Coleman v. Pearman

Decision Date22 September 1932
Citation165 S.E. 371
PartiesCOLEMAN et al. v. PEARMAN et al.
CourtVirginia Supreme Court

Appeal from Law and Chancery Court of City of Roanoke.

Suit by W. J. Pearman and others against II. L. Coleman and others. From a decree against defendant Coleman and certain other defendants, they appeal.

Affirmed.

Argued before HOLT, EPES, HUDGINS, BROWNING, and CHINN, JJ.

Hart & Hart and Engleby & Engleby, all of Roanoke, for appellants.

Caldwell, Chaney & Loyd and Horace M. Fox, all of Roanoke, for appellees.

HUDGINS, J.

The only question involved in this appeal is whether or not the appellants have perfected their respective liens as subcontractors under the mechanics' lien statutes.

W. J. Pearman, R. A. Covington, and L. C. Priddy, appellees, filed a bill in chancery alleging that in August, 1929, they, as owners of a certain parcel of land in the city of Roanoke, made a contract with Roanoke Construction & Lumber Corporation, as general contractor, to erect a building thereon, according to certain plans and specifications, for a sum not to exceed $19,650 on a cost plus basis; that the owners were compelled to complete the building because of the failure of the general contractor and its consequent inability to comply with the terms of the contract; that a final settlement with the general contractor showed that the owners had overpaid it in the sum of $1,022.75; that H. L. Coleman, Stone Tile & Supply Company, Inc., Adams, Payne & Gleaves, Inc., and J. W. Hodges, trading as Joseph W. Hodges & Sons, appellants, filed in the clerk's office for recordation their respective memoranda for mechanics' liens on forms prescribed for general contractors; that Roanoke Iron & Bridge Works, Inc., and J. G. Wilson Corporation, as subcontractors, filed their respective memoranda for mechanics' liens, and gave notice to the owners of the amount and charac-ter of their respective claims; that at the time of receiving these notices the owners were not indebted to Roanoke Construction & Lumber Corporation; that the appellants were not general contractors; and that the recordation of the memoranda of the several parties did not constitute valid liens on the property, but were clouds upon the owners' title.

The prayer of the bill was that the court declare the said memoranda, as recorded, invalid as mechanics' liens, and that they he so marked of record. A demurrer was filed to this bill and overruled.

From the answers of the respondents and the evidence, it appears that the complainants, the owners of the land, owned all the stock in a certain corporation, i. e., Jefferson Electric Company; that Roanoke Construction & Lumber Corporation, at the time of entering into the building contract, owed Jefferson Electric Company the sum of $5,000, and that before the building was completed this indebtedness had been Increased to $7,680; that no part of the consideration for this debt was used in and about the buildings in question; and that, with the consent of Roanoke Construction & Lumber Corporation, the owners had paid the debt out of the sums due under the building contract.

The trial court held that the payment of this debt to Jefferson Electric Company constituted an assignment pro tanto of the sum due the general contractor, which assignment, by the provisions of Code, § 6435, was void as to laborers and materialmen who had perfected their liens in the manner prescribed by chapter 270 of the Coda (section 6426 et seq.). From this decision the owners sought an appeal, which was refused.

Later, i. e., December 24, 1930, the trial court entered a decree declaring valid the liens claimed by Roanoke Iron & Bridge Works, Inc., and J. G. Wilson Corporation, but held invalid the liens claimed by the appellants. It is the latter part of this decree that appellants are seeking to reverse by this appeal.

Appellants now admit that they are not entitled to liens on the property, as general contractors; they contend, however, that they have complied with all the provisions of Code, § 6428, except the giving of written notice to the owners of the amount and character of their claims, and that in this case notice was not necessary, because the owners had actual knowledge of all the facts which a formal notice would have given.

It is to be observed that a general contractor may perfect his lien without giving notice to the owner, the filing of the required memorandum for recordation in the clerk's office being sufficient, but Code, § 6428, expressly requires that a subcontractor comply with the provisions of section 6427, i. e., tile certain memoranda required for the perfection of a general contractor's lien, "and in addition give notice in writing to the owner of the property or his agent of the amount and character of his claim."

