Hill v. La Crosse , 11 Wis. 214 ( 1860 )

By the Court,

Paine, J.

This action was brought to enforce a mechanic’s lien for building a part of a brick block, which if completed according to the contract, was to have constituted the depot of the respondents, in the city of Milwaukee. The contract describes the land on which the building was erected, as block 41, in the 2d ward of that city. This was composed of a number of lots, and was bounded on the east by the Milwaukee river, and on the west, by Third street. The contract required the appellants to erect the building along the whole front of the block, upon the street, being four hundred and twenty feet, and to the depth of about fifty-five feet. The appellants erected the building along a part of the front, when by default of payment on the part of the company they were' unable to proceed, and this suit was brought to enforce the lien for the part built, Judgment was recovered by default, and was entered for a lien upon the interest of the company in the whole block 41. An application was subsequently made on behalf of the company for a modification of the judgment, upon affidavit, setting forth that the rail road track was laid across the east part of the block between the buildings and the river, that the whole block was not neceessary or convenient for the use of the buildings erected which were designed for stores and offices, and that one Carney, a sub-contractor had recovered a judgment against the company for $1630,87, which had not been credited by the appellants. Upon this application the court referred it to a surveyor to report upon the situation and character of the premises, and upon his report, modified the judgment so as to confine the lien to the west sixty feet of the particular lots on which the building as far as erected actually stood, and also by deducting from it the amount of the Carney judgment. From this modified judgment, this appeal is taken.

The question is made whether it is proper as a matter of practice, for the court at a subsequent term, to modify a final judgment. The respondent’s counsel contend that the power given by sec. 38, chap. 125, R. S., 1858 is ample for the purpose. We think where an application is made under that section to be relieved against a judgment, if the relief sought involves a trial of the merits of the action or any part thereof, it contemplates that the relief is to be given by opening the judg-meat, upoa just terms, and allowing a trial in the ordinary way;,and not that the court should try the merits on affidavits, and modify the judgment according to its conclusion. But where the application is under the other clauses, to “ supply an omission,” or to amend proceedings taken, “ so as to make them conform to the provisions of law,” and not involving the merits,, of course a trial would not be necessary, but the court on being properly informed could make the necessary modification. And we- are inclined to think that in this case, where the defendant did not dispute the debt, nor the right to the lien, but only asked that it might be limited to the proper bounds; if judgment had been taken for a lien beyond those bounds, the court might on such an application, so modify it as to make it conform to the law.

The respondent’s counsel contended that the appellants could not complain of the reduction of the lien, for the reason .that by law they were not entitled to any lien whatever. This position is urged upon the grounds of public policy. It is said the public are interested in preserving railroads in an operative condition, and that if these liens are allowed to attach to their buildings, or creditors allowed to levy upon and sell their cars, or other personal property necessary to the operation of the road, they will be rendered incapable of sub-serving the public interest; and several cases are referred to in which it has been held that judgment creditors could not levy on and sell the cars, or any other personal property of the company, necessary for the operation of the road, upon the ground that the railroad must be considered as an entire thing, and public policy required, that these articles should not be severed from it. But whatever merit there may be in this doctrine we are clearly of the opinion, that it cannot have the extent here claimed for it. And on the contrary it cannot be applied at all except so far as the property has become entirely the property of the company divested of all specific liens. When that has been done, if there is any reason for saying that a general creditor, must take all or nothing, that is one thing. But it is entirely a different thing to say when the company by the very act of acquiring a particular portion of property, either by contractor by the force of law, creates a specific lien in favor of the vendor or manufacturer, or would create it unless hindered by public policy, that such lien shall not attach for that reason. Suppose a company furnishes materials to a manufacturer of cars or engines, and contracts with him to build them, and he does so upon his own premises. The company takes possession without paying for his labor, and he replevies them; would the doctrine referred to in regard to a levy upon cars, after Jhey have once become fully the property of the company, be applicable there ? Could the company say that the railroad with all its cars, &c., was an entire thing, and therefore the mechanic’s lien did not attach ? It seems obvious that the doctrine cannot support such a conclusion.

Suppose that in this case the company had acquired the title of block 41 from the appellants, and had, at the same time, made this contract, and executed a mortgage on the block to secure the purchase money and payment upon the contract. Suppose the appellants had completed the building and expended their labor and materials to the amount of $79,000; could the company then hold it against a foreclosure sale, on the ground that it was part of the railroad, and that public policy would not permit the railroad to be severed ? No one would for a moment entertain such an idea. The obvious answer to such a claim would be that, as against the specific lien, it was not a part of the entirety. And there can be no conceivable reasons of public policy .that should prevent the enforcement of such specific lien, by means of which the company had acquired the very property itself.

