Comly v. Lehmann
| Decision Date | 13 March 1934 |
| Docket Number | No. 42374.,42374. |
| Citation | 253 N.W. 501,218 Iowa 644 |
| Parties | COMLY v. LEHMANN et al. HALLER OVEN CO. v. LEHMANN (COMLY, Intervener). |
| Court | Iowa Supreme Court |
OPINION TEXT STARTS HERE
Appeal from District Court, Hardin County; O. J. Henderson, Judge.
This is an action brought by a mortgagee of real estate to foreclose a mortgage as against the owner, and two vendors of property sold the owner, and affixed to the real estate. The contest is between the mortgagee of the real estate on one side, and the vendors of a large built in bake oven and a steam boiler on the other. The oven and the boiler were sold under a conditional sales contract, reserving title in the vendor until the purchase price was paid. The lower court found in favor of the vendors, and against the mortgagee of the real estate, giving the vendors a right of repossession. From a decree to that effect, plaintiff appeals.
Reversed and remanded.
Mallory & Leming, of Hampton, and W. W. White, of Iowa Falls, for appellant Comly.
Peisen & Soper, of Eldora, for appellee Haller Oven Co.
C. E. Gilchrist, of Iowa Falls, for appellee C. E. Burton Plumbing & Heating Co.
On March 8, 1926, the defendant Lehmann, as owner of the real estate, executed a note secured by a mortgage to one Claude H. Koon, who later assigned it to plaintiff herein. The note and mortgage became due in 1931, but was extended for a period of five years. On nonpayment of later interest when due, the note was declared due and this action was brought to foreclose the mortgage. When the mortgage was executed the owner was conducting a bakery business in the building on the premises. At that time the building was equipped with two bake ovens and two boilers, connected with the building.
In March, 1929, the defendant mortgagor purchased from the appellee Haller Oven Company, and installed in the mortgaged building, an elaborate oven costing $8,680 on which there is still due about $2,500. About the same time he also purchased a large boiler from the Burton Plumbing & Heating Company costing nearly $1,000 on which there is still due about $200. The old ovens and boiler in the building were removed at that time.
Separate actions were commenced to foreclose the mortgage, and for repossessing the oven and boiler sold under conditional sales contracts. These actions were, by agreement of the parties, tried together.
The new oven was built upon the concrete floor of the bakery building, and was connected with the steam boiler pipes, with the gas pipes, and with the electric power connections in the building. The oven weighed about 22,000 pounds and was built upon steel plates laid on the floor.
The boiler weighed about 2,900 pounds and was set up in a boiler room in the building, and connected with the bake oven to furnish steam for baking purposes, and with several radiators to furnish heat for the building. The front of the boiler rested on the concrete floor and the rear on a pier built under it.
The oven and boiler were sold under conditional sales contracts reserving the title and possession in the vendors until fully paid. These contracts were not recorded until December, 1931. The machines in question were installed after the execution of the real estate mortgage and without the knowledge or consent of the plaintiff or the original mortgagee.
The question for determination in this case is whether or not the machines in question, after their installation, became fixtures and part of the real estate, or remained personal property subject to repossession by the vendors under their conditional sales contract.
I. The first question for consideration is whether or not, under ordinary conditions and without a conditional sales contract, the oven and boiler in question, after being installed, would constituted fixtures and become part of the real estate.
Considering first the character of the boiler, we find that it was installed in a boiler room in the basement. The front of it was set on the cement floor and the rear part on a pier built in to support it. The boiler is connected with several radiators providing heat for the building, and is also connected with the new Haller oven, to furnish steam for baking. It is also connected with other machinery, and is used in connection with the operation of the bakery business. Its removal would prevent the owner from operating the bakery without substituting another boiler. Before the present boiler was installed, there was a small boiler and some stoves in the building used for the business. These were removed on the installation of the new boiler. The pipes from the boiler are used in the bakery business and for heating the building. There are numerous pipes connected with the main pipes leading in the boiler. The boiler is too large to be taken out of the boiler room without tearing down some of the wall. The boiler cannot be taken out of the door because the building is not wide enough to turn it. The boiler might be tipped, but if taken through the door it would be jarred to pieces. It is the law in this state that a furnace attached to a concrete floor becomes a fixture as between vendor of the land and the seller of the furnace. Des Moines Improvement Co. v. Holland Furnace Co., 204 Iowa, 274, 212 N. W. 551;Holland Furnace Co. v. Pope, 204 Iowa, 737, 215 N. W. 943;Joyce Lumber Co. v. Wick, 200 Iowa, 796, 205 N. W. 476;Schoeneman Lumber Co. v. Davis, 200 Iowa, 873, 205 N. W. 502;West v. Farmers' Mutual Ins. Co., 117 Iowa, 147, 90 N. W. 523;State Security Bank v. Hoskins, 130 Iowa, 339, 106 N. W. 764, 8 L. R. A. (N. S.) 376;Ilten & Taege v. Pfister, 202 Iowa, 833, 211 N. W. 407. We believe that the boiler in question became such an integral part of the building as to become a fixture and part of the realty.
