City of St. Louis v. Keane

• Citation: 27 Mo.App. 642
• Parties: CITY OF ST. LOUIS, Plaintiff, v. WILLIAM KEANE ET AL., Interpleaders, Appellants.
• Decision Date: 08 November 1887
• Court: Court of Appeal of Missouri (US)

27 Mo.App. 642

CITY OF ST. LOUIS, Plaintiff, v. WILLIAM KEANE ET AL., Interpleaders, Appellants.

Court of Appeals of Missouri, St. Louis.

November 8, 1887

APPEAL from the St. Louis Circuit Court, GEORGE W. LUBKE, Judge.

Reversed and remanded with directions.

H. D WOOD, for T. S. Smith, appellant, and KLEIN & FISSE, for Thorne & Hunkins, appellants: The attempted assignment of Murphy to Keane being for part only of the fund, and not assented to by the city, was void at law and in equity. Burnett v. Crandell, 63 Mo. 410. And this point can be taken by any one interested in the fund. Bank v Coates, 79 Mo. 169; Dickinson v. Coates, 79 Mo 250. This provision of the contract, and the retention of the fund by the city, created a lien or trust in favor of the material men superior to the claim of Keane, which a court of equity will enforce. Luthy v. Woods, 6 Mo.App. 67; Irons v. Price, 14 Mo.App. 179; Murphy v. Bank, 30 Hun (N. Y.) 40; Bank v. Mayor, 58 How. Pr. 207; affirmed, 27 Hun 467; Ewing v. Arthur, 1 Humph. 514; Legard v. Hodges, 1 Ves. Jr. 478.

M. MCKEAG, for W. Keane, appellant: No lien was created by the provisions of the contract and the acts of the city. Grassman v. Bonn, 30 N.J.Eq. 491. Keane is entitled to a decree under the assignment of Murphy to him. Superintendent v. Heath, 15 N.J.Eq. 22; Bank v. Noonan, 14 Mo.App. 243; Pullis v. Robinson, 73 Mo. 212; George v. Williamson, 26 Mo. 193; Newham v. Kenton, 79 Mo. 382. Equity will not aid a creditor to reach the effects of a debtor until the creditor has established and liquidated his claim in a court of law. Wright v. Ellison, 68 U.S. 16; Hoyt v. Story, 3 Barb. 262; Dodd, Brown & Co. v. Day, 10 Mo.App. 121.

OPINION

ROMBAUER J.

Under date of April 28, 1884, the city of St. Louis entered into a written contract with John C. Murphy as principal, and the interpleader, William Keane, as one of his sureties, whereby the latter covenanted to construct Gingrass sewer in part, and the city agreed to pay Murphy, for the work and materials, certain specified prices.

The payments were to be made upon the certificate of the sewer commissioner, and the contract contained the following clause:

" If the contractor shall fail to pay the laborers employed on the work, or to pay for materials used therein, the sewer commissioner may withhold his certificate for everything in excess of eighty-five (85) per cent. of the value of the work done, until he shall be satisfied that all such claims for labor or materials are paid."

There were other clauses in the contract authorizing the city to withhold money from the contractor, but this was the only one which referred to fifteen per cent., and there was no evidence that the money hereinafter mentioned was withheld by the city under any other clause. The contractor, Murphy, began the construction of this sewer and carried it to a certain point, when he abandoned it, and the city finished it at his expense. The city withheld fifteen per cent. of the value of the work done and materials furnished by Murphy, up to the time when he quit the work, the amount so withheld being $1,246.68. This was reduced to $869.34, by the completion of the work at Murphy's expense, and the amount last named, being claimed respectively by William Keane and Thaddeus S. Smith, the city brought the present action against them and John C. Murphy, and asked leave to pay the $869.34 into court, and for a decree compelling these claimants to interplead therefor. The prayer of the city was granted, and the $869.34 deposited by the city with the clerk of the court, and a decree entered discharging the city from all further liability in the premises. Murphy failed to interplead, and was barred. Keane and Smith and Thorne & Hunkins (the latter being admitted to do so without objection) interpleaded for the fund, and there was a trial of their respective interpleas, with the following result:

The court found that William Keane had a judgment demand against Murphy for $834.00, for money advanced towards the construction of the sewer; that Thaddeus Smith had a demand of $793.71, on open account, for materials furnished to Murphy for the same purpose, and that Thorne & Hunkins had a demand of $117.00, on open account, for materials furnished in like manner. Concerning these facts, there was no controversy.

The court further found, and its finding is well supported by the evidence, that Murphy made an assignment of so much of the fund in the hands of the city as would satisfy the claim of Keane to the latter, to which assignment the city never assented. Whereupon, Keane brought a suit in equity against the city, to subject the funds in its hands to his claim against Murphy; and that a similar action was subsequently brought by Smith.

Upon the facts so found, which are partly conceded, and partly established by the evidence, the court decreed that the fund in court be distributed among the three claimants in proportion to the amount of their respective claims, after first deducting the costs of the interpleader proceedings.

From this decree all the interpleaders appeal. Keane claims that, under the evidence, he is entitled to the entire fund, and Smith and Thorne & Hunkins claim that he is entitled to no part thereof, but that the fund should be divided between them in proportion to the amount of their respective claims, and that Keane should be adjudged to pay the costs of the interpleader proceedings.

The court evidently based its decision on the well-settled proposition announced in Heiman v. Fisher (11 Mo.App. 275), that, when...