In re Dubosky
| Decision Date | 08 November 1918 |
| Docket Number | 4919. |
| Citation | 253 F. 794 |
| Parties | In re DUBOSKY. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Arthur L. Shay, of Pottsville, Pa., for petitioner.
John B McGurl, of Minersville, Pa., for defendant.
The question really involved in this petition for a review can be best presented through a skeleton statement of the facts. On July 7, 1913, C. E. Christ et al. filed a mechanic's claim, the lien of which reverted to an earlier date. The claim was filed against the bankrupt as owner and contractor and if valid admittedly had priority of lien to the judgment which the First National Bank of Tamaqua had secured against the bankrupt. The adjudication was entered October 13, 1913, and on February 7 1914, the real estate against which the above mechanic's claim and judgment were respectively liens was sold under proceedings divesting both liens. On June 29, 1914, application was made to the court of common pleas in which the mechanic's claim was filed to strike it from the record, on the ground that no notice of its filing had been given in accordance with the provisions of the Pennsylvania act of assembly of June 4, 1901 (P.L. 431). Distribution of the proceeds of sale was proceeded with before the referee, before whom both the mechanic's claim and the judgment were presented as entitled to share in the distribution, each claiming a priority of lien. Objection was made to the mechanic's claim as invalid, because of the fact that the record showed the failure to give notice of the filing of the claim within the time required by the act of assembly.
The referee disallowed the mechanic's claim. On a certificate for review, the order made by the referee was reversed, and the cause recommitted to him for further proceedings. The grounds for this action were that it appeared, in conjunction with the proceedings to strike off the lien, that application had been made to the court of common pleas, in the office of the prothonotary of which the mechanic's lien had been filed, to amend the record of the date of the filing of the proof of notice referred to; the averment being made that the filing date, as it appeared of record, was a clerical error of the prothonotary. The cause was remanded, in order that the parties to the proceedings before the referee might be able to present the action of the court of common pleas on the application to correct its record. That court, being satisfied the filing date was incorrect, permitted the true date to be shown by its record. The mechanic's claim was then re-presented before the referee. The record then showed a compliance with the requirements of the act of assembly, and the objection which had been made to the allowance of the mechanic's lien claim was removed.
A new objection, however, to the claim, because of another failure to comply with the requirements of the state statute, was then interposed. This was that no sci. fa. had issued within the two-year limit of time within which the statute requires that such writ should issue, and, of course, no judgment in any such proceeding had been recovered within the limit of five years, as the statute further requires. The referee found this objection to be well taken, and disallowed the claim. The order embodying this finding has been brought before us for review.
To sharply present the point of the controversy the pertinent dates already given may be restated. July 7, 1913, mechanic's claim filed, and February 7, 1914, the real estate premises against which the said lien was filed were sold. As a mechanic's lien claim is primarily, at least, a claim in rem, a very practical difficulty is thus presented. Within the two years, at any time during which a writ of sci. fa. might issue, the premises subject to the claim were sold. The sale further took place before it would be practically possible to reduce the claim to judgment, or for a writ of sci. fa. even to issue, because no such writ of any value could issue until the status of the lien had been established.
In the proceedings in the court of common pleas to amend its record, action was not taken until after the sale. Whenever a sale takes place within the two-year period, one of two consequences flow. The mechanic's lien claimant loses because of this what is otherwise a perfectly valid claim, or he must proceed by sci. fa. proceedings to judgment. He must not only resort to this seemingly useless proceeding, but he must also, in some way, overcome the difficulty of sustaining a proceeding in rem against a rem which has been relieved of the operation of the lien which is the foundation of the whole proceeding. Assuming, for the purpose of presenting the point in mind, the proceeding to be one wholly and purely in rem, if a sci. fa. had issued, the purchaser of the property would have been served with process, or in any event would have had the right to intervene as defendant. He would, of course, have presented the defense of the divestiture of the lien. How could the plaintiff be awarded judgment? If there were no form of judgment which could be rendered under such circumstances, then we would have a law which denied to the claimant the recovery of what was due him because he had failed to secure judgment therefor, and the same law which thus punished him for not securing judgment would forbid him from getting judgment.
The referee has met the difficult situation thus presented by taking his stand upon the absolute declaration of the statute that the claim shall be 'wholly lost' unless the sci. fa. issues and judgment is recovered, and sought to dispose of one of the obstacles in the way of the issuing of the writ by citing Mesta Mach. Co. v. Dunbar Furnace Co., 250 Pa. 472, 95 A. 585, in which a sci. fa. issued after bankruptcy with notice to the trustee, and supports his view of the unyielding character of the statutory requirement by citing the cases of Sterling Bronze Co. v. Syria Imp. Ass'n, 226 Pa. 475, 75 A. 668, and Philadelphia v. Sciple, 31 Pa.Super.Ct. 64, to which are added Hunter v. Lanning, 76 Pa. 25, Philadelphia v. Kelly, 63 Pa.Super.Ct. 133, and Kountz v. Consolidated Ice Co., 36 Pa.Super.Ct. 639. Reference is also made to the cases of Ward v. Patterson, 46 Pa. 372, Hershey v. Shenk, 58 Pa. 382, Hoole v. Cox, 21 Pa.Dist.R. 118, Kittanning Ins. Co. v. Scott, 101 Pa. 449, and Cope's Appeal, 96 Pa. 294.
These cases fully support the referee in the proposition for which he cites them. The proposition is in substance that a failure either to issue the sci. fa. or to secure judgment cannot be excused because of interposed delays, even if it be true that the delays were in large part at least 'the law's delays.'
It is to be observed, however, that in every one of the cases cited there was no legal impossibility interposed as an obstacle to the issuing of the sci. fa. or the recovery of a judgment. It is further to be observed that in the instant case, however, such impossibility does exist, unless we read into the act a contraction of the time from two years and five years to the seven months which intervened between the filing of the lien and the sale of the premises, or we must hold proceedings against the rem might go on to judgment after the lien was gone. We assume there is no justification for the requirement that either a sci. fa. should have issued or a judgment have been recovered within the seven months. If the sci. fa. proceeding, therefore, be, as before stated, a proceeding wholly in rem, then a compliance with the requirements of the act was a legal impossibility, unless it can be held that the claimant can pursue the rem after it had been relieved of the lien of his claim.
Counsel for the bank, in supporting the findings of the referee, asserts that the mechanic's lien claim can be upheld only by a finding either that the failure to comply with the act was excused because of the error of the prothonotary in entering upon his record the date when proof of notice was filed, or that the time which was lost in the correction of this error should be excluded. This way of meeting the real question involved would seem to merely evade it.
If the learned referee...
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