Central Const. Co. v. Blanchard

• Decision Date: 01 April 1966
• Docket Number: No. 36033,36033
• Citation: 141 N.W.2d 416,180 Neb. 62
• Parties: CENTRAL CONSTRUCTION COMPANY, a Nebraska Corporation, Appellee-Cross-Appellant, v. Mabel H. BLANCHARD, Appellant-Cross-Appellee.
• Court: Nebraska Supreme Court

Page 416

141 N.W.2d 416

180 Neb. 62

CENTRAL CONSTRUCTION COMPANY, a Nebraska Corporation, Appellee-Cross-Appellant, v. Mabel H. BLANCHARD, Appellant-Cross-Appellee.

No. 36033.

Supreme Court of Nebraska.

April 1, 1966.

Sullabus by the Court

1. Where there is a contract for a specified sum to furnish labor and materials for the repair of a building, a detailed account is not necessary for filing a mechanic's lien.

2. Under the circumstances in this case, the filling of a blank in the written instrument was not a material alteration, and the plaintiff, in the absence of specific instructions otherwise, had implied authority to fill in the date.

3. In an action to recover the valid principal amount due on a usurious contract, the defendant shall recover costs under the provisions of section 45--105, R.R.S.1943.

4. Where the defense of usury is established, the plaintiff is not entitled to interest on the judgment awarded him.

James F. Brogan, Madison, for appellant.

Abrahams, Kaslow, Story & Cassman, Omaha, Deutsch & Hagen, Norfolk, for appellee.

Heard before WHITE, C.J., and CARTER, SPENCER, BOSLAUGH, BROWER, SMITH and McCOWN, JJ.

BROWER, Justice.

This is an action to foreclose a mechanic's lien based on a written contract involving a time price differential. The trial court entered a judgment for the plaintiff for the amount of the cash contract price. The defendant has appealed, and the plaintiff has cross-appealed.

On April 10, 1963, the plaintiff and defendant entered into a written contract providing that the plaintiff would remodel and repair the defendant's residence. The contract had a total cash price of $1,350, and contained a time price differential of $505.80, with a total time price balance of $1,855.80, payable in 60 installments of $30.93 each on the same day of each successive month. It was on a printed form which was completely filled out at the time it was signed by the defendant except for the commencement date of the payments. There was specific testimony that it was understood and agreed that the payments would commence 45 days after the job was completed. Sometime later the date of June 28, 1963, was inserted as the commencement date for monthly payments.

The plaintiff employed a carpenter who performed most of the labor. The plaintiff furnished the materials and the work was completed on or about May 10, 1963. On that date, the defendant signed a completion certificate. The mechanic's lien was filed May 25, 1963, for the sum of $1,855.80. The itemization on the lien was: 'See attached copy of contract.'

The judgment of the district court found that the plaintiff was entitled to recover the sum of $1,350 only and that the charge for the time price differential was invalid. It held the sum of $1,350, together with $4.75 of recording expense, was a first lien, and entered judgment of foreclosure for the sum of $1,354.75, which interest from the date of the judgment at 6 percent and plaintiff's costs in this action.

The defendant contends first that the plaintiff was a mere broker who advanced money only; that the labor was actually performed by someone other than the plaintiff; and that, therefore, the plaintiff has not established that it furnished labor and materials within the meaning of the mechanic's lien statute. It is apparently the defendant's position that a contractor must perform the labor and deliver the materials itself, and cannot perform through agents or subcontractors. The argument is that when a principal contractor contracts with someone else to furnish labor or materials required, the contractor is merely furnishing money, and not the labor or materials within the meaning of the mechanic's lien statute. This is simply unsupported by the record here, and there is no question but that the work and materials were furnished by the plaintiff under the contract, although the labor was performed by a carpenter who was paid on a basis other than an hourly basis.

It is contended that the plaintiff did not file a written itemized account as required by section 52--103, R.R.S.1943, although it did attach to and file with the lien a copy of the written contract. This court has held that where there is a contract for a specified sum to furnish labor and materials for the repair of a building, a detailed account is not necessary. Green v. Fiester, 125 Neb. 874, 252 N.W. 397. The lien and its filing here complied with sections 52--101 and 52--103, R.R.S.1943.

The defendant also contends that the plaintiff had no authority to fill in the blank as to the date for commencement of monthly payments. The evidence shows that it was agreed that the commencement date would be 45 days after the job was completed. The defendant did not deny that agreement, but simply testified that she did not give any authority to fill in any blanks. Under such circumstances, the filling of the blank in the written instrument was not a material alteration, and the plaintiff, in the absence of specific instructions otherwise, had implied authority to fill in the date. See, Montgomery v. Dresher, 90 Neb. 632, 134 N.W. 251, 38 L.R.A.,N.S.., 423; Mazanec v. Lincoln Bonding & Ins. Co., 169 Neb. 629, 100 N.W.2d 881.

The district court's action in entering a judgment for the plaintiff for the amount of the cash contract price was correct.

The remaining matters in dispute involve that portion of the contract requiring payments in excess of the cash price, and with the rights to interest and costs as affected by those requirements. The defendant contends that the plaintiff is not entitled to any costs, nor even interest on the judgment because the contract is usurious. The plaintiff contends, in its cross-appeal, that the contract was for a time price differential; that it was not usurious; and that the plaintiff is entitled to the full amount of the contract, including the full time price differential, interest, and costs.

The district court found that the time price differential was invalid, and the defense of usury was specifically pleaded. It has been established since Elder v. Doerr, 175 Neb. 483, 122 N.W.2d 528, that a contract in compliance with the 1959 Nebraska Installment Sales Act was not a bona fide time sale, under circumstances similar to those in the case here, and that such agreements were usurious when they provided for time price charges in excess of the legal interest rate. Since that decision, legislative action has changed the effect of such contracts so that they are no longer entirely void, but there is now no right to collect or receive any interest or charges on such a contract. The practical effect has been to place such contracts under the provisions of the general usury statute, section 45--105, R.R.S.1943. That section provides: 'If a greater rate of interest than is allowed in section 45--101 shall be contracted for or received or reserved, the contract shall not on that account be void, but if in any action on such contract, proof by made that illegal interest has been directly or indirectly contracted for, or taken, or reserved, The plaintiff shall recover only the principal, without interest, and the defendant shall recover costs; and if interest shall have been paid thereon, Judgment shall be for the principal, deducing interest paid; * * *.' (Italics supplied.)

The statute is specific that the defendant shall recover costs. In Montgomery v. Albion National Bank, 50 Neb. 652, 70 N.W. 239, it was held that the defendant's recovery of costs even applied to costs incurred in the suing out of an attachment before judgment.

In the case of Interstate Savings & Loan Ass'n v. Strine, 58 Neb. 133, 78 N.W. 377, this court held that where the defense of usury was established, the plaintiff was not entitled to interest on the judgment awarded him. This is the proper construction placed on section 45--105, R.R.S.1943, hitherto set out. The first portion in italics plainly provides that on a usurious contract the plaintiff shall recover only 'the principal, without interest.' The second portion emphasized refers to the judgment which shall be for the principal. We think the legislative intent is clear that no interest can be recovered on the judgment. Section 45--105, R.R.S.1943, is a special statute governing usurious contracts and judgments to be entered thereon, and takes precedence over the general statute providing for interest on judgments, section 45--103, R.R.S.1943, in cases...