City of St. Louis v. The O'Neil Lumber Company

Citation21 S.W. 484,114 Mo. 74
PartiesThe City of St. Louis v. The O'Neil Lumber Company, et al.; Doyle et al., Appellants
Decision Date06 February 1893
CourtUnited States State Supreme Court of Missouri

Certified from St. Louis City Court of Appeals.

Reversed and remanded.

J. H Trembley for respondent O'Neil Lumber Company.

(1) The amount of $ 976.11, due McLane when he absconded, was a valid legal claim for the recovery of which he, McLane, could then have maintained an action against the city. Yeats v Ballentine, 56 Mo. 530; Eyermann v. Cemetery Ass'n, 61 Mo. 489; Ahern v. Boyce, 19 Mo.App. 552; Austin v. Keating, 21 Mo.App. 30. (2) A bill, in the nature of an equitable garnishment, it is useless to say, is the proper proceeding for reaching funds belonging to a debtor in the treasury of a municipal corporation, and, when the debtor has absconded, so that the claim cannot be reduced to judgment, a court of equity will entertain jurisdiction in the first instance, and give such a proceeding, founded on an ordinary claim, the same effect as that founded on a judgment at law, after the return of an execution nulla bona. Pendleton v. Perkins, 49 Mo. 565. (3) The claim of the O'Neil Lumber Company being for materials used in doing the work contemplated by the ordinance that appropriated the money now in court, its equities, apart from the question of priority, are equal to those of any other interpleader herein, and by its superior diligence in instituting proceedings on November twenty-second, 1888, against McLane and the city, in the nature of an equitable garnishment, it acquired the right to be first satisfied out of the $ 976.11 then due McLane from the city. City v. Keane, 27 Mo.App. 642.

Rassieur & Schnurmacher for respondents Higgins & Sellers.

(1) A bill in equity, seeking to subject to the payment of a creditors' claim, the assets of his debtor in the hands of one beyond the reach of legal process, is in the nature of and similar to a garnishment at law. It is often styled an equitable garnishment. Pickens v. Doris, 20 Mo.App. 1; Pendleton v. Perkins, 49 Mo. 565; Lackland v. Garesche, 56 Mo. 267. (2) In such case a court of equity will grant the creditor the same rights against the debtor's assets as he would have had in a court of law had the assets been accessible by process. But no new rights are created; the court merely undertakes to furnish a remedy. Authorities, supra. (3) In a garnishment proceeding, only such funds can be reached by the creditor as belong to his debtor; the creditor's rights can be no greater than the debtor's. Weil v. Tyler, 38 Mo. 545; Firebaugh v. Stone, 36 Mo. 111; Karnes v. Pritchard, 36 Mo. 135. (4) Therefore, since McLane was not entitled to that much of the fund in court earned by defendants, Higgins & Sellers, after his departure, it cannot be applied towards the payment of McLane's debts. (5) There is nothing in the contract which gives McLane's subcontractors a lien upon that portion of the fund. The obligation of the sureties is, by the terms of the contract, purely to the city. In this respect it differs from the bonds in the cases of Luthy v. Woods, 6 Mo.App. 67, and City v. Keane, 27 Mo.App. 642. (6) The liability of a surety will not be enlarged by implication. On the contrary, his obligations will be construed strictly and he will not be held beyond the express terms of his contract. Blair v. Ins. Co., 10 Mo. 560; Prior v. Kiso, 81 Mo. 241.

Brace J. Barclay, J., dissents.

OPINION

Brace, J.

This case is certified here from the St. Louis court of appeals under section 6 of the amendment of the constitution adopted in 1884.

