Ruge v. Webb Press Co.

• Decision Date: 18 April 1916
• Citation: 71 Fla. 536,71 So. 627
• Parties: RUGE et al. v. WEBB PRESS CO., Limited.
• Court: Florida Supreme Court

71 So. 627

71 Fla. 536

RUGE et al. v. WEBB PRESS CO., Limited.

Florida Supreme Court

April 18, 1916

Appeal from Circuit Court, Franklin County; E. C. Love, Judge.

Bill in equity by the Webb Press Company against John G. Ruge and another. From a decree for complainant, defendants appeal. Affirmed.

Syllabus by the Court

SYLLABUS

Under section 2237, General Statutes of Florida 1906, Compiled Laws of 1914, the landlord's lien provided for in the second subdivision of the section is not superior to a lien acquired by another prior to the bringing of the property upon the leased premises or prior to the commencement of the tenancy under the lease.

A written lease of lots which provided that the time should begin to run from a date in the past, executed between the owner of the lots and a tenant subsequently to the bringing upon the lots of personal property which was immediately mortgaged to secure a balance due for its purchase price will not be given a retroactive effect in order to defeat the superiority of the mortgage lien over that of the landlord.

COUNSEL Fred T. Myers, of Tallahassee, for appellants.

R. Don McLeod, Jr., of Apalachicola, for appellee.

OPINION

ELLIS J.

During the year 1911 a corporation was organized at Apalachicola Fla., to engage in the cotton compress business at that place. Before the organization of the corporation was completed, two of the subscribers for stock were appointed by their associates to purchase the necessary compress machinery, boilers, etc. This commission was executed by the two representatives of the proposed stockholders of the compress company entering into an agreement with the Webb Press Company, the appellee, for the purchase of the necessary machinery. The contract, which was in writing, provided that the compress should be erected in Apalachicola, and that the amount then remaining due upon the purchase price of the machinery should be evidence by four notes of $1,250 each and payable one each year beginning with May 1, 1912; that said notes should be secured by first mortgage on the entire compress plant of the Apalachicola Compress Company, and the title to the machinery, which was described in the instrument, should remain in the Webb Press Company 'until fully settled for as herein provided.' This contract was dated July 11, 1911.

In April, 1911, and before the company was organized, one of the proposed stockholders of the company began negotiations with appellants for a lease upon the wharf lots described in the bill, and it was understood by the appellants that the lease was to be taken in contemplation of erecting upon the lots a cotton compress. The proposition was made to Mr. Henderson who was one of the proposed stockholders, at the request of Mr. Phillips, another proposed stockholder.

Three of the proposed stockholders of the company, Beverly Henderson, and Phillips, without the knowledge or consent of the appellants, went upon the lots with a force of employés and began excavating for the foundation to be laid for the machinery and had a pile driver at work driving piles. The appellants notified the people at work that Ruge Bros. had not authorized the work, and that the workmen would have to look to the compress people for payment for the same. Henderson was notified by one of the appellants, verbally and in writing, to discontinue the work on the property and vacate the same, beacuse the appellants had given Henderson and his associates no authority to undertake any permanent work or exercise right of possession as trustee in behalf of the compress company 'until the lease and agreements were perfected.' To this notice the representatives of the proposed stockholders of the company replied that 'they would perfect matters at once.' But they did not do so, and no other action was taken by Ruge Bros. to dispossess these men, who continued their preparations for the foundations for the press machinery and began erecting the same about the latter part of August.

In the meantime the organization of the corporation was progressing, and on December 4, 1911, the Apalachicola Cotton Compress Company, having been duly incorporated, executed and delivered to the Webb Press Company four notes for $1,250 each, and to secure the payment of the same executed and delivered to the Webb Press Company a mortgage upon the following property:

'All of the right, title and interest of the party of the first part in and to wharf lot four (4), wharf lot five (5) and wharf lot six (6) of said city and Water street adjacent thereto. Said interest in wharf lots being more specifically described as the north half of wharf lot four (4), all of wharf lot five (5) and the south half of wharf lot six (6), together with all improvements thereon consisting chiefly of one double hydraulic compress, boilers, pumps, and engines, compress sheds, platforms, tools and all fittings and fixtures thereto belonging. The same being the entire compress plant of the Apalachicola Cotton Compress Company in Apalachicola, Franklin county, Florida, together with all and singular the tenements, hereditaments and appurtenances thereunto belonging or in any wise appertaining and the reversion and reversions, remainder and remainders, rents, issues and profits thereof.'

The mortgage appears to have been duly acknowledged and was recorded in the public records of Franklin county on December 18, 1911.

On March 11, 1912, the negotiations between the compress company and the appellants for the rental of the wharf lots upon which the compress machinery had been erected were renewed, and on that date a written contract of lease was executed and delivered between the parties, under the terms of which the lessors let the premises for the term of 10 years from the 22d day of August, 1911, and the lessee agreed to pay to the lessors 'an annual rental of $500 for the full term of this lease, to be paid in semiannual payments of $250 on the 22d day of February and the 22d day of August in each and every year.' It was also provided in that instrument that the lessee 'its successors and assigns' should have the right to remove from the 'said lots hereby leased' within 90 days after the expiration of the lease any buildings, structures, machinery, trade fixtures, equipment, and personal property placed thereon by the lessee, its successors and assigns.

The reason given by one of the appellants for making the term of the lease to begin August 22, 1911, was to make it coincident 'with the date of a lease obtained from the city of Apalachicola to the Apalachicola Cotton Compress Company which was to be assigned in part to the Ruge Bros. Canning Company.' During the taking of testimony one of the appellants upon cross-examination in answer to the following question: 'Q. Is any rent due to you from the Apalachicola Cotton Compress Company for the premises mentioned in your lease accruing prior to the 18th day of December, 1911?' replied as follows: 'A. All rent which matured prior to the installment falling due August 22, 1912, has been paid.' The rent accruing for the three periods from February 22, 1912, to August 22, 1913, not having been paid, the appellant obtained a judgment against the compress company therefor, which has not been paid. The rent accruing for the three periods from August 22, 1913, to February 22, 1915, is also unpaid.

The Cotton Compress Company having failed to pay to the Webb Press Company two of the notes secured by the mortgage, the latter company on the 8th day of December, 1913, filed its bill in the circuit...