjecting its logs to liens for the services of the contractor's employees. (Holt Mfg. Co. v. Collins, 154 Cal. 265, 270 [97 P. 516].) The logs in Siskiyou Mills' possession and ownership were burdened with a security interest for the benefit of the wage claimants hired by Rasor as its statutory agent.

[4a] When the foreclosure action was commenced, Siskiyou Mills became aware, if it was not already aware, that Rasor was in financial trouble and owed wages to its workingmen. Siskiyou had under its control logs of a known aggregate value, subject to the liens and constituting security for unpaid wage claims whose aggregate amount was also known. Siskiyou might have retained a minimum inventory adequate to meet the wage claims as ultimately determined in the foreclosure action. Without retaining this minimum inventory *110 and fully conscious of the liens created by its own agent, Siskiyou deliberately cut, sold and shipped the entire lot. If this course of action destroyed the wage liens as a matter of law, it demolished the claimants' security for unpaid wages. If it did not destroy the liens as a matter of law but only made them impractical or impossible of enforcement, it demolished the value of the security. The economic loss to the claimants was the same in either case. Under either interpretation of the statute Siskiyou's deliberately chosen course of action destroyed or rendered fruitless the security which the Civil Code provisions provided the unpaid wage claimants.

[5] The owner of property who diminishes its value or sells or destroys it to the damage of a lienholder may be liable to the latter on a conversion theory. (Mills v. Brown, 205 Cal. 38, 40-41 [269 P. 636]; Taylor v. S & M Lamp Co., 190 Cal.App.2d 700, 712 [12 Cal.Rptr. 323]; Bastanchury v. Times-Mirror Co., 68 Cal.App.2d 217, 236 [156 P.2d 488]; McCaffey Canning Co., Inc. v. Bank of America, 109 Cal.App. 415, 424 [294 P. 45]; 14 C.J.S., Chattel Mortgages, 214, p. 816; sec. 261, p. 816.) [4b] Frequently availability of an action for conversion turns on the plaintiff's right to possession of the chattels. Loggers' liens, as we have noted, are not possessory. It is unnecessary to decide whether Siskiyou's course of action amounted to a conversion in strict theory. The wage claimants had an enforceable right which Siskiyou Mills deliberately and knowingly destroyed. The destruction of this right entitles the lienholders to damages. Whether this entitlement is premised on tort, contract or trust theory is of little importance, since the damages are the same under any theory. Siskiyou Mills was bound, regardless of contract, to abstain from injuring the wage claimants or infringing upon any of their rights. (Civ. Code, 1708.) By deliberately indulging in injurious action Siskiyou committed a wrong for which the law provides a remedy. (Civ.

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Related

Bastanchury v. Times-Mirror Co.
156 P.2d 488 (California Court of Appeal, 1945)
Virden v. Neese
152 P.2d 761 (California Court of Appeal, 1944)
Wolfsen v. Hathaway
198 P.2d 1 (California Supreme Court, 1948)
Morehouse v. Shipman Lumber Servaes Co.
335 P.2d 496 (California Court of Appeal, 1959)
Ward v. Taggart
336 P.2d 534 (California Supreme Court, 1959)
Taylor v. S & M Lamp Co.
190 Cal. App. 2d 700 (California Court of Appeal, 1961)
Division of Labor Law Enforcement v. Siskiyou Mills
229 Cal. App. 2d 105 (California Court of Appeal, 1964)
McCaffey C. Co., Inc. v. Bank of America
294 P. 45 (California Court of Appeal, 1930)
Wm. J. Bettingen Lumber Co. v. Kerrin
279 P. 163 (California Court of Appeal, 1929)
Holt Manufacturing Co. v. Collins
97 P. 516 (California Supreme Court, 1908)
Robinett v. Brown
141 P. 368 (California Supreme Court, 1914)
Mills v. Brown
269 P. 636 (California Supreme Court, 1928)
Becker v. Superior Court of Santa Clara Cty.
90 P. 689 (California Supreme Court, 1907)
Goodrow v. Buckley
38 N.W. 454 (Michigan Supreme Court, 1888)
Breault v. Merrill & Ring Lumber Co.
75 N.W. 122 (Supreme Court of Minnesota, 1898)

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229 Cal. App. 2d 105, Counsel Stack Legal Research, https://law.counselstack.com/opinion/division-of-labor-law-enforcement-v-siskiyou-mills-calctapp-1964.