Henry & Coatsworth Co. v. Halter

• Decision Date: 08 June 1899
• Citation: 79 N.W. 616,58 Neb. 685
• Court: Nebraska Supreme Court
• Parties: HENRY & COATSWORTH CO. v. HALTER ET AL.

58 Neb. 685

79 N.W. 616

HENRY & COATSWORTH CO.

v.HALTER ET AL.

Supreme Court of Nebraska.

June 8, 1899.

Syllabus by the Court.

1. One cannot, except under special circumstances, become the assignee of a judgment against himself. The rule is that, when payment has been made by one who is primarily liable, it operates as an absolute satisfaction, even though an assignment be made to a third person with the intention of keeping the judgment alive.

2. An attorney cannot, without actual authority from his client, sell and assign his client's judgment.

3. A judgment which has been paid and extinguished by the owner of land upon which it was a lien cannot be afterwards revived for the purpose of cutting out other liens.

4. A contract providing for a conditional exchange of securities is valid, and will be enforced according to the mutual intention of the parties thereto.

5. An agent cannot bind his principal beyond the limits of his actual or apparent authority, and the declared willingness of a principal to ratify a conditional contract will not operate as a ratification of an unconditional contract of which he is ignorant.

6. The doctrine of election between inconsistent remedies has no application to a case where a party declares upon an express contract, and demands whatever relief he may be entitled to thereunder.

7. The lien of an ordinary mortgage is not subordinate to mechanics' liens merely because the money which it was given to secure was loaned for the purpose of improving the mortgaged premises, and under an express contract that it should be so used.

8. A finding of the trial court, upon conflicting evidence, as to the amount due upon a mechanic's lien, will not be disturbed unless clearly wrong.

9. An architect is entitled to a mechanic's lien upon a building which has been constructed in accordance with plans prepared by him under contract with the owner.

10. Where labor or material has been furnished by a party under distinct contracts, the claim for a mechanic's lien under each contract must be filed within the time limited by the statute for that purpose.

Appeal from district court, Lancaster county; Holmes, Judge.

Action by the Henry & Coatsworth Company against Alexis Halter and others to foreclose a lien. From the judgment, certain parties appeal. Reversed.Charles A. Robbins, Stewart & Munger, George E. Hibner, Abbott, Selleck & Lane, and John S. Kirkpatrick, for appellants.

S. L. Geisthardt, for appellees.

SULLIVAN, J.