And we can see no distinction, upon principle, between allowing such a lien to be created by the mortgage of the company, and allowing it to be done by the force of the statute. A building built for a railroad company is as clearly, within the letter and spirit of the statute, as any other building. The object was to furnish a protection to those who expended their labor and materials in improving the property of others. Is there any thing in public policy that requires, or should permit railroads to be built at the expense of defeating this object ? If there is, we fail to perceive it, and shall recognize no such policy till the legislature enacts it into a positive law We have decided at the present term that the lien given by this statute does not extend to a railroad bridge, because we thought it not within the language or intention. La Crosse and Milwaukee Railroad Co. vs Vanderpool, supra, 119. But where a railroad company does come within both, we feel that we have no authority, and certainly have no disposition to exempt them from its provisions.

The case of Dunn vs. The North Missouri Railroad, 24 Mo., 493, is not applicable to the policy of this state. The court there place express reliance upon the fact that their constitution required the state “ to forever encourage internal improvements,” and that the state had, accordingly, “ assumed immense responsibilities,” in building that and other roads. But our constitution expressly forbids the state to be any party to carrying on such improvements, but leaves them to private enterprise, with such aid as may be obtained from the localities through which they pass.

But there are several very recent and well reasoned cases which, we think, take a sounder view of this question of public policy, and some of which reject the doctrine that creditors of these corporations are not entitled to the ordinary remedies to collect their debts.

In the case of Platt vs. The New York and Boston Railroad Co., 26 Conn., 544, proceedings were taken against the company under the insolvent act, and this same plea was set up, that although they might be within the letter of the act, they were not within the intent, and the public interest forbid that they should be subjected to those proceedings. But the court held them liable, and said: “ The reasons urged for distinguishing between railroad companies and other private business corporations, do not strike us with any considerable force, while justice obviously requires that the creditors of that particular class of corporations, should have the same protection for their debts, as is furnished for the creditors of other similar corporations.”

So also in the Boston, Concord, and Montreal Railroad vs. Gilmore et al, 87, N. H., 410, an attachment of the locomotives and cars in daily use, was sustained by the court against this same argument, and they utterly reject the doctrine that the personal property of a railroad is not liable to the same remedies as the property of others. A portion of the remarks of the court are directly applicable to the question here. Having alluded to the fact that these corporations may mortgage their property, they proceed: “ We are unable to see any principle of public policy or convenience, which should allow such corporations to mortgage their cars and engines, which would not be equally strong to allow a creditor of the corporation to secure a lien substantially of the same kind by an attachment. In either case the debt must be paid, or the creditor, by suitable proceedings may caúse the property to be applied, by sale or otherwise, to the payment of the debt, and the inconvenience of the public, or to the corporation, is not materially greater in the one case than in the other.” The same reasoning applies with greater force to the question of exempting a railroad corporation from the specific lien given by statute to the mechanic, who has erected a building.

In a recent case in Ohio, not yet reported, The Columbus, Piqua & Ind. R. R. Co. vs. Geo. S. Coe, a copy of the opinion in which has fallen under our observation, this whole subject is reviewed, and the doctrine that a railroad, with all its cars, engines, and other personal property, is an entire thing, and the latter not subject to levy and sale separately, is repudiated. They say that the property of a railroad company consists of its franchises, its real estate, and its personal property, and that the latter, consisting of cars, &c., is no more a part of the road than farming implements are a part of the farm, or furniture a part of the house; a proposition so obvious, that it seems strange that a different doctrine could ever have received any sanction. The court very justly says, that the interest of the owners is a sufficient security, that the road will be constructed and operated, if it could be done profitably, and if not, there is no power on the part of the state to compel it to be done. And on this question of policy they remark: “We are satisfied that it is not the policy of the state, nor just to individuals, that the power of a court should be invoked to enable an insolvent corporation to operate a railroad by protecting its property from the claims of creditors ; of those who have performed for it labor, or have suffered losses or sustained injuries by the misconduct of its agents. We think that the true policy of the state requires that just demands should be met, and that the property of those against whom they exist, should bejapplied for that purpose.” These views commend themselves to our judgment. We think, although railroads, like many other improvements, are of great public interest and importance, yet that sound policy does not require them to be built any faster than can be done consistently with justice and the preservation of private rights. And we are satisfied that the doctrine in question, together with another which has been held in some cases, that where a railroad is mortgaged with its franchises, that such mortgage would attach to all subsequent property acquired by the company, tends to great hardship and injustice towards the smaller creditors of these corporations. It leaves them substantially without any remedy, by leaving one only which is too unwieldly for them to use. And their labor and property are absorbed for the benefit of those whose capital and operations were extensive enough to enable them to obtain the mortgage securities. We are not inclined to adopt a doctrine which leads to such inequality and injustice. And we hold that the appellants were entitled to the lien given by the statute. And as it appears from the affidavits on behalf of the company, that the building, as far as constructed, was designed for £! stores and offices,” it would be very extraordinary if they were not.

