Filston Farm Co. v. Henderson & Co.

This is an appeal from a decree of the Circuit Court for Baltimore County as a Court of equity, establishing a mechanics' lien for the sum of $68,542.62, with interest on $53,542.62 from November 29th, 1904, for the erection of a certain school building upon a tract of land near Glencoe Station, in Baltimore County, and ordering a sale of said building, together with twelve hundred and ninety three acres of adjacent land belonging to the owner of said building, for the payment of said lien. The case involves a very considerable amount of money. The record is voluminous, covering 1650 printed pages; eminent counsel have appeared on both sides, and numerous questions have been raised, that as to the extent of the mechanics lien for the construction of buildings upon farming lands, and to be used for farming purposes being for the first time before us. The statute being the same in all cases however, the amount involved cannot alter, or control the application of the legal principles to be applied.

The bill states that the plaintiff, a corporation under the laws of Pennsylvania, being a contractor and builder, entered into a contract on June 10th, 1904, with the defendants, Henry D. Perky, and the Filston Farm Company, a corporation under the laws of Maryland, to furnish the materials and labor required for the erection of a large building or two connected buildings, designed for use as a school of agriculture and other pursuits, "to be maintained by and upon tracts of land located in the Tenth District of Baltimore County," and that there was then due the plaintiff for such material, work and labor, the sum of $77,307.46.

That the said Perky and the Filston Farm Company were, at the beginning of the said work and labor, and the furnishing of said materials, the owners of all the lands intended to be used for said school, including the land actually covered by said building or buildings.

That part of said land so owned had been conveyed before said contract to one George C. Weddell of Philadelphia by sundry deeds from parties acting under the direction of said Perky and said Filston Farm Company, but that the purchase money was paid by them, and that said Weddell had no beneficial interest in said lands, and held the same in trust and at the pleasure of said Perky and said Filston Farm Company; and that other parts of said lands were conveyed by deed of mortgage by said Perky and said Filston Farm Company on October 22d 1904, to one Joseph Fels of Philadelphia, to secure an alleged indebtedness therein mentioned.

That on November 4th, 1904, said sum of $77,307.46 being then due and unpaid, the plaintiff filed in the Clerk's Office of the Circuit Court for Baltimore County "a claim for lien under and in accordance with the provisions of Article 63 of the Code of Public General Laws of Maryland, against the said building, the ground upon which it is erected and the land immediately adjacent thereto, belonging in like manner to the owners of said building or buildings, which is necessary for the ordinary and useful purposes of said building or buildings and the convenient use of the same for the purpose for which the same was or were designed," and that said lien claim was filed therewith as Exhibit A.

The prayer of the bill was that the land so conveyed to Weddell should be declared to be held in trust for said Perky and for said Filston Farm Company, and be so brought within the whole tract of which it was alleged to be a part, and was intended to be devoted to the use and maintenancc and convenience of said school building or buildings.

The lien claim filed described by metes and bounds a number of tracts of land containing in all about 1700 acres conveyed at different times and by different persons, some to said Perky and said Filston Farm Company and some to said Weddell, by ten distinct conveyances, some of which embraced several distinct tracts or parcels of land. The amount claimed is thus stated:

Total price of original contract: —                      $64,357.00
  Amount of extras. —                                       27,372.46
__________
Credits July 11, 1904,                        $1,833,44    $91,729.46
Credits Aug. 11, 1904,                        12,588.56     14,422.00
__________
$77,307.46

But no copy of the contract was filed with the bill, nor were its provisions set forth or referred to therein.

The defendants Perky and the Filston Farm, filed a joint answer accompanied by a copy of the contract. The answer denied that the sum claimed, or any other sum whatever, was due under the terms of said contract, and alleged that the Filston Farm was at the time of the execution of the contract, and still continued to be, the sole owner of the land upon which said buildings stand and of all the other land immediately adjacent thereto, and necessary for the ordinary and useful purpose thereof; also that one of said other tracts attempted to be included in said lien was used as a residence by Mr. Perky, and the remainder were used for farming and stock raising, a portion being in timber, and were so intended to be used. It admitted that Weddell had no substantial interest in the property conveyed to him as alleged in the bill, and declared that it was purchased by Perky and wholly paid for by him and had since been conveyed to him by said Weddell, and that they were purchased to be used in connection with other buildings designed to be erected on one of said tracts near the line of the railroad, at a point distant more than one mile from the building erected by the plaintiff. It alleged that the mortgage to Joseph Fels mentioned in the bill was made by the Filston Farm alone, of land. belonging exclusively to it, and that it was made in good faith to secure an actual indebtedness. It alleged that the plaintiff had wholly failed to fulfill the terms of said contract, and charged that the buildings because of bad workmanship and improper materials done and provided by the plaintiff, were defective and unsafe, and could not be used for the purposes for which they were designed; that the plaintiff refused, after due notice by the architect under said contract, to make said work and materials conform to said contract, and stopped all work thereon on October 22d 1904, and since then had made no effort to complete the work as required by said contract. It alleged that the contract provided that payments should be made only on certificates of the architects, and that the architects had certified to the defendants that no money is due to the plaintiff by reason of faulty and unsafe construction, and that all certificates that were given by said architects had been promptly paid. It alleged with reference to the claim for extras that all bills for materials and labor were required to be approved by the architects, before any money should be due and payable therefor, and that no bills for any of such extras have ever been presented to or approved by said architects, and that a large part thereof is defective and improper and has been duly rejected by said architects, but the plaintiff has refused to make the same good.

