Fairbanks, Morse & Co. v. Town of Cape Charles

131 S.E. 437, 144 Va. 56, 1926 Va. LEXIS 230
CourtSupreme Court of Virginia
DecidedJanuary 14, 1926
StatusPublished
Cited by19 cases

This text of 131 S.E. 437 (Fairbanks, Morse & Co. v. Town of Cape Charles) is published on Counsel Stack Legal Research, covering Supreme Court of Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Fairbanks, Morse & Co. v. Town of Cape Charles, 131 S.E. 437, 144 Va. 56, 1926 Va. LEXIS 230 (Va. 1926).

Opinion

Burks, J.,

delivered the opinion of the court.

[58]*58This was a suit in chancery brought by the appellants against the town of Cape Charles and J. Edward Cole, trustee, to enforce certain alleged mechanics’ liens against the water works of said town. Stephens-Ely, Montague, Inc., had contracted to construct certain water works for the town of Cape Charles, which contract had been assigned by the contractor to the National Bank of Commerce of Norfolk, Virginia, to secure a loan of $2,000. The complainants claimed to have furnished to the contractor certain materials which were used in the construction of said water works. The contractor became insolvent and conveyed all of its assets, subject to the prior assignment to the National. Bank- of Commerce, to J. Edward Cole, trustee, in trust for the benefit of its creditors. The contractor was not made a party to the suit. Cole, trustee, demurred to the bill on the ground that no mechanic’s lien could be claimed against a municipal corporation. The town of Cape Charles filed an answer in the nature of a bill of interpleader, admitting indebtedness to the contractor in the sum of $3,036.81, which it paid into court, but stated that the National Bank of Commerce, Norfolk, Virginia, claimed priority over the complainants as to part of the fund, and asking that the parties be compelled to litigate their rights to the fund, and that the town be discharged from liability in the premises.

The National Bank of Commerce filed its answer to the bill of interpleader, claiming priority over the fund to the extent of $1,000, by reason of the assignment •aforesaid which was prior in date to any of said alleged mechanic’s liens.

There were quite a number of other pleadings and proceedings in the case, but they need not be noticed.

The trial court sustained the demurrer of Cole, [59]*59trustee, to the bill, dismissed the bill at the costs of the appellants, and directed the refunding to the town of Cape Charles of the amount which it had paid into court. From that decree the appellants appealed.

The errors assigned are—

“1. The court erred in sustaining the demurrer.

“2. The court erred in ordering the money paid into court by the town of Cape Charles to be returned to the said town of Cape Charles without first determining the rights of the claim of the National Bank of Commerce and its priority ’over the claims of your petitioners, if any.

It is clear that the appellants have no lien on the water works of the town of Cape Charles, as it is the public property of a municipal corporation. Phillips v. University, 97 Va. 472, 34 S. E. 66, 47 L. R. A. 284. It is equally clear that unless the complainants have a lien on the fund in controversy, or some right of priority of satisfaction therefrom over other creditors of' the contractor, the decree of the trial court is right and should be affirmed. They claim sueh right of priority by virtue of section 6435 of the Code and the' decision of this court in London Bros. v. National Exch. Bank, 121 Va. 460, 93 S. E. 699.

The case cited arose under section 2482a of Pollard’s Code, quoted in the margin.1 Section 6435 of the Code is as follows:

[60]*60“Validity and priority of lien not affected by assignments. — Every assignment or transfer by a general contractor, in -whole or in part, of his contract with the •owner or of any money or consideration coming to him under snch contract, or by a snbcontraetor of his •contract with the general contractor, in whole or in part, or of any money or consideration coming to him under his contract with the general contractor, and every writ of fieri Jadas, attachment or other process against the general contractor or subcontractor to subject or encumber his interest arising under such -contract, shall be subject to the liens given by this chapter to laborers, mechanics, and material men. No such assignment or transfer shall in any way affect the validity or the priority of satisfaction of liens given hy this chapter.”

