Barclay v. Wainwright

• Decision Date: 25 February 1878
• Citation: 86 Pa. 191
• Parties: Barclay <I>et al. versus</I> Wainwright <I>et al.</I>
• Court: Pennsylvania Supreme Court

Page 191

86 Pa. 191

Barclay et al. versus Wainwright et al.

Supreme Court of Pennsylvania.

February 1, 1878.

February 25, 1878.

February 1st 1878.

Before AGNEW, C. J., SHARSWOOD, MERCUR, GORDON, PAXSON, WOODWARD and TRUNKEY, JJ.

Error to the Court of Common Pleas, No. 1, of Philadelphia county: Of July Term 1877, No. 113.

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W. W. Wiltbank and E. Spencer Miller, for plaintiffs in error.— Since the Act of 1836, in Pennsylvania a leasehold interest is not the subject of a mechanic's lien: Church v. Griffith, 9 Barr 117; White's Appeal, 10 Id. 252; Haworth v. Wallace, 2 Harris 118; Schenley's Appeal, 20 P. F. Smith 98. In all these cases it was held that no claim could be filed because of the provisions of the Act of 1836, and we contend that the case at bar is analogous to these in every important respect. It is true no rent was here to be charged for the first year, but it will not be urged that this would make the difference between a lease and a building agreement. It was a mere encouragement to take the lease. It is true, also, that the building, if erected, was to be left at the end of the term, but it must be remembered that the original structure was to be pulled down. There was no covenant to build. It is left to the option of the lessee. If he builds, it is for his own benefit, and not for the advantage of the owner. The true distinction is that where the lease contains a covenant on the part of the lessee to build, and is therefore a mere building agreement in disguise, the lessor is owner of the lessee contracts within the meaning of the lien laws: Woodward v. Leiby, 12 Casey 437; Leiby v. Wilson, 4 Wright 63; Fisher v. Rush, 21 P. F. Smith 44. In Reid et al. v. Kenney, 4 W. N. C. 450, the court distinctly held that to amount to a building agreement the lease must compel the lessee to build. The court below disregarded the averment of Rogers that the lien was not to be sued out until the mortgage was due, on the ground that this verbal agreement contradicted the written one. It plainly did not, and the evidence of it was clearly admissible: Selden v. Williams, 9 Watts 9; Powelton Co. v. McShain, 25 P. F. Smith 238; Shughart v. Moore, 28 Id. 469; Graver v. Scott, 30 Id. 88; Caley v. The Phila. & Chester County Railroad Co., Id. 364; Lippincott v. Whitman, 2 Norris 244.

James W. Latta and S. E. Megarge, for defendants in error.— This paper may be styled a lease, but is, in reality, the strongest kind of a building contract. Does it admit of argument that this was in fact a contract between Barclay and Rogers, by which the latter was to build a theatre, costing at least $17,500, upon the lot of the former, in consideration whereof Rogers was to have a lease of the premises for five years at a nominal rental, pay no rent for the first year, and also have the privilege of purchasing the property at a fixed price? Barclay had it in his power to compel Rogers to build, by the provision making Rogers liable for $8400 a year for the entire five years for what was an unproductive piece of property unless improved. What was the inducement to Rogers to "build a theatre upon his lessor's land?" It was this: "erect a substantial theatre upon my lot costing at least $17,500," says his lessor by the lease, "and I will contribute $8400 towards the cost by charging you no rent for the first year; further, I will give you a lease for five years, and I also permit you to purchase the property at a fixed price upon easy terms."

The case at bar is analogous to Hopper v. Childs, 7 Wright 310. To say that in this case "there is no covenant to build," is to raise a question of no importance to the issue. There is not a line in any one of the cases cited, as to improvement-leases, which rests the decision upon the fact, that there was, or was not, a covenant to build contained in the lease. In several of the cases there was no such covenant. The question is, is there a contract to build? Wainwright & Bryant, in the agreement with Rogers, reserve in the most unequivocal manner all rights under the mechanic's lien law, and leave themselves free to proceed forthwith. It is a strained construction that would make "forthwith" read "a year hence." Rogers, in his affidavit, does not set forth anything as taking place or anything said at the execution of the agreement, which under the cases would be a ground for equity to relieve, nor was the parol evidence clear, precise and indubitable: Martin v. Berens, 17 P. F. Smith 461; Penna. Railroad Co. v. Shay, 1 Norris 201; Greenawalt v. Kohne, 4 Id. 369.

Mr. Justice SHARSWOOD delivered the opinion of the court, February 25th 1878.

It would not be easy, and might be dangerous, to lay down any general rule by which to determine, in all cases, whether an improvement lease does or...