Shaw v. Webb

131 Tenn. 173

• Court: Tennessee Supreme Court
• Decided: December 15, 1914
• Status: Published

Opinion

MR. Justice "Williams

delivered tlie opinion of the Court.

Shaw sold an automobile to one Akers, the purchase price being represented in two notes, each of which contained a-stipulation retaining title to the machine to secure payment. The machine passed at once into the possession of the vendee. Some time thereafter it became necessary to have some repairs made on it, and the automobile was taken to Webb, a mechanic, about the date of the' maturity of the first note. After the repairs were placed the machine was turned hack by the mechanic to the conditional vendee, Akers. On default being made in the payment of the first maturing note, Shaw by writ of replevin repossessed himself of the machine. Suit was thereupon brought by Webb, the mechanic, against Shaw, the vendor, to enforce a claimed mechanic’s lien on the automobile for the amount of the repair bill so created.

This action was predicated upon a recent statute (Acts 1909, ch. 150) which provides:

‘ ‘ That there shall be a lien upon any vehicle . . . for any repairs or improvements made or fixtures or machinery furnished at the request of the owner or his agent in favor of the mechanic, contractor, founder, or machinist who undertakes the work, ’ ’ etc.

Judgment was rendered in favor of the mechanic by the circuit judge, who tried the case without the intervention of a jury. On appeal that judgment was affirmed by the court of civil appeals; and we are, by petition for certiorari asked to review the judgment of the conrt last named.

The mechanic had no actual notice of the retention of title; and the conditional vendor did not know that the machine was placed with the mechanic to be repaired.

It is to be noted that we are not dealing with a claim by Webb to the artisan’s common-law lien which depends for validity, as against third parties, upon the retention of possession on the part of the artisan. Here Shaw had parted with possession, after the repairs were made on the automobile, to Akers, the conditional vendee.

However, the few cases that pass upon the right of an artisan in possession and claiming such common-law lien as against a conditional vendor of the personalty repaired by analogy shed much light upon the point we have to decide.

In Baughman Automobile Co. v. Emanuel, 137 Ga., 354, 73 S. E., 511, 38 L. R. A. (N. S.), 97, we understand from the report of the case that such common-law lien was relied upon by a mechanic for repairs put by him on an automobile, under contract with a conditional vendee in possession, and the court held that the artisan’s lien was subordinate to the right of the vendor, standing on his title retained. In that case it appeared that the lien claimant had knowledge of the rights of the conditional vendor at the time the work on the machine was done.

Small v. Robinson, 69 Me., 425, 31 Am. Rep., 299, involved a contest between tbe conditional seller of a back, wbicb bad been in tbe possession of tbe vendee for abont two years, and a mechanic urging tbe common-law ben of an artisan. A bke ruling was made in favor of tbe conditional seller.

If we go, for further analogy, to tbe law governing chattel mortgages, we find tbe rulings to be at least apparently variant. Tbe artisan’s common-law lien has been held to be subordinate to tbe rights of a mortgagee of such a chattel under a registered instrument; and tbe fact that tbe mortgagor is permitted to remain in possession, in tbe absence of a statute providing otherwise, affords no implied authority on bis part to subject tbe chattel to such a lien in priority. A lien attaches, it is held, but only to tbe mortgagor’s interest. Denison v. Shuler, 47 Mich., 598, 11 N. W., 402, 41 Am. Rep., 734, and cases cited; Bissell v. Pearce, 28 N. Y., 252; Hampton v. Seible, 58 Mo. App., 181, overruling, it would seem; Kirtley v. Morris, 43 Mo. App., 144; 7 Cyc., 39.

Other cases uphold tbe priority of tbe artisan’s ben, over tbe mortgagee’s title, in instances where there may fairly be implied a consent, on tbe part of tbe mortgagee, that tbe mortgagor while in tbe use of tbe chattel may have it repaired. Thus in Watts v. Sweeney, 127 Ind., 116, 26 N. E., 680; 22 Am. St. Rep., 615, it was held that a machinist was entitled to prevail on such a ben as against tbe claim of tbe mortgagee of a locomotive, the mortgagor being a public or common carrier, and tbe repairs being made after tbe condition of tbe mortgage was broken and tbe mortgage debt bad become dne.

In Hammond v. Danielson, 126 Mass., 294, tbe subject-matter was a back let for bire wbicb bad been mortgaged and described in tbe mortgage as “now in use” in a certain livery stable. Tbe mortgagor was left in possession agreeably to tbe terms of tbe mortgage; that is, tbe manifest intention of tbe parties was that tbe back should continue to be driven for bire and kept in a proper state of repair for that purpose. For repairs made under contract with tbe mortgagor tbe artisan’s lien was awarded priority.

