McDermott v. McDonald — 50 N.Y. Super. Ct. 153

Majority

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PATRICK McDERMOTT, Plaintiff, v. J. T. McDONALD and EDWARD KILDUFF, JOHN MURPHY, and JOHN NESBIT, Respondents, and JOHN J. BOWES, and CHARLES M. BOWES, Appellants.

Decided March 3, 1884.

Headnote

Action to foreclose a mechanics' lien fled under the Public Works Lien Act— Laws of 1878, chap. 315.

In an action brought to foreclose a mechanics’ lien filed under chapter 315, Laws of 1878, in which the plaintiff has filed a lis pendens with the comptroller, it is not necessary for a lienor made a defendant in such an action, and named as such in the lis pendens filed by the plaintiff, to thereafter bring a separate action on his own claim and lien, and file a notice of the pendency thereof with the comptroller.

If such a lienor appears and answers in the action brought, and sets forth his claim and lien, he is entitled in the absence of other objections to a judgment in said action according to the date of filing his lien, when all parties who have filed claims and liens are made parties defendants, and have appeared and answered the claims at that point of time become the subject of adjudication. The court must determine their validity, their amounts, and their priority as liens.

Before Sedgwick, Ch. J., Tkuax and O’ Gorman, JJ.

Appeal in an action, begun under the provision of chapter 315 Laws of 1878, in relation to the enforcement of claims, upon money due by the city of New York to contractors. The appeal is by defendants whose claim was by the judgment postponed to the claim of respondents, other defendants.

The plaintiff had filed his claim, brought an action within ninety days from the time of such filing and within the same time, filed notice of pendency of the action. He made the appellants and respondents parties. Before the beginning of this action the appellants and respondents had filed claims. Before said time, the appellants had

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filed their claim, and within ninety days had brought an action for the enforcement of such claim and filed notice of its pendency. They made parties defendant, the plaintiff in the present action and the respondents. By order under the provisions of the act, the two actions were consolidated, and the parties proceeded in the present action. The respondents did not within ninety days from the time of filing their claims begin an action for its enforcement. After ninety days they filed another claim but of like substance, and began an action. The adjudication in the present action, did not embrace such other claim.

The referee decided that the respondents, having been made parties defendant to the present proceeding before ninety days had elapsed from the filing of their claim, although they had not begun an, action to enforce their claim, or filed notice of its pendency, were entitled to be paid before the appellants who had filed their claim after the respondent’s claim had been filed.

The referee found that the present plaintiff begun his action within ninety days from the time of filing his claim and before the expiration of ninety days from the time the respondents had filed their claim.

The following opinion was delivered by the referee:

Charles A. Jackson, Referee.—The evident intent of the legislature was to consolidate the trial of all valid and subsisting liens in one action, thereby avoiding multiplicity of suits.

The first question that arises is as to whether the action having been properly commenced by the plaintiff, and he having filed a notice of lis pendens within ninety days from the filing of his lien in this action, such filing inures to the benefit of such of the defendants as have appeared and answered herein without having filed a notice of lis pendens.

Section 4 of the act says, “No lien provided for in this act shall be binding on the property therein described, unless an action be commenced within ninety days from

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the filing of the same, and a notice of pendency of said action be filed with the financial officer of the city.”

In my opinion the words “an action” refer to the particular lien spoken of, and the word “thereon” is clearly understood as following the words “ an action.”

It then follows that each and every lien must be enforced by action, and notice of pendency of such action must be filed with the financial officer of the city.

How does the act anywhere else provide that anything else may stand in the place and stead of these requirements % Section 7 says, “ the plaintiff must make all parlies who have filed claims, the contractor, and the said city parties defendants. .... But all parties who have filed claims under this act may by answer in such action set -forth the same, and the court in which the action is brought may decide as to. the extent, justice, and priority of the claims of all parties to the action.”

The word “may” here, as applied to the court, clearly should be construed “must.” That is to say, the correct interpretation of the latter part of this section would seem to be, that as to all parties who have availed themselves of the privilege of coming in and setting up their claims by answer, the court must decide as to their extent, justice, and priority.

The next section 8 provides that the court in which the action is brought shall determine the validity of the lien . . and shall render judgment directing that the said city shall pay over to the claimants .... whose claims or liens it shall hold to be valid and just, in the order of their priority as determined by said court .... so much of said funds .... as will satisfy their liens or claims.

These sections all show the intent of the act to be, that an action should determine the extent, validity, and justice of the liens of all the claimants against the fund.

Section 13 provides that the lien may be discharged as follows Second, by lapse of time, when ninety days have elapsed since the filing of the claim. Third, by

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satisfaction of any judgment that may be rendered in actions.

