United Iron Works Company v. Sleepy-Hollow Mining And Development Company
| Decision Date | 13 November 1917 |
| Citation | 198 S.W. 443,198 Mo.App. 562 |
| Parties | UNITED IRON WORKS COMPANY, Plaintiff, v. SLEEPY-HOLLOW MINING AND DEVELOPMENT COMPANY et al., FOREST LUMBER COMPANY, (Appellant), OSCEOLA LEAD AND ZINC MINING COMPANY, (Respondent), Defendants |
| Court | Missouri Court of Appeals |
Appeal from Newton County Circuit Court.--Hon. Charles L. Henson Judge.
AFFIRMED.
Judgment affirmed.
H. S Miller for appellant.
George V. Farris for respondent.
This suit having various parties defendant was brought under section 8235A, Laws 1911, page 314, for the purpose of having determined the various rights, interests and liens of the various mechanic's lien claimant and claimants of other liens and owners with respect to a certain mining plant then situated on leased premises in Newton County, Missouri. The rights of all the parties, other than the Forest Lumber Co., appellant and the Osceola Lead and Zinc Mining Company, respondent, have been adjusted and this suit terminated as to them. The appellant, Forest Lumber Company, sought to enforce a mechanic's lien against said property and the respondent, the Osceola Company, resists the same on the ground that a certain mortgage on said property was a valid prior lien thereon and that this respondent now owns said property as purchaser under said mortgage free from any such mechanic's lien. The appellant states and respondent concedes that the only question for decision on this appeal is whether or not the mechanic's lien of the appellant is prior in right to the mortgage lien and the the purchaser's title thereunder. The trial court held the mortgage lien to be prior to the mechanic's lien and entered judgment declaring the Osceola Company, respondent, to be owner of such property free from any rights of the Forest Lumber Company, appellant.
We may properly view this case as a contest between the mechanic's lien claimant and the mortgagee for priority of lien in which neither party questions the validity or amount of the other claimant's lien. The rights of these contending parties grow out of the following facts: The LeRoy Mining Company was owner of a certain mining plant and concentrating mill located on land in Jasper County, Missouri. On October 21, 1913, that company sold said mining plant as personalty to the Sleepy-Hollow Mining and Development Company. This purchasing company made a cash payment on the purchase price and gave a chattel mortgage of that date to the LeRoy Company, to secure the balance of the purchase price, in which the property is described as follows: "One concentrating mill which now is located on the Southwest quarter of the Northwest quarter of section 7, Township 27, Range 32, but will be immediately moved and rebuilt on the West half of the Southeast quarter of section 24, Township 27, Range 33, Newton County, Missouri, and agrees to keep said mill insured in some reliable fire and tornado insurance company for at least $ 800 to be payable in case of loss to the said J. F. Todd, Trustee of the LeRoy Mining Company." This chattel mortgage was properly filed and recorded in Jasper County where both the mortgagor and mortgagee resided. The mortgagor thereafter dismantled the mining plant and moved it to and rebuilt it on the land in Newton County. It was moved by being torn down and loaded on wagons but being kept in sections so far as practicable. The lien claim of the appellant, Forest Lumber Company, is for lumber and material sold by it to the mortgagor and used in rebuilding the plant in Newton County. The question is, does the lien of this materialman take precedence over, or is it subordinate to, the mortgage lien already on this property? Default was made in the secured debt and the mortgage was lawfully foreclosed and respondent became the purchaser. The appellant says there is no question of innocent purchaser in the case, and we think this is true, since the appellant, constructively at least, had knowledge of the mortgage when it sold and furnished the material used in rebuilding the plant and the respondent when it purchased under the mortgage knew as did the mortgagor that the plant was to be and had been moved from Jasper County and that lienable work and material would be and had entered into its rebuilding.
There can be no doubt of the general rule that a valid mortgage given by the owner of property constitutes a valid lien thereon prior and superior to liens arising under contracts made by the mortgagor subsequent to such mortgage. [Jones on Chattel Mortgages (5 Ed.), sec. 478, 472; Hampton v. Seible, 58 Mo.App. 181; Stone v. Kelley, 59 Mo.App. 214; Vette v. Leonori, 42 Mo.App. 217, 224; McAdow v. Sturtevant, 41 Mo.App. 220, 230; Schulenburg v. Hayden, 146 Mo. 583, 591, 48 S.W. 472.] In 27 Cyc., p. 236, the law is stated as follows: "Where the property is subject to a mortgage at the time of the accrual of the mechanic's lien, such mortgage retains its priority and the mechanic's lien is postponed thereto, notwithstanding the fact that the value of the mortgage security is increased by the labor or material of the mechanic's lien claimant, or that the building is so changed that very little of the original structure remains."
The property mortgaged being personal property could be moved at will by the mortgagor, such removal at most subjecting him to having the mortgage foreclosed; so that the lien of the mortgage having once attached, the subsequent removal of the property to another locality and county would in nowise destroy the mortgage lien or subordinate it to a subsequent lien. [McNichols v. Fry, 62 Mo.App. 13, 17; Jones on Chattel Mortgages, sec. 260.]
There is some conflict in the evidence as to the extent to which the mining plant was converted into raw material and lost its identity in the process of removal; but the trial court was justified in finding that practically all the material and parts as it stood when the mortgage was given were used for a similar purpose in the rebuilt structure; that the mining plant was a complete structure as it stood in Jasper County and little or no change was made in rebuilding it; that it was the same size and on the same lines as rebuilt; that the mill was made of good material, and, while it could not be moved except to tear it down and haul it in wagons, yet it could be rebuilt without the use of very much new material. One witness said the lumber was the same in the rebuilt mill excepting the repairs; that some boards were broken or damaged in taking it down or lost in moving or reconstructing and these were replaced by new boards.
The appellant relies on a line of cases holding that where the mortgage covers a structure unfinished and incomplete at the time the mortgage is...
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