Allison v. Schuler

• Citation: 36 P.2d 519,38 N.M. 506
• Decision Date: 01 October 1934
• Docket Number: No. 3939.,3939.
• Parties: ALLISON et al.v.SCHULER et al.
• Court: Supreme Court of New Mexico

38 N.M. 506

36 P.2d 519

ALLISON et al.

v.SCHULER et al.

No. 3939.

Supreme Court of New Mexico.

Oct. 1, 1934.

Appeal from District Court, Chaves County; George W. Hay, Judge.

Suit by Charles L. Allison and others against Albert H. Schuler and others. From the decree, defendants appeal, and plaintiffs cross-appeal.

Affirmed, and cause remanded.

Owner of property held not personally liable to subcontractors for work and material, where there was no contractual relation between them and principal contractor agreed to make payment. Comp.St.1929, §§ 82-202, 82-206, 82-210, 82-215.

Hervey, Dow, Hill & Hinkle, of Roswell, for appellants.

O. E. Little, of Roswell, for appellees.

BICKLEY, Justice.

Suit was brought by plaintiffs, appellees to foreclose a mechanic's lien upon property of defendants. The defendants-appellants answering plaintiffs' complaint sought to defeat the action upon the ground that the claims of lien were not filed within 90 days after the completion of the building as required by statute. Comp. St. 1929, § 82-206. A decree was entered establishing plaintiffs' liens, and defendants have appealed, and plaintiffs have cross-appealed. The parties will hereafter be referred to as plaintiffs and defendants.

It is the contention of defendants that plaintiffs' claims of lien were filed more than 90 days after the building was substantially completed. This involves the further proposition of defendants that the construction contract was abandoned and that such abandonment is equivalent to completion.

The defendants entered into contracts with one Anderson for the construction of a building for the sum of $6,800. Plaintiffs were subcontractors, having supplied work and material under agreement with Anderson. Anderson entered upon the performance of the building contract, and the work progressed to such a stage of completion that defendants were able to occupy the same for the purpose for which it was designed, and it was complete in detail according to contract except that the contractor never furnished or installed three elevating doors to the automobile driveway on the ground floor through a wall of said structure, and never furnished or installed seven wheel guards along said driveway, and never furnished or installed an iron pipe balcony rail around the balcony or well hole on the second floor of said building, and never affixed the ornamental iron grills over or about three windows of said building according to the plans and specifications. It would have been necessary to spend the sum of $462.25 in order to supply these deficiencies.

The court found from these and other facts that the building was not substantially complete; there having been no change in the physical situation between the cessation of work by the contractor on February 8, 1932, and the time of the trial on May 22, 1933.

All are agreed that “substantial completion” of a building or structure is adequate to start the running of the limitation period within which a claim of lien must be filed. See Genest et al. v. Las Vegas Masonic Building Association et al., 11 N. M. 251, 67 P. 743. In that case, there remained but seven or eight hours of one man's work of ornamental carving on the outside of the building, and it was held that the building was substantially complete. The fact that the owner occupied a portion of the building for the purposes for which it was intended was considered as having a bearing on the question. In a note to Milliken Bros. v. City of New York, 201 N. Y. 65, 94 N. E. 196, in Ann. Cas. 1912A, 908, it is said: “It seems to be a general rule that the time for filing a mechanic's lien is to be computed from the time when the work is completed, and that the acceptance of the work in an incomplete state is not sufficient to set running the time for filing the lien. Nichols v. Culver, 51 Conn. 177 (referred to in the reported case); St. Louis Nat. Stock Yards v. O'Reilly, 85 Ill. 546; Hutchinson First Presb. Church v. Santy, 52 Kan. 462, 34 P. 974; General Fire Extinguisher Co. v. Schwartz Bros. Commission Co., 165 Mo. 171, 65 S. W. 318. And see the reported case.”