The next question is, as to the land to which the lien extended. The statute provides that in cities, it shall extend to the interest of the owner of the building in the lot on which it is situated, not exceeding in extent one acre. And we are satisfied that the word “ lot” here used, had not reference to the lines of lots, as recorded upon city plats, but referred to the particular piece or parcel of land, used or designed for use in connection with the building erected. Chateau et al vs. Thompson, 2 Ohio St Rep., 123. So that if two or more city lots, less than an acre in all, should be in one enclosure, intended for use as one residence, the lien for a building, built on either, would extend to all. And on the other hand, if a single lot were divided into'two or more, designed for separate use, a building on either division would only extend the lien to that division. Applying this doctrine here, it is obvious that if the whole building had been completed according to the contract, the lien would have extended to an acre in the block. And where, as here, the building was contracted for as an entire building, designed for some purposes to be used as such, though for others capable of and designed for division and separate uses, we think if the mechanic builds any portion of it so as to be entitled to any lien whatever, and is prevented by the default of the other party from completing it, that such default cannot have the effect to limit and apportion the lien to such parts of the land as would be convenient for the use of the part actually erected, taken alone, but that it extends to all the land to which it would have extended, if the contract had been carried out. We hold therefore, that, as the whole block exceeded an acre, the appellants were entitled to a lien upon an acre in the block. And as it appears that the block was more than an acre, it became necessary to determine to what portion the lien extended. This question is not without its difficulties. And difficulties of even a more complicated character may arise in applying the provisions of the lien law to such cases. But in answer to an argument drawn from similar difficulties, in the case of Platt vs. N. Y. & Boston R. R. Co., before cited, the court said they considered them insufficient to show that the legislature did not intend that the creditors should have the benefit of an application of the laws so far as they could be applied. We think the same principle applies here.

The difficulty arising here grows out of the fact that the track of the company runs across the eastern portion of the block, between the building and the river. In the case of a building occupying such a position with reference to the track nt any other point, except at the very end of the road, there would be much more reason for saying that the land on which the track was laid, should not properly go with the building. But here, where the premises are at the very end of the road, and where, from the very nature of the premises, it would be more convenient to both parties if they are to be severed, to have access both to the river and the street, and there not being an acre west of the track, we have come to the conclusion, that the lien of the appellants was equivalent to a mortgage by the company of an acre in the block, and that it should be adjudged to cover the south one acre of the block, extending from the river to the street, and that it should be so sold as to leave what remained to the company in a compact form, extending also from the river to the street.

We think also, the court erred in reducing the appellants’ judgment by the amount of the Carney judgment. The appellant’s judgment was recovered first. And if there is any incompatibility between the existence of the two judgments, the company, after the first was recovered, should have set it up in the other suit, by leave of the court, if necessary, to prevent another recovery. But no such incompatibility exists. It is frequently the case that several judgments are recovered for the same debt. It is true, there can be but one satisfaction. But the recovery of a judgment is not a satisfaction. And in this case, notwithstanding Carney’s judgment, he might have sued the appellants for the same debt, and have collected it out of their property. If he had done so, then their only remedy would have been to make another application and have their judgment modified back to its original amount. We do not understand this to be the proper method of adjusting such matters. But that the several judgments remain, and the court by the proper order or judgment provides for the application of the proceeds so as to protect the rights of all the parties.

The order or modification of the judgment appealed from is reversed, with costs, and the cause remanded with directions to modify the judgment in accordance with this opinion.

Note. — Since writing the above opinion my attention has been called to section 34, chap. 79, R. S., 1858, making the rolling stock of railroads fixtures. That, of course, would render the reasoning of the opinion inapplicable to any question arising in regard to the rolling stock, but does not impair its force considered independently of statutory provisions. — Paine, J.