Sheffield Birmingham Coal Iron Railway Company v. Gordon

Statement by Mr. Justice BROWN:

This was an intervening petition filed by the firm of Gordon, Strobel & Laureau, in a case pending in the circuit court for the northern district of Alabama for the foreclosure of a deed of trust, setting up and claiming a mechanic's lien on certain furnace property described in the petition, to secure the payment of a large balance due to them as builders. The Central Trust Company of New York, trustee under the deed of trust, and plaintiff in the foreclosure suit, the Sheffield & Birmingham Coal, Iron & Railway Company, the mortgagor, Jacob G. Chamberlain, who was receiver in the foreclosure suit, and one Charles D. Woodson, as holder of certain bonds of the company, were made defendants to the petition. Petitioners' claim arose under a contract whereby they agreed to construct for the Alabama & Tennessee Coal & Iron Company, the predecessor of the appellant corporation, three iron blast furnaces at Sheffield, in Colbert county, Ala., for $564,000, 90 per cent. of which amount was to be paid from time to time during the construction of the furnaces, and which 90 per cent. had been practically paid as agreed between the parties, the claim of the appellees being the balance, together with some amounts alleged to have been paid out for excessive freight charges, and upon material furnished to repair and reconstruct one of the furnaces.

Joint and several answers were filed by the defendants, setting forth certain defenses to the petition, and demanding proof of each allegation thereof. It was admitted that the defendant company had become liable for whatever amount was due the petitioners by the original Alabama & Tennessee Coal & Iron Company. The main defense was that Gordon, one of the interveners, had undertaken to supervise the blowing in of one of the three furnaces, in which operation the furnace was ruined, and subsequently abandoned; that, in the blowing in of a second furance, it suffered such damage that it required about six months to put it in good condition; that the furnaces were not built according to the plans, specifications, and agreements of the contract, but were constructed in so faulty and inadequate a manner that their daily expense for coal was much larger than it would have been had they been properly constructed.

A decree was entered by consent, referring the case to a special master to examine and report the facts as to the existence of the contract, the construction of the furnaces, the payments made therefor, the amount due the petitioners, the existence of their lien, and also to report upon all matters of defense stated in the answer.

In pursuance of this order the master took the depositions of a number of witnesses, found the facts, and reported a balance due of $57,808.12, with interest from September 18, 1888. Exceptions were filed to this report by the defendants, which, upon argument, were overruled by the court, and a final decree entered in favor of the interveners for the amount reported by the master. From this decree an appeal was taken to this court.

Henry B. Tompkins, for appellant.

W. A. Gunter and R. C. Buckell, for appellee.

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