Turner v. John

• Decision Date: 28 December 1898
• Citation: 78 N.W. 340,8 N.D. 245
• Parties: TURNER v. ST. JOHN et al.
• Court: North Dakota Supreme Court

8 N.D. 245

78 N.W. 340

TURNER

v.ST. JOHN et al.¹

Supreme Court of North Dakota.

Dec. 28, 1898.

Syllabus by the Court.

1. Evidence relating to certain disputed payments considered, and amount due plaintiff determined, upon a trial de novo in this court in a mechanic's lien foreclosure case.

2. A certain note transaction considered and construed. Held to constitute neither payment to, nor the giving of collateral security to, the lien claimant.

3. An account filed to perpetuate a mechanic's lien, under section 5476, Comp. Laws, which shows, upon its face, the separate charges for three separate contracts, also separate charges for extras and alterations, preceded by a statement of what each is for, followed by a total credit for cash paid and statement of balance due, is sufficiently explicit to comply with the above section.

4. Where it appears that the account filed was for an amount more than was due, but it also appears that it was so filed as a result of an honest mistake of fact and in an honest belief in its correctness, the lien is not lost.

5. An account filed under section 5476, Comp, Laws, to secure a mechanic's lien for a balance due for the erection of a passenger elevator at a fixed total price, which shows such contract price, with a full description of the elevator built, with a statement of the balance due after allowing all credits, is sufficient.

6. An account in writing, and properly sworn to and filed, under section 5476, Comp. Laws, is not rendered a nullity by reason of the omission of the jurat, and the fact that the affidavit was properly made by the affiant may be shown by evidence aliunde.

7. The affidavit required by section 5476, Comp. Laws, construed. Held not to require the jurat to give it validity, and distinguished from affidavits primarily intended for evidence or as the basis of creating a right or duty in a public officer to act.

8. A mechanic's lien for the erection of a passenger elevator is superior to the liens of mortgages on the same property taken during the progress of the construction of the building. Heater Co. v. Gordon, 50 N. W. 708, 2 N. D. 246, followed.

9. Priority of conflicting interests in the same property determined, and foreclosure decreed in accordance with such determination.

Appeal from district court, Grand Forks county; C. J. Fisk, Judge.

Action by Arthur F. Turner against H. H. St. John and others. Judgment for plaintiff. Plaintiff and certain defendants appeal. Reversed.

Cochrane & Corliss, for appellant Turner. Templeton & Rex, for appellants Guaranty Sav. Bank, Security Trust Co., and Grand Forks Inv. co. Burke Corbet, for appellant J. W. Reedy Elevator Mfg. Co.

YOUNG, J.

This is an action to foreclose a mechanic's lien upon what is known as the “St. John Block,” in the city of Grand Forks It is conceded that the interests of all the parties joined as defendants herein, in the property in question, are subordinate to the rights of plaintiff under his lien, if he is entitled to one and any balance still remains due to him thereon. The defendant H. H. St. John, the original debtor, and against whose property the lien was filed, did not appear or answer in the district court. The same is true of George B. Clifford, E. F. Powers, and Fred S. Martin. The other four defendants, however, contested plaintiff's right to recover, and in their separate answers set out at length the nature of the interest which each has in this property. The trial court found for the plaintiff, and fixed the balance due upon his lien at $7,858.25, with 7 per cent. interest from January 3, 1892, adjudged the same to be a first lien, determined the relative interest therein of the contesting defendants, and entered the decree of foreclosure usual in such cases. both the plaintiff and the four contesting defendants appeal. Plaintiff appeals, contending that the sum allowed to him by the trial court is too small by $2,000. To correct this, he asks us to reverse one particular finding of the court, wherein, without sufficient evidence to support it, as he contends, he was found to have received at a certain time the sum of $2,000, which amount was charged to him by the court, and deducted from the amount of his recovery. The defendants the Guaranty Savings Bank of Manchester, N. H., the Security Trust Company, and the Grand Forks Investment Company, feeling aggrieved by the amount of the allowance made to the plaintiff by the court, also appeal. The remaining defendant, the J. W. Reedy Elevator Manufacturing Company, which claims an interest in the property under an alleged mechanic's lien, which it admits is subject to plaintiff's, but which it claims is superior to the rights of the other defendants, appeals from the action of the court in entirely rejecting its claim to an interest in the property. It will be observed that the entire controversy is between parties asserting conflicting interests in the same property, and is not between Turner, the creditor, and St. John, his debtor.

