Peninsular General Elec. Co. v. Norris

• Decision Date: 23 May 1894
• Citation: 59 N.W. 151,100 Mich. 496
• Court: Michigan Supreme Court
• Parties: PENINSULAR GENERAL ELECTRIC CO. v. NORRIS ET AL.

59 N.W. 151

100 Mich. 496

PENINSULAR GENERAL ELECTRIC CO. v. NORRIS ET AL.

Supreme Court of Michigan

May 23, 1894

Appeal from circuit court, Kent county, in chancery; William E Grove, Judge.

Action by the Peninsular General Electric Company against Charles Shepard and others to establish and enforce a mechanic's lien. After the judgment appealed from was rendered, Shepard died, and Mark Norris, executor, and Dorinda N. Shepard executrix, of his estate, were substituted in his stead. From a judgment overruling a demurrer to the bill, the executors appeal. Affirmed.

Mark Norris, for appellants.

More &amp Wilson, for appellee.

LONG J.

The bill in this case was filed to enforce a mechanic's lien. The bill states that Charles Shepard is the owner of lots 3, 4, 5, and 6 of block or section 9 of Campau plat of Grand Rapids, except the west 99 feet of lot 4, and has been the owner for more than 10 years past; that prior to May 1, 1890, Caroll S. Hartman, under an agreement with Shepard, had built a brick block on lots 4, 5, and 6, except the west 99 feet of lot 4, by which agreement Shepard leased to Hartman the ground on which the block stood, and Hartman was the owner of the building; that about May 1, 1890, Shepard and his wife made a new lease to Hartman, for 96 years, of the land above described, and by the same instrument leased to Hartman, for the same term, lot 3, and a six-story building to be erected thereon by Shepard; that before May 1, 1892, the building was erected, and was connected with Hartman's building, so that the two buildings or blocks constituted one building, and have been used as such ever since; that Hartman has had possession and control of the entire premises from the time the Sheppard building was erected on said lot 3 down to the 29th day of July, 1892; that Hartman, being in possession of the premises under said lease, and being the owner of that part of the building which stands on lots 4, 5, and 6, except the west 99 feet of lot 4, entered into a contract in writing with complainant on May 5, 1892, for the making of certain improvements on said buildings, consisting of an electric lighting plant, with the necessary appliances, wiring, and fixtures; that complainant performed its contract, and furnished labor and materials to the amount of $4,946.67, from which should be deducted a credit of $56.04, leaving a balance due of $4,890.63; that the performance of the labor and the furnishing of the materials were begun May 13, 1892, and ended July 22, 1892; that on July 29, 1892, Hartman made a general assignment for the benefit of his creditors of John Widdicomb, who accepted the trust; that the materials furnished and labor performed by complainant constitute and have made a valuable improvement to said premises, and have largely increased the value thereof; that on September 3, 1892, complainant filed its claim of lien on said premises in the office of the register of deeds of the county of Kent, with a detailed statement of its account for said labor and materials; that the prices charged were just and reasonable, and in accordance with the contract; that the labor and materials were furnished and went into both of said buildings, which were considered and treated as one building, and the work done and materials furnished under the contract were considered and treated as one job; that copies of the claim of lien were served on Hartman and Widdicomb, his assignee, as required by statute, and proof of service filed in the office of the register of deeds; that there is owing and unpaid upon said contract $4,890.63 over and above all legal setoffs; that complainant has taken the steps required by the statute, and therefore has a lien on the entire interest of Hartman in the premises, which is enforceable in this action; that complainant is informed and believes that Shepard claims that Hartman is indebted to him in a large amount, and that, under and by virtue of said lease, Shepard has a lien, prior to all other claims on Hartman's interest in said lands and buildings, for the entire amount of said indebtedness; that, at the time of making said contract with Hartman, complainant was ignorant of Shepard's claim, or Hartman's indebtedness to him, and only learned of it after the assignment to Widdicomb; that, before making the contract, complainant caused an examination of the records in the office of the register of deeds of Kent county to be made, to ascertain if there was any lien or incumbrance on Hartman's interest in said premises, and none was found, and complainant made the contract relying on the results of such examination, and would not have made the contract otherwise; that Shepard did not have his lease recorded in the office of the register of deeds, or file a copy in the office of the city clerk of Grand Rapids, until the 29th day of July, 1892, the day the assignment to Widdicomb was made; it was then that complainant first learned of Shepard's claims; that any lien Shepard may have on Hartman's interest should be postponed to complainant's lien; that complainant has caused an examination to be made of the records in the office of the register of deeds of Kent county, and finds that Peter C. Campbell and John McNabb, copartners under the name of Campbell & McNabb, have filed a claim of lien, and have commenced a suit to enforce it; that no proceedings at law have been taken to recover the amount due complainant from Hartman for said labor or materials, or any part thereof. The prayer of the bill is (1) that complainant be decreed to have a lien upon the entire interest of Hartman in the premises, and the buildings situated thereon; (2) that an account be taken of the amount due complainant, and a decree rendered for the amount found due, with costs; (3) that the rights of Shepard and Hartman under the lease be determined and adjusted, and that complainant's lien be determined prior to any claim of lien of Shepard's on Hartman's interest in said premises and buildings, by virtue of the lease, for moneys owing from Hartman to Shepard; (4) that, in default of payment of the decree by Hartman, his interest in the premises be sold to satisfy the decree; (5) that complainant have such other and further relief in the premises as shall be agreeable to equity. To this bill the Shepards interposed a general demurrer, which was heard in the court below, and overruled. After the demurrer was overruled, Charles Shepard died. The defendants Norris and Dorinda N. Shepard were appointed executors, and the cause was revived, and is now brought here for review. This appeal is based upon the claims (1) that under the mechanic's lien law the complainant's lien can attach only to Hartman's actual interest, no matter what his apparent interest may have been; (2) that complainant had actual notice of Shepard's lien prior to the time when its lien attached; (3) that complainant can claim no lien under its contract, by the terms of which no title to the materials and machinery is to pass until paid for.

The action is brought under the provisions of Act No. 179, Pub Acts 1891. Section 1 provides: "Every person who shall, in pursuance of any contract *** between himself as contractor and the owner, part owner or lessee of any interest in real estate, build, alter, improve, repair, erect, ornament or put in, or who shall furnish any labor or materials in or for building, altering, improving, repairing, erecting, ornamenting or putting in, any house, building, machinery, wharf or structure *** shall have a lien therefor upon such house, building, machinery, wharf or other structure or its appurtenances, and also upon the entire interest of such owner, part owner or lessee in or to the lot or piece of ground *** upon which such...