This action, which was brought by the Henry & Coatsworth Company to foreclose a mechanic's lien, resulted in a decree from which a number of lien claimants who were parties defendant have appealed. The pleadings and evidence are voluminous, but we believe the following statement of facts will sufficiently develop the main questions presented for decision: Alexis Halter, being the owner of three business lots in the city of Lincoln, decided to erect thereon a five-story building. In June, 1892, he employed Tyler & Son, architects, to prepare plans, and in the following October commenced the work of construction. January 21, 1893, he borrowed of the Clark & Leonard Investment Company $35,000, to be used in carrying the structure to completion. To secure this loan, Halter and wife executed to the investment company a coupon bond for $35,000, and a first mortgage on the property in question. At the same time the borrower executed to the lender a commission mortgage for $1,500 on the same property. Both mortgages were immediately recorded, and five days later, on January 26th, the $35,000 mortgage was sold and assigned to the appellee Charles W. Hare, who afterwards transferred it to the appellee John J. Tyler as collateral security for a loan of $32,000. In his written application for the loan, Halter stated that the money was to be used in completing the building then in course of construction, but there was no agreement requiring him to use it for that purpose. Halter did, however, as part of the transaction, execute a bond, with sureties, to indemnify the mortgagee and its assigns against possible loss resulting from the filing of the mechanics' liens. This obligation also provided that the investment company, or its successors in interest, might pay off any lien against the property when filed and established. In July, 1893, a portion of the building was ready for occupancy, but it was not entirely finished until December of that year. The appellants and others, having contributed labor or materials towards the construction of the building, and not having been paid therefor, filed in the proper office their claims for liens. In August, 1893, the property in controversy, commonly known as the “Halter Block,” was conveyed by Alexis Halter and wife to the Lincoln Business Block Company, a corporation. Some of the stock of this corporation, issued to Halter, was by him pledged to the German National Bank as collateral security for money loaned. In March, 1894, transcripts of two judgments in favor of the Hawarden Furnace-Grate Company and against the Lincoln Business Block Company were filed in the office of the clerk of the district court of Lancaster county. Under executions issued on these judgments, the Halter Block was sold on May 1, 1894; the purchaser being Charles T. Boggs, who was acting in the interest of the German National Bank, of which he was president. The sale was confirmed by the district court on May 5th. In October, 1892, Christopher Tiernan recovered a judgment in the district court of Lancaster county against Alexis Halter for the sum of $385.40. This judgment was a lien on the Halter Block, and was prior to the lien of the mortgages to the Clark & Leonard Investment Company, and also prior to most of the mechanics' liens. In October, 1893, Alexis Halter sent his brother Andrew to pay the Tiernan judgment. He gave him for the purpose $300 in cash, and his personal check for the balance. This balance Andrew agreed to advance as an accommodation. He made the advancement according to his agreement, and paid the full amount due on the judgment. Instead, however, of having it canceled, he caused it to be assigned to Leo Haben, his brother-in-law, who had no knowledge of the matter, and no interest in it. The check given by Alexis to Andrew was afterwards paid, but the precise time of payment does not appear. In May, 1894, R. J. Greene, assuming to act as attorney for Haben, made a formal sale and assignment of the judgment to Boggs. Of this transaction Haben was entirely ignorant. He had only recently learned that the judgment stood in his name as assignee. He claimed no interest in it, and had conferred upon Greene neither actual nor apparent authority to sell it. It seems, however, that he afterwards advanced Andrew Halter some money on the judgment, and that in September, 1894, for a consideration of $250, he ratified in writing the assignment previously made by Greene to Boggs. Under an execution issued on the Tiernan judgment, Boggs, soon after obtaining the assignment from Greene, caused the Halter Block to be sold, and became himself the purchaser. The purchase price was $35,000, which, according to the return of the sheriff, has been fully paid, and is in his hands for distribution. On June 23, 1894, the sale was confirmed, and a deed ordered. The following day Boggs and wife conveyed the premises to Charles C. Clark, who soon after mortgaged the same to the Clark & Leonard Investment Company to secure his coupon bond for the sum of $35,000. Clark also executed a mortgage on the property to W. F. Meyer to secure the sum of $18,777.50. This mortgage was apparently made for the benefit of the German National Bank and the First National Bank of Lincoln, and represents an indebtedness due from Halter to those banks. Clark paid nothing for the property, and was merely acting for Boggs in making the mortgages; the latter not wishing to appear of record as a borrower. When the transactions were concluded the premises were reconveyed to Boggs, who is now the fee owner of the same. Before the sale under the Tiernan judgment an arrangement was made between Boggs and J. W. McDonald, representing the investment company, which contemplated that Boggs should buy the property, pay off the liens and claims of the investment company, and execute to it a new mortgage for $35,000 to take the place of the mortgage held by Hare and Tyler. Whether the execution of this plan was to depend upon confirmation of the sale, or upon the acquisition by Boggs of a good title under the sale, is not very clear. In pursuance of this arrangement, Boggs paid the investment company on July 26, 1894, the sum of $5,500; being the amount of its commission mortgage, interest coupons paid to Hare and Tyler, and some other matters. He also caused Charles C. Clark to execute the $35,000 mortgage above mentioned. This mortgage has never been delivered to Hare and Tyler personally, and they have neither surrendered the Halter mortgage, nor released it of record. Prior to November 4, 1894, they had no knowledge of the arrangement between McDonald and Boggs, and were not aware that the property had become involved in litigation, or that there had been any change of ownership. Hare and Tyler were not originally parties to the action, but became such by intervention in February, 1895. The substance of their amended answer is that they delivered the Halter mortgage to the Clark & Leonard Investment Company, to be exchanged for the Clark mortgage in case the court should affirm the validity of the sale under the Tiernan judgment. They ask, in the event of the sale being adjudged void, for a foreclosure of the Halter...