The statement of the case made by Judge Biggs of that court is as follows:

"On the seventeenth day of July, 1888, the municipal assembly of the city of St. Louis passed an ordinance authorizing the board of public improvements to contract for certain alterations and repairs at the House of Refuge. Section 2 of the ordinance is as follows: 'The cost of the above work shall be paid by the city of St. Louis, and the sum of $ 4,500 is hereby appropriated out of funds set apart for improvements, alterations and repairs of the House of Refuge.' The work was let to one James McLane under three separate contracts. Contract number 2071 provided for the erection of two new privy buildings at a cost of $ 2,800. By contract, number 2083, McLane agreed to make certain alterations in the basement and in the dormitory of the old building for the sum of $ 850. The third contract, number 2076, provided for furnishing lumber and laying the floor in the shoe shop of the House of Refuge. The foregoing contracts were signed by McLane as principal and the interpleaders Thomas C. Higgins and John M. Sellers, as his sureties. Among other things the contracts provided that 'in case the contractor shall abandon the work * * * the commissioner of public buildings shall have power under the direction of the board of public improvements to place such and so many persons as he may deem advisable by contract or otherwise to work and complete the work to be done, and to use such materials as he may find on the line of said work, or to procure other materials for the completion of the same and to charge the expense of said labor and materials to the contractor; that this expense shall be deducted and paid out of such moneys as may then be due, or may at any time thereafter grow due to him under the contract; and, in case such expense is less than the amount still due under the contract, had it been completed by the contractor, he shall be entitled to receive the difference, and, in case such expense is greater, the party of the first part (which included the contractor and his sureties) shall pay the amount of said excess.'

"The contracts also contained the following provision: 'And said party of the first part (which includes the contractor and his sureties) hereby further agrees that he will furnish the said board of public improvements with satisfactory evidence that all persons who have done or furnished materials under this agreement and are entitled to a lien therefor , under any law of the state of Missouri, have been fully paid are no longer entitled to such lien; and in case such evidence be not furnished such amount as the board may consider necessary to meet the lawful claims of the persons aforesaid, provided said persons shall notify said board before the final estimates be returned, shall be retained from the moneys due the said party of the first part under this agreement until the liabilities aforesaid may be fully discharged.' Under paragraph S. of the contract an estimate of the amount of the work done each month is to be made about the first of each succeeding month and a valuation according to the current market prices put thereon; from the amount of such estimate, ten per cent. is to be deducted and the balance certified as due.

"The obligation of Higgins & Sellers binds them with McLane to the city of St. Louis and for the faithful performance of the foregoing contracts in every particular. The foregoing quotations from the contracts are believed to be sufficient for an understanding of the legal propositions arising upon this record.

"McLane entered upon the work and continued it until the twentieth day of November, 1888, when he absconded from the state, leaving the work in an unfinished condition. It is conceded that up to the first day of November the city had paid to McLane, for work done and materials furnished under contract number 2071, the sum of $ 1,003.50. This would leave the sum of $ 1,796.50 due from the city if the work should be completed. The work under contract number 2083 was also left in an unfinished condition. Monthly estimates of the work under this contract had also been made, and, up to the first day of November, McLane had been paid on account thereof $ 607.50, leaving a balance due from the city, if the work had been completed, of $ 242.50.

"The work under the third contract had been fully completed and paid for. It was also admitted that, in addition to the amounts earned by McLane under the two contracts, between the first and twentieth of November, the city owed him the sum of $ 37 for work done at the house of refuge not embraced in either contract.

"When McLane abandoned the contracts, the city made an arrangement with Higgins & Sellers to complete the work. No new contract was entered into. The work was to be completed under the old contracts. Higgins & Sellers finished the work to the satisfaction of the city authorities. A few days after this arrangement with Higgins & Sellers, the O'Neil Lumber Company, one of the interpleaders, filed a suit in equity against McLane and the city, in which it claimed that McLane was indebted to it for lumber furnished on account of said contracts, of the value of $ 750, and it asked that this amount be charged against the remainder of the money due from the city under the contract. Then followed a like suit by John M. and Edward Doyle, the appellants herein, in which they claimed to have performed work and furnished materials to McLane, under contract number 2071, of the value of $ 1,304. They sought to make their claim a charge upon the balance due from the city under said contract number 2071. Other mechanics and materialmen followed with like suits, but, under the view we have taken of the case, it will not be necessary to notice them. When Higgins & Sellers completed the work, they claimed that the work done and the materials furnished by them in the completion of contract number 2071 actually cost them the sum of $ 1059.89; that they did work in completing contract number 2083 of the value of $ 40; and that they did extra work under the last-mentioned contract amounting to $ 29.50 making a total of $...

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