Opinion
(September Term, 1896.)
Mechanic's Lien — Subcontractor — Notice to Owner.
1. While, under section 1789 of The Code, a mechanic's or laborer's lien, or lien for material, when filed, relates back and takes priority over all liens attaching, or purchases for value made subsequent to the beginning of the work or of furnishing the first material, yet it is good only for the amount due the contractor, laborer, or material man.
2. A subcontractor can enforce his right of lien against the owner of property only to the extent of any unpaid sums due the contractor at the date of giving notice to the owner of his (the subcontractor's) claim.
3. Until a subcontractor gives to the owner of property notice of his claim he has no lien, and the owner is justified in making payment to the contractor.
4. The mere fact that laborers and subcontractors are working on a building is not notice to the owner not to pay out to the contractor until it is ascertained how much is due by the latter to each and every subcontractor, laborer, material man, etc.
(116) ACTION, tried at February Term, 1896, of WAKE, before McIver, J., and a jury.
J. C. L. Harris for plaintiff (appellant).
W. N. Jones for defendant.
It is true, under section 1789 of The Code, that where a mechanic's or laborer's lien, or lien for material, is filed as required, it dates back and takes priority of all liens attaching, and against all purchases for value (though without notice) made subsequent to the beginning of the work, or furnishing the first material. Burr v. Maultsby, 99 N.C. 263; Lumber Company v. Hotel Company, 109 N.C. 658. But such lien is only good for the amount due the contractor, laborer or material man, and the subcontractor can be put in no better condition. As defendant's counsel said forcibly and pertinently on the argument, the subcontractor can only sue into the contract. Accordingly The Code, section 1801, affords the subcontractor giving notice of his claim a right to a lien "not exceeding the amount due the original contractor at the time of notice given," and section 1802 confers on the subcontractor the right to enforce such lien if the owner fails "to retain" the amount thereof "out of the amount due the said contractor." In this case the plaintiff, who was subcontractor, did not give the owner of the property notice of his claim till after the contractor, who was paid up to that date, had failed in business and abandoned the work. Neither at that time nor at any time thereafter was anything due the contractor — the owner completing the building himself. There was, therefore, no sum due the contractor out of which the owner should have "retained" the plaintiff's claim. The plain language and intent of the statute controvert the plaintiff's contention, which, if correct, would prevent owners from paying anything to contractors till twelve months after the completion of their work. The mere fact that laborers and subcontractors are working on the building is not notice to the owner not to pay out to the contractor (120) till it is ascertained how much is due by the contractor to each and every subcontractor, laborer, material man, etc. The statute requires that the subcontractor must give notice, and till he does this he does not have a lien, and the owner is justified in making payment to the contractor.
NO ERROR.
Cited: Baker v. Robbins, post, 292; Woodworking Co. v. Southwick, post, 615; Dunavant v. R. R., 122 N.C. 1001; Weathers v. Borders, 124 N.C. 613; Hall v. Jones 151 N.C. 424; Roper v. Ins. Co., 161 N.C. 160; Supply Co. v. Eastern Star Home, 163 N.C. 515; Brick Co. v. Pulley, 168 N.C. 375; Granite Co. v. Bank, 172 N.C. 358.