Landau v. Cottrill
| Decision Date | 22 December 1900 |
| Citation | 60 S.W. 64,159 Mo. 308 |
| Parties | LANDAU et al. v. COTTRILL, Appellant |
| Court | Missouri Supreme Court |
Appeal from St. Louis City Circuit Court. -- Hon. John A. Talty Judge.
Affirmed.
R. M Nichols, with whom is Henry H. Denison, for appellant.
(1) It is in evidence and uncontradicted that the houses were erected to the roof before the plaintiffs' mortgage was executed, and mechanic's liens have always been held superior to a mortgage executed after the buildings were begun, which is also the theory of the Missouri statute. R S. 1899, sec. 4209; Vite v. Dixon, 12 Mo. 479; DuBois' Adm'r v. Wilson, 21 Mo. 213; Reilly v. Hudson, 62 Mo. 383. The petition of the plaintiffs alleges the establishment of the mechanic's lien, and the plaintiffs introduced the lien in evidence. There is no claim in this case that the lien was not established, or that the lienor was not entitled to his lien, or that there was any irregularity in the foreclosure of the lien, or that all the parties of record were not made parties to the lien proceedings. In Schaeffer v. Lohman, 34 Mo. 68, Judge Bates says: "It is true those not made parties are not bound by the judgment; that is, they may impeach its regularity." Bissell v. Lewis, 56 Iowa 231, 9 N.W. 177; Gardner v. Leck, 52 Minn. 522, 54 N.W. 746; Cheshire Prov. Inst. v. Stone, 52 N.H. 365; Steam Heater Co. v. Gordon, 2 N.D. 246, 50 N.W. 708; Hahn's Appeal, 39 Pa. St. 409; Construction Co. v. Meyer, 100 U.S. 476; Douglas v. Zinc Co., 56 Mo. 388; Allen v. Mining Co., 73 Mo. 688; McKim v. Mason, 3 Md. Ch. 186; Reading v. Hopson, 90 Pa. St. 494; Brooks v. Railroad, 101 U.S. 443; Davis v. Bilsland, 18 Wall. 659; Taylor v. Railroad, 4 Dill. 570; Neilson v. Railroad, 44 Iowa 71; Ins. Co. v. Paulison, 28 N.J.Eq. 304. (2) The statute guarantees protection from the "commencement of the building." Judgment relates back to commencement of building. Allen v. Sales, 56 Mo. 28; McAdow v. Sturtevant, 41 Mo.App. 220; Brick Co. v. Bormans, 19 Mo.App. 664; Schaeffer v. Lohman, 34 Mo. 68; Kuhleman v. Schuler, 35 Mo. 142; Douglas v. Zinc Co., 56 Mo. 388; Great Western Planing Mill v. Bormans, 19 Mo.App. 671. (3) By designating Will J. Howard in the deed of trust as the beneficiary of the loan, and placing the deed of trust of record as notice to persons who had furnished materials in the construction of said buildings, that said Howard was the beneficiary, thereby inducing the lienors to act upon the belief that Howard was the owner of the notes and the proper person to make a party to the suit as such owner -- by the plainest principles of justice the administrator or guardian would be estopped from now contending that Howard was not the owner of the notes and the beneficiary of the deed of trust, and upon the well-settled principle that "if the owner of a promissory note be clothed with the indicia of ownership he will be estopped to assert his ownership against third persons who have been misled thereby." Lee v. Turner, 89 Mo. 489; Neuhoff v. O'Reilly, 93 Mo. 164; Ragan v. McElroy, 93 Mo. 349; 2 Herman on Estoppel, sec. 1125; Foot v. Clark, 102 Mo. 407.
Bryan & Christie for respondents.
(1) Section 6713, Revised Statutes 1889, expressly provided that in all suits to enforce a mechanic's lien against property, "all persons interested . . . . in the property charged with the lien may be made parties, but such as are not made parties shall not be bound by any such proceedings." R. S. 1889, sec. 6713; R. S. 1899, sec. 4211; Russell v. Grant, 122 Mo. 161; Hicks v. Scofield, 121 Mo. 381. Plaintiffs, as holders of notes secured by deed of trust on the property, were persons "interested in the property." Russell v. Grant, 122 Mo. 161; Coe v. Ritter, 86 Mo. 277; Jones on Liens, sec. 1579; Boisot on Mech. Liens, sec. 532. Plaintiffs, not having been made parties to the mechanic's lien suit of the Hynson Hardware Company, were not bound, that is to say, were not affected thereby, but such proceedings were, as far as plaintiffs were concerned, void and of no effect. Russell v. Grant, 122 Mo. 161; Hicks v. Scofield, 121 Mo. 381; Coe v. Ritter, 86 Mo. 277; Crandall v. Cooper, 62 Mo. 478; Tel. Co. v. Trust Co., 147 U.S. 431; Jones on Liens, sec. 1571. Nor is it sufficient that the original payee of the notes was made a party. Giraldin v. Howard, 103 Mo. 40; Bank v. Grewe, 84 Mo. 477; 101 Mo. 625; Gitchell v. Kreidler, 84 Mo. 472; Bannon v. Thayer, 124 Ill. 451; Boisot on Mech. Liens, sec. 532. It is not sufficient, either, that the trustee in the deed of trust was made a party. Stafford v. Fizer, 82 Mo. 393; Brass Co. v. Boyce, 74 Mo.App. 343; Roger v. Tucker, 94 Mo. 346; Lumber Co. v. Oliver, 65 Mo.App. 438; Bank v. Frame, 112 Mo. 502. (2) In no event could defendant Cottrill have acquired any title superior to plaintiffs' mortgage by a purchase at the sale under the