Edwards & Bradford Lumber Co. v. Rank

• Decision Date: 05 January 1899
• Citation: 57 Neb. 323,77 N.W. 765
• Court: Nebraska Supreme Court
• Parties: EDWARDS & BRADFORD LUMBER CO. v. RANK ET AL. (OTTO GAS-ENGINE WORKS, INTERVENER).

57 Neb. 323

77 N.W. 765

EDWARDS & BRADFORD LUMBER CO.

v.RANK ET AL. (OTTO GAS-ENGINE WORKS, INTERVENER).

Supreme Court of Nebraska.

Jan. 5, 1899.

Syllabus by the Court.

Where one purchases an engine with a view that it shall be placed in a flouring mill of which he is the owner, to propel the machinery therein, and he executes a chattel mortgage on such engine to secure the payment of a portion of the purchase price, he thereby evinces his intention that the engine shall retain its status as personalty, even though physically attached to the freehold by such owner, and it will be so regarded by the courts whenever the rights of innocent third persons will not be prejudiced.

Appeal from district court, Dakota county; Norris, Judge.

Action by Edwards & Bradford Lumber Company against Murry Rank and others. The Otto Gas-Engine Works intervened. From the judgment, the intervener appeals. Reversed.E. P. Wigton, Wilbra Coleman, and Powers & Hays, for appellant.

M. B. Slocum, Jay & Welty, J. T. Spencer, J. Fowler, R. E. Evans, and W. P. Warner, for appellees.

NORVAL, J.

This was a suit to foreclose a mechanic's lien for materials sold and delivered by the Edwards & Bradford Lumber Company, a corporation, to Murry Rank, for the erection of a steam flouring mill upon certain real estate in South Sioux City, of which Rank was the owner of the undivided two-thirds, and the estate of J. M. Moon, deceased, was the owner of the other one-third. Among those made parties defendants were the holders of mechanics' liens on the premises, and J. P. Twohig and the Dubuque Turbine Roller-Mill Company, who owned real-estate mortgages thereon. Answers and cross petitions were filed on behalf of said lienors and mortgagees. Subsequently the Otto Gas-Engine Works intervened, and set up a chattel mortgage on the engine in the mill, executed by Rank and others to secure the payment of the purchase price thereof. Upon the hearing a decree was entered allowing the Moon estate a one-third interest in the real estate in the unimproved condition, dismissing the claim of the intervener, awarding foreclosure of the various mechanics' liens and realestate mortgages, and directing a sale of the property subject to the interest of the Moon estate, including the engine embraced in the intervener's chattel mortgage. The Otto Gas-Engine Works prosecutes this appeal.

There is no controversy as to the facts. The several mechanics' liens and real-estate mortgages are valid, and the decree foreclosing them is correct. It is disclosed by the written stipulation of the parties that on July 15, 1893, and while the mill was being constructed, Murry Rank and those interested with them in the building of the mill entered into a written contract with Scheicher, Schum & Co. for the purchase from the latter, to be used in operating said mill, of the engine in controversy, and the fixtures thereto belonging, for the sum of $1,800, of which amount $450 were to be deposited by the purchasers in the Citizens' State Bank of South Sioux City, to be held by it in trust until the conditions of said contract were complied with, and the remainder of the consideration was to be divided into three notes, of $450 each, due in 6, 12, and 15 months, respectively, from the date of the delivery of the engine. The purchasers were to be permitted to receive the engine on 30 days' trial, and, if found satisfactory upon such trial, the money so deposited was to be forwarded to Scheicher, Schum & Co., and the purchasers were to execute their promissory notes as aforesaid. The engine was shipped and received as agreed, and having given satisfaction upon the trial thereof, on October 26, 1893, the $450 were paid as agreed; and the purchasers also executed and delivered to the vendor their three notes, of $450 each, and secured the payment thereof by a chattel mortgage on the engine, which was duly filed for record on November 2, 1893, in Dakota county. The notes were, before their maturity, for a valuable consideration, sold and indorsed to the intervener, the Otto Gas-Engine Works, and no part thereof has been paid. The engine was placed in an outside building, upon a suitable brick foundation imbedded in the ground, being securely attached to said foundation by bolts, the tank was set upon a similar foundation of lighter construction, and the 40 feet of gas pipe was buried under ground. The engine can be removed without substantial injury to the realty.

The vendor and purchasers alike treated the engine as personalty, and no innocent third parties will be prejudiced by the court holding that the engine did not become a fixture and a...