In Ruppert v. Zang, 73 N. J. Law, 216, 62 Atl., 998, in an opinion by Pitney, J., it was held that a common-law lien bad priority over a mortgage when claimed for repairs upon a wagon by an artificer, made without tbe knowledge of tbe mortgagee.

However, in tbe cases of Watts v. Sweeney and Ruppert v. Zang, supra, tbe distinction between tbe effect of such a common-law lien and a statutory lien of a mechanic was noted — whether properly so is a debatable point. Judge Pitney in tbe last-named case refers to Sullivan v. Clifton, 55 N. J. Law, 324, 26 Atl., 964, 20 L. R. A., 719, 39 Am. St. Rep., 652, as a case pointing out tbe ground of such a distinction. It was said in Sullivan v. Clifton:

“It is one of tbe characteristics of common-law liens wbicb arise, upon considerations of justice and policy, by operation of law, as distinguished from liens created by contract or statute, that the former, as a general rule, attach to the property itself without any reference to ownership, and override other rights in the ■property, while the latter are subordinate to all prior existing rights therein.”

See, also, D’Gette v. Sheldon, 27 Neb., 829, 44 N. W., 30; 25 Cyc., 678,

We think it manifest that if the New Jersey court had been dealing with a claim that could only have had basis on a statute, like the one in the pending ease, it would have held the same inferior to the mortgage lien.

Coming now to precedents which contrast the rights of statutory lien claimants with those of mortgagees under previously registered chattel mortgages:

In McGhee v. Edwards, 87 Tenn. (3 Pick.), 506, 11 S. W., 316, 3 L. R. A., 654, it was ruled that the statutory lien of a livery stable keeper on a horse must yield to the lien of such a mortgagee, where the lien claim arises under contract with the mortgagor in possession before the maturity of the mortgage. In accord are many cases relating to the statutory lien for pasturage of live stock. National Bank of Commerce v. Jones, 18 Okl., 555, 91 Pac., 191, 12 L. R. A. (N. S.), 310, and note, 11 Ann. Cas., 1041. The same rule applies to other chattels. 25 Cyc., 678.

Thus, in the recent case of Adler v. Godfrey, 153 Mich., 186, 140 N. W., 1115, it' was held that the fact that the mortgagor is permitted to remain in possession of a mortgaged automobile affords him no implied authority to create a lien thereon for storage (a lien by statute in that State) superior to the rights of the mortgagee, and that the rights are not changed by the fact that the mortgagee knew that the mortgagor was keeping the machine in a public garage.

' The claim advanced in this case in behalf of Webb as lienor is based upon a statute which awards a lien, notwithstanding the mechanic may have parted with possession, upon any vehicle “for any repairs or improvements made ... at the request of the owner or his agent, ’ ’ but saving the rights of purchasers without notice under good faith transfers.

The question for solution, then, is: Is this statutory lien superior to the rights of Shaw, the conditional vendor?

We have not been cited, nor have we been able to find, where the point in the presented phase has been ruled in any reported case. We are of opinion, however, that' on the above and other analogies of the law the lien claimant must fail in the pending case.

The Michigan court ruled in Presque Isle, etc. Co. v. Reichel, 179 Mich., 466, 146 N. W., 231, that the title of a conditional seller of a saw has priority over a statutory lien of a laborer for services in installing the saw in a mill under contract with the vendee.

Where real estate is the subject-matter of transfer and the vendor retains the legal title, it is not within the power of the vendee, under a bond for title or under a contract to convey (nothing else appearing), to fix a mechanic’s lien upon the property which will be superior to the title so retained. Gillespie v. Bradford, 7 Yerg. (15 Tenn.), 168, 27 Am. Dec., 494; Rhea v. Allison, 3 Head (40 Tenn.), 176; Belnap v. Condon, 23 L. R. A. (N. S.), 601, note.

The prior rights of a mortgagee of realty under a registered mortgage cannot be so affected by the mortgagor in possession (New Memphis Gaslight Co. Cases, 105 Tenn. [21 Pick.], 268, 302, 60 S. W., 206, 80 Am. St. Rep., 880), even where the mortgagee merely knew of the repairs or improvements (Pride v. Viles, 3 Sneed [35 Tenn.], 125).