In my opinion the commencement of any action on any one of several claims, in which action the other claimants are made and become parties and present their claims affirmatively as by answer, as by section 7 is provided, is the commencement of an action to enforce each and every of said claims within- the meaning of the law ; and when such an action is commenced the ninety days does not run as against the claimants, parties thereto, whose claims were with respect to time valid, at the time of the commencement of such action.

, The filing of a lis pendens is no essential part of the validity of the claim. A claim that is just may be enforced by suit, as we have seen. The filing of the Us pendens is simply to give notice to the financial officers of the city that the claim is being enforced, being brought before the court for adjudication. Now of what conceivable use would the filing of a dozen notices of the pendency of the same action be to the financial officers of the city \ It would in my judgment be useless.

I am aware that the courts have ever interpreted mechanics’ lien acts with great strictness, but I do not think that strictness of interpretation inconsistent with the opinion hereby indicated.

The legislature intended, in my judgment,

1st. To make it necessary that a lien shall be filed.

2d. That an action to enforce the same within ninety days should be brought.

3d. That in an action brought by a claimant under a lien, all other claimants, who have filed liens, shall be made parties, that such other claimants may then set up their claims .by answer, and that, in the words of the Buffalo Mechanics’ Lien Act, Laws of 1880, vol. 1, chap. 143, § 8, “when a claimant is made a party defendant to any action brought to enforce any other lien, such action shall be deemed an action to enfore the lien of such defendant who is a claimant within the provisions of this section,” and the

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court shall then proceed to determine the justice and priority of such liens.

4th. That one notice of pendency of such action should suffice.

This conclusion has not been reached without much doubt.

The defendant Smith not having interposed any answer, I am of opinion that he has presented no issue to be determined by the court, and that he has lost his lien. ■

There is no dispute as to the validity and priority of the lien of the plaintiff McDermott, and he should have judgment therefor.

Conlon & McCrae, for appellant.

Wallace MacFarlane, for respondents.

I think the learned referee was correct in his construction of the statute.

The statute has, as is usual in such cases, matters that require construction. Section4 declares that “nolien provided for in this act shall be binding upon the property therein described, unless an action be commenced within ninety days from the filing of the same, and a notice of pend-ency of said action be filed with the financial officer óf said city.” This, however, cannot mean that during the ninety days there is no lien or claim, for the next section declares that the lien shall attach from the time of filing the same to the extent of the liability of the contractor for the claim preferred, upon any funds which may be due or to grow due to the contractor from the city.

By section 6 any person who has filed the notice mentioned in the second section not the fourth section, may enforce his claim against the fund. By section 7 the plaintiff must make all parties who have filed claims, the contractor and the city parties defendant and all parties who have filed claims under the act may by answer in each action set forth the same, and the court may decide as to the extent, justice and priority of the claims of all parties.

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It seems to be clear that, if judgment were obtained in an action like the present within ninety days from the time the first claim had been filed, there would be no ground for the position that a lienor, a party defendant, who had not begun an action and filed notice of it, was not entitled to judgment in his favor. It would apparently, be absurd that a lienor should be compelled to bring an action and file a notice of lis pendens after judgment in his favor and before ninety days had expired.

The statute is mandatory, as to the court adjudicating upon claims of all parties to the action. It must determine their validity, their amounts, their priority. Of course this must refer to the time of action brought, or of answer served. 0

When the law requires, that the plaintiff must make all parties who have filed claims—not who have begun actions,—defendants, the intention seems to be, that the claims shall at that point of time, became the subject of adjudication. If while action was going on, the claimants should be required to begin an action and file a notice of lis pendens it would be a useless and vain thing, especially in view of the policy of section 10, that provides for the consolidation of all actions brought under the act, as to the same fund.

If when an action is begun, the plaintiff files notice of its pendency making all claimants parties, then the persons for whose benefit a notice of lis pendens may operate, will have the same notice, that there would be if each claimant began an action and filed a notice with the financial officer of the city.

By section 13, a lien may be discharged, “ Second, by lapse cf time, when 90 days have elapsed since the filing of the claim and no action shall have been commenced to enforce the claim.” This evidently refers to such rights as depends upon the mere filing of a claim which constitutes the lien. If ninety days pass and no action is begun to enforce it, it is discharged. But it has no reference to a case, where the claimant’s rights do not rest upon those

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provisions that contemplate his own affirmative enforcement of the claim, as a plaintiff, but do rest upon those provisions that give him a right, as a defendant to have his claim passed upon and to obtain and enforce a judgment if it be in his favor.

If this last consideration be valid, Noyes v. Burton, 29 B. 631 , does not sustain appellants position. That case did not refer to the effect of an adjudication provided by the law, that regulated the mode of enforcing claims filed under it.

If the court is to pass upon the validity of the claims, one of the questions will be, whether the lien has expired by the lapse of ninety days from the time of filing and before action begun without the commencement of an action and the filing notice of its pendency.

Judgmenb affirmed, with costs.

Truax and O’Gorman, JJ., concurred.