DocketNumber： No. 4140.
Judges： McGregor, Palmer
Filed Date： 11/10/1932
Status： Precedential
Modified Date： 11/14/2024
On March 30, 1929, W.M. Pollock, one of the defendants herein, leased by written contract to R.E. Parker, the other defendant, the following described premises in De Soto parish: "A certain tract of land described as beginning 21.24 chains North of the Southeast corner of the Southeast Quarter (SE ¼) of Section Eighteen (18) Township Twelve (12) North Range Thirteen (13) West, and run North 18.76 chains, thence West 18.84 chains, thence South 18.76 chains, thence East 18.84 chains, to the point of beginning, containing 35.34 acres more or less, less that portion sold by J.C. Allen to M.K. Hirschman, as recorded in Book 20 of Conveyances, page 176, of the Records of DeSoto Parish, Louisiana, and described as beginning at the Northeast corner of the South East Quarter (SE ¼) of the South East Quarter (SE ¼) of Section 18, Twp. 12, N. Range 13 West, and run North 480 feet, West between parallel lines to make six acres. Also less a tract of land described as beginning at the South west corner of the above described lot sold to Hirschman and run West 260 yards to land formerly owned by Wm. Stiles, thence North 210 yards, thence East 140 yards, thence South to Mansfield and Logansport Road, thence in a Northeasterly direction with said road about 130 yards to point directly North of point of beginning, containing 10 acres, more or less, and being part of the Northeast Quarter (NE ¼) of the South East quarter (SE¼) of Section 18, Twp. 12, N. Range 13 West, leaving in the tract herein above 18.84 acres more or less, with all buildings and improvements thereon, and containing about twelve (12) acres, more or less, North of the aforesaid gravel road."
The property that was leased consisted of about twelve acres of land, more or less, with the residence and some outhouses. The term of the lease was to be ten years, and the rental price was $10 per month, payable on the first day of each and every month.
The property had previously rented for $20 per month, and, in the lease referred to above, it was stipulated and agreed that, in consideration of the fact that the monthly rental was reduced to $10 per month, the lessee obligated himself to enlarge the dwelling house on the property so as to make it a six-room house and to build on the premises a garage, two chicken houses, and a poultry wire fence around the entire property. The houses were to be painted and the dwelling house was to be wired for electricity and piped for gas. All these improvements were to be made within a period of two years from June 1, 1929. Nothing is said as to the ownership of these improvements and structures, but, in the absence of any stipulation to the contrary, we are bound to presume that they were being made for the benefit of the owner of the property and belonged to him at the time they were made. This presumption is strengthened by the fact that in another paragraph of the contract it was specially "stipulated and agreed" that: "In addition to the aforesaid enlargement and improvements to the aforesaid described premises, the said lessee agrees to, at his own cost and expense, build at his convenience, before or *Page 159 after the first two years, laying houses, hatchery houses, brooder houses, feed houses and work house upon the above described property, which improvements are to revert to and become the property of the lessor at the expiration of this ten-year lease, less ordinary wear and tear excepted."
If the improvements made on the dwelling and the garage and fencing were not to be the property of the lessor from the beginning, it would have been specially stipulated as was done with reference to the buildings enumerated in the paragraph above quoted from the contract.
Attached and annexed to the lease contract was a schedule of the cost and itemized list of materials that the lessee agreed to use in improving the property, and also plans of the houses and improvements he was to place upon the property, in accordance with the agreement contained in the above-quoted paragraph.
This lease contract was recorded in its entirety in the records of the clerk's office in the parish of De Soto.
The improvements upon the dwelling were made in accordance with the terms of the contract and the lessee continued to live in it until some time in December, 1929, when it was destroyed by fire. The lessee had the dwelling insured in his name for $1,400, and collected this sum of money. The lessor at once demanded of the lessee that the dwelling be rebuilt, and as he says in his testimony, he "hopped on him about it." The work of rebuilding the dwelling must have been begun by the lessee very soon after the fire for the reason that the bill for the materials bought for this purpose shows that it was bought and delivered between the dates of January 4, 1930, and February 11, 1930, inclusive.