In this State, the retention by a vendor of the title to personal property to secure the purchase money partakes of the nature of a lien. Automobile Co. v. Bicknell, 129 Tenn., 493, 167 S. W., 108, and cases cited. Such title, when retained in a written contract, unregistered, is superior to any right acquired by a purchaser for value and without notice. Price v. Jones, 3 Head (40 Tenn.), 84; McCombs v. Guild, 9 Lea (77 Tenn.), 81.

It is not easy to conceive, then, how the title retained or lien that is prior in time may he supplanted by a junior lien, created by statute in behalf of a mechanic, without the concurrence of the holder of the precedent lien; and it is not contended that any such express assent or concurrence is shown in the pending case.

There are cases which hold that such consent may be implied from the nature of the transaction or from the circumstances. In Hammond v. Danielson, supra, and Watts v. Sweeney, supra, the chattels were in use by public carriers, and tbe courts found room to imply sucb consent. In Drummond Carriage Co. v. Mills, 54 Neb., 417, 74 N. W., 966, 40 L. R. A., 761, 69 Am. St. Rep., 719, involving a buggy, tbe court construed tbe language of tbe mortgage to bave bad tbe making of repairs in contemplation.

Doubtless a court, in order to sustain a claim to lien, would not hesitate to seize upon any provision in a contract retaining title or in a mortgage wbicb may be construed to look to tbe making of repairs or improvements at tbe instance of tbe vendee or mortgagor in possession. Ragon v. Howard, 97 Tenn. (13 Pick.), 334, 37 S. W., 136; Drummond Carriage Co. v. Mills, supra.

Tbe English courts, it appears, take this view of tbe rights of tbe parties. In tbe recent case of Keene v. Thomas, 1 K. B. (1905), 136, where by a hire-purchase agreement plaintiff bad let a dogcart to one Robertson, who in tbe course of time sent tbe cart to be repaired to defendant, a couch builder, Lord Chief Justice Alverstone said:

“This case raises an important point, and one on which there is no direct authority. I am rather surprised, indeed, that there is not more, but probably hire-purchase agreements were not so common formerly as they are now. I think that the county judge has come to a right conclusion. The real question that we have to decide is that stated by Alderson, B., in Buxton v. Baughan (1834), 6 C. & P., 674, 40 R. R., 842, namely, whether the man who made the bargain with the repairer had anthority from the plaintiff to make such a bargain. There is no dohbt that Robertson made the bargain that the trap should be repaired by the defendant. The hire-pnrchase agreement expressly says that Robertson is ‘to keep and preserve the dogcart from injury (damage by fire included).’ . . . The clause does give Robertson authority to take care of the cart and to keep it in proper order, and that, in my opinion, implies an authority on the plaintiff’s behalf to get the trap repaired if it needed repair. ...

“The case of Buxton v. Baughan is not authority in favor of the plaintiff. The facts there were not the same. In that case, Alderson, B., said: ‘If you trust yoiir goods into a man’s possession, and he makes a bargain about them without your authority, you are not bound by that bargain, and may reclaim the goods. . . . A man has no right to keep my property, and charge for the standing of it, unless there was a previous bargain between him and me, or between him and some agent authorized by me’ — and he held there on the facts of that case that there was no such authority.”

We are of opinion, therefore, that something more is required than the fact that a vehicle, which may need repair in order to continue personal use by the vendee, is placed in the possession of the conditional vendee. The vendor in such case should not be considered as consenting in advance to the subordination to that which both parties patently intended to make superior — the title retained for the security of the payment of the purchase money.

The intent of the vendor to permit repairs to he made and a consequent lien to attach to his interest should have been manifested in the note contract, since upon a transfer of the note the transferee is vested with the rights of the conditional vendor. To announce a doctrine such as is contended for by the mechanic in this case would be to deprive a note which contains a reservation of title to personalty of a no inconsiderable element of marketability. The transferee of such paper should not, we believe, take it subject to the risk of having his right embarrassed or lessened by such act of the vendee maker, when the note contains nothing to put him on notice.

It should perhaps be noted, by way of parenthesis, that a distinction is taken by the authorities between such a claim of a mechanic and the common-law lien of an inn-keeper on a chattel held in possession as conditional vendee by a guest. To such a chattel brought upon his premises, the lien attaches in favor of the innkeeper, provided he had no notice of the nature and extent of the guest’s title when the property was brought into the inn. In such case the common law imposed upon the innkeeper the obligation to receive the guest and his baggage, and that liability is deemed sufficient to give rise to a coextensive lien. So to speak, by way of recompense for the enforced obligation, the lien is held to attach to the property regardless of the true ownership.

The court of civil appeals in its judgment awarded priority to the mechanic oh his claim to a paramount lien. Reversed, with judgment here in accord with this opinion.