Jordan v. Natrona Lumber Co.

• Decision Date: 25 January 1938
• Docket Number: 2035
• Citation: 52 Wyo. 393,75 P.2d 378
• Parties: JORDAN v. NATRONA LUMBER COMPANY
• Court: Wyoming Supreme Court

75 P.2d 378

52 Wyo. 393

JORDAN v. NATRONA LUMBER COMPANY

No. 2035

Supreme Court of Wyoming

January 25, 1938

ERROR to the District Court of Natrona County; C. D. MURANE, Judge.

Proceedings to foreclose mechanic's lien by the Natrona County Lumber Company, a corporation, against Michael P. Jordan and another. Judgment of foreclosure, and named defendant brings error.

Affirmed.

For the plaintiff in error there was a brief by H. B. Durham, C. M Crowell and D. W. Ogilbee of Casper, and oral arguments by Messrs. Durham and Crowell.

A lessor is not liable under our Mechanic's Lien Statute for improvements made on leased property by lessee. Pertinent sections of our statutes are 66-501, 505 and 525, R. S. 1931. Statutes on this subject are classified in two groups. Section 66-501, R. S., requires a contract with the owner or his representatives. Wyoming is therefore classified in the contract theory group. The other classification is known as the estoppel theory, based upon the fact that the owner knowing of the repairs or construction, has allowed himself to remain in a position of acquiescence. The entire question has been reviewed in Stewart v. Talbott, (Colo.) 146 P. 771, a case supporting the contract theory. Our Mechanic's Lien statutes are similar to those of Missouri, but our law was enacted before the bulk of the Missouri decisions were rendered. In that state, the rule was that if the lease obligated the lessee to make improvements the interest of the lessor was subject to lien for such improvements. The rule seems to have been modified by the case of Dougherty-Moss Lumber Company v. Churchill, 114 Mo. 578, 90 S.W. 405. In that case, the lessee was not obligated by the lease to make improvements, but the circumstances and contemplated use of the building by lessee required improvements and the lessor was held subject to lien. The doctrine was supported in Curtin-Clark Hardware Co. v. Churchill, (Mo.) 104 S.W. 476, and in Dierks & Sons Lumber Co. v. Morriss, (Mo.) 156 S.W. 75. In the latter case, the "receipt-of-benefits" rule is mentioned. In Development Company v. Fox, (Okla.) 39 P.2d 143, lessor was held not liable under a lease providing that lessee should make improvements, and the same rule was followed in Morrow v. Merritt, (Utah) 52 P. 667. Section 66-525 relating to liens for improvements made by tenants required an agreement that the landlord is to pay the cost of such improvements. This section has never been construed by this court. The landlord in the present case did not agree to pay the cost of improvements. The lien is invalid, since it was filed without notice and not filed within time. Section 66-508, R. S. 1931 and Section 66-521, R. S. 1931. An original contractor is a person who contracts directly with the owner of the property to erect or construct a building or any part thereof. 40 C. J. 132, Sec. 144; Van Horn Trading Co. v. Day, (Texas) 148 S.W. 1129. Construed in the light of the authorities, Section 66-508, R. S., of our lien statute can mean only, that an original contractor is the corporation or person agreeing with the owner to furnish materials, labor and supervision for a construction or building operation; a sub-contractor is one who, likewise, contracts with the contractor rather than the owner. In this case, the Lumber Company had no contract with anyone, and a notice is necessary to give a valid lien in any event. A party furnishing material for a building is an original contractor. Darlington v. Building Company, (Mo.) 114 S.W. 77. The cases of Magill Lumber Company v. Carter, (Mo.) 17 S.W.2d 581 and Iron Works v. Riekenberg, (Idaho) 38 P. 650, deal with certain phases of the question. The Idaho case was followed in Gray v. New Mexico Pumic Stone Co., (N. M.) 110 P. 603. See also Wisconsin Planing Mill Co. v. Grams, (Wis.) 39 N.W. 531; Ferger v. Gearhart, (Cal.) 186 P. 376; Sash & Door Co. v. Weatherford, (Ore.) 294 P. 344. The interest of lessor Jordan cannot under the authorities be subjected to a lien for repairs made by lessee Brewing Company; Jordan's interest is not subject to lien, since he is within the exception stated in Section 66-525, R. S. 1931. The Lumber Company is not an original contractor. The Lumber Company contracted with Thimmig, who was the original contractor for the repairs.

For the defendant in error, there was a brief by Hagens & Wehrli of Casper, and oral argument by Mr. Wehrli.

