Atlee Elec. Co., Inc. v. Johnson Const. Co.

• Decision Date: 24 September 1973
• Docket Number: No. 57203,57203
• Citation: 14 Ill.App.3d 716,303 N.E.2d 192
• Parties: ATLEE ELECTRIC COMPANY, INC., Plaintiff-Appellee, v. JOHNSON CONSTRUCTION CO. et al., Defendants-Appellants.
• Court: United States Appellate Court of Illinois

Page 192

303 N.E.2d 192

14 Ill.App.3d 716

ATLEE ELECTRIC COMPANY, INC., Plaintiff-Appellee, v. JOHNSON CONSTRUCTION CO. et al., Defendants-Appellants.

No. 57203.

Appellate Court of Illinois, First District, First Division.

Sept. 24, 1973.

Michael C. Zissman, Chicago, for defendants-appellants.

Norman Wexler, Wexler & Wexler, Chicago, for plaintiff-appellee.

GOLDBERG, Justice.

Atlee Electric Company, Inc. (plaintiff) filed suit for the foreclosure of a mechanic's lien upon certain real estate. After trial by the court, a judgment for foreclosure of the lien and sale of the property was entered. Johnson Construction Co., Howard Western Industries, Inc., Howard Savings & Loan Association, Howard-Northfield Building Development Corp. and Gustav A. Prodromos (defendants) appeal.

Defendants urge that the judgment appealed from should be reversed for failure of plaintiff to join another lien claimant as a party defendant; the trial court erred in taking judicial notice of foreclosure of another other mechanic's lien claim and in denying defendants the right to a continuance for amendment of their pleadings. Defendants also urge that the judgment is contrary to the evidence in that the trial court improperly included certain extras and the amount of certain labor and material; inconsistencies between plaintiff's claim for lien, complaint and proof are fatal, and the evidence is insufficient to support the judgment so that the judgment was arbitrary and capricious. Plaintiff responds that the point regarding alleged failure to join a necessary party is without legal foundation; the trial court properly took judicial notice of sworn pleadings in other proceedings; the trial court did not abuse discretion in denying a continuance; plaintiff met the burden of proof regarding extras; monies expended by plaintiff for labor and materials were properly proved; there is no inconsistency between plaintiff's claim for lien and its complaint; and, finally, since the judgment is not clearly against the manifest weight of the evidence, it should be affirmed.

We will first state the general factual background and we will later supplement this statement as required for decision of the various points raised. On February 27, 1970, Johnson Construction Company (Johnson Co.), one of the defendants, entered into a written contract with plaintiff. Johnson Co. was the general contractor for remodeling of improved real estate at 1321 West Howard Street, in Evanston, so that plaintiff was a subcontractor. The contract provided that plaintiff was to furnish and install various electric apparatus complete with wiring for a stated prise of $20,517. The allegation in plaintiff's complaint that, as regards this contract, Johnson Co. served as nominee and agent of the owner of the property is admitted by defendants.

Plaintiff entered into the premises and commenced performance. On May 21, 1970, another written agreement was entered into between plaintiff and Johnson Co. for additional electrical work for a stated price of $2080. The first agreement provided that an initial payment was to be made to plaintiff upon commencement of performance with 85% Of the balance to be paid as the work progressed and final balance to be paid upon completion. The second agreement provided for payment of 85% Of the contract price according to progress with balance upon completion.

It is plaintiff's general theory that the work progressed in due course but that defendants failed to pay plaintiff in accordance with progress. It is the theory of defendants that plaintiff failed to pursue the work diligently and that defendants, although ready, willing and able to pay, were not legally obligated to do so. It is agreed, however, that plaintiff stopped performance on August 12, 1970, and withdrew from the job. Thereafter, defendants entered into a contract with another firm, Amber Electric Construction Corp. (Amber Co.), to complete the electrical work.

The property is registered under the provisions of 'An Act concerning land titles' generally referred to as the Torrens Act. (Ill.Rev.Stat.1971, ch. 30, par. 45 et seq.). Therefore, service of notice of subcontractor's lien upon the owner was unnecessary. (Ill.Rev.Stat.1971, ch. 82, par. 24.) Plaintiff registered its initial claim for lien on October 16, 1970 and another claim on December 4, 1970.