The Shreveport Long Leaf Lumber Company, Incorporated, plaintiff herein, through its branch office in Mansfield, furnished a large part, if not all, of the material that went into the new dwelling, the same having been sold to R.E. Parker, the lessee and one of the defendants herein. The charge for this material was $729.51, no part of which was ever paid. Within sixty days after the delivery of the last item charged on the bill, the furnisher of the material recorded a. sworn itemized statement of its account and asserted its lien upon the property as provided by law. Copies of the account and annexed affidavit were sent by registered mail to R.E. Parker as contractor and W.M. Pollock as owner, which copies were duly received and acknowledged by signing the receipts for the registered mail.
Parker, the lessee, apparently took no steps to pay the bill and soon abandoned the premises and departed from the state. Pollock, the lessor, brought suit against Parker, the lessee, for six months' rent, or $60, and on October 9, 1930, secured judgment for that amount. The judgment further decreed the dissolution of the lease contract and recognized Pollock, the lessor, as the owner of all the buildings and improvements on the premises and restored the possession and occupancy of the same to him "free and clear of all liens and incumbrances."
On August 18, 1930, the plaintiff herein, the Shreveport Long Leaf Lumber Company, Incorporated, filed suit against R.E. Parker as contractor and W.M. Pollock as owner for the amount of its bill for the material furnished by it and which it alleged was used in the construction of the dwelling which was built by Parker on Pollock's property. In its petition it was alleged that Parker had left the state and was therefore a nonresident and that it was necessary to appoint a curator ad hoc to represent him. Accordingly a curator ad hoc was appointed and service was made on him, as well as on Pollock, the other defendant.
In its petition the plaintiff prayed for judgment against R.E. Parker and W.M. Pollock, the defendants, for $729.51 plus $5, the cost of recording the lien, and for the recognition and enforcement of its lien and privilege as furnisher of materials upon the dwelling and the premises upon which it was located.
Upon trial there was judgment in the lower court in favor of the plaintiff for $734.51, and interest, recognizing and enforcing its lien and privilege as furnisher of materials against the dwelling house erected, but rejected its lien and privilege upon the land itself. From that judgment the defendant Pollock has appealed and the plaintiff has answered the appeal and has asked that the judgment be amended so as to recognize and enforce its lien upon the land upon which the dwelling is erected, or, in the alternative, that it be recognized and enforced at least upon the one acre of the premises upon which the said dwelling is erected.
Parker was not present during the trial and has taken no appeal. Since he is a nonresident and no property of his has been attached, he has practically passed out of the picture and the case is between the plaintiff and the defendant Pollock alone.
The defendant Pollock filed an exception of no cause or right of action, which was overruled by the trial judge. The exception is not contended for in this court and we therefore dismiss it from further consideration.
Counsel for both appellant and appellee appear to agree in their argument that the only question to be determined in this case is as to whether the plaintiff's lien and privilege as recorded operate on the land of the defendant Pollock and the dwelling, for which *Page 160 it is alleged plaintiff furnished materials which were used therein.
It must be borne in mind that the materials which plaintiff furnished and which we find were used upon the land of the defendant in the construction of the dwelling in question were not furnished to repair the dwelling already on the premises at the time of the execution of the lease contract, but they were furnished and used in the construction of a new house which was built by Parker to replace the old dwelling which had been repaired, enlarged, and painted in accordance with the terms of the said lease contract and which was destroyed by fire a few months after the beginning of the said lease.
I have searched the contract in vain for any provision for the replacement of any burned improvements on the premises. So this case has to be determined independent of the contract. Unquestionably the original dwelling on the premises, as repaired and enlarged by Parker, the lessee, was the property of the lessor, Pollock. There was no thought in anybody's mind about this dwelling, as repaired, reverting to the lessor at the expiration of the lease. It was already his. The reference to any improvements reverting to the lessor is in a separate paragraph and covers only laying, hatchery, brooder, feed and work houses to be constructed at the convenience of the lessee during any time of the term of the lease. So far as the evidence discloses, none of these improvements were ever constructed, nor are they involved in this suit.
It is the contention of the defendant Pollock that this case is governed exclusively by the terms of section 11 of Act No.
