Pringle Associated Mortgage Corporation v. Eanes

208 So. 2d 346
Louisiana Court of Appeal·Decided June 4, 1968·No. 7280·Published·Cited by 22 cases

Opinion

208 So.2d 346 (1968)

PRINGLE ASSOCIATED MORTGAGE CORPORATION et al.
v.
Ernest R. EANES, Jr., et al.

No. 7280.

Court of Appeal of Louisiana, First Circuit.

March 4, 1968.
Rehearing Denied April 8, 1968.
Writ Refused June 4, 1968.

*347 Frank P. Simoneaux and Victor A. Sachse, of Breazeale, Sachse & Wilson, Robert C. Taylor, Baton Rouge, for Pringle Associated Mortgage Corporation & Ross E. Cox.

Doris Gates Rankin, Baton Rouge, for J. R. McFarland.

George S. Womack and Douglas M. Gonzales, Baton Rouge, for Livingston Roofing & Sheet Metal Co., Inc.

R. Gray Sexton, of Taylor, Porter, Brooks, Fuller & Phillips, Baton Rouge, for Capitol Detective Agency, Inc.

Ernest R. Eldred, Baton Rouge, for Seaborn R. Wicker, Jr., Assignee of Rawlins Electric, Inc.

Before LANDRY, REID and BAILES, JJ.

LANDRY, Judge.

The pivotal issue presented on this appeal by plaintiff, Pringle Associated Mortgage Corporation (Pringle), is one of law, namely, does a subcontractor who pays his laborers their wages when due in the ordinary course of business, for labor performed on a private construction contract, become subrogated by operation of law to the laborers' lien and privilege against the property involved and the owner thereof pursuant to LSA-R.S. 9:4801 and 9:4812? In answering the question in the affirmative, we think the trial court erred. In addition to the foregoing point, certain ancillary contentions are presented but are rendered moot by our decision on the stated prime interrogatory.

No dispute exists as to the essential facts and circumstances of the present inquiry which may be summarized thusly: Pringle is the holder of a duly recorded mortgage in the sum of $335,000 granted by defendant Ernest R. Eanes, Jr. (Eanes) on the Plantation Trace Apartment Project located in East Baton Rouge Parish, said mortgage being given in security for a note in like amount. It became necessary for Pringle to foreclose its mortgage in which proceeding Pringle became the purchaser of the hypothecated property at sheriff sale, subject to all liens and encumbrances which might prime Pringle's rights under its mortgage. There being numerous liens filed against subject property for allegedly unpaid laborers' wages and materials reputedly furnished for the project in question, Pringle ruled all lienors to show cause why their liens should not be cancelled insofar as they purported to affect the property in question. Of the thirty-two liens claimants, the rights of three were held by the trial court to prime appellant's mortgage, namely: Livingston Roofing and Sheet Metal Co., Inc., in the sum of $2,961.74; J. R. McFarland, d/b/a United Masonry Company, aggregating $5,606.86, and Capitol Detective Agency, Inc., amounting to $1,446.26.

It is conceded the claim of Livingston Roofing and Sheet Metal Co., Inc. represents the sum of $1,471.50 paid its employees in wages, including some wages for labor performed off the construction site in fabricating certain components incorporated into the project and also includes the sum of $1,490.24 paid another subcontractor. McFarland's claim is acknowledged to be in the sum of $3,214.24 paid his employees as wages and also wages in the aggregate of $2,396.62 for labor personally performed on the construction by McFarland notwithstanding he was a subcontractor of the masonry work involved. Similarly, all litigants agree the claim of Capitol Detective Agency, Inc. represents salaries paid two night watchmen assigned to protect the apartment project during the construction period. It is also agreed that all of the laborers' *348 wages involved herein were paid by their respective employer-lienors promptly when due and that no lien was filed by any laborer except McFarland against the project in question. Finally, it is acknowledged that the three lienors hereinabove named were all subcontractors of the prime contractor, Buddy Eanes Home Builders, Inc., and that each said subcontractor timely filed a lien in his own name for the purposes and in the amounts previously indicated.

Lienors concede the absence of a conventional act of subrogation from either the prime contractor or owner of subject property and admit the subrogation herein advocated is subrogation of right or legal subrogation provided for by LSA-C.C. Article 2161.

Appellant's basic contention is that the trial court erred in holding legal subrogation resulted under the circumstances noted inasmuch as the legal relationship existing between the laborers, subcontractors, prime contractor and owner do not fall into either of the four categories provided in Article 2161, supra, in which subrogation is said to occur as a matter of right.

Lienors, however, rely upon Tilly v. Bauman, 174 La. 71, 139 So. 762, which they argue is squarely in point and therefore determinative of the case at hand. It does indeed appear that Tilly v. Bauman, supra, is indistinguishable from the present matter. We note in the cited case the liens involved are referred to solely as follows: "The contractor defaulted in the building, leaving numerous unpaid liens upon it." At first glance, the quoted language would appear to at least infer the liens alluded to were those of laborers whose wages were unpaid which circumstance, if true, would certainly differentiate Tilly v. Bauman from the case now before us. However, counsel for lienors appends to her brief certain excerpts from the transcript of testimony taken in Tilly v. Bauman which indicate the liens involved were filed by subcontractors only. If this be true (and we accept it as so for the present discussion), it follows that Tilly v. Bauman is factually indistinguishable from the case at bar.

Conceding (on the basis of the foregoing) that Tilly v. Bauman is in point, nevertheless, with all due respects, we decline to apply the ruling in the cited authority to the instant case. We so demur because the cited authority standing alone in the jurisprudence appears to be squarely in conflict not only with the French interpretation of the operation of the comparable article of the Code Napoleon, upon which our own subrogation law is predicated, but also contrary to certain prior pronouncements of our own Supreme Court on the subject of subrogation as we shall hereinafter attempt to demonstrate.

Readily acknowledging our duty and obligation to follow and apply the decisions of the Supreme Court when its rulings are clear and unambiguous, we also are under the obligation of pointing out those instances wherein we find conflicting views expressed by our superiors. Where such conflict exists, we are disposed to follow the view which appears to us most sound. We do so in order that such conflicts may be resolved by a reconsideration of the issues by the Supreme Court to the end that all resulting uncertainties may be resolved and removed.

Unquestionably the issue presented is one of grave and far reaching importance considering the extent of modern day construction. Any uncertainty regarding the question should, we believe, be set at rest once and for all by a decision which not only pronounces a certain result but does so upon reasoning which harmonizes the ruling with all principles of law involved. Only such a decision can result in an opinion of value to laborers, contractors, subcontractors and owners alike.

We note that in Tilly v. Bauman, supra, the court did not consider the operation and nature of subrogation in depth. It merely contented itself with a reference to the applicable statute and concluded legal *349 subrogation resulted therein.

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