The case is here for trial anew, under chapter 5 of the Laws of 1897. The record discloses that the defendant H. H. St. John was the owner of, or at least had the record title to, certain corner lots in the city of Grand Forks, and, in addition, was reputed to be a man of some financial resources. On February 11, 1891, St. John orally contracted with plaintiff to erect for him, upon his lots, a five-story brick and stone bank and office building, at an agreed price of $42,839. This did not include the finishing of the fourth and fifth stories. At a later time, however, plaintiff contracted to finish these two stories at a fixed compensation for each, and, in addition, furnished certain extras and made certain alterations; bringing the total cost of the construction of the building, or at least the portion done by plaintiff, to $51,545.25 at its completion. All parties to this litigation agree that this sum was due Turner in the first instance. Actual work was begun March 4, 1891, and the building was completed January 3, 1892. On January 11, 1892, Turner filed a mechanic's lien for an alleged unpaid balance of $22,680.25. In his complaint in this action he sets out as still due him a balance of $12,184.25, with interest from January 3, 1892. As a defense against the lien, all of the defendants united in alleging that plaintiff has been paid in full, and, with the exception of the Reedy Elevator Manufacturing Company, they strenuously urge that defense upon this appeal. It developed that St. John was not a man of means. He did, however, become an extensive borrower. On June 1, 1891, he executed a first mortgage for $40,000 on this property to the Security Trust Company. This mortgage was sold and assigned to the Guaranty Savings Bank, and the notes secured by it are still unpaid. On the same day, to wit, June 1, 1891, St. John also executed a deed of the property to George B. Clifford and George F. Shult, which appears to have been given in trust or for security. Again, on November 27, 1891, St. John executed a second mortgage to the Security Trust Company for $10,000. This that concernstill owns, and the debt secured is unpaid. The Guaranty Savings Bank and Security Trust Company seek, in their defenses, to protect their respective interests in the property acquired under the mortgages. On February 11, 1892, George B. Clifford, G. F. Shult, and H. H. St. John joined in deeding the property in question to the Grand Forks Investment Company, which corporation had just come into existence under the auspices of Mr. Clifford, for the purpose, as the evidence shows, of financing this and other buildings then under process of construction and similarly situated financially; that is, to provide a method of carrying them to completion. The title still continues in the investment company. It is evident that these loans, which were negotiated by St. John through Mr. Clifford, who was the secretary and general manager of the Security Trust Company, were made for purposes connected with the construction of this building. The record, however, is silent as to the amount of money realized from them. Neither does it appear what portion thereof was paid to St. John by the Security Trust Company. They concern us, in finding the amount due plaintiff, only so far as we can trace payments made therefrom to plaintiff, Turner, upon his account, or to his subcontractors with his assent or upon his order. It is one of the conceded facts in this case that up to July 15, 1891, all payments made upon the contract were made by St. John; further, that none were made by him personally after that date. Turner experienced difficulty in getting money from St. John. The funds which Clifford was disbursing from these loans were not reaching Turner with certainty. On the above date, Turner obtained this order: “Grand Forks, North Dakota, July 15th, 1891. Geo. B. Clifford, Secy.: Please pay to Art Turner the amts. due him on his contract, from time to time, out of balance to my credit, acct. loan made on the property. H. H. St. John.” After giving this order, St. John disappears from the record, and returns again only to execute the $10,000 mortgage, and later to join in the deed to the investment company. The record also shows that all payments that were made after the date of this order, up to and including April 26, 1892, were made by the Security Trust Company. Further, that all payments made after the last-named date were made by or through the Grand Forks Investment Company, including a prior payment made on March 7, 1892. It also appears that such payments as were made on the contract by the Security Trust Company and Grand Forks Investment Company (barring the note transactions, to which we will subsequently refer) were all by means of their checks drawn upon the Grand Forks National Bank, of which Mr. Clifford was an officer. These checks were within defendants' reach, and a portion of them were produced...