Phoenix Iron Co. v. Hopatcong

• Decision Date: 02 June 1891
• Citation: 27 N.E. 841,127 N.Y. 206
• Parties: PHOENIX IRON CO. v. THE HOPATCONG AND THE MUSCONETCONG, ETC.
• Court: New York Court of Appeals Court of Appeals

127 N.Y. 206

27 N.E. 841

PHOENIX IRON CO.

v.THE HOPATCONG AND THE MUSCONETCONG, ETC.

Court of Appeals of New York, Second Division.

June 2, 1891.

Affirming 6 N. Y. Supp. 215.

Appeal from supreme court, general term, second department.

Leon Abbett, for appellants.

E. A. Brewster, for respondent.

BRADLEY, J.

This controversy between the respondent and the Hoboken Land & Improvement Company is in a proceeding instituted and conducted pursuant to chapter 482 of Laws 1862, entitled ‘An act to provide for the collection of demands against ships and vessels,’ amended by Laws 1863, c. 422. On July 23, 1884, Ward, Stanton & Co., ship-builders at Newburgh, by contract with the Hoboken Land & Improvement Company undertook the construction for the latter of two iron ferry-boats, at the price of $150,000, and proceeded to construct them. Part of the materials for the work was ordered from the phoenix Iron Company, and it delivered to them August 5, 7, 18, 19, September 11, and October 17, 1884, quantities of angle-iron, at prices aggregating $4,958.72. The terms of sale were cash, which imports no credit. No payment was made for the iron; but on November 21, 1884, Ward, Stanton & Co. sent the Phoenix Company, by mail, their two notes, one at three and the other at four months, for the amount of the claim, and December 24, 1884, they made a general assignment for the benefit of their creditors. On application of the Phoenix Company to a justice of the supreme court a warrant to enforce its lien for such debt pursuant to the provisions of the statute was issued February 5, 1885, to the sheriff against such vessels, their tackle, apparel, and furniture, and on the same day the sheriff attached and seized the two iron ferryboats, etc., which were then incomplete. Afterwards an order was made by the same justice directing the sheriff to sell, and they were sold March 28, 1885, pursuant to that order and two others on the applications,respectively, of the Chester Rolling-Mills and Whitehall, also lien creditors of Ward, Stanton & Co.; and on the application of the Phoenix Company a second warrant was issued against the proceeds of the sale April 16, 1885. The Hoboken Company, as owner of the Hopatcong and Musconetcong, filed answers to those claims and proceedings of the Phoenix Company, and thus were presented the issues for trial. The special term determined that the warrant of February 5th was ineffectual because the right to it was suspended by the then unmatured notes given and held for the debt, and the proceedings founded upon it were dismissed; and that upon the proceeding instituted April 16th the company was entitled to receive from the proceeds of the sale of the vessels satisfaction only of the last bill of iron delivered in October, 1884, amounting to $369.74, as the lien of the debt arising from the prior sales and deliveries had terminated when that proceeding was commenced. The statute upon that subject provides that the debt shall cease to be a lien at the expiration of six months after it was contracted unless, etc. Id. § 2. The view of the general term in support of the last proceeding was that all the iron was delivered in performance of a single contract, also that the first proceeding was sustainable upon the ground that the notes were sent to the Phoenix Company with the intent on the part of the markers not to pay the debt. The first proposition is not sustained by the evidence. The Phoenix Company did not undertake to deliver any specific amount of iron, or the entire quantity requisite for any particular purpose. It agreed to furnish angle-iron at specified prices, which was done from time to time upon the orders of Ward, Stanton & Co. The second is the main proposition, and is one of fact. The contention of the appellants' counsel that the facts were not before the general term is not supported. The paragraph following the evidence in the case that ‘the foregoing is all the testimony and proceedings upon the trial,’ is presumptively sufficient to meet the question so raised. Although a certain inventory and schedule introduced in evidence do not appear in the record it is evident from what does appear that they could add nothing essentially bearing upon any contested fact. It is also urged that the statute does not provide for a lien upon unfinished vessles, and that the debt in question was not contracted in this state, and therefore was not a lien upon them. These boats were partially constructed at the time they were attached, and the hulls were then in no condition to float in the water, and would notfloat if launched. The statute provides that ‘whenever a debt amounting,’ etc,' as to any * * * vessel shall be contracted by the master, owner, charterer, builder, or consignee of any ship or vessel * * * within this state * * * on account of work done or materials or other articles furnished in this state to wrads the building, repairing, fitting, furnishing, or equipping such ship or vessel, * * * such debt shall be a lien upon such vessel, her tackle, apparel, and furniture, and shall be preferred to all other liens thereon except mariners' wages.' The iron was furnished by the respondent as material towards the building of these vessels, and all of it, except a small portion, had been put into the work. The hulls were on the stocks in the course of completion. They were unfinished vessels, and, within the contemplation of the statute, were subject to lien of debt for work done and materials furnished towards building them. Phillips v. Wright, 5 Sandf. 342. And the debt was contracted by the owner within this state on account of materials furnished in this state. The Phoenix Iron Company was a corporation of the state of Pennsylvania, doing business at the city of Philadelphia, and the goods were there shipped to the builders, and delivered to them at Newburgh in this state. The debt, within the meaning of the statute, was not contracted until the iron was delivered, and then was contracted at the place of delivery. Veltman v. Thompson, 3 N. Y. 438;Crawford v. Collins, 45 Barb. 269;Mullin v. Hicks, 49 Barb. 250. The materials were furnished for and used in the building of both vessels, which were being constructed at the same time and place, and no reason appears why they are not subject to the lien, and to a single proceeding to enforce it against them. The ferryboats are within the term ‘vessels,’ as used in the statute referred to. The construction given in Birkbeck v. Ferry-Boats, 17 Johns. 54, to the statute in question in that case, has no necessary application to that under which the present proceedings were had. King v. Greenway, 71 N. Y. 413.

The remaining question is one of fact, and has relation to the effect to be given to the notes sent by Ward, Stanton & Co. to the Phoenix Company. The acceptance of the notes apparently operated as an extension of the credit of the makers until maturity. And, if such was the effect, the right of the creditor to enforce the lien it before had was not only suspended during that time, but when the suspension terminated, the lien as to most of its debt had expired by lapse of time. Happy v. Mosher, 48 N. Y. 313;Mott v. Lansing, 57 N. Y. 112. But it is contended on the part of the respondent that the notes did not have the effect to suspend the right of the creditor to take proceeding to enforce the lien because they were made and sent to it with the fraudulent intent on the part of the markers not to pay the debt. The general term disagreed with the trial court on that question, and reversed the judgment upon the facts as well as on the law; and this court must review the determination there made upon the questions of fact. Code Civil Proc. § 1338. This section, as well as section 272 of the old Code, which was in this respect substantially the same, has received some judicial consideration, and the rules applicable to the review in such cases have been somewhat defined, (Godfrey v. Moser, 66 N. Y. 250;Moran v. McLarty, 75 N. Y. 25;Baird v. Mayor, etc., 96 N. Y. 567.) and it is there held that the rule that where there is conflicting evidence, or any evidence to sustain the finding of the trial court, it is error for the general term to reverse, has no application to...