Opinion
Argued April 25, 1922
Decided May 31, 1922
Joseph A. Seidman for appellant. Albert M. Lee and Arthur Ofner for respondent.
This action was brought to foreclose a mechanic's lien. After the commencement of the action it was discontinued so far as the plaintiff was concerned and thereafter continued and tried as though Pollack O'Neill, Inc., were the plaintiff and the Broadway-94th Street Realty Co., Inc., the defendant. At the trial it appeared that on or about the 17th of August, 1916, the defendant Pollack O'Neill, Inc., entered into a contract with the Broadway-94th Street Realty Co., Inc., by the terms of which the former agreed to furnish all the materials and perform all the labor required in connection with the plumbing of a building in the city of New York belonging to the latter. The trial court found there was due Pollack O'Neill, Inc., $4,965.55, besides costs and disbursements, and the lien filed by it therefor a valid lien upon such premises. Judgment was entered upon the decision for the amount found due, directing a foreclosure and sale. Both parties appealed to the Appellate Division — Pollack O'Neill, Inc., only from that part of the judgment which disallowed interest upon the amount recovered. The Appellate Division unanimously affirmed the judgment and denied leave to appeal to this court. The realty company then appealed, by permission of this court. The application of Pollack O'Neill, Inc., for leave to appeal, however, was denied by this court. Notwithstanding that fact it took an appeal from that part of the judgment disallowing interest.
The decision of the Appellate Division being unanimous, and leave to appeal not having been given to