Douthit v. Wilks

• Decision Date: 16 May 1984
• Citation: 480 So.2d 544
• Court: Alabama Court of Civil Appeals
• Parties: Robert DOUTHIT v. Paul T. WILKS, Sr., Jene C. Wilks, William F. Aldridge, Valley Federal Savings & Loan Association, Timothy John Morgan, Kimberly K. Morgan, and Central Bank of the South. Civ. 4150.

Page 544

480 So.2d 544

Robert DOUTHIT v. Paul T. WILKS, Sr., Jene C. Wilks, William F. Aldridge, Valley Federal Savings & Loan Association, Timothy John Morgan, Kimberly K. Morgan, and Central Bank of the South.

Civ. 4150.

Court of Civil Appeals of Alabama.

May 16, 1984.

Rehearing Denied June 27, 1984.

J.A. Dardess, Sheffield, for appellant.

William F. McDonnell of McDonnell & Jones, Sheffield, for appellees Aldridge, Valley Fed. Sav. & Loan Assoc., and Morgans.

J. Michael Broom of Almon, McAlister, Ashe, Baccus & Tanner, Tuscumbia, for appellee Cent. Bank of the South.

WRIGHT, Presiding Judge.

On application for rehearing, the original opinion is withdrawn and the following opinion is substituted in lieu thereof.

This is a suit to determine priority and enforce a mechanic's lien. Douthit entered into a contract for repairs to the residence of the Wilkses on June 24, 1982. The work was done and completed on July 9, 1982, for the amount of $7,187.11. A mechanic's lien was perfected by filing a lien statement on September 16, 1982. Suit was brought for enforcement on November 16, 1982.

At the time of commencement of work, there were two prior mortgages on the property. The Wilkses purchased the property in 1970, assuming a prior mortgage and executing a second mortgage to one Aldridge. Subsequent to the performance of the repairs, Aldridge foreclosed his mortgage on August 16, 1982. He purchased at the foreclosure sale and sold to the Morgans on September 14, 1982. The Morgans executed a mortgage to Central Bank on September 17, 1982.

The mechanic's lien is a creature of statute. Section 35-11-210, Code of Alabama 1975. As pertinent here, the statute provides:

"Every mechanic ... who shall do any work, or labor upon ... any building ... under any contract with the owner thereof, ... upon complying with the provisions of this division, shall have a lien therefor on such building ... and on the land on which the same is situated, to the extent in ownership of all the right, title and interest therein of the owner...."

The Wilkses, though mortgagors and owners only of an equity of redemption in the property, could nevertheless, while in possession, contract for improvements or repairs to the property. Bain v. Mazel, 275 Ala. 531, 156 So.2d 624 (1963); Sorsby v. Woodlawn Lumber Co., 202 Ala. 566, 81 So. 68 (1919). However, it is evident from the words of the statute, that the lien and the rights of the lienholder are limited to the extent of the right, title and interest of the owner with whom he contracted. Staley v. Woodruff, 257 Ala. 571, 60 So.2d 384 (1952); City Realty & Mortgage Co. v. Tallapoosa Lumber Co., 231 Ala. 238, 164 So. 55 (1935).

Therefore, in view of the undisputed fact that Douthit complied with the statute, he perfected a lien against the property upon which he effected repairs. The lien attached as of the commencement of the work. Lily Flagg Building Supply Co. v. J.M. Medlin & Co., 285 Ala. 402, 232 So.2d 643 (1970). However, it must be remembered that the lien extended only to the right, title and interest in the property of the Wilkses as of June 24, 1982. We have said such interest was as a mortgagor--thus it consisted only of an equity of redemption. Trauner v. Lowrey, 369 So.2d 531 (Ala.1979). That equity of redemption was extinguished by the subsequent foreclosure of the Aldridge mortgage, leaving to the Wilkses a statutory right of redemption as of August 16, 1982. § 6-5-230, Code 1975; Vines v. Wilcutt, 212 Ala. 150, 102 So. 29 (1924). Therefore, at the time of perfection of his lien, there remained only a statutory right of redemption available to Douthit to attach his lien. Vines v. Wilcutt, supra.

We must now determine the priority of the lien in relation to the interest of the Morgans and of Central Bank.

Section 35-11-211, Code of Alabama 1975, establishes priority of a mechanic's and materialman's lien as to other liens and mortgages. As pertinent to this case, it provides as follows: "Such lien as to the land and buildings thereon..., shall have priority over all other liens, mortgages or encumbrances created subsequent to the commencement of work on the buildings or improvement...."

The trial court determined that the Morgans' purchase of the interest of Aldridge, after foreclosure and sale under the prior mortgage of Aldridge, was an innocent purchase without notice. There is no priority of a mechanic's lien over a subsequent purchaser without notice. Guaranty Pest Control, Inc. v. Commercial Investment and Development Corp., 288 Ala. 604, 264 So.2d 163 (1972); Martin v. Clarke, 154 Ala. 425, 46 So. 232 (1908). The evidence of the Morgans' executed contract of sale, the payment of a substantial part of the total purchase price, the delivery of a deed to the property and the entering into possession prior to actual or constructive notice of the lien, was sufficient to support the finding of priority of the purchase. The subsequent payment of the remaining part of the purchase price after the execution and substantial performance of the contract of sale does not prevent the finding of an innocent purchaser. We find no error in the finding of priority of the Morgans.

The priority of the mortgage from the Morgans to Central Bank, however, is not as readily resolved. The lien statement of Douthit was filed on September 16, 1982. The mortgage was executed on September 17, 1982 and not recorded until September 20, 1982. By the terms of the statute, Douthit's lien would appear to have priority over Central Bank's mortgage, an encumbrance created subsequent to the perfection and filing of the...