Basing his argument on the contention that plaintiff's rights, whatever they may be, are derived solely from this section, counsel for defendant Pollock states:
"It is evident that the lien created by this statute where improvements are constructed by a lessee on the property of the lessor, extends only to whatever right the lessee may have under the lease. This would include, of course, the right to seize and sell the lessee's contract, including all privileges flowing therefrom, but subject to all conditions thereof."
"We respectfully submit, therefore, that the only right which the plaintiff herein could claim would be to claim a lien and privilege against all the rights conferred upon R.E. Parker under the terms of the lease contract between him and W.M. Pollock, dated March 30, 1929; and subject of course to the right of Mr. Pollock to demand cancellation of the lease and to claim ownership of any improvements placed upon the property by the lessee."
By his argument counsel likens this case to one wherein a lessee, bound under the terms of his lease to make certain improvements which at the termination of the lease shall revert to the lessor, does so, and afterwards defaults in the monthly payments of rent and has his lease forfeited therefor by a judgment which recognizes the reversion of the improvements to the lessor. He contends that in such a case the lessor obtains a perfect right to these improvements, regardless of how much the lessee may owe on them to laborers and/or furnishers of material who may have complied with the strict letter of the law in causing their liens to be recorded. He claimed that in no case do the laborers and materialmen have any lien whatever on the improvements; that their liens and privileges are confined to the rights of occupancy and enjoyment conferred upon the lessee by the lease contract; and that even then the lien is subject to the right of the lessor to cancel the lease and nonpayment of rent.
So that it is the position of the appellant, as I see it, that the dwelling house involved herein is in the nature of improvements placed upon the property of another within the contemplation of section 11 of Act No.
After this case was filed, while it was pending and before it was tried, the defendant W.M. Pollock, lessor, brought suit against the lessee, R.E. Parker, also defendant herein, wherein he secured judgment canceling the lease contract between him and Parker and declaring all the improvements on the property to belong to him. Since it is his contention that plaintiff's right or lien was confined in the first instance to Parker's rights of occupancy under the lease, and since that lease was canceled for failure to pay rent, appellant claims that the plaintiff has no recourse whatever either against the lease contract or the improvements which, so far as the evidence discloses, consist solely of the dwelling house constructed of plaintiff's material.
Conceding for the moment, for the sake of the argument, that this case is governed solely by section 11 of the Building Contract Law, we do not think that counsel for defendant has properly interpreted the law. The first clause of that section reads as follows: "Where any work as hereinabove set forth, is done or buildings or other improvements made, where the person for whom the work is done or with whom the contract is made, or by whom the work is done, is not the owner of the land upon which the work is located, then he shall be subject to all theobligations that are made incumbent on the owner by this act, andthe liens and privileges created and established by this actshall operate upon whatever right said person having the workdone or doing the work may have to the use of the land as lessee;and said lien and privilege shall operate against the lease suchperson holds, if there is one, or if said work is caused to be erected by a mineral lessee, then the privilege shall exist against the mineral lease and whatever rights the lessee may have therein, thereon or thereto. * * *" (Italics ours.)
In the above quotation I have italicized those words which, in my opinion, grant the lien provided for by that section. The words "then he shall be subject to all the obligations that are made incumbent on the owner by this act" refer to the obligations to or the rights of those persons named in section 1 of the act, viz: "Every contractor, sub-contractor, architect, engineer, master-mechanic, mechanic, cartman, truckman, workman, laborer, or furnisher of material, machinery or fixtures, who performs work or furnishes material for the erection, construction, repair or improvement of immovable property."
That means that, whenever building material is furnished to one who does not own the land on which the building is erected, that one is subject to all the obligations that are made incumbent on the owner by this act. Those obligations are to grant a lien in favor of the persons named in section 1, as quoted above, on the improvements and the land; but in the case provided for in section 11, there can be no lien on the land but upon the rights that the party may have in the land. In the case of a lessee being the builder, it is the lease right and the right of occupancy instead of ownership. In the case provided for in section 11, the ownership of the improvements is in the lessee or other person building, and therefore the lien of the furnisher of material is a perfect right which cannot be defeated by the lessor except as it may operate on the lease itself.