We do not doubt the further statement of the note writer to the effect that the acceptance of the work by the owner may disclose an understanding that it is completed so as to authorize the filing of a statement for a lien thereon. Defendants put some reliance upon the circumstance that they had entered into an occupancy of the building and were using it for the purpose for which it was intended for some time prior to the trial, and that no changes or additions had been made by them after they had taken possession. The evidence shows, however, that the defendants a short time before the trial had purchased the elevating garage doors and iron banisters for the balcony with the intention of installing them. While there is evidence that defendants occupied the building there is no evidence that they accepted it as complete performance by the original contractor. Defendants quote 18 R. C. L. p. 930, “Mechanic's Liens,” § 61, as follows: “The time when the contract is to be deemed to have been completed is to be ascertained from the language of the statute, from the provisions of the contract, the conduct of the parties with reference thereto, and the surrounding facts and circumstances, as well as the circumstances pointing to the time of abandonment of the work, if it has been abandoned.”

In 40 C. J. “Mechanic's Liens,” § 223, it is said: “When a building is completed within the meaning of the statute is a question to be determined in view of the circumstances of each case.”

In considering the conduct of the parties as bearing on the question, we find that the courts not infrequently consider the facts in the light of the effect their application will accomplish. For instance, in Sarchet et al. v. Legg, 60 Or. 213, 118 P. 203, 204, cited by defendants, it is said: “In order to protect laborers and materialmen, our statute makes ample provision, and should be liberally construed in their favor, on the ground that the enactment is remedial. Where, however, the rights of an owner, who, relying upon the completion of the building, has paid the contract price, or of an innocent grantee of the premises, become involved, such trifling things as the fastening of an electrical switch or the placing of a pipe through a wall should not be regarded as incidents in the completion of a building, but as repairs.”

The writer of the annotation in 64 A. L. R. at page 277, says: “There is direct authority to the effect that, in determining the question when a work is completed or abandoned, as regards the rights of parties to file or assert mechanics' liens, the court should not take a technical and narrow view, but should save to parties entitled to liens any rights they may justly have under a fair and equitable construction of the facts and the law applicable thereto.”

This view has the support of decisions of this court in Lyons v. Howard et al., 16 N. M. 327, 117 P. 842, and Gaastra, Gladding & Johnson v. Bishop's Lodge Co., 35 N. M. 396, 299 P. 347. At least such is the rule when there is no contention that the claimant does not belong to the class of persons who may claim the right to a lien nor that the property is such that a lien may not attach thereto.

In Sarchet et al. v. Legg, supra, the equities were with the owner who had paid the contract price and was being called on to pay a second time. In the case at bar, the owner had paid $800 on a $6,800 contract. The amounts they are called upon to pay to the subcontractors would doubtless be charged against the balance due the original contractor. Even so, there might be an assertion of liens in excess of the contract price on the balance due thereon and some hardship inure to the owner, but ordinarily the owner can protect himself. Such a possible hardship to the owner does not affect the validity of our statute. Baldridge v. Morgan, 15 N. M. 249, 106 P. 342, Ann. Cas. 1912C, 337.

[1][2] The illustrations presented by defendants in support of a view of substantial completion do not parallel the situation in the case at bar. In Rice et al. v. Brown, 1 Kan. App. 646, 42 P. 396, the court thought it significant that “both parties (the original contractor and the owner) seem to treat the house as completed.” In the case at bar the contractor did not claim that his contract had been performed by completion of the building. There is evidence of cessation of work by the original contractor on February 8, 1932, but it also appears that the contractor was seeking to secure finances to enable him to complete the more than 6 per cent. of the job unfinished. The defendants (owners) did not treat the contract as performed or the building as substantially completed because they were engaged in a search to locate the absent contractor in order to force him or his bondsmen to complete the building according to his contract. In Crane Company v. Ellis et al., 58 Or. 299, 114 P. 475, 476, the original contractor had led the owner to believe the building was complete and had been paid the contract price in August, but a subcontractor alleged that 2 1/2 feet of sewer pipe was placed on October 15 so as to connect the house with the sewer, and filed his claim on October 30. By statute, claimant was required to file his claim within 30 days after completion of the building. The placing of 2 1/2 feet of sewer pipe long after the owner had moved in and paid the original contractor was held to be mere repair work and a trifling circumstance. The court said: “The owner of the building had a right to know when the building was completed and to act thereon for his own protection. In this case the only witness, except Nickert, by whom plaintiff has attempted to establish the date of the completion of the work, is the contractor, to whom was paid the contract price for the construction of the building at a time when he...