Graham v. Magann Fawke Lumber Co.

• Court: Court of Appeals of Kentucky
• Writing for the Court: BURNAM, C.J.
• Citation: 118 Ky. 192,80 S.W. 799
• Decision Date: 11 May 1904
• Parties: GRAHAM v. MAGANN, FAWKE LUMBER CO.

80 S.W. 799

118 Ky. 192

GRAHAM
v.
MAGANN, FAWKE LUMBER CO.

Court of Appeals of Kentucky.

May 11, 1904

Appeal from Estill County Court.

"To be officially reported."

Action by David Graham against Magann, Fawke Lumber Company. From a judgment for plaintiff for insufficient relief, he appeals. Modified.

L. A. West, for appellant.

Riddell & Riddell, for appellee.

BURNAM, C.J.

The Magann, Fawke Lumber Company owned a sawmill plant near Irvine, Ky. and were engaged in the [80 S.W. 800.] business of manufacturing lumber. On the 20th of April, 1900, they mortgaged their entire plant to George P. Magann to secure the payment to him of a note for $40,000 for borrowed money. George P. Magann transferred this debt to the Bank of Montreal, Canada. The bank, on the 14th of March, 1902, filed its petition in the Estill circuit court for an enforcement of their lien and a sale of the property. A judgment was rendered decreeing a foreclosure in accordance with the prayer of the petition. At the sale made thereunder by the master commissioner of the Estill circuit court, the bank became the purchaser of all the mortgaged property at the price of $37,800. The bank subsequently transferred the benefit of their bid to Angus Kirkland, the president of the bank, and the sale was confirmed. In the meantime appellant, David Graham, who had been in the employ of the sawmill company at a salary of $75 per month up to the 23d of April, 1902, filed a lien in the county clerk's office of Estill county for $225, as required by section 2494 of the Kentucky Statutes of 1903, and on the 10th day of June, 1902, instituted this suit against the lumber company, the bank, and other creditors, asking that his lien be adjudged superior to that of the bank, and that it should be paid out of the proceeds arising from the sale of the company's property. The defendants answered, denying the alleged indebtedness, and also that he was entitled to the priority asserted.

Section 2487 of the Kentucky Statutes of 1903 provides that when the property or effects of any manufacturing establishment shall in any wise come to be distributed among creditors, whether by operation of law or by the act of the company, owner, or operator, the employés of such company, owner, or operator in such business shall have a lien upon so much of such property and effects as may have been involved in such business, and all the accessories connected therewith, including the interest of...