Moore-Mansfield Const. Co. v. Indianapolis, N.C.&T. Ry. Co.

• Citation: 101 N.E. 296,179 Ind. 356
• Decision Date: 27 March 1913
• Docket Number: 21,854.,Nos. 21,823,s. 21,823
• Parties: MOORE-MANSFIELD CONST. CO. et al. v. INDIANAPOLIS, N. C. & T. RY. CO. et al.
• Court: Supreme Court of Indiana

179 Ind. 356

101 N.E. 296

MOORE-MANSFIELD CONST. CO. et al.

v.INDIANAPOLIS, N. C. & T. RY. CO. et al.

Nos. 21,823, 21,854.

Supreme Court of Indiana.

March 27, 1913.

Appeal from Superior Court, Marion County; Charles J. Orbison and Vinson Carter, Judges.

Action by the Moore-Mansfield Construction Company and others against the Indianapolis, New Castle & Toledo Railway Company and others. From the judgment, plaintiffs appeal. Reversed, with instructions.William A. Ketcham, Howe Stone Landers, and Ralph Miller Ketcham, all of Indianapolis, for appellants. Baker & Daniels, Addison C. Harris, Henry Hammer, and Whitcomb, Dowden & Stout, all of Indianapolis, for appellees.

MORRIS, J.

Cause 21,854 in this court, entitled Moore-Mansfield Construction Co. v. George A. Buskirk et al., was heretofore ordered consolidated with cause No. 21,823, entitled as above. The principal questions for determination are the same in each case.

The pleadings show that appellee Indianapolis, New Castle & Toledo Railway Company was incorporated under the Indiana laws in 1905, and at the same time appellee New Castle Indianapolis Construction Company was organized under the laws of this state. The same persons constituted the officers, directors, and stockholders in each corporation. Shortly thereafter, a contract was executed by the two companies for the building and construction, by the construction company, of a new electric railway line from Indianapolis to New Castle, Ind. Afterward appellee construction company, with the consent and procurement of the railroad company, and its incorporators, entered into a contract, in writing, with the Electrical Installation Company for performing certain work and furnishing certain materials in the construction of the railroad. Afterwards, on November 21, 1906, the installation company, with the knowledge and consent, and upon the procurement, and for the benefit of the railway company, the construction company and the incorporators thereof entered into a written contract with appellant Moore-Mansfield Construction Company (hereafter termed the Moore Company) for the performance, by the latter, of the labor, and the furnishing of materials, for the construction of the bridges of the new railway line. The Moore Company immediately entered on the performance of the work, pursuant to the contract, and finished the same on November 28, 1907. On November 29, 1907, it filed, in the proper offices, notices of its intention to hold a mechanic's lien on the railway property. On November 5, 1907, on the complaint of said installation company, appellee Union Trust Company was appointed receiver of the property and assets of the railway company by the superior court of Marion county, and since that time has been in possession of said property, as receiver, and managing the trust, under the order of the superior court, room 3. On July 14, 1908, appellant Moore Company filed its petition in superior court, room No. 3, for leave to bring suit against said receiver and others to enforce its alleged mechanic's lien. The petition was granted, and thereafter, pursuant to leave granted, on November 28, 1908, the Moore Company filed its complaint in superior court, room 1, to enforce its lien. In this complaint the receiver, the railway company, the incorporators thereof, the construction company, the installation company, and Frederick L. Eldridge and the Knickerbocker Trust Company, mortgage trustees, were made defendants. While the suit was pending in the superior court, Eldridge and the Knickerbocker Trust Company resigned as mortgage trustees, and were succeeded as such by appellees George A. Buskirk and Louis F. Smith, citizens and residents of Indiana. Thereupon Buskirk and Smith were by order of the lower court substituted as defendants for their predecessors, who had resigned.

It is alleged that there is due plaintiff Moore Company, for labor performed and materials furnished under the contract, the sum of $20,000; that it holds a lien therefor on the railway property; that defendants are asserting liens thereon; but that in fact such liens are junior to that of plaintiffs. There is a prayer for the foreclosure of the lien and the sale of the railway property, by the sheriff or receiver, to satisfy the same. Demurrers to the complaint for insufficient facts were filed by defendants, and each demurrer was sustained. The plaintiff declined to plead further, and judgment was rendered for the defendants. The errors assigned here are the rulings on the various demurrers.

