McDonald v. Village of Ballston Spa

34 Misc. 496, 70 N.Y.S. 279
New York Supreme Court·Decided April 15, 1901·Published·Cited by 1 cases

Opinion

Houghton, J.

This action is brought for the foreclosure of a mechanic’s lien, and there is involved the question'of the rights of certain of the parties holding certain orders, given by the contractor, which are claimed to be equitable assignments.

The defendant Van Arnam entered into a contract with the village of Ballston Spa for the construction of a portion of its water-works system. At the time of the bringing of the action, there remained a balance of $871.43 due him upon the contract, including a small-amount for extra work. Orders upon the treasurer of the defendant village had been given by the contractor, from time to time, to the plaintiff and other persons, which had been paid. There remain, however, unpaid two orders in favor of the plaintiff, one in favor of the defendant Riley and one in favor of the defendant Thomas, aggregating $324.69. The orders of the plaintiff are dated, respectively, October twenty-sixth and October thirtieth. The order of the defendant Thomas is dated October seventeenth, and that of the defendant Riley October twenty-eighth. Practically, all of the work had been done by the latter part of November, but was not payable until acceptance on the fifteenth of December following. On the seventeenth of October the defendants Scherer & Haight duly filed a lien for material, furnished to the contractor, amounting to $161.72. On the thirty-first of October, an order in supplementary proceedings was issued against the contractor, and, on November fourth, the defendant Vedder Gervin was appointed receiver, and there is due on the judgment in that proceeding $110. On November eighteenth, the plaintiff duly filed a lien for material furnished, amounting to $84.46. Liens for material were filed by other defendants, and from the twenty-third of November to as late as the twentieth of December, various defendants filed liens for labor performed upon the public improvement for the contractor. The labor liens amount, in the aggregate, to $461.

By an amendment to the Lien Law (Laws of 1898, chap. 169, §2), laborers for daily or weekly wages, such as these defendants were, have preference over all other lienors, without reference to the time of filing a notice of their lien.

The amount due upon the contract will not pay the orders and the various liens. There is nothing in the contract which pro[498] Mbits the giving of orders, and, in the absence of anything to the contrary, and before any notice of lien is filed, the contractor may assign to his creditor in payment of his debt, the whole or any portion of the moneys due or to become due under the contract, and the assignee acquires a preference over a subsequent lienor. Bates v. Salt Springs National Bank, 157 N. Y. 322. All of the orders remaining unpaid, except the Thomas order of twenty-five dollars, are subsequent to the lien filed by defendants Scherer & Haight. The Thomas order bears date the day the lien was filed.- There is no proof that this order was presented to the financial officer of the village before the filing of that lien, and I think I must assume that the lien was first filed from the fact that, in the ordinary course of business, the order would not probably be presented immediately upon its delivery. Scherer & Plaight had, therefore, filed their lien prior to the giving of any unpaid orders, and their lien has preference, therefore, over any of the orders, even if they should be held to be equitable assignments of the fund due or to become due from the village to the contractor. Hnder the Lien Law, however, because the contract related to a public improvement for a municipality, the labor liens, amounting to $461, have preference over the Scherer & Haight lien, irrespective of their time of filing.

If there was anything due the contractor which had not been transferred by assignment, legal or equitable, or had not been attached by the filing of liens when the supplementary proceedings were instituted on the thirty-first of October, the defendant Gervin, as receiver, would take sufficient to pay $110 due upon the judgment which he represents.

There not being sufficient money to pay all these claims, it is necessary to determine whether or not the orders remaining unpaid amounted to an equitable assignment pro tanto of the moneys due or to become due to the contractor upon the contract.

The plaintiff’s order of October twenty-sixth is addressed to the treasurer of the village, and is as follows:

Please pay to the order of Martin McDonald $119.73 and charge same to my account.
“ (Signed)^ Charles Vah Arham."

[499] The order of October thirtieth is in the same form and for $168.94.

"VVhat is claimed to be the order of the defendant Riley is a mere due-bill, addressed to no one, and cannot be considered.

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McDonald v. Village of Ballston Spa, 34 Misc. 496, 70 N.Y.S. 279 (N.Y. Super. Ct. 1901).

34 Misc. 496 (McDonald v. Village of Ballston Spa) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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