There is no privity of contract between a subcontractor and the owner. A party whose labor or material is used in the erection of a building, without the consent of either the general contractor or the owner, is given a right by the mechanics' lien statutes in the sums to become due under the building contract, but, in order to perfect that right, it is essential that such party substantially comply with all the requirements of the statutes. Judge Kelly in Maddux v. Buchanan, 121 Va. 102, 92 S. E. 830, 831, said:

"Laborers and materialmen are favored by the statute, but not to the extent of requiring the owner of property to pay the same bills twice, once to the builder with whom he has contracted, and again to parties with whom he has no contractual relations. Our present mechanic's lien laws deal fairly with both the owner and the subcontractor, requiring the owner, after notice, to withhold from the general contractor enough to pay the subcontractor, " provided the owner is indebted to the general contractor at the time notice is given, or may thereafter become indebted to him by virtue of the contract.

" * * * The statute was designed to protect subcontractors, and creates a liability which would not otherwise exist; but its terms must be met before its benefits can be enjoyed. In other words, as this court has said in former decisions: 'The owner is under no obligation to protect the interest of the subcontractor, except where the latter has complied with the law, and thus placed himself in a position to demand protection from the owner.' Schrieber v. Bank, 99 Va. 257, 262, 38 S. E. 134, 135; University of Va. v. Snyder, 100 Va. 567, 581, 42 S. E. 337; Steigleder v. Allen, 113 Va. 686, 691, 75 S. E. 191."

Judge Whittle, in the case of Francis v. Hotel Rueger, 125 Va. 106, 99 S. E. 690, 694, has this to say:

"An examination of outside authorities shows that there exists a hopeless diversity of opinion as to whether mechanic's lien statutes should receive a liberal or strict construction. We believe the correct rule deducible from the language and purposes of our statute and the decisions of this court with respect to it is that there must be a substantial compliance with the requirement of that portion of the statute which relates to the creation of the lien; but that the provisions with respect to its enforcement should be liberally construed."

Laborers and materialmen who are unwilling to extend credit to a general contractor have three courses, or methods, opento them to obtain additional security for their claims out of the funds due, or to become due, under the building contract: (1) By taking the steps prescribed by section 6429a of the Code of 1930 to fasten personal responsibility upon the owner; (2) by filing separate and independent liens under Code, § 6428; (3) by taking advantage of a lien perfected by the general contractor. Whichever method is followed, written notice to the owner of the amount and character of the claim is a prerequisite to the perfection of the lien or to fasten personal responsibility upon the owner.

It is a matter of common knowledge that the owner of a building under construction is frequently on the lot and sees the mechanics and laborers at...

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11 cases
  • Guldberg v. Greenfield
    • United States
    • Iowa Supreme Court
    • November 15, 1966
    ... ... See also George v. Hall, Tex., 371 S.W.2d 874, 876; Steigleder & Son v. Allen, 113 Va. 686, 75 S.E. 191, 192; Coleman v. Pearman, 159 Va. 72, 165 S.E. 371, 372 ...         It is also said that an owner should not be compelled to pay the same sum twice, once ... ...
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    • United States
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    • July 28, 1964
    ... ... In answering that question, both federal and state courts must look to state law, * * *." ...         In Coleman v. Pearman, 159 Va. 72, 165 S.E. 371, 372 (1932), the Court outlined the methods open to materialmen for obtaining additional security for their ... ...
  • Alessandrini v. Mullins
    • United States
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    • September 10, 1941
    ... ... H. & George C. Sutherland, of Clintwood, and R. E. Williams, of Grundy, for plaintiff in error.H. Claude Pobst and Marjorie Coleman, both of Grundy, for defendant in error.CAMPBELL, Chief Justice.This action at law was brought by plaintiff in error to recover of George W ... Pearman, 159 Va. 72, 79, 165 S.E. 371, 372, we said: "Laborers and materialmen who are unwilling to extend credit to a general contractor have three ... ...
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    • September 10, 1941
    ... ... Coleman, for the defendant in error ...         CAMPBELL, C.J., delivered the opinion of the court ...         This action at law was ...         In Coleman Pearman, 159 Va. 72, 79, 165 S.E. 371, we said: "Laborers and materialmen who are unwilling to extend credit to a general contractor have three courses, or ... ...
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