The evidence in relation to the oven shows that prior to its installation the building was used for the bakery business. At that time it was equipped with two bake ovens, a boiler, and other machines necessary for the operation of a bakery business. That two old ovens were removed when the new one was installed. The new oven was built up from and set upon a concrete foundation, and weighs 22,000 pounds. The foundation upon which it was built was leveled up with cement and other material connecting the oven with the floor. After being installed, it was covered with wire mesh and insulating material, so that when completed it had the appearance of being part of the building. It is contended that because the skeleton part of the oven was built upon iron or steel plates, without being attached by bolts to the foundation, and because it could be dismantled piece by piece, it was portable and did not become part of the building or a fixture. The building itself could be dismantled and removed from its foundation in the same manner, but that would make it none the less a part of the realty. In view of the enormous weight of the oven, it is immaterial that the bottom plates were not attached to the foundation by means of bolts. The force of gravity would hold this 22,000-pound oven in place as effectively as if fastened with many bolts. 26 C. J. 661, § 10, and numerous cases cited under note 83; Thomson v. Smith, 111 Iowa, 718, 83 N. W. 789, 50 L. R. A. 780, 82 Am. St. Rep. 541;Boon v. Orr, 4 G. Greene, 304;Smith v. Carroll, 4 G. Greene, 146.
This rule has been applied in many cases to buildings resting on timbers, blocks, or stones. Fences merely resting on the surface of the ground, heavy machinery (Hooven Co. v. Featherstone's Sons, 111 F. 81, 49 C. C. A. 229), large scales, millstones and large bells suspended from a frame, furnaces, and ice boxes. 26 C. J. 661.
The evidence also shows that when this oven was installed it was too large for the room in which it was built, and it became necessary to remove part of the ceiling in the room so that the oven extended up through the ceiling to a point near the roof. The building itself was a frame, and it is fair to say, although the evidence is not clear on that point, that the new oven built was heavier, and more substantial, than the building itself. It was built into the building as a permanent structure for the purpose of the bakery business conducted by the owner. When the oven and boiler were installed, he intended them to be permanent annexations to his real estate. It is our conclusion that from the construction of the oven, with all of its connections with the machinery and other parts of the building, it was of such a permanent character as to become an integral part of the building and therefore took on the character of real estate. We think this conclusion must be reached in the light of the furnace and other cases hereinabove cited. In view of the law announced in the furnace cases hereinabove cited, supra, we believe that under ordinary conditions and without considering the effect of any conditional sales contract, the oven and boiler in question must be considered fixtures, an integral part of the building, and therefore part of the real estate.
[1] II. It is claimed, however, that where personal property is sold under a conditional sales contract with a provision that it shall remain the property of the vendor until paid, it will retain its character of personal property, if the removal thereof would not materially reduce or injure the security of a prior mortgagee of the realty.
This rule is supported by the greater weight of authority, and an agreement that an article attached to the realty shall be removable and remain personalty is ordinarily given full effect as against a prior mortgagee, in so far as it will not interfere with the security of such mortgage. 26 C. J. 684, § 49; Beatrice Creamery Co. v. Sylvester, 65 Colo. 569, 179 P. 154, 13 A. L. R. 441 and note. Waterloo First National Bank v. Elmore, 52 Iowa, 541, 3 N. W. 547;Detroit Steel Co. v. Sisterville Brewing Co., 233 U. S. 712, 34 S. Ct. 753, 58 L. Ed. 1166;Ratchford v. Cayuga County Cold Storage, 217 N. Y. 565, 112 N....
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