Eason Oil Co. v. M. A. Swatek & Co.
| Decision Date | 09 October 1934 |
| Docket Number | Case Number: 23567 |
| Citation | 169 Okla. 170,36 P.2d 504,1934 OK 509 |
| Parties | EASON OIL CO. v. M. A. SWATEK & CO. et al. |
| Court | Oklahoma Supreme Court |
¶0 1. Mechanics' Liens--Contract Price as Fund for Payment for Labor and Material.
Where a contract is made for the erection of a building, the contract price for the erection thereof constitutes a fund from which the subcontractors and those furnishing material to or performing labor for them are to be paid for their material and labor, and it is the duty of the owner and principal contractor to see that such fund is properly distributed id the persons entitled Thereto.
2. Same--Waiver of Liens of Subcontractors Required to Be Supported by Consideration.
An instrument purporting to be a waiver of liens provided for by section 10977, O. S. 1931, relating to liens of subcontractors, must be supported by a consideration.
3. Same--Failure of Consideration for Lien Waiver Where Payment Is by Check Which Is Refused Payment.
A lien waiver given in consideration of full payment of the claim fails of consideration where payment is made by check which upon presentation is refused payment, unless the evidence discloses an agreement to the contrary.
4. Same--Owner of Premises With Notice of Failure of Consideration for Waiver Given by Claimants not Entitled to Rely Upon Such Waiver.
The owner of premises upon whom rests the duty, together with the contractor, to distribute the funds represented by the contract price between him and the contractor to the persons properly entitled thereto, may not rely upon a waiver given by the claimants when such owner has notice of a failure of consideration supporting such waiver.
Appeal from District Court, Oklahoma County; Dennis H. Wilson, Judge.
Action by M. A. Swatek & Company and intervening petitioners against the Eason Oil Company and another, to foreclose materialman's liens. Judgment for plaintiff and others similarly situated. Defendant Eason Oil Company appeals. Affirmed.
Simons, McKnight, Simons, Mitchell & McKnight, for plaintiff in error.
G. A. Paul, Shirk, Danner & Phelps, and Charles E. Earnheart, for defendants in error M, A. Swatek & Company, Overhead Door Company, J. B. Klein Iron & Foundry Company, Standard Roofing & Material Company.
Willingham & Fariss and C. E. McAfee, for defendant in error R. E. Ernest, a sole trader doing business as R. E. Ernest & Company, and William McCaig.
O. A. Cargill and Walter Graalman, for defendant in error A. R. Griffith, a sole trader doing business as Griffith Electric Company.
Conner & Conner, for defendants in error E. E. Barbee, trustee of Blockie Furnace & Supply Co.
¶1 Plaintiff in error, Eason Oil Company, a corporation, prosecutes this appeal from the district court of Oklahoma county against the defendants in error, M. A. Swatek & Company, a corporation, Overhead Door Company, a corporation, J.B. Klein Iron & Foundry Company, a corporation, Standard Roofing & Material Company, a corporation, A. R. Griffith, doing business as Griffith Electric Company, E. E. Barbee, trustee of the Blockie Furnace & Supply Company, a corporation, R. E. Ernest doing business as R. E. Ernest & Company, and William McCaig.
¶2 The action was commenced in the district court by M. A. Swatek & Company, a corporation as plaintiff against the Eason Oil Company, a corporation, and Harry Reynolds Construction Company, as defendants. The other defendants in error became parties in the trial court by filing their several and separate petitions in intervention. The plaintiff and all of the interveners sought and obtained in the trial court judgment against plaintiff in error, establishing their separate claims and liens as materialmen against plaintiff in error's property. For convenience the defendants in error will be referred to as plaintiffs, and the plaintiff in error will be referred to as defendant.
¶3 On or about January 11, 1931, the Reynolds Construction Company, as contractor, completed a filling station in Oklahoma City for the defendant. Immediately the contractor procured of the plaintiffs, who had furnished labor and material in the construction of the filling station, the following lien waiver:
¶4 This instrument was properly acknowledged before a notary public, by the persons executing the same.
¶5 The contractor, upon procuring plaintiffs' signatures to this waiver, delivered to each of them, respectively, his check for the amount due as shown by the waivers. Checks so given were returned to plaintiffs by the payor bank marked no account." Upon return of these unpaid' checks the plaintiffs complained to one Chas. H. Biggs, the defendant's managing agent of filling stations in Oklahoma City, advising Mr. Biggs that their checks and claims were unpaid, and inquiring of him what action the defendant would take in the matter. Mr. Biggs informed them that he would take it up with the Eason Oil Company and advise them further. Mr. Biggs later informed the plaintiffs that the Eason Oil Company would look into the matter before final settlement with the contractor, and on the day before the contractor received a check in final settlement Mr. Biggs advised plaintiffs that the Eason Oil Company was not paying the money to the contractor direct, and that it was going to take care of their individual claims.
¶7 Hatton did not deliver the check to the contractor, but on the same day sent the check payable to the order of the contractor to the defendant's agent, Mr. Biggs, in Oklahoma City. Mr. Hatton testified further as follows:
¶8 And in pursuance of his intention he transmitted the following letter to defendant's Oklahoma City agent:
¶9 It appears that the contractor in some manner obtained possession of the check, or the proceeds of the check from Mr. Biggs, and wholly failed to pay any part of the same to the plaintiffs here. The defendant, Eason Oil Company, failing to provide for the payment thereof, each of the plaintiffs perfected his lien in conformity with law, and by this suit are seeking the enforcement thereof. A jury was waived and the cause tried to the court, resulting in a judgment establishing the claims and liens of the several plaintiffs as herein shown.
¶10 The...
To continue reading
Request your trial