224

be filed in the firm name by any member of the firm,220 and the names of the individual partners need not be signed thereto.221 A subcontractor's lien may be enforced by a firm, one of whose members is the contractor, since although the contractor must be a party defendant to a suit to enforce such a lien, yet the suit is really one in rem, in which the property is the party liable.222 After the death of one member of a firm entitled to a mechanic's lien, the rights of the firm may be enforced by the surviving partner.223 Where a contract is entered into with a firm, and partly performed by it, but finally completed by one of the co-partners after dissolution of the firm, the lien for the entire work may be enforced by him.2 But where materials are furnished by a firm on running account, without any express contract, and, after dissolution of the firm by death of one of the partners, the surviving partner continues to furnish such materials, the continuity of the account is broken, and the materials furnished before and after the dissolution are the subjects of distinct liens.225 A contract in the names of "R. W. H. and J. F. K., of the firm of H. & K.," though signed in the name of the firm, has been held to be the contract of the individuals named, under which no lien could be claimed by said firm where the firm was composed of three members.226 It is held in Kansas that a lien which has accrued to a partnership, for lumber and material furnished, is not lost by the retirement of one of the persons composing the co-partnership, and the associating of another person with the remaining partner, who continue the business under the same name, and as the successors of the old firm, and that a claim for a mechanic's lien may be filed within the statutory time by the

220 Deatherage v. Woods, 14 Pac. 474, 37 Kan. 591; Jones v. Hurst, 67 Mo. 568.

221 Smith v. Johnson, 2 MacArthur (D. C.) 481.

222 Chambersburg Woolen Manuf'g Co. v. Hazelet, 3 Brewst. (Pa.) 98.

223 Davis v. Church, 1 Watts & S. (Pa.) 240; Rockwood v. Walcott, 3 Allen (Mass.) 458.

224 Holmes v. Shands, 5 Cushm. (Miss.) 40; Ogden v. Alexander, 35 N. E. 638, 140 N. Y. 356, affirming 17 N. Y. Supp. 641, 63 Hun, 56.

225 Miller v. Hoffman, 26 Mo. App. 199; Henry v. Mahone, 23 Mo. App. $3. So, too, where the firm is merged into a corporation. Allen v. Smelting Co., 73 Mo. 688.

226 Hilliker v. Francisco, 65 Mo. 598.

227

new firm.2 But it has been held in Iowa that where a firm contracted to furnish machinery to the owners of a mill, and, after it had been mostly furnished, one partner withdrew, and the firm underwent successive changes by the withdrawal of old members and the admission of new, with each change the remaining members assuming all obligations, the partners who made the contract are the ones to file a lien, and it inures to the benefit of the new firm, who hold the debt.228 Where work is done and materials are furnished for a building by persons as partners, and the owner knows that such persons are doing the work, their right to a lien is not affected by the fact that one of them made the agreement with the contractor without disclosing the fact that he was acting for the firm,229 and where the right to file a mechanic's lien claim existed in a firm composed of three members, the sale to two of them of his general interest in the partnership by the third does not destroy the right of the remaining partners to file it.2

230

Assignees as Lien Claimants.

§ 259. The assignability of mechanics' liens has been already discussed,231 and the effect of an assignment on other parties than the assignee will be considered hereafter.232 Although, as we have seen, mechanics generally cannot assign their liens before they have filed their claims,233 yet where a contractor assigns his rights before the work is completed, and the assignee completes it, the assignee has a right to file a claim in his own name for the part of the work done by him, 234 or for extra work contracted for between the owner and

