Iroquois Transportation Company v. Ed Laney Forge Iron Company

These cases may be considered together. They are writs of error to the judgments of the supreme court of Michigan affirming the decrees of the circuit court of Wayne county, Michigan, enforcing liens for the De Laney Forge & Iron Company, defendant in error, in 218, and George W. Edwards and others, defendants in error in 219, and interveners in the original case.

The Winnebago, a steel steamer of 1,091 tons burden, was built by the Columbia Iron Works, at St. Clair, Michigan. The contract price was $95,000; date of contract, March 8, 1902; between the Columbia Iron Works and John J. Boland and Thomas J. Prindeville. It was understood that these persons should organize a corporation to be known as the Iroquois Transportation Company. The contract price was to be paid, $31,000 in cash, from time to time; for the balance the transportation company was to execute its notes to the amount of $16,000, to issue bonds for $48,000, to be secured by mortgage upon its property. On April 5, 1902, Boland and Prindeville assigned the contract to the Iroquois Transportation Company. Payments were made on the contract as follows: $7,500, at date of signing contract; 7,500, April 3, 1902; 4,000, April 14, 1902; 4,000, June 15, 1902; 4,000, July 15, 1902.

An additional $4,000 was paid on October 3, 1902, and two negotiable notes of $4,000 given, maturing respectively November 1, 1903, and November 1, 1904.

The steamer was launched March 21, 1903. After she was in the water the work on the contract continued. On July 18, 1903, she was inspected, measured, enrolled, and licensed to be employed in domestic and foreign trade. This license was issued in the name of the Columbia Iron Works as owner.

On July 19, 1903, the Iroquois Transportation Company received a bill of sale of the steamer and delivered to the Columbia Iron Works ninety-six negotiable bonds of $500 each, secured by mortgage on the steamer, and paid the balance of the purchase money, which was to be paid in cash, then amounting between $400 and $500.

The agreement recited that possession was given to the Iroquois Transportation Company for the purpose of completing and finishing up those things still remaining undone on the steamer and required to be done by the iron works by the terms of the contract for the construction of the steamer, 'it being the sole intent and purpose of this agreement to enable the Iroquois Transportation Company to obtain immediate possession of the steamer, and without intending either to limit the extent of the obligation of said Columbia Iron Works under the original specifications.'

The steamer left St. Clair for Lorain, Ohio, July 19, 1903. At that time she was not completed, and workmen remained on her and went with her to St. Clair, where additional work was done upon her. She was afterwards engaged in carrying cargoes between points on Lake Erie and Lake Superior.

On July 30, 1903, the Columbia Iron Works made an assignment for the benefit of creditors. On August 25, 1903, the De Laney Forge & Iron Company served notice on the Iroquois Transportation Company that it made a claim of lien against the steamer for forging and material furnished; and on October 6, 1903, complaint was filed in the circuit court of Wayne county, Michigan, and shortly thereafter Edwards and others intervened in the case, claiming a lien. The Iroquois Company gave a bond under the statute for the release of the vessel. Decrees were rendered in favor of the claimants and interveners in the circuit court of Wayne county, and upon appeal they were affirmed in the supreme court of Michigan, 142 Mich. 84, 105 N. W. 527.

Mr. Justice Day delivered the opinion of the court: