Wallich Lumber Co. v. Golds
| Decision Date | 10 May 1965 |
| Docket Number | No. 50,50 |
| Citation | 134 N.W.2d 722,375 Mich. 323 |
| Parties | WALLICH LUMBER COMPANY, a Michigan Corporation, Plaintiff and Appellant, v. Sidney GOLDS and Syivia Golds, his wife, Bank of Dearborn, a Banking Corporation, Max Yorke, Nathan Shaye and Maurice Axelrod, a co-partnership, d/b/a Sayme Investment Company, Alex Kramer, and Boston Tile & Terrazzo Company, a Michigan Corporation, Defendants and Appellees. |
| Court | Michigan Supreme Court |
Schuur & Keating, Detroit, for plaintiff and appellant.
Jesse W. Bollinger, Dearborn, for defendant Bank of Dearborn.
Glassen, Parr, Rhead & McLean, Lansing, for defendants and appellees, Sidney and Sylvia Golds.
Before the Entire Bench.
This is a suit to determine the validity and priority of a material man's lien. On October 5, 1959, plaintiff began delivery of materials to the home site of defendants Golds. On December 14, 1959, defendants Golds executed a mortgage with the Bank of Dearborn. The trial judge found that some time after April 20, 1960, plaintiff and defendants Golds entered into a written contract for the purchase of the materials which were being and had been supplied. The contract was predated 'October 2, 1959.'
The last delivery of materials was on August 23, 1960. On August 31, 1960, plaintiff filed a claim of lien for $6.250.90. The trial judge found that this was the value of the materials and that they had been used in the Golds' home. Plaintiff filed its bill of complaint and all defendants were served within one year after filing of the claim of lien. Plaintiff did not, however, file notice of lis pendens. Because of failure to do so, the trial judge ruled that plaintiff had no cause of action.
The portions of the mechanics' lien law which prompted that decision read as follows:
--C.L.S.1961, § 570.9 (Stat.Ann.1963 Cum.Supp. § 26.289).
--C.L.S.1961, § 570.10 (Stat.Ann.1963 Cum.Supp. § 26.290).
Once a lien attaches, a liberal construction should be made of the statute because of its remedial character. C.L.1948, § 570.27 (Stat.Ann.1953 Rev. § 26.307); Burman v. Ewald, 192 Mich. 293, 295, 158 N.W. 853. A liberal construction is achieved by holding that the lis pendens need not be filed as to those who have actual notice of suit. To hold otherwise would exalt constructive notice over actual notice. See the extensive discussion on this point in Whitehead & Kales Co. v. Taan, 233 Mich. 597, 603-605, 208 N.W. 148. Also, see Vander Horst v. Kalamazoo Apartments Corporation, 239 Mich. 593, 603-605, 215 N.W.57; Hart v. Reid, 243 Mich. 175, 183, 219 N.W. 692, 220 N.W. 717. The trial judge was in error . The filing of a lis pendens was unnecessary as to defendants who had notice of the lien and were sued and served within the one year period.
The next question is whether the plaintiff acquired a lien. Defendants Golds' property was held by the entireties. Liens upon such property must meet the requirements of section of the mechanics' lien statute which reads:
'In case the title to such lands upon which improvements are made is held by husband and wife jointly * * * the lien given by this act shall attach to such lands and improvements if the improvements by made in pursuance of a contract in writing signed by both the husband and wife.'--C.L.1948, § 570.2 (Stat.Ann.1953 Rev. § 26.282). (Emphasis supplied.)
The plain requirement of this statute is that the lien shall not attach if the improvements are not made in pursuance of the written contract. As to those materials which were delivered prior to the execution of the contract, no lien was created. To hold otherwise would permit a waiver of the statute contrary to the holding of this Court in McMillan v. Schneider, 147 Mich. 258, 110 N.W.961, and F. M. Sibley Lumber Co. v. Letterman, 234 Mich. 32, 35, 207 N.W. 869. Upon remand, the trial court shall determine the date when the contract was executed and allow a lien for only such materials as were furnished from that date.
The final question is whether the plaintiff's lien has priority over the bank's mortgage. Section 9 of the mechanics' lien law establishes priority for the entire act. That portion of section 9 relative to the priority question involved here was construed in Kay v. Towsley, 113 Mich. 281, 71 N.W. 490, as follows:
'Subdivision 3 * * * provides that mechanics' liens 'shall be preferred to all other titles, liens, or incumbrances which may attach to or upon such building, machinery, structure, or improvement, or to or upon the land upon which they are situated, subsequent to the commencement of said building, erection, structure, or improvement.' This provision has been passed upon frequently by the courts, and it has been uniformly held that the lien has priority over a mortgage executed upon the lands or premises after the actual commencement of the building, though no part or the labor performed or materials furnished for which the lien is claimed was done or performed until after the execution and recording of the mortgage.' (Emphasis supplied.)
See, also, Kerr-Murray Manufacturing Co. v. Kalamazoo Heat, Light & Power Co., 124 Mich. 111, 82 N.W. 801; River Rouge Savings Bank v. S & M Building Company, 359 Mich. 189, 101 N.W.2d 260, 91 A.L.R.2d 409.
In this case the mortgage was executed after the commencement of construction and the lien did not come into being until after the execution of the mortgage. Under Kay v. Towsley, supra, the lien would relate back to the commencement of construction and take priority. However, Kay v. Towsley involved property which was not held by the entireties, and was unaffected by section 2. The question then is whether section 2 requires a different construction of the priority section.
It seems obvious that the different treatment of entireties property was for the protection of a spouse, so as to prevent a husband or wife from affecting their unitary ownership without the written consent of the other. In this respect section 2 is consistent with other branches of the law dealing with entireties property. See 13 MLP, Husband and Wife, §§ 4, 5. This policy prevents the alienation of entireties property and has no relevance to priorities which deal with property already encumbered. There is nothing in section 2, or the policy that section seeks to effectuate, to warrant a different interpretation of section 9, the priorities section, as...
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