A lessor cannot agree with the lessee for the erection of a building in lieu of rent and defeat the lien of the materialman if the lien is properly established and recorded as required by law. That would be equivalent to defeating building liens by the payment of the contract price in advance, and that is specially prohibited by law. Civ. Code, art. 2774.
If A should contract with B for the erection of a building for the sum of $10,000 and should pay that sum in advance without requiring B to give bond according to law, certainly A's premises, as well as A personally, would be bound for the payment of the entire sum in case of B's failure to pay the laborers and materialmen. In the case of Panama Sash Door Company v. U. S. Fidelity Guaranty Co., 12 Orleans App. 15, it was held that the owner could not credit the contractor on an old account and thus defeat the liens provided for in the Building Contract Law, so by analogy, a lessor cannot defeat a lien on a building erected by a lessee as such, or as his agent, by taking the building as payment of rent or under a clause in a lease contract providing for the reversion of improvements to the lessor or landowner.
If the terms of the lease provide a forfeiture or cancellation of the lease, then necessarily the materialman's lien is subject to this right of cancellation. But the lien upon the improvements is different. The obligation to grant a lien upon the improvements themselves is the same upon lessee, as provided in section 11, as it is upon the owner, as provided in section 1 of the act, and it is specifically declared that that lien "shall be superior to all other liens * * * except taxes and local assessments for public improvements or a bona fide vendor's privilege * * * or a bona fide mortgage, provided said mortgage or vendor's privilege exists and is recorded before * * * any material is furnished." In case the building belongs to the landowner, the obligation is on him to grant a lien on the building and the land. If the building is built by the lessee without the knowledge or consent of the landowner for his own purposes, the obligation is on him, the lessee, to grant a lien upon the building and his rights *Page 162 under the lease. Of course, if he forfeits his rights under the lease on account of failure to fulfill the terms thereof, he has no rights and the holder of the liens necessarily loses his lien rights in so far as the rights of occupancy are concerned. Under our law the building belongs to the lessee, and, if the lienor complies with all the provisions of the law, his lien is preserved upon the building regardless of the failure of the owner of the building, that is the lessee, to live up to his obligation to pay rent on the land. If the lessee owes nothing on the building and defaults in paying his rent on the land, then the building would be subject to seizure and sale for the payment of the rent. But if he does owe furnishers of material and they have preserved their liens, then this building is not subject to seizure and sale for the payment of the rent to the detriment of the lien which the furnisher of material has preserved.
The lower court evidently held that this case is governed by section 11 of the Building Contract Law, and interpreted the law exactly as we have done, for he gave judgment in favor of the plaintiff for the amount prayed for and recognized its lien against the dwelling in question.
In support of his contention that the furnisher of materials is not entitled to a lien on buildings erected on lessors' property by lessees, counsel for appellant cites one paragraph from the syllabus in the case of Klema Realty Co., Inc., v. Fauria et al.,
Another case cited by the appellant is that of Jackson Homestead Ass'n v. Zimmer et al.,
It is clear that the question of the right to a lien on the improvements separate and apart from the land was not raised in the case. The only question decided was as to a right to a lien on the realty itself. In that portion of the body of the opinion, on which the syllabus cited is based, it is said: "The mere fact that one person holds an unregistered and unrecorded right to purchase the real estate of another does not give to a third person who furnishes material any right against another innocent party purchasing from the owner, or lending money on the property on the faith of clear certificates. Of course, as to the owner himself the situation might be different, if, by his permission, the prospective purchaser was afforded the opportunity to erect improvements, because the owner, by granting such permission, may, under certain circumstances, create an estoppel which will prevent him from contesting the rights of the materialman."
Even though this case now under consideration should be decided under section 11 as contended, it must be remembered that the dwelling was built by the lessee not only with the special permission and knowledge of the owner himself, but it was built at his urgent demand and he inspected it at different times during the course of its construction, and in accordance with the reasoning of the above-cited case, it would seem that he should be estopped from contesting the rights of the materialman, plaintiff in this case.
