Ford v. Springer Land Ass'n.

Decision Date28 August 1895
Citation41 P. 541,8 N.M. 37,1895 -NMSC- 011
CourtNew Mexico Supreme Court

Appeal from district court, Colfax county; before Justice O'Brien.

Action by Patrick P. Ford against the Springer Land Association and others to foreclose a mechanic's lien. From a judgment for plaintiff, defendants appeal. Affirmed.

Where a contractor constructing an irrigation ditch agrees to select a tract of land and pay a certain sum for it, which is to be credited as part payment of the work on condition that his employer secures a sufficient deed from the owner to himself tender of a sufficient deed to the contractor by his employer must be shown.

This is an action in chancery, brought by Patrick P. Ford, appellee against the Springer Land Association, and certain individuals corporate thereof, together with the Maxwell Land-Grant Company and its trustees, to establish, fix, and foreclose a mechanic's lien upon a certain ditch and reservoir system, rights of way therefor, and certain lands alleged to be appurtenant thereto, and it is founded on the following facts:

On October 20, 1888, a contract was entered into between Patrick P. Ford, of the first part, and the Springer Land Association, of the second part, for doing the earth work in constructing a certain ditch line and reservoir system, for irrigation, all in the county of Colfax and territory of New Mexico, the provisions of which, so far as pertinent to this case, are as follows: The party of the first part to furnish all necessary tools and labor, and perform all work of excavating and grading required in the construction of the Cimarron ditch and its accessories. Said work to be done in a thorough and workmanlike manner, and in full accord with the specifications thereto attached, and made part of the contract. The party of the second part agreed to pay said party of the first part for the work so done at the rate of 11 cents per cubic yard for all earth removed, without classification; amounts due for said work to be paid at the time and in the manner described in the specifications thereto attached. "Specification 13. Subcontracts must be submitted to the engineer, and receive his approval before work is begun under them. No second subcontracts will be allowed. Subcontractors will be bound by the same specifications as the original contractor, and will be equally under the authority of the engineer." "Specification 15. On or about the first day of each current month the engineer will measure and compute the quantity of material moved by the contractor during the preceding month. He will certify the amount to the company together with an account of the same at the price stipulated, which amount will be audited by the company without unnecessary delay, and the amount thereof, less ten per centum, retained, will be paid to the contractor, in cash, within ten days thereafter. This retained percentage will be held by the company as a guaranty for the faithful completion of the work, and will be paid in full with the final estimate, upon the certificate of the engineer accepting and approving the work; it being expressly understood that the failure of the contractor to fulfill his obligations will mean a forfeiture of this retained percentage to the company. The amount due to the contractor under the final estimate will only be paid upon the satisfactory showing that the work is free from all danger from liens or claims of any kind through failure on his part to liquidate his just indebtedness, as connected with this work."

The land upon which the ditches and reservoirs were to be and were actually located and constructed, and upon which the improvements were actually made, did not belong to the said the Springer Land Association, or to any of the parties to the contract, or to their successors in interest, so far as appears from the record, but was at the time the property of the Maxwell Land-Grant Company, which was not a direct party to the contract. The Maxwell Land-Grant Company did, however, make a contract on the 1st day of May, 1888, with C. C. Strawn and his associates, who afterwards organized the Springer Land Association, by which the Maxwell Company gave it and its associates a right of way for the proposed irrigation system of ditches and reservoirs, and by which said agreement it was provided, among other things, that, with the view of selling certain of its lands at an enhanced value, and in consideration of certain perpetual water rights and franchises to be granted it by the other party, it agreed to set apart and reserve from sale about 20,000 acres of its lands, and to give the other party, the Springer Land Association, which succeeded to the rights of said Strawn and his associates under said contract, a certain portion of the proceeds which might be derived from the sale of the said lands, when sold. These lands were under the proposed ditch system, and to be irrigated by it. And by this agreement said Strawn and his associates agreed to expend about $60,000, or a sufficient sum to complete the enterprise on the proposed plan. The title to the lands at that time and at all times afterwards, so far as appears from the record, was in, and remained in, the Maxwell Company, except as to the rights acquired by Strawn and his associates and successors in interest under said contract. The same contract constituted and made Strawn and his associates and successors in interest the agent of the Maxwell Company to the extent of and for the purposes of carrying into effect the spirit and intent of the contract as to the sale of the said lands; but that party, the Springer Land Association, contracting with the appellee, Ford, had no other title in the lands than as given in that contract. Five days subsequent to the time the ditch contract was made, Ford entered into another contract with the Springer Land Association, by which he agreed to select and take one section of the land under the ditch system, at the stipulated price of $8,000, to be considered as part payment on the contract price for constructing the ditch system, and the Springer Association agreed to procure a deed to Ford from the Maxwell Company, free from all incumbrances. The work of construction proceeded under the Ford contract, and he let subcontracts to McGarvey, Dargle, and Haynes. Estimates, as provided by the contract, were made by E. H. Kellogg, the supervising engineer, from time to time, which were audited and paid by the Springer Association, up to about May, 1889, and the final estimates were made, including all balance alleged to be due on the contract, and for extra work, and presented about the middle of June of that year, and at the time the contract work was alleged to have been completed, amounting to $17,634.27 due on the contract and $390 for extra work, and which the Springer Association refused to pay, on the grounds that the sum claimed was in excess of the amount due, and that the work had not been completed according to the contract; that the engineer's final estimate was erroneous in part, either through fraud, inadvertence, or mistake; and because the subcontractors had not been paid the several sums due them on the work by Ford, and that the property was not free from danger from liens. Thereupon Ford, on July 3, 1889, filed his notice of claim of lien for $17,634.27, alleged to be due on the contract, including all moneys due subcontractors at that time, and for $390, alleged to be due him for extra work. Thereafter the subcontractors filed their notice of claims of liens on the property for moneys alleged to be due them,--McGarvey for $5,000, Dargle for $2,274.30, and Haynes for an amount not shown by the record,--all of which said notices were filed within the time prescribed by law. Soon thereafter suits were brought to establish and foreclose the several liens by the subcontractors, some of which were pending when this suit was brought, and all against the ditch, laterals, reservoirs, and right of way, about 60 feet wide, the full length of the ditch, about 26 miles in length, and against 22,000 acres of land, alleged to be under the ditch system, and to be irrigated thereby, and appurtenant thereto.

Ford filed his bill to foreclose the lien so claimed on June 30 1890, in which he set out his contract of October 20, 1888; averred substantial compliance therewith, completion and acceptance of the same, but not by whom accepted; the filing of his claim of lien; the total amount due him at completion thereof; described the property as in the claim of lien; averred as to the contracts between the Maxwell Company, Strawn and his associates, and the Springer Association and its associates; that, during all the time the Ford contract was being executed, the Maxwell Company and the Springer Association both had full knowledge of the same, and that neither gave any notice that they would not be responsible for it; that at the time of the completion of the work there was due Ford from the Springer Association and the individuals composing it $17,634.27 on the contract, and $390 for extra work ordered by the supervising engineer in charge,--with prayer for an accounting and foreclosure of lien, decree for payment of costs, solicitors' fees, sale of ditches, laterals, and reservoirs, and the 22,000 acres of land described, and for a deficiency judgment, in case the property, when sold, should not produce sufficient funds to fully satisfy the several amounts so found to be due against the Springer Land Association and its associates. The Springer Land Association and the individuals composing it answered the bill, and denied that the work was ever completed by complainant or accepted by defendants; denied that they were indebted to the...

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