The other defendants, Weddell and Fels, adopt this answer as their own.

The contract between the parties was the form of building contract approved and adopted by the Institute of Architects and the National Association of Builders, and in general use throughout the country, and it was designed to afford equal protection to builders and owners, and to minimize the hazard of litigation as far as possible.

The important provisions of this contract are the following:

Article 2 provides that all work is to be done under the direction of the architects named therein, Esenwein and Johnson, in conformity with their drawings and specifications as part of said contract, whose decision, in respect thereto is to be final between the parties.

Art. 3. No alterations to be made in the work except upon written order of the architect; the amount to be paid by the owner or to be allowed by the contractor to be stated in said order, or if not then agreed on, to be determined by arbitration as provided in Art. No. 12.

Art. 4. "The contractor shall at all times provide proper facilities for inspection of the work by the architects, and shall within twenty-four hours after written notice from the architects, remove from the ground and buildings all materials condemned by him, whether worked or unworked, and take down all portions of the work by written notice condemned as unsound or improper, or in anyway failing to conform to the specifications, and shall make good all work damaged or destroyed thereby."

Art. 5. If the contractor at any time refuse or neglect to supply sufficient skilled workmen, or materials of proper quality, or fail to prosecute the work with diligence, or fail in the performance of any agreement, such failure being certified by the architect, the owner, may, after three days written notice to the contractor, provide any such material and labor and deduct the cost from any money due or to become due to the contractor; or, if so determined by the architects, may terminate the employment of the contractor, enter upon the premises, and employ any other person to complete the work.

Art. 6 provides: "It is strictly understood that the buildings must be entirely completed ready for occupancy on the first day of September, 1904. The contractor agrees to pay the owner the sum of one hundred dollars for each day that the work shall remain unfinished after September 1st, 1904. Such payment is not to be as a penalty but as liquidated damages agreed upon by the parties hereto."

Art. 9. Fixes the sum to be paid for work and materials at $64,357, such payment to be made only upon certificates of the architects, and to be made upon the tenth day of each month for the work done in the preceding calendar month, as estimated by the architects, the owner to retain twenty per cent of the estimated value of each payment, until final settlement, and the certificate of the architects is to be final as to this clause of the contract. This article also provides that "certain additions, as per amended plans and specifications are to be made to the work provided in the original plans and specifications," the work of said additions to be done on a percentage basis, as provided in said article, and "all bills for material and labor are to be approved by the architects." "The final payment to be made within sixty days after the completion of the work included in this contract, and all payments shall be due when certificatesfor the same are issued."

Art. 10 provides that no certificate given, or payment made, except the final certificate or final payment, shall be conclusive evidence of the performance of said contract, either wholly or in part, and that no payment shall be construed to be an acceptance of defective work or improper materials.

This contract bears date June 10th, 1904, but was not fully executed until several days later, as it was necessary to send it to Mr. Henderson who was then in St. Louis, for his signature, and the corner stone was laid June 17th, 1904.