In this case, the evidence shows that under the lease, the landlord agreed to pay cost of improvements, therefore coming within the terms of Section 66-525, R. S. 1931. The courts hold that where the landlord decreases the rental or accepts the making of repairs, in lieu of payment of rental, the repairs are done at the cost of the landlord. Whitcomb v. Gans, (Ark.) 119 S.W. 676; Boisot on Mechanics' Liens, Sec. 290; Potter v. Conley, (Kans.) 112 P. 608; Lumber Company v. Borden, (C. C. A., 9th Cir.) 211 F. 50; Kremer v. Walton, (Wash.) 29 P. 374. The landlord's estate is subject to lien for materials or labor furnished lessee in making repairs or improvements required by lease. The Missouri cases so hold. Ward v. Nolde, 168 S.W. 596; Lumber Company v. Churchill, (Mo.) 90 S.W. 405; Clark Hardware Company v. Churchill, (Mo.) 104 S.W. 476; Estate Ass'n. v. Boeke & Son, (Mo.) 254 S.W. 858; American Sash & Door Co. v. Stein, 96 S.W.2d 927. Cases from other jurisdictions based on statutes similar to those of Wyoming support the same doctrine. Carey-Lombard Co. v. Jones, (Ill.) 58 N.E. 347; Mancourt v. Wissel, (Ind.) 146 N.Y. 423; Jones v. Menke, (N. Y.) 60 N.E. 1053; Denniston & Partridge Co. v. Brown, (Ia.) 167 N.W. 190; Lumber & Fuel Co. v. Nolan, (Ore.) 143 P. 935; Nicolai-Neppach Co. v. Poore, (Ore.) 251 P. 268; Seattle Company v. Central Market, (Wash.) 286 P. 43; Gravel Company v. Turner Co., (Wash.) 17 P.2d 9; Brown v. Walker, (Kans.) 164 P. 1092; Kremer v. Walton, (Wash.) 39 P. 374; Lumber Company v. First State Bank, (Okla.) 293 P. 1079; Gem State Lumber Co. v. Elevator Co. , (Ida.) 278 P. 775; McNulty Bros. v. Offerman, 116 N.E. 775. The statute involved in Stewart v. Talbott, (Colo.) 146 P. 771, cited by plaintiff in error, expressly provides that a person furnishing labor or materials to a lessee has no lien against his lessor. It seems that the present case involving a lease requiring the making of improvements, the cost of which is deductible from rent fixes liability on the lessor. Natrona Lumber Company was the original contractor and had four months in which to file lien and was not required to give notice. Lumber Company v. Jones, (Ill.) 58 N.E. 347; Boyer v. Keller, (Ill.) 101 N.E. 237; Ward v. Nolde, 168 S.W. 596; Company v. Market, (Wash.) 286 P. 43; Myers v. Estate Co., (Ore.) 160 P. 135; Sand & Gravel Co. v. Turner Company, (Wash.) 17 P.2d 9; McNulty Bros. v. Offerman, (N. Y.) 116 N.E. 775; Carey Company v. Kellerman Contracting Company, (Mo.) 170 S.W. 449; East Arkansas Lumber Company v. Bryant, (Mo.) 247 S.W. 496; Waters v. Gallemore, (Mo.) 41 S.W.2d 870; Colorado Iron Works v. Rickenberg, (Ida.) 38 P. 651; Gray v. New Mexico Stone Co., (N. M.) 110 P. 603; Heating Company v. Wallace, (N. M.) 27 P.2d 984; Bernard v. Hassan, (Ore.) 118 P. 201. Assuming a performance of the contract by Thimmig, a somewhat similar situation arose in Lumber Company v. Churchill, (Mo.) 90 S.W. 405; Waters v. Gallemore, (Mo.) 41 S.W.2d 870. The authorities conclusively support the recovery by Natrona Lumber Company in this case. Denniston & Partridge Co. v. Brown, (Ia.) 167 N.W. 190; Nicolai-Neppach Co. v. Poore, (Ore.) 251 P. 268; Lumber Company v. Elevator Company, (Ida.) 278 P. 775.

RINER, Justice. BLUME, C. J., and KIMBALL, J., concur.

OPINION

RINER, Justice.

This case brings before the court questions arising upon the record in a mechanic's lien foreclosure suit under the provisions of Chapter 66, W. R. S. 1931. The defendant in error, Natrona Lumber Company, hereinafter usually mentioned as the "Lumber Company" was plaintiff in that suit in the district court of Natrona County, and the plaintiff in error, Michael P. Jordan, for convenience subsequently referred to at times as the "owner" or "lessor," was a defendant, together with other persons who are not parties to this proceeding in error. The district court aforesaid entered a judgment foreclosing a mechanic's lien claim in plaintiff's favor upon certain real estate owned by Jordan, and he, alleging error, asks its reversal. The material facts are very little in dispute and appear to be these:

During part of the year 1920 and at all times since then, Jordan was, and now is, the owner of lots numbered 1 to 19 inclusive in Block numbered 6 in Burlington Addition to the City of Casper. There was located upon this property a brick building, which was of considerable size and which had been erected and used for a brewery in the pre-prohibition era. During the years 1920 until 1934 it had remained unoccupied except for the presence of a caretaker.

On January 27, 1934, the Wyoming Brewing and Distributing Company, a corporation organized under the laws of this state, as second party, which for brevity will be designated hereinafter as the "Brewing Company" or the "lessee," through its "Manager and Authorized Agent," one A. W. Thimmig, obtained from Jordan, as first party, a lease agreement covering the property above described, wherein it was agreed, among other things, that the lessee should "hold said property and premises from date of this agreement until and including July 31st, 1934, upon and for the consideration in hand paid first party by second party, in advance, receipt whereof is hereby acknowledged by first party, of 120 shares of the capital stock of second party and upon the further consideration that second par...