Bear Lake River Waterworks Irrigation Company v. Garland

Page 2 The appellants herein have appealed from a judgment of the supreme court of the territory of Utah, affirming a judgment of the district court of the first judicial district of the territory, in favor of the respondents, William Garland and Corey Bros. & Co.

The action was brought be the plaintiff, William Garland, against the Bear Lake Company, the Jarvis-Conklin Mortgage Trust Company, as trustees, Corey Bros. & Co., and others, for the purpose of enforcing an alleged mechanic's lien in favor of the plaintiff, and against the Bear Lake Company, for work done by the plaintiff for that company in the construction of its canal from its initial point (the Bear River ca non) for a distance of 12 miles on both sides of the river. The complaint alleged that on the 16th of August, 1889, the plaintiff and the Bear Lake Company entered into a contract for the construction by plaintiff of the portion of the work above mentioned; and under that contract the plaintiff commenced work on the 31st of August, 1889, and continued it to and including December 10, 1890. Various payments on account of the work were made the plaintiff, and, after crediting the same, the plaintiff alleged there was still due him from the Bear Lake Company, at the time of filing his claim for a lien (December 23, 1890), the sum of $80,250.50, and interest thereon, as set forth in the complaint. The Jarvis-Conklin Mortgage Trust Company and Corey Bros. & Co. and the other defendants were made parties to the action as subsequent mortgagees or other incumbrancers. The answer of the mortgage trust company set up the fact that it was the mortgagee in a mortgage executed by the Bear Lake Company to it, as trustee, on the 1st day of October, 1889, to secure the payment of $2,000,000 of the bonds of the mortgagor company, and that such mortgage covered all the water rights, franchises, lines of canal, and other property upon the whole or any part of which the plaintiff claimed a lien, and that the mortgage also, by its terms, covered all after-acquired property of every kind. The mortgage was duly recorded in Box Elder county, Utah, November 14, 1889; in Bear Lake county, Idaho, December 24, 1889; in Weber county, Utah, February 6, 1890. The bonds secured by the mortgage were all delivered between October 1, 1889, and February 1, 1891, and in large part paid for; and the balance was to be paid for by drafts drawn upon the mortgage company by the treasurer of the Bear Lake Company as fast as the money was needed to pay for the construction of the works. At the time the plaintiff, Garland, entered into the contract already mentioned, and when he commenced work thereunder, the statutes of Utah provided a mechanic's lien, under the provisions of which a contractor, within 60 days after the completion of his contract, was to file for record with the county recorder a claim stating his demand, and giving a description of the property to be subjected to the lien. By section 3814 (section 1065), no lien provided for by the chapter upon liens was to bind any of the property longer than 90 days after the claim was filed, 'unless proceedings be commenced in a proper court within that time to enforce the same.' 2 Comp. Laws Utah 1888, p. 406, from section 3806 to and including section 3820. The answer further set up the fact that while the above act was in force, and on the 12th of March, 1890, the legislature of Utah passed an act in relation to mechanics' liens, and section 32 thereof replealed the former and above-mentioned lien act, but added the following proviso: 'Provided, that the repeal of said acts or parts of acts or any of them shall not affect any right or remedy, nor abate any suit or action or proceeding existing, instituted or pending under the laws hereby repealed.'

The answer then set forth that the plaintiff did not commence his action to enforce his lien within the 90 days given by the act in force when the work was commenced under the contract, and therefore the lien no longer existed at the time the action was commenced to enforce it.

The answer of Corey Bros. & Co. was in the nature of a cross complaint, and set up the fact that they entered into a contract with the Bear Lake Company on the 1st of May, 1890, to construct certain portions of the canal of the company, and that between such date and the 5th of December, 1890, they did the work provided for in the contract, and on the 7th of January, 1891, they filed their claim for a lien for the balance of the money due them under the contract (which was about $11,000); and they asked for a decree enforcing their lien as a prior incumbrance to that of the mortgage upon the property of the Bear Lake Company.

The Bear Lake Company set up the same facts as a defense against the plaintiff's cause of action that were alleged by the Mortgage Trust Company; and it answered the claim of Corey Bros. & Co. by alleging that the mortgage to the mortgage trust company had been executed and duly recorded, and was in existence long before and at the time of the execution of the agreement which Corey Bros. & Co. made with the Bear Lake Company, and that, therefore, the lien of Corey Bros. & Co. was subsequent and subject to the lien of the mortgage upon the after-acquired property of the Bear Lake Company.

No question arises with reference to the other defendants.

The case came on for trial upon the issues thus found, and the court, after hearing the evidence, gave judgment in favor of plaintiff and of Corey Bros. & Co., establishing their liens, respectively, upon an equality, and making them prior and superior to the lien of the mortgage trust company by reason of its mortgage, and decreeing the sale of the property to satisfy such liens. 34 Pac. 368.

John F. Dillon, for appellants.

[Argument of Counsel from pages 5-10 intentionally omitted]

S. B. Ladd and Arthur Brown, for appellees.

Mr. Justice PECKHAM, after stating the facts in the foregoing language, delivered the opinion of the court.