For several years previous to the execution of this contract Mr. Perky owned and conducted in Worcester, Massachusetts, a school of domestic science for girls or women, and in 1904 purchased from the receiver of the Filston Farm Company for $157,000 all the stock of that corporation except a few shares, intending to transfer said school to Maryland and to erect school buildings upon some part of the land of the Filston Farm Company, and to extend the system of instruction to boys. The Filston Farm Company had conducted a dairy business, and the property purchased by Perky from the receiver included several tracts of land known as the Upper Farm, The Meadow Farm, the Lower Farm and 109 acres of timber land, in all 1,167 acres, and he subsequently purchased from other parties other adjoining lands increasing his holdings to about 1,700 acres. The building erected by the plaintiff stands upon the tract known as the "Lower Farm" shown by the testimony to contain about 200 acres. Mr. Perky's plan and purpose was to open the school in Maryland on October 3rd, 1904, and in order to ensure this, he required the contract to provide for its complete execution and fulfillment by September 1st, 1904. The plaintiff's original bid for this contract was $59,857, but it was so vital to Mr. Perky's plans that there should be no delay in the completion of the buildings by September 1st, that Mr. Esenwein the architect, inquired of Mr. Swindells, who represented the plaintiff, if he had figured on night work, as Esenwein thought the building could not be completed by that time without night work. Swindell said he had not done so, and he at once communicated with plaintiff, and as a result the sum of $4,500 was added to cover the cost of night work, thus raising the bid to $64,357. Thereupon Mr. Perkey issued and distributed over the country his catalogues providing for the opening of the school to be known as the Oread Institute, on October 1st, 1904, and secured 65 pupils who were to pay $500 a piece per annum, and these engagements he was obliged to cancel, because of the non-completion of the building according to the contract. Mr. Perky testified that he paid $70,000 for the Worcester property, and had spent $55,000 in improving it and that it was absolutely unincumbered until the plaintiff laid an attachment upon it after the litigation in this case began. He also testified that he was president of the Natural Food Company at Niagara, making the cereal known as shredded wheat, and that he held $10,000 of the stock of that company paying regular annual interest of six per cent — and that he had $35,000 invested in a patented enterprise in Worcester, a paper company, the foreign patents for which had been recently sold for $300,000 of which $100,000 was in cash and the balance in stock; also that he had paid for, and then owned 250 head of cattle and other personal property on the farm unincumbered, besides some other stocks. It is quite clear therefore, that he was a man of independent means amply able to undertake such an enterprise, and to perform the contract in question on his part. There is evidence that Mr. Perky sometime in September, 1904, was not prepared with the necessary cash to carry out his plans, without realizing upon his property, but he states that if the building had been in conformity with the contract he would have been prepared to raise the necessary cash to pay every installment of the contract as certified, and Mr. Fels, a man of large financial means in Philadelphia, testifies that Mr. Perky in September, about the 21st, conferred with him in reference to a contemplated loan, that he investigated the situation, and that he and his brother were financially able and willing, and were prepared to lend him $80,000 or $90,000, and were prepared to see him through his building operations. Mr. Perky testifies that the establishment of his school was "the dream of his life," and when he went to Europe for his health in August, 1904, he gave to Mr. Dormon, his attorney, a power of attorney, authorizing him to raise money to pay all certificates issued in his absence. It is impossible therefore to find any justification for the non-completion of this building, in the inability of Mr. Perky to perform his contract as to payments. The contract was quite a large one to be executed in the time named, and it is evident that great expedition and good management were necessary on the part of the plaintiff to enable him to comply as to time, but he was an experienced builder, and his attention was called by the architect before the execution of the contract, to the architect's opinion that night work would be an absolute necessity to its completion, and $4,500 was added to the bid — his own estimate of the additional cost of such night work. If, therefore, the time was in fact shorter than was prudent, that was a risk he took with open eyes, and constitutes no defence to him in law for failure to complete in time, nor can the fact that the rush required night work, and haste both day and night, constitute any defence for defective work or materials.

The rights of the parties must be determined by the terms of the contract by which they both advisedly bound themselves.

When the case came to a hearing, the Court, in the opinion delivered, held that under the conditions of the pleadings, much of the testimony taken would be inadmissible, and suggested such an amendment would be allowed as to cure the vague and general allegations without making out a new and different case and the bill was accordingly amended so as to charge that the architects"wrongfully and without justification failed and refused to make an estimate for the work and material put in place during the month of August preceding, and to give complainant a certificate for the payment of such work and material; whereupon complainant nevertheless proceeded with the erection of such building, and in good faith completed the same substantially as contracted for, save in certain relatively unimportant and minor variations and particulars, said default in respect thereto being unintentional on the part of the complainant, and the result of inadvertence on the part of its employees engaged in said work, and not being of a character materially to impair the usefulness or safety of such building or render it in any degree unfit for the purposes for which it was designed, and being susceptible of correction by the expenditure of relatively small sums of money for labor and material, or an allowance to the owner out of the contract price. But that the architects on September 20th, 1904, wrongfully and without justification condemned the whole work, and refused to accept the same in behalf of the defendants, and the defendants knowing the action of said architects to be wrongful and unjustifiable, did also refuse to accept and pay for said building." This amendment was made ex parte and without notice to defendants, who excepted thereto, but their exceptions were overruled. The defendants then answered the amended bill denying all its averments, and alleging that the architects in good faith, and in pursuance of the duties imposed upon them by the contract, refused to make said estimate and give said certificate, because of plaintiff's failure to furnish proper materials and do proper work as required by said contract, and had failed and refused to make the changes in the work required by the architects in order to make said building conform to the specifications, and therefore no sum or sums of money were due under said contract in the judgment of said architects; and the defendants acted in good faith in reliance upon the judgment of said architects; that the building was not completed substantially as contracted, and was not fit for the use for which it was intended, and could not be made such without the expenditure of many thousands of dollars.