Defendants' first point bears upon the statutory requirement that plaintiff in a mechanic's lien foreclosure '* * * shall make all parties interested, of whose interest he is notified or has knowledge, parties defendant * * *. Parties in interest, within the meaning of this act, shall include persons entitled to liens thereunder whose claims are not, as well as are, due at the time of the commencement of suit * * * also all persons who may have any legal or equitable claim to the whole or any part of the premises.' (Ill.Rev.Stat.1971, ch. 82, par. 11.) Defendants interpret this as a mandatory requirement of the statute. They reason from this premise that since the record shows that Amber Co. had instituted a suit for foreclosure of a mechanic's lien against defendants' property, it was a necessary party so that the judgment appealed from should thus be reversed. However, certain additional facts must be supplied from this record before this simplistic reasoning can be accepted.

Plaintiff's complaint contains no allegation regarding Amber Co. Plaintiff conceded in its brief in this court that it was aware that Amber Co. intended to take over the job after plaintiff abandoned it. However, plaintiff contends, and this assertion is borne out by the record, that there is no evidence before us that Amber Co. was a party in interest within the meaning of the statute. There is no evidence that Amber Co. furnished any labor or materials under its contract; and no evidence that any monies remained due and unpaid to Amber Co. The record shows only that at one point one of the defendants, Gustav A. Prodromos, testified, 'I paid Amber.' This could be construed to mean that Amber Co. had been paid and therefore had no lien. Immediately after this, counsel for plaintiff asked the court to take judicial notice of 'a pending lawsuit' brought by Amber Co. against certain of defendants to which defendants objected.

Furthermore, there is no showing here that Amber Co. ever registered a claim for lien against the property in the office of the Registrar of Titles of Cook County. Such registration would generally be a mandatory condition precedent to creation of any interest in the registered property by a lien claimant. (Ill.Rev.Stat.1971, ch. 30, par. 126. See also 31 I.L.P. 328, § 10 under Registration of Land Titles.) Thus, the record does not show whether Amber Co. in fact has any 'legal or equitable claim' against the premises which would make it a necessary party.

It follows that there was no legal requirement in the case at bar for plaintiff to add Amber Co. as a party. We cannot agree with the contention of defendants that the trial court should have consolidated the proceedings brought by Amber Co. with the case at bar Sua sponte as soon as counsel for plaintiff showed the court a copy of the complaint filed by Amber Co. The authorities cited by defendants in this regard are inapplicable. (Granquist v. Western Tube Co., 240 Ill. 132, 88 N.E. 468; Malkov Lumber Co. v. Serafine Builders, Inc., 1 Ill.App.3d 543, 273 N.E.2d 654; Rochelle Bldg. Co. v. Oak Park Trust & Savings Bank, 121 Ill.App.2d 274, 257 N.E.2d 542.) All of these cases are dramatically different from the case at bar in their factual structure. We will, however, note that in Bingaman v. Dahm, 307 Ill.App. 432, 30 N.E.2d 509, cited by plaintiff, the court pointed out that one purpose of the applicable statute was to prevent harassment of the owner with a multiplicity of suits for lien which would increase costs and expenses. Defendants, here, presumably having full knowledge of the facts concerning the claim of Amber Co., whatever such facts were, have apparently waived this right, if it ever existed, by failing to move for consolidation. The court in Bingaman also pointed out that a court of review '* * * will not dismiss or remand simply because of non-joinder of necessary parties, unless it appears that the decree will have the effect of depriving an omitted party of his property rights. (Crescio v. Crescio, 365 Ill. 393, 6 N.E.2d 628), or, as stated in the Granquist case, of unnecessarily burdening an owner of property with a multiplicity of suits in a mechanic's lien case.' 307 Ill.App. at 438, 439, 30 N.E.2d at 512.

Bingaman is more analogous to the case at bar than any other case here cited. There, the court considered actual lien claimants who were not made parties to the proceedings but their claims had become '* * * unenforceable at the time objection was first raised by defendants.' (307 Ill.App. at 439, 30 N.E.2d at 512.) Quite similarly, in the case at bar, the record does not disclose that Amber Co. had any interest in the premises in accordance with the requirement of the applicable statute. In addition, in oral argument it appeared that any problems which may have existed between defendants and Amber Co. have now been settled.

Defendants next urge reversal because of prejudicial attempts by counsel for plaintiff to impeach defendant Gustav A. Prodromos. During cross-examination of this defendant, counsel for plaintiff asked the court to take judicial notice of the fact that there was a 'pending lawsuit' against certain of the defendants by Amber Co. Defendants' theory is that this created a prejudicial atmosphere in the mind of the court. Defendants then argue that it was incumbent upon plaintiff, having commenced an attempt at impeachment, to complete it. Apparently defendants are attempting to rely here upon the general rule that, where a foundation for impeachment has been laid on a material issue, failure to offer proof of prior...