mechanic's lien, for the reason that at the date of the sheriff's sale, Cottrill was the holder of the equity of redemption under a deed which in express terms recited that the conveyance was subject to plaintiffs' deed of trust, and a purchaser of property subject to a mortgage, is estopped from setting up any title afterwards acquired by him at a sale made under a lien which it was his duty to discharge. Chrisman v. Hough, 146 Mo. 102; American Baptist Miss. Union v. Hastings, 67 Minn. 303; Manning v. Bonard, 87 Iowa 648; Bank v. Bacharach, 46 Conn. 513; Dana v. Trust Co., 75 N.W. 429; Avery v. Judd, 21 Wis. 262; Kilpatrick v. Haley, 66 F. 133; Mendenhall v. Hall, 134 U.S. 559; Keezer v. Clifford, 59 N.H. 208; Fells v. Barbour, 58 Mich. 49; Jordan v. Sayre, 29 Fla. 100; B. & L. Ass'n v. Waters, 27 S.E. 948; Frank v. Caruthers, 108 Mo. 569; Hinters v. Hinters, 114 Mo. 26. Particularly is this true in cases where the deed by which the equity of redemption is conveyed to the purchaser expressly refers to the mortgage or deed of trust, and the amount of the mortgage debt is deducted from the price which the purchaser pays for the property. Drury v. Holden, 121 Ill. 130; Kennedy v. Borie, 166 Pa. St. 360; Jones on Mortgages (5 Ed.), secs. 736, 744, and 1491; Water Works Co. v. Farmers L. & T. Co., 20 C. C. A. 133; Byington v. Fountain, 61 Iowa 512; Stears v. Hollenbeck, 38 Iowa 550. A fortiori is this true where the mortgagor or grantor in the deed of trust has expressly covenanted that the mortgaged property shall be kept free from mechanic's liens, for in such cases the duty to discharge the liens is expressly imposed on the holder of the equity of redemption. Bonner Springs Co. v. McClelland, 53 P. 866.
OPINION
On the eighth of December, 1892, Henry Maltby and T. Jefferson Roe, being the owners, by their deed of trust of that date, duly executed and recorded, conveyed a lot of ground in lot or block thirty-two of Peter Lindell's Second Addition to the City of St. Louis, and in Block 4877 South, of said city, particularly described in the petition by metes and bounds, to M. B. O'Reilly, to secure to Will J. Howard, the payment of one principal note for the sum of $ 16,000, payable five years from date; one principal note for the sum of $ 4,000, payable in five years after date, and ten interest notes, each for the sum of $ 480, payable in 6, 12, 18, 24, 30, 36, 42, 48, 54 and 60 months, respectively, from date; and also ten interest notes each for the sum of $ 120, payable in the same time respectively, and all of even date with the deed of trust.
Afterwards, in the latter part of December, 1892, Mrs. Landau, who was the curatrix of her minor children, the plaintiffs herein, purchased said notes with funds belonging to the estate of her said wards, and they were then assigned and delivered to her as such curatrix, and thus the plaintiffs became the owners and holders thereof and of the deed of trust aforesaid securing the payment thereof.
Afterwards, Henry Maltby, having in the meantime acquired the interest of T. Jefferson Roe in the premises, subject to said deed of trust, by mesne conveyances, on the twentieth of July, 1893, executed a deed of trust of that date, duly recorded, conveying the premises to Joseph C. Darst to secure to Joseph Gummersbach the payment of a principal note of that date for $ 6,000, payable May 1, 1894, and "three interest notes of same date for $ 90, $ 90 and $ 120, maturing October 8, 1893, January 8, 1894, and May 8, 1894, respectively. Default having been made in the payment of the first of said interest notes, said deed of trust was duly foreclosed by sale on the twentieth of November, 1893, and the said Gummersbach became the purchaser thereof for the sum of one hundred dollars and received the trustee's deed therefor dated November 10, 1893.
Afterwards, by two warranty deeds duly executed and recorded, one dated December 1, and the other December 7, 1893, the said Gummersbach conveyed the premises, subject to plaintiff's deed of trust, to the defendant William R. Cottrill.
Afterwards on the sixth day of January, 1894, in an action in the circuit court, city of St. Louis, wherein the Hynson Hardware Company was plaintiff, and Clarence C. Marsh Will J. Howard, M. B. O'Reilly, J. J. Darst, Joseph Gummersbach and Henry Maltby were defendants, the said plaintiff recover judgment against the said Maltby for the sum of $ 288 and costs, which was thereby charged as a mechanic's lien upon the premises, for material furnished between January 5, and June 7, 1893, for six buildings then being erected on the premises. On the eighth day of January, 1894, this judgment was assigned to the said Darst by the said hardware company, and special executions thereon issued June 27, 1895, under which the premises were sold on August 5, 1895, and the said Cottrill, through Darst,...
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