Wheaton v. Berg
| Decision Date | 15 July 1892 |
| Citation | 50 Minn. 525 |
| Parties | GEO. A. WHEATON <I>et al.</I> <I>vs.</I> SWAN BERG <I>et al.</I> |
| Court | Minnesota Supreme Court |
On August 29, 1889, the appellant owned lot eight, (8,) block five, (5,) Monroe Street Addition to Minneapolis. On that date he entered into a contract for the sale of the lot to Swan Berg for the sum of $1,575, to be paid within ninety days, with eight per cent. interest, giving Berg meanwhile the possession. This contract did not provide for the erection of a building on the lot by Berg, but there was a clause to the effect that in case of nonperformance by the vendee, "all the improvements on said premises, or which may be made thereon," should become the property of the vendor. The lot was vacant at the time the contract was made. In September, 1889, Berg began the erection of a house on the lot. At just what time Nilson learned that a house was being erected on the lot is doubtful, but it was conceded that after the foundation was completed some time in September, 1889, he knew that the building was being constructed. Nilson never served or posted any notice as required by Laws 1889, ch. 200, § 5. Berg, failing to pay according to the contract at the expiration of the ninety days, Nilson extended the time for payment fifteen days, and a new contract was entered into between them of the same import as the first, except that time was made of the essence. On February 14, 1890, Berg had failed to pay anything under the contract; most of the material and labor for the house had been furnished, and various liens had been filed therefor. On that day Nilson gave written notice to Berg and the various lien claimants that he would require performance within thirty days or treat the contract as forfeited. Neither Berg nor the lienors performed the contract.
The plaintiffs, Wheaton, Reynolds & Co. furnished Berg materials for the erection of the house, amounting in value to the sum of $549. These materials were furnished and used in the erection of the house between October 4 and December 3, 1889, but the greater part thereof were furnished under a verbal contract made before October 1. Thompson Brothers; Standard Menomonie Brick Company; Frank P. Nicoll, as assignee of J. P. Gray; Twin City Sidewalk & Pavement Company; Farnham Marble & Mantel Company; P. O. Simonson; Ole Johnson; Ole Skjolberg; Robert Thompson and C. F. Warn, severally furnished material for or performed labor in the construction of the building, under contracts with Berg, made at various periods between October 1, 1889, and April 17, 1890. The Pineville Lumber Company, between September 7, 1889, and December 30, 1889, furnished materials for the erection of the house, under a contract with Berg made September 7, 1889; Andrew Moe, between September 3, 1889, and November 13, 1889, performed work and labor on the house under a contract with Berg made September 3, 1889.
This action was commenced early in 1890, to foreclose the lien claimed by the plaintiffs on the lot. On May 9, 1890, the court made an order that all lien claimants be brought in and made parties to the action as required by Laws 1889, ch. 200. This was done, all the various lien claimants above named were made parties to the action, except C. S. Warn. The case was tried January 5, 1891, and Warn was, during the trial, permitted to file his answer and prove his lien. The complaint and answers of the defendant lien claimants did not allege that the contract with Berg had been forfeited so as to bring their rights to liens under section 4 of the Lien Law of 1889, but Nilson's answer set up the forfeiture of the contract.
The case was tried January 5, 1891. The court held that all of the claims were specific liens against the interest of Nilson in the property, except those of Moe and the Pineville Lumber Company. They were contracted before the Law of 1889 went into effect. These two claims were held to be liens on the interest of Berg in the property, and a separate sale of that interest was ordered to be first made. All the lien claimants were to share pro rata in the proceeds. Afterwards a sale of Nilson's interest was to be made. All except Moe and the Pineville Lumber Company were to share in the proceeds. The defendant Nilson made a motion for a new trial, which was denied, and he appealed.
Ueland & Holt, for appellant.
Reed & Kerr, for respondents.