The defendants then asked leave to take additional testimony, agreeing that the testimony already taken should be considered as re-filed, after replication to amended answer, and this leave was refused, and the Court proceeded to final decree determining that there was due the plaintiff for work and labor in erecting said building the sum of $53,542.62 with interest from November 29th, 1904, and that upon correcting certain defects in said building enumerated in the decree, subject to the approval of said Court, the plaintiff would be entitled to the further sum of $15,000 to be paid into Court as therein provided within 30 days thereafter: also declaring that the lien sought to be enforced should embrace and include 1293 acres of land described in the surveyors report to be mentioned hereafter, and appointing trustees to sell said land.

Either party in equity upon application to the Court, has the right to amend the pleadings at any time before final decree upon payment of such costs as the Court may direct, so as to bring the merits of the controversy fairly to trial. This amendment was a most liberal, and indeed unusual allowance of the exercise of that right, but it was plainly allowed with the commendable purpose of avoiding further costly delay in this unfortunate litigation, and we cannot perceive that it made a new or different case — nor that any real injury has been worked to the defendants by the refusal to take additional testimony, and we shall not therefore question its allowance under the circumstances of this case.

The learned Judge of the Circuit Court in the course of the opinion filed says: "In view of the effort that has been made by both the parties litigant and their respective counsel all through the progress of the case to lay the blame and responsibility for the present unfortunate situation upon the opposite side, I deem it proper to say that there is no testimony whatever in the case directly pointing, or from which theslightest inference can be drawn, that either of the parties, orany of their representatives, either in the preliminnrynegotiations, or in the consummation of the contract by itsexecution, acted otherwise than with the utmost good faith." And in this view we fully agree, after a careful and laborious perusal of the testimony; but it is just here that we encounter the principal and most difficult question in the case.

This contract, and the work to be done under it, has been very properly denominated by the parties as a "rush contract" and "rush work," and the haste required in its performance may well explain much oversight in the preparation and use of defective material, and the inspection of work not up to the requirements of the contract, both by the plaintiff's employees and by the supervising architect.

But this contract provides, as we have seen, that payments are to be made only upon certificates of the architect, and that all payments shall be due only when certificates for the same are issued, and the Maryland cases are uniform in holding that such a provision makes the production of the certificate a condition precedent to the liability of the owner to pay for material and labor, unless its refusal is due to fraud or bad faith. It was so held in Gill v. Vogeler, 52 Md. 663; Lynn v. B. O.R.R.,60 Md. 404; B. O.R.R. v. Brydon, 65 Md. 198; Annapolis Balt. Short Line R.R. v. Ross, 68 Md. 310, and B. O.R.R. v. Canton Co., 70 Md. 405. A citation from a single one of these cases will suffice to show how broadly and emphatically this doctrine has been stated. In Lynn v. B. O.R.R., supra, JUDGE MILLER said: "By granting the fourth prayer the jury were instructed that it was not sufficient for them to believe from the evidence that Legge unreasonably rejected the ice unless they find that his action in this respect was fraudulent or done in bad faith; and by the fifth instruction they were told that it is not enough to establish the fraud charged, that they may believe from the evidence that Legge rejected ice which they may believe from the evidence heought to have accepted, or that he rejected ice which intheir opinion, or that of others, corresponded in all particulars with that described in the agreement. * * *

While, as we have said, the condition precedent in this contract will be dispensed with by proving that the judgment of the agent to whom the parties entrusted the duty of inspection and approval was the result of his fraud or mala fides, it isplain that nothing less will suffice. This is well illustrated by Clarke v. Watson, 18 C.B.N.S. 278. In that case there was an agreement by which the plaintiffs contracted to do certain works according to certain plans and specifications, and were to be paid for the same upon the production of the certificate of the defendant's surveyor that the contractors have duly and efficiently performed and completed the work to his satisfaction. The declaration, to which there was a demurrer, averred that the plaintiffs had done all things under the contract necessary to entitle them to have this certificate of the surveyor, but that he had wrongfully and improperly neglected and refused to give the same. The Court held that this was not sufficient. ERLE, C.J., said: ``This is, in effect, an attempt on the part of the plaintiffs to take from the defendants the protection of their surveyor, and to substitute for it the opinion of a jury. That is not the contract the defendants have entered into. The allegations of the plaintiffs are not in my judgment, such as to entitle them to succeed.' * * * So in the case before us, it was not enough that the jury might believe from the evidence that Legge unreasonably rejected the ice, or that he was grossly wrong in his judgment as stated in the plaintiff's third prayer. By this contract, which is perfectly lawful, the parties expressly agreed to submit the question whether the ice to be supplied was good, clear and solid, to the judgment of this third party, and his judgment, no matter how erroneous ormistaken it may be, or how unreasonable it may appear to others,is conclusive between the parties, unless it be tainted withfraud or bad faith. To substitute for it the opinions and judgments of others, whether Judge, jury or witnesses, would be to annul the contract, and make another in its place."

The language of JUDGE ALVEY in B. O.R.R. v. Brydon,65 Md. 225, 226, is equally clear and emphatic, but we forbear from repeating it. The same law has been laid down by the Supreme Court of the United States in numerous cases such as Kihlberg v. U.S., 97 U.S. 398; Sweeney v. U.S., 109 U.S. 618;Martinsburg Potomac R.R. v. March, 114 U.S. 549; U.S. v.Gleason, 175 U.S. 588. And in the recent case of Dulaney v.Fidelity Casualty Co., ante p. 17, this Court said: "Under the repeated decisions of this Court the policy must, like other contracts, be construed according to the sense and meaning of the language in which the parties have seen fit to express themselves, and they must abide by that language, even though its selection turn out to have been unwise or unfortunate."

But after a thorough reading and careful consideration of all the testimony, we are forced to the conclusion that this case cannot be justly and properly determined by applying that doctrine and dismissing the bill. In Lynn v. B. O.R.R.,supra, the Court said: "There are several modes in which the performance of a condition precedent may be dispensed with, which the case does not require us to notice." One of these modes is by waiver or estoppel, and that is a question which the peculiar circumstances of this case does require us to consider.

It would be impossible within the limits of any opinion of reasonable length, to review, or even refer to all the testimony bearing upon this question, and we can only summarize its results with occasional reference to details. The principal matters of complaint by the architect were the mortar used in the erection of the wall — the piers under the auditorium — the interior plastering, and portions of the flooring and interior wood work. As we have said, this was a "rush contract," known to be necessarily so by both parties, and this fact required unusually close and careful supervision by the architect, who, while the agent of both parties, was more especially the representative of the owner. It was work which required his constant presence and close attention, either in person or by some competent subordinate, in order that prompt and effective objection might be made to any defective material or poor workmanship, as the work progressed and in order that such defective material be taken out and replaced with proper material, and such inferior work be made good at once, without waiting until the building was nearly completed, when the cost of such correction would be so largely increased. This degree of close and constant supervision does not seem to been given by Mr. Esenwein personally, and his representative, Mr. Thompson, though constantly on the spot and frequently remonstrating with Mr. McQuade, plaintiff's superintendent, about matters as to which they differed, did not apparently require or suggest to Mr. McQuade any peremptory removal of material or renewal of work, until at or about the 10th of September when the estimate of the August work was called for Mr. Thompson refused to make that estimate as he states, because of his quarrel with McQuade, and the latter's improper refusal to recognize him in the matter, and Esenwein, for that reason was notified he would personally have to make the estimate. Mr. Esenwein admitted that Thompson had changed the specifications as to mortar, by changing it from "cement mortar with lime as directed," to "lime mortar with cement as directed," and this change must necessarily have had the effect of contributing to the failure of the mortar to harden as the architect desired, and to the continuing softness of which he complained, though he did not until September 20th, when the building was approaching completion, condemn the mortar and the walls and piers in the erection of which it was used, and in his testimony in relation to these piers, he withdrew his condemnation of them, and said "I wish very much to modify some of the expressions of that letter." It is quite plain we think from all the testimony of Mr. Esenwein that while he was not fully satisfied with this mortar, he allowed it to go in as the work progressed, relying upon the assurance of Mr. Swindell and the foreman that it would harden in due time.

The plastering was going on for a considerable time, and if it was as inferior as the testimony of all the witnesses makes it appear, the inferiority whether due its mixing or composition, or to the method of its application, ought to have been discovered by the architect either during the mixing or when the application was under way, and it should then have been condemned, and its use ordered discontinued. There can be no doubt from all the testimony that this part of the work was wretchedly poor from the beginning, but that fact serves to emphasize the necessity of prompt rejection as soon as there was opportunity for discovery of its character.