The trial court filed a written opinion when it sustained the demurrers, and this opinion is incorporated in the record. It shows that the demurrers were sustained because appellant Moore Company was a contractor, and for that reason, in the opinion of the trial court, not entitled to a lien. While the case was pending, and before the court's ruling, the opinion in the Indianapolis, etc., Traction Co. v. Brennan, 174 Ind. 1, 87 N. E. 215, 90 N. E. 65, 68, 91 N. E. 503, 30 L. R. A. (N. S.) 85, was handed down, and the trial court based its ruling on the doctrine announced in that case. This question will be considered later in connection with the same proposition urged by appellants Pulse and Porter. Appellees Buskirk and Smith urge the point that, while the complaint was filed within the year, appellant Moore Company did not commence the action against the mortgage trustees within that time, and consequently no cause of action is stated against them.

[1] This contention is met by appellant Moore Company with the proposition: (1) That, because the only demurrer filed by the mortgage trustees was a joint one by them and other defendants, no question is presented in favor of the trustees, unless the demurrer is well taken as to all parties joining in the demurrer. We think appellant is correct on this proposition. Armstrong v. Dunn, 143 Ind. 433, 41 N. E. 540;Miller v. Rapp, 135 Ind. 614, 34 N. E. 981, 35 N. E. 693. It is not contended that the demurrer is well taken, on this question, in favor of the other defendants joining in the demurrer.

[2] In ordinary cases, an action is not commenced until a complaint shall have been filed and a summons issued and placed in the proper officer's hands for service. However, in Carriger v. Mackey, 15 Ind. App. 392, 44 N. E. 266, it was held that if the complaint, in a mechanic's lien case, “shall be filed” in one year from the time of receiving the notice for record in the recorder's office, the same is sufficient. Section 8299, Burns 1908. We do not feel inclined to overrule Carriger v. Mackey, supra.

The aforementioned installation company sublet to the Allis-Chalmers Company the construction of substations and power houses for the railroad, and thereafter the same was sublet by said company to appellants Pulse and Porter (cause No. 21,854) by written contract. Thereafter, with the consent and knowledge of all parties, Pulse and Porter furnished all the labor and materials in the construction of certain substations and other buildings in Hancock and Marion counties, and filed in the proper offices of said counties notices of their intention to hold a mechanic's lien on the railway property. These notices were filed in December, 1907, and January, 1908.

[3] Within one year after the filing of the lien notices, actions to foreclose the liens, alleged to amount to many thousands of dollars, were filed in the superior court of Marion county, room 3, and these actions were pending there on October 22, 1910, when Buskirk and Smith, mortgage trustees, filed in the same court a complaint to foreclose a mortgage on the railway property, given to secure the payment of 4,500 bonds of $1,000 each, and dated July 1, 1905. The complaint alleges that the mortgage indebtedness is a first lien on the railway property, and prays for a decree of foreclosure and sale of the railroad property. To this complaint the appellantsMoore Company, Pulse, and Porter, and a great number of others, were made defendants. Appellants Pulse and Porter filed a cross-complaint against the plaintiffs, mortgage trustees, alleging the before-recited facts relative to their contract, the performance of work, filing of notices of lien, and actions to foreclose. It further alleges that when the mortgage was executed, no part of the railroad had been constructed, and the railway company owned nothing but a right of way; that the mortgage bonds were sold for the express purpose of raising money with which to pay for the construction and equipment of the road, which fact was well known to all the bondholders; that said bondholders also knew that, when the mortgage was executed it was the intention of the railway company to employ various persons to perform labor and furnish material under contract for the construction of the road, including substations and other buildings; that the cross-complainants are entitled to a lien on the property, which is superior to that of the mortgage; and they ask judgment for $15,000 and the foreclosure of their liens. The lien notices were filed with the cross-complaint and made a part thereof. A demurrer for want of facts was filed by plaintiffs to this cross-complaint and was sustained. This ruling is assigned as error. As it presents the question of the right of a subcontractor to acquire a mechanic's lien, this ruling will be later considered.

To the complaint of Buskirk and Smith, mortgage trustees (filed October, 1910), the Moore Company filed (February 1, 1911) its plea in abatement of a prior action pending between the same parties. This plea avers the facts heretofore noted relating to the Moore Company suit against the mortgage trustees et al., filed in November, 1908, in superior court of Marion county, room 1. This plea is very long, and it is unnecessary to set out its details. It alleges the pendency of the suit by the Moore Company against the mortgage trustees, filed in 1908, which,...