This is an action to have established and enforced a mechanic's lien upon a lot of land owned by the defendant Nilson, but which he had contracted to sell to the defendant Berg. Berg interposed no defense. The numerous defendants, other than Berg and Nilson, also asserted claims for mechanics' liens upon the property, which they sought to have adjudged and enforced in this action. These various lien claims having been sustained by the decision of the court, and judgment having been directed for the enforcement of the same (with some exceptions hereafter specified) by sale of the property, including the interest of Nilson therein, he moved for a new trial, which was refused, and be alone prosecutes this appeal from the order refusing a new trial.
The defendants Andrew Moe and the Pineville Lumber Company not appearing in opposition to the appellant's motion that the order appealed from be reversed as to them, the motion should be granted, and the order for judgment, so far as it involves the charging of the amount of the recovery of those two defendants as a lien upon the real estate, and the enforcement of such lien by sale, is reversed. It will hence be unnecessary to consider some assignments of error which relate merely to the claims of these parties, and to the manner in which they were directed to be enforced.
The other defendants, as to whom a like motion was made, having appeared by Messrs. Reed & Kerr, the attorneys for the other respondents, and asked that the case as to them be considered upon the briefs submitted in behalf of the other respondents, this is allowed, and the motion to reverse, as for their default, is denied.
The appellant, Nilson, the owner of the lot in question, entered into a written contract with Berg for the sale of it to him, on the 29th of August, 1889. The contract provided that the entire purchase price ($1,575) should be paid on or before ninety days thereafter. It was expressly provided in the written contract that all improvements on the premises, or which might be made thereon, should become the absolute property of the vendor, and held as additional security for the payment of the purchase price, and should be forfeited by the purchaser in case of his failure to comply with the conditions of the agreement.
Under this contract Berg went into possession, and commenced the erection of a dwelling house on the premises. It was found as a fact by the court that he purchased the lot for that purpose, and that the appellant knew this when he contracted to sell; that the appellant knew that the house was being constructed from the time when building operations were commenced; and that he never made any objection thereto. While, from the evidence, it might be doubted whether Nilson knew anything about the building operations until after the foundation was completed, it is conceded that at that stage of the work, some time in September, he did know that the building was being constructed. As by this decision the lien upon the appellants' estate will be sustained only for material and labor supplied subsequent to October 1st, it is unnecessary to consider whether the court erred in finding that Nilson had knowledge of the improvement from the commencement of the building operations.
It further appeared from the evidence that in the latter part of November of the same year, at the expiration of the time within which the purchase price was agreed to be paid, Nilson agreed to extend the time of payment to the 14th day of December, and a new contract was executed to that effect, by the terms of which the specified time of payment was made an essential part of the agreement. The purchase price was never paid, and on the 14th of February, 1890, after all the materials and labor had been contributed for which liens are claimed, except as to some part of two of the claims, the appellant gave notice to Berg, and to the lien claimants, that the contract of sale would be forfeited, unless the purchase price should be paid before the 15th day of March.
No notice was ever served or posted by the appellant, such as is prescribed by Laws 1889, ch. 200, § 5.
The claim of the plaintiff Wheaton, Reynolds & Co. is for lumber purchased from them by Berg and furnished for this building between the 4th of October and the 3d of December, pursuant to a verbal contract which the court found to have been made after October 1, 1889. It appears from the evidence that the agreement for the sale of the greater part of this was made before October 1st, although none of the material was delivered until after that date. It is hence claimed, on the authority of O'Neil v. St. Olaf's School, 26 Minn. 329, (4 N. W. Rep. 47,) that the lien law of 1889, which took effect October 1st of that year, is not available to the lien claimant. But we hold otherwise, for the reason that, the verbal agreement being within the statute of frauds, it only became effectual and enforceable as a contract by the delivery after October 1st. Hence the finding of the court as to the time of the agreement is in accordance with the legal effect of the transaction, and the law of 1889 is applicable.
The defendants Frank F. and Noble G. Thompson, (Thompson Bros.;) Standard Menomonie Brick Company; Frank P. Nicoll, as assignee of J. P. Gray; Adam Gilles, August Anderson, and F. L. Whitcomb, (Twin City Sidewalk & Pavement Company;) P. O. Simonson; the...
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