Mr. Esenwein also admitted that he passed some wood work which they would not have passed except for the fact that he wanted the work rushed, and said "I admit I was wrong about the wood work, but as it is now I admit it is a fairly goodjob, and I would accept most of it."

He also admitted that after making allowance for defects existing September 10th, a considerable sum would have been due the plaintiff, and that he came to the premises at that time, intending to make the estimate, and that he did not then intend to refuse all payment or payments and that he made his letter of September 20th a wholesale condemnation because he thought all the matters in dispute would go to arbitration, and thus no removal or correction of work would be required, but he subsequently learned such arbitration was not permissible under the contract.

We have said before, and we now repeat, that the evidence shows that Mr. Perky was financially responsible to respond to all liability under this contract, but it also appears that he became temporarily embarrassed and in need of cash about September 10th, and it also appears from the testimony of Mr. Bond that at the interview of September 20th with Mr. Perky and Mr. Dorman the only subject of conference was the financial embarrassment of Mr. Perky, and the best way to protect all parties by a receivership or some other plan which would tide over the difficulties, and that it was not until the subsequent receipt of the letter of condemnation of September 20th that he had any knowledge of the situation in that respect.

In view of all these circumstances we are of opinion that the production of the architect's certificate must be regarded as waived, and the owner as estopped to deny the acceptance of the work and material objected to, but without prejudice to a proper allowance for any inferiority in the materials or work so accepted; and without going into a consideration of the general principles which underlie the doctrine of substantial performance, we are of opinion this is a case where its application may be permitted, Orem v. Keelty, 85 Md. 337.

This brings us to the question of the extent of the lien, for if there is no lien, there could be no relief in this proceeding.

Upon the application of defendants, under sections 6 and 7 of Art. 63 of the Code, the Court ordered Col. Charles. B. McLean, County Surveyor, to designate and describe by metes and bounds the extent of ground necessary for the convenient use of said buildings for the purposes for which they were designed, with power and leave to hear such testimony as the parties may wish to adduce on the question of the purposes for which the buildings referred to were designed, and he filed the report heretofore mentioned — describing the several tracts containing 1293 acres of land he "believed should attach to the Oread Institute for the purpose for which it was designed." No action was taken upon this report until the passage of the decree appealed from, in and by which said report was approved and the land described therein was declared subject to the lien for the indebtedness established by that decree. Sec. 7 of Art 63 provides that such report shall be entered at length upon the Mechanics' Lien Docket, and if approved by the Court shall be conclusive upon all persons concerned, and the appellee now contends "that the action of the Court in approving the surveyor's report, in fulfillment of its function in this special jurisdiction is not reviewable."

Whatever might be the construction to be given to secs. 6 and 7, if that report had been made in a separate proceeding, and it had been approved by a special order for that purpose, in such proceedings we are not called on to consider. But we have no such proceeding here. The petition for designation of boundaries was filed in the pending proceeding to enforce the statutory lien, and as part of that proceeding. It was never disposed of or acted upon in any manner until the final decree disposing of the entire case.

This being so, and that decree as an entirety being subject to appeal, we think everything for the first time disposed of by it ought to be open for review on appeal. It may well be doubted whether the purpose of the Legislature in enacting that law was to confer upon the surveyor, without the intervention of a jury, and without the right of appeal, the judicial power to determine the question here raised. It would seem to be more probable that it was only designed to give him authority to designate the boundaries of such parcels of land as are admittedly subject to a lien, and to make that designation "obligatory upon all persons concerned," as expressed in sec. 5, where the owner files boundaries designated by him, and "conclusive upon all persons concerned" as expressed in sec. 7, having special reference thereby to persons acquiring liens subsequently to the commencement of the building, or previously acquired but not recorded before the commencement of the building, as provided in sec. 15 of Art. 63.

The appellee's argument in support of this unprecedent extension of the lien is founded primarily upon the fact that Mr. Perky drove Mr. Baton over nearly all this land, and told him it was all "to be used in connection with the school," and upon Mr. Baton's declared understanding that the plaintiff was to have a lien on the whole; and he relies also and chiefly upon the case of Lindsay v. Gunning, 59 Conn. 296, 11 L.R.A. 552, and some cases cited in a foot note in 11 L.R.A. 552, as holding that such statutes should be liberally construed in favor of builders.