The language of the two statutes is materially •different. Section 2482a declared invalid and unenforceable all assignments by the contractor until the claims of all subcontractors and material men had been satisfied, and further declared that no debt or demand of the owner to the general contractor should he subject to the payment of any debt, or the lien of any judgment, writ of fieri facias or garnishment of' the general contractor for debts having no relation to the work, unless and until the claims due by the general contractor to all subcontractors, material men and [61]*61laborers have been paid. Section 6435 of the Code contains no snch language. While the two statutes cover much of the same ground, they are essentially different. One is a comparison of claims, the other a comparison of liens. A claim is generally a liability in personam. A lien is a liability in rem. A claim is much more comprehensive than a lien. It may embrace both a personal liability and a lien on property. If the rights of a party are dependent upon his having a lien, they cannot be extended to a case where he has no lien, but a mere claim. Under the former statute assignments were subordinated to the claims of subcontractors, material men, etc. Under section 6435 they are subordinated only to the “liens given by this •chapter.”

It seems to be assumed that section 6435 was a mere revision of section 2482a of Pollard’s Code, and that the revisors did not, by the change of language, intend any change in substance. But section 2482a is not even referred to under section 6435, as is usually done when the old law is revised. On the contrary, in the revisors’ note to section 6435 it is said:

“This is a new section dealing with the effect of assignments. It is taken in part from section 3844 of the West Virginia Code. (Hogg, 1913.) Assignments are not prohibited, but are made subordinate to a mechanic’s lien. It is intended that no assignment made by a general or subcontractor shall in any way •affect the rights of other parties arising under the mechanic’s lien law.”

It is earnestly contended for the appellants that it “has always been the purpose of the mechanic’s lien law, and the wise and just policy of the State, to require that laborers and supply men, whose work and .material create the fund arising from the construction [62]*62of buildings, be paid out of said funds in preference to-the general contractor” and that the word “liens” in-section 6435 should be construed as synonymous with the word “claims” in the former statute. But we are-unable so to construe the statute without producing absurd results, and also declaring that the legislature-did not intend what its language plainly declares. For example, if we substitute “claims” for “liens” in section 6435, it would declare that all assignments “shall be-subject to the claims given by this chapter” and that no assignment should affect the validity of “claims”' given by this chapter when no “claims” are or could be given by the chapter. The catch words of the-section also plainly show that the legislature was dealing with liens and not with mere claims. They are-“validity and priority of liens not affected by assignment.”

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Miller & Rhoads Bldg., L.L.C. v. City of Richmond
790 S.E.2d 484 (Supreme Court of Virginia, 2016)
Murnan v. Stewart Title Guaranty Co.
585 F. Supp. 2d 825 (E.D. Virginia, 2008)
Fears v. Virginia State Bar
51 Va. Cir. 367 (Richmond County Circuit Court, 2000)
City of Bristol v. Johnson
47 Va. Cir. 185 (Bristol County Circuit Court, 1998)
Washington Federal Savings Bank v. William H. Metcalfe & Sons
33 Va. Cir. 161 (Fairfax County Circuit Court, 1994)
TQY Investments v. Rodgers Co.
26 Va. Cir. 40 (Fairfax County Circuit Court, 1991)
Kayhoe Construction Corp. v. United Virginia Bank
257 S.E.2d 837 (Supreme Court of Virginia, 1979)
Carter v. Nelms
131 S.E.2d 401 (Supreme Court of Virginia, 1963)
Sellers v. Bles
92 S.E.2d 486 (Supreme Court of Virginia, 1956)
Hereford v. Meek
52 S.E.2d 740 (West Virginia Supreme Court, 1949)
Almond v. Gilmer
49 S.E.2d 431 (Supreme Court of Virginia, 1948)
Temple v. City of Petersburg
29 S.E.2d 357 (Supreme Court of Virginia, 1944)
City of Roanoke v. James W. Michael's Bakery Corp.
21 S.E.2d 788 (Supreme Court of Virginia, 1942)
Boyles v. City of Roanoke
19 S.E.2d 662 (Supreme Court of Virginia, 1942)
Ingram v. Harris
5 S.E.2d 624 (Supreme Court of Virginia, 1939)
Fremont Foundry & Machine Co. v. Saunders County
285 N.W. 115 (Nebraska Supreme Court, 1939)
Coleman v. Pearman
165 S.E. 371 (Supreme Court of Virginia, 1932)
DeWitt v. Coffey
143 S.E. 710 (Supreme Court of Virginia, 1928)

Cite This Page — Counsel Stack

Bluebook (online)
131 S.E. 437, 144 Va. 56, 1926 Va. LEXIS 230, Counsel Stack Legal Research, https://law.counselstack.com/opinion/fairbanks-morse-co-v-town-of-cape-charles-va-1926.