But I do not think that the decision of this case should be based on section 11 of the Building Contract Law. It is true that Parker was a lessee or tenant of Pollock, but this building in question was not built by him in accordance with any provision or obligation of the lease contract. Nor was it a building built by a lessee for his own convenience which he would have ever had the right to remove. Buildings and improvements made which are referred to in section 11 of the act are the property of the builders and the landowner must either buy them or permit them to be removed. In case he buys them he does so subject to the liens that may be on them.
Under the terms of the lease contract in this case, Parker was under obligation to repair and enlarge the dwelling house that was on Pollock's property. He did this to the letter and discharged this obligation. There was no provision made in the lease contract or otherwise for the replacement of any house or houses that might be destroyed by fire. The original dwelling was the property of Pollock without any qualification whatever. After Parker had complied with his obligation to repair and enlarge the house, it still belonged to Pollock, and Parker had no right in it whatever except to occupy it. After the lease had run for several months and several weeks after the dwelling had been repaired and enlarged, it was destroyed by fire. This loss was clearly Pollock's and not Parker's. Under some kind of arrangement that has not been explained, the building was insured for $1,400 as Parker's property instead of as Pollock's and Parker collected the money. Under all the rules of law and equity this money belonged to Pollock. Also, under the law it was Pollock's duty to rebuild the dwelling, *Page 163 and, if he had not done so, Parker could have sued to terminate the lease contract on account of the destruction of a part of the leased property. Civ. Code arts. 2692 and 2697. Recognizing his obligation to replace the building, and knowing that Parker, the lessee, had $1,400 insurance that belonged to him (Pollock), he "hopped him about it" and ordered or authorized him (Parker) to proceed at once to replace the burned building. This was done. Pollock permitted Parker to keep all the money and required only that the building be replaced. It was the equivalent of Pollock employing Parker to rebuild the building and paying for it in advance. Parker was the contractor and Pollock was the owner, and the rights of all parties should be determined in accordance with section 1 of the Building Contract Law. Or if Parker was not a contractor, then he was surely the authorized agent of Pollock with money advanced to him in full for the construction of the building and the rights of all parties should be governed by section 12 of the Building Contract Law. In either case, Pollock, the owner, was fully cognizant of the fact that Parker was buying material for the construction of the work, and in case Parker was the contractor, Pollock was bound personally for the payment of all bills incurred by Parker for the reason that no bond was furnished, and, in addition thereto, the plaintiff had a lien on the improvements, as well as the land on which they were situated. And, if Parker were the agent instead of contractor, the owner, Pollock, was bound exactly as he was in case of Parker being considered as contractor.
When Pollock was decreed to be the owner of the dwelling in question, the court simply recognized a fact. That dwelling was always Pollock's and all the court could do was to restore to him the possession of it on account of his lessee's failure to pay the rent. But this could not rid the building or those premises of the lien for materials which he knew had gone into his building with his consent, and, not only wth his consent, but with his urgent insistence. It would be unconscionable to permit Pollock to enrich himself at the expense of plaintiff by permitting him to hold his land and this dwelling free of all liens for material furnished, when those liens were duly recorded.
The majority opinion holds that the burned house was rebuilt by Parker as lessee just as though he were building a house on leased premises on which there was no residence in the first instance. But the evidence does not substantiate that view. At one point in his testimony, Pollock, the lessor and landowner, testified as follows: "Well, after his house burned down he told me, — he wanted to rent the store building across the street or across the road, and I asked him about rebuilding and he said, ``Don't worry, I am going to build you back a house that is as good or better than the one that burned down.' He said that he had Fourteen Hundred ($1,400.00) Dollars worth of insurance on the old house and that he would rebuild as soon as he collected the insurance, that he was going back and rebuild a house there as good or better than the one that had burned down as soon as he collected the insurance."
At another point in his testimony the following questions and answers appear:
"Q. Well, immediately following the burning of that house I will ask you whether or not you consented or agreed or requested Mr. Parker to rebuild another house on that property? A. Well, as I started to say a while ago, I hopped on him about it and he said he had Fourteen Hundred ($1400.00) Dollars worth of insurance and as soon as he collected the insurance he would rebuild it back. And he was, I reckon, some thirty or forty days collecting the insurance and before he rebuilt it or started to rebuilding it back he lived in the old store building waiting until he could collect the insurance.