227 Brown v. School Dist., 29 Pac. 1069, 48 Kan. 709.

228 German Bank v. Schloth, 13 N. W. 314, 59 Iowa, 316.

229 Wahlstrom v. Trulson, 43 N. E. 183, 165 Mass. 429.

230 Simons v. Webster, 40 Pac. 1056, 108 Cal. 16.

231 Ante, §§ 9-12.

232 Post, § 346.

233 Ante, § 10.

234 Pensacola Railroad Co. v. Schaffer, 76 Ala. 233; O'Connor v. Railroad Co., 20 S. W. 16, 111 Mo. 185. In the case of Gibson v. Nagel, 15 Mo. App. 596, it was held by an intermediate court that the assignee might in such case file one lien, including the work done by himself and that done by his assignor; but this is not in accordance with the decisions of the supreme court of that state. See O'Connor v. Railroad Co., supra.

himself. 23 235 Where, after joint contractors have abandoned the work, being fully paid for all the work done by them, one of them then completes the work under a new agreement with the owner, he may file a claim therefor in his own name, the fact that he takes an assignment from the other contractors not showing that they are interested.236 The assignee of a mechanic's lien is subrogated to all the rights of his assignor; and the taking of a mortgage by the assignee on the property affected by the lien, the consideration of which mortgage was used in the purchase of the lien, will not merge the latter in the mortgage, unless it appears that such was the intention of the parties. 237 Being subrogated to the rights of his assignor, the assignee is also bound by his covenants and conditions. Thus, in a case where the building contract provided that the last installment of the price should be paid when the building was completely finished and accepted, and that no payment should be made until the contractor should procure from the county clerk a certificate that "no liens or claims have been recorded or filed against said premises or building, which are then unsatisfied of record," it was held that where the work was abandoned by the contractor, and finished by the owners, an assignee of the final payment to become due the contractor could not recover without producing such certificate.2 And an assignee is concluded by a release given by his assignor before the assignment, even though the assignee had no notice of such release when he obtained the assignment.2

239

238

§ 260. A subcontractor who has received an assignment from the contractor, and who relies on such assignment, and does not file any claim as subcontractor is entitled only to what the contractor would receive had no assignment been made, even though, as subcontractor, his rights would have been greater. 24 Where a surety

on the bond of contractors on a city building, who also becomes their

235 McDonald v. Kelly, 14 R. I. 335.

236 Hubbell v. Schreyer, 56 N. Y. 604, reported more fully in 15 Abb. Prac. (N. S.) 300. Reversing 14 Abb. Prac. (N. S.) 284.

237 Henry & Coatsworth Co. v. Bond, 55 N. W. 643, 37 Neb. 207.

238 Bates v. Trustees of Masonic Hall & Asylum Fund, 27 N. Y. Supp. 951,

7 Misc. Rep. 609.

239 Rauer v. Fay, 42 Pac. 902, 110 Cal. 361.

240 English v. Sill, 18 N. Y. Supp. 576, 63 Hun, 572,

assignee for the benefit of creditors, completes the work after its abandonment by them, the question whether he acted as agent of the city, or as assignee of the contractors, depends on his intent.241 Where a contractor who is entitled to a lien takes a note for the amount due him, negotiates the note, and then makes a general assignment, his assignee has no right to enforce the lien, since the contractor had no pecuniary interest therein when he made the assignment.242 The right of an assignee to enforce the lien by suit in his own name will be considered hereafter.243

DIVISION VI. PRIORITIES AND SUBROGATION.

Priorities.

§ 261. As a general rule, there are no priorities as between mechanics' liens on the same property.244 In some cases the statute expressly declares that ali mechanics' liens shall share pro rata; in others, this is inferred from the general provisions of the act. Thus, where the statute makes all mechanics' liens relate back to the commencement of the work, it follows that all such liens must be equal.245 And, where the statute contains no provision in re

241 McChesney v. City of Syracuse (Sup. Ct.) 22 N. Y. Supp. 507.

242 Morton v. Austin, 12 Cush. (Mass.) 389.

243 See post, § 524.

244 Moxley v. Shepard, 3 Cal. 64; Crowell v. Gilmore, 18 Cal. 370; Wing v. Carr, 86 Ill. 347; Butcher v. Dew, 39 Ill. 40; Rosenthal v. Brick Co., 61 Md. 590; Finlayson v. Crooks, 49 N. W. 398, 645, 47 Minn. 74; Henry & Coatsworth Co. v. Bond, 55 N. W. 643, 37 Neb. 207; Choteau v. Thompson, 2 Ohio St. 114; Willamette Falls Transportation & Milling Co. v. Riley, 1 Or. 183; In re Hoyt, Fed. Cas. No. 6,805, 3 Biss. 436.