As to the first ground, we need only say that the driving over the property may be fully and satisfactorily explained as designed merely to show the amount and apparent value of the real property held by Perky, as indicative of his general financial resposibility, without adopting so violent a presumption as that he intended to promise a mechanics' lien on the whole. It is to be observed also that in defining the lien in sec. 4 of Art. 63 it is provided that it "shall extend to the ground covered by such building and to so much other ground immediately adjacent thereto * * * as may be necessary for the ordinary and useful purposes of such building," without adding the words, "for which it was designed," found in sec. 7. But giving these last words full effect we think the word "designed" as there used may be properly understood as equivalent to "adapted." The building in question may be adapted to a number of uses as fully as to the particular use for which Mr. Perky intended it when he let this contract. In all probability in view of his death, it will never be used for the purpose for which he intended it, but must be put to some other use for which it is adapted, and the extent of the lien should be determined by the ordinary and probable uses to which it will be put. Mr. Perky intended to use the building for a school of Domestic Science and Agriculture which he says he knew would not be self supporting, but which he, as a philanthropist, wished to establish, and he designed the immense area of farming lands which he purchased adjoining, to provide the necessary financial revenue for the support of the school.

Upon this common sense view the cases of Tunis v. LakeportAgr. Assn., 98 Cal. 285, and Cowan v. Griffith, 108 Cal. 225, were decided.

In the former case the builder of a club-house and saloon erected upon fair grounds of 60 acres, with training stables and grand stand, claimed a lien on the whole tract under a statute giving a lien on the building "together with a convenient space about the same, or such as may be required for the convenient use and occupation thereof, to be determined by the Court on rendering judgment."

The lien was not allowed to embrace any of the other buildings — but was restricted to the meaning of the statute, the Court saying, "A flouring mill erected upon a large ranch would require a given space around it for the purposes incidental to its operation; it might require the whole ranch to create business for it, but it would not follow under our statute that the entire ranch would be subject to a lien for its erection." In the latter case the lien was claimed on a house and 40 acres five miles from Fresno, and in denying the lien the Court said, "the statute means just what it says. It does not contemplate that enough land should be set apart to support the owners." In Girard StorageCo. v. Southwark Foundry Co., 105 Pa. St. 248, it was held that "where materials are furnished to one or more of several buildings upon a large tract of land used together in the general business of a private corporation, a mechanics' lien may be filed against the particular building or buildings only to which the materials were supplied, and the lot and curtilage appurtenant thereto," and the Court said, "we do not believe that a lien so general in its character as to embrace many buildings and 130 acres could be sustained." See also Holland v. McCarty, 24 Mo. App. 82. In Edwards v. Derrickson, 28 N.J.L. 39, cited by the appellee, the whole tract contained 52 acres. It was a mill seat with dwelling, mill and two houses occupied by employees of the mill, and the lien was extended to the whole, it having been for 30 years known and conveyed as one property. The Court said, "It is not so much the size of the lot or curtilage (spoken of in that statute) as whether it is one single parcel lying together, known as one tract, and bought and sold as such, its metes and bounds being generally known, the owners when bought and sold always recognizing one set of metes and bounds, and never making any other."

In Lindsay v. Gunning, supra, the lien was held to cover 350 acres which though made up of several tracts had been combined into one tract by the removal of the former division fences. The houses on the several parcels were also to be removed so as to destroy their former identity and create a new unit of holding, and new and extensive buildings were erected for a dairy farm which required a large area for its successful operation. In maintaining the lien the Court said: "The case is an extreme one." The present case is much more extreme without the features which induced the Connecticut Court to sustain the lien. Here the 1293 acres embrace a number of separate tracts each with its own original dwelling and appropriate out buildings still occupied for farming purposes, and the old boundaries and fences are still maintained. In the Connecticut case, the new buildings were central to the combined tracts, and superseded the former buildings.

Here the school building was erected in one corner of the whole tract, and upon an existing sub-division known as the Lower Farm containing, according to the testimony, about 200 acres. This is a larger area than is usually regarded as necessary according to the testimony for farm or agricultural schools, a number of which are mentioned by Mr. Dorman as having from 100 to 200 acres, and the Md. Agricultural College, a State institution, it is stated has about 300 acres.

Our conclusion is that the lien established by the decree cannot be properly sustained and that it should be restricted to the Lower Farm mentioned above as containing about 200 acres. The boundaries of this tract can be defined and establiseed by the decree to be passed when the case is remanded as it must be in view of our conclusion.