"Q. Then you made a demand that he build one? A. Well, according to the contract he was to leave me the improvements there that were there and whatever he put on the land, and I had nothing there after the building burnt up, and I had had a building and improvements there before which I considered were fully worth Six or Eight Hundred Dollars.
"Q. Well, I will ask you subsequent to that time whether or not he did build a house back there? A. Subsequent to which date?
"Q. To the time that you demanded of him that he build the house? A. Yes, after the burn he build back another house which is on the property there now.
"Q. And which is the property in question in this suit? A. Yes, sir. * * *
"Q. But the thing that you were interested in was in seeing that the proper kind of a house was built back? A. Yes, and I was interested too in seeing that he paid the bills. And after Mr. McCrocklin told me about Parker not taking care of his bills some ten or fifteen days before I received the notice, I jumped on Parker and he told me that he would take care of it, and I didn't want to be troubled and worried about paying it and he said that he would take care of it. And he claimed that he had a place in South Louisiana and his returns from down there hadn't been so good, but he said he was going to pay it and he promised me he was going to pay it, and I was after him three or four times about it, riding him to get him to settle it. * * *
"Q. Mr. Pollock, you stated that he did not comply with the terms of the contract? A. He did not wholly comply with the terms of the contract. *Page 164
"Q. How? A. Well, as to the buildings, the number of buildings he agreed to build according to the lease contract and according to the plans and specifications.
"Q. But you were satisfied with the amount that he did build, weren't you? A. Well, I had to be whether I was or not.
"Q. Well, he put improvements on there on this lease, which amounted to around Two Thousand ($2,000.00) Dollars, didn't he? A. Well, but he had my improvements there before, and he had Fourteen Hundred ($1400.00) Dollars to do that with. In other words, Parker hasn't been out, I might say, anything, because of the fact that he had Six Hundred Dollars, Six to Eight Hundred Dollars as the value of my improvements that were already there and he had the Fourteen Hundred ($1,400.00) Dollars insurance."
A careful reading of the above testimony convinces me that Parker rebuilt the burned residence for Pollock, and Pollock recognized the house as his and claimed it. Parker built it either as Pollock's agent or as contractor. If Pollock claims the house is his absolutely, then he is forever estopped from denying plaintiff's lien on both the house and the land on which it is built.
Furthermore, the finding of the majority opinion is, in my opinion, contrary to the contentions of both parties to the suit, for they both take the position in their pleadings and in their testimony that Parker rebuilt the burned dwelling for Pollock. In the petition of plaintiff there appears the following paragraph: "Petitioner further shows that said materials were furnished and said buildings and improvements erected by and with the consent and at the request of the said W.M. Pollock."
In defendant's answer there appears the following paragraph: "Your respondent further shows that, after, or about the time the said R.E. Parker collected the insurance, he promised and agreed with your respondent that he would build upon said premises a new dwelling house, as soon as the insurance was collected; and that after the insurance of Fourteen Hundred ($1,400.00) Dollars was collected by the said lessee, R.E. Parker, he built a new dwelling house upon said premises, thereby replacing the dwelling house that had been destroyed by fire."
Since Pollock claims the ownership of the building not by reversion under the terms of the lease, but by virtue of it having been built by Parker at his request to replace the burned building, plaintiff's lien is bound to attach both to the building and the land. In holding that the building is now the property of Parker, with full right of removal by him, the majority opinion holds what both parties deny.
It appears to me inconceivable, unconscionable, and contrary to law and equity to hold that Parker should collect the insurance on Pollock's house and be permitted to keep this money on a promise and an agreement to rebuild this house, and, after the house is rebuilt with this money, it should be declared to be the property of Parker.
If Parker were in court demanding the ownership of the house, with the right of removal, the case might be different. But both plaintiff and defendant allege and contend that Parker has no interest in the house and never has had.
Article
For the reasons assigned, I respectfully dissent from the majority opinion herein and think that the judgment appealed from should be amended by recognizing plaintiff's lien, as the furnisher of materials and supplies, on the one acre of land on which the dwelling is erected and by making the judgment personal against W.M. Pollock, and as thus amended, that it should be affirmed, with all costs to be paid by the appellant.