But a statute providing for the pro rata apportionment of the proceeds of the sale of property sold subject to mechanics' liens does not apply to liens for materials furnished for different improvements erected at different times, on the same premises. State v. Drew, 43 Mo. App. 362.

245 In re Hoyt, Fed. Cas. No. 6,805, 3 Biss. 436; Willamette Transportation & Milling Co. v. Riley, 1 Or. 183. Contra, Hall v. Hinckley, 32 Wis. 362. In this last case, the liens, although relating back to the commencement of the work so far as other incumbrances were concerned, were held to rank, as between themselves, according to the order in which the claims were filed.

Under a statute providing that any mortgage on land at the time of the

gard to priorities, all mechanics' liens are equally entitled to payment out of the property.246 Liens for labor and liens for materials

are of equal force.247

249

§ 262. There are some exceptions to this rule of equality. In some states mechanics' liens are entitled to priority according to the order in which the claims are filed for record,248 and subcontractors' liens have been held superior to those of contractors.2 In one case, where several mechanics' liens were enforced against a building belonging to an unincorporated association, it was held that one of the liens, which was held by a member of the association, was not entitled to be paid until after the liens of outsiders were paid in full, for the reason that the members of the association were, in law, copartners.250 And in Pennsylvania the failure to designate in a joint lien claim the amount claimed as lien on each building named therein has the effect of making other mechanics' liens superior thereto.251 The holder of a junior mechanic's lien on a lessee's interest, for work which the lessee had contracted with the lessor to have completed, cannot enjoin the sale of the property, upon the foreclosure of a senior lien, for work performed for the lessor, of which the holder

inception of a mechanic's lien shall not be affected thereby, and that all liens shall be upon an equal footing, without reference to the date of filing. the beginning of the erection of any building constitutes the inception of all subsequent liens, and a mortgage intervening after the first lien has attached will not defeat the equality of subsequent liens with the first, though it was stipulated by the parties to the mortgage that said mortgage should be paramount to all other liens, and the mortgagors covenanted to keep the premises free from all other incumbrances. Oriental Hotel Co. v. Griffiths (Tex. Sup.)

33 S. W. 652.

246 Choteau v. Thompson, 2 Ohio St. 114; Crowell v. Gilmore, 18 Cal. 370. 247 Moxley v. Shepard, 3 Cal. 64; Henry & Coatsworth Co. v. Bond, 37 Neb. 207, 55 N. W. 643; Rosenthal v. Brick Co., 61 Md. 590, overruling Robinson v. Insurance Co., 55 Md. 111.

248 Kaylor v. O'Connor, 1 E. D. Smith (N. Y.) 672; Robertson v. Barrack, 45 N. W. 1062, 80 Iowa, 538; Hall v. Hinckley, 32 Wis. 362.

249 Vogel v. Luitwieler, 5 N. Y. Supp. 154, 52 Hun, 184; English v. Sill, 18 N. Y. Supp. 576, 63 Hun, 572; Pell v. Baur (City Ct. Brook.) 16 N. Y. Supp. 258; Lay v. Millette, 1 Phila. (Pa.) 513; Midland Ry. Co. v. Wilcox, 23 N. E. 506, 122 Ind. 84.

250 Babb v. Reed, 5 Rawle (Pa.) 151.

251 Thomas v. James, 7 Watts & S. (Pa.) 382.