The testimony in this case was taken in open Court, and the opinion filed gives evidence that it was thoroughly reviewed and weighed by the learned and careful Judge who heard the case. He found the value of the extra work done under the ten per cent commission clause of the contract to be $23,107.62, and we adopt this finding. As the architect stated in his testimony that he would not after his letter of condemnation of September 20th, have given a certificate for any of this work, it would have been idle to demand it, and the failure to produce it can constitute no bar to recovery for such extra work and we adopt this finding also. The Court also allowed the defendants a credit of $4,500 as liquidated damages for delay in completion of the building by September 1st, being at the rate of $100 per day as stipulated in the contract, and for forty-five working days which the Court found would have been sufficient for the purpose. But this estimate makes no allowance for any delay in obtaining a new contractor, or in assembling the men and materials for the work. Some delay on this account must necessarily have occurred, and that consideration should not be omitted. We think two weeks reasonable for that purpose, and our conclusion is that the time allowed should be 60 instead of 45 days, thus increasing that credit from $4,500 to $6,000.

The Court reached the present indebtedness, as ascertained by the decree in this way.

The contract price for the building was ......................  $64,357
To this was added the ascertained value of the extra work ....   23,107 62
___________
$87,464 62
From this was deducted the amt. of the July and August
certificates paid ..........................................   14,422 00
___________
$73,042 62
From this again was deducted allowance for delay .. $ 4,500
Also an amt. reserved by the decree to ensure the
correction of certain defects enumerated in the
decree ........................................    15,000
_______
19.500 00
__________
Leaving as the present amt. due ..............................  $53,542 62

which the decree requires to be paid with interest from November 29th, 1904, when the bill was filed. The decree also provides that the defendants shall pay into Court within 30 days from its date the sum of $15,000 to secure the correction of the defects enumerated in the decree, subject to the approval of the Court, and which sum the decree says the plaintiff will then be entitled to receive.

We cannot agree with the two last-mentioned provisions of the decree. The Court in its opinion, after reciting the various defects disclosed by the evidence thus characterizes the conduct of the plaintiffs: "Instead of undertaking to remedy these matters of their own motion, they sat still, doing nothing, bring suit, and have the Court to unravel as best it can the tangled webb they are in a measure responsible for. Having so acted, they must take and suffer all the consequences necessarily resulting from their arbitrary conduct."

Interest is allowed on judgments and decrees, as damages, and in view of the conduct of the plaintiffs so well described in the passage quoted from the Court's opinion, we do not think they should be allowed interest as provided by the decree.

In reference to the $15,000 required to be paid into Court for the purposes, mentioned, we think it would be a hardship to require the defendants to pay so large a sum into Court to protect the plaintiffs against the consequences of their own default as found by the Court. Moreover, this course would in all probability result exclusively to the benefit of some third person as purchaser of the property. Mr. Perky's death makes it very improbable that any of his heirs or representatives will desire to carry out his scheme, or to become purchasers of the property for any purpose, and in that event the only way in which the defendants or Mr. Perky's estate can receive any benefit from the correction of the defects indicated is by allowing now as an absolute credit whatever the testimony shows it will cost to correct the same. All experience shows that costly improvements add comparatively little to the selling value of country lands — and the correction of these defects cannot be expected to add anything to the price that may be obtained at a sale under this decree. But if the cost of these corrections is allowed now as a credit, Mr. Perky's representatives if they should desire to bid upon the property and should become its purchaser, can elect whether they will complete the work under the direction of a builder and architect of their own selection, or convert the property to some other use as they may deem most advantageous to them. We have a satisfactory standard for the allowance of such a credit in the sworn report of Mr. J.A. Dempwolf, a disinterested and competent architect, and his testimony before the Court, in which he says that all the defects required by the Court to be corrected can be corrected at a cost of $5,365.00. Mr. Dempwolf was appointed by the Court for this purpose, with the assent or at least without the objection of the parties; and we know of no better guide in the matter, than the opinion of a disinterested and competent architect, whose conclusion has not been seriously questioned, and we think the amount he states should be allowed as an absolute credit, and the whole matter be closed by the decree to be passed.

The matter will then stand thus:

Contract price .............................................. $64,357 00
Extra work done .............................................  23,107 62
__________
$87,464 62
Credit amount of July and August certificates paid ............  14,422 00
__________
$73,042 62
Deduct allowance for time of delay 60 days ............. $6,000
Deduct amount required to correct defect as per report
of Dempwolf ..........................................  5,365 $11,365 00
_____ __________
Total amount of indebtedness .........................        $61.677 62

To be allowed without interest except from date of decree. We approve the provision of the decree that the plaintiff and defendants pay their own costs respectively.

Decree affirmed in part and reversed in part and causeremanded, that a new decree may be passed in conformity withthese views; the plaintiffs and the defendants both in No. 12 andNo. 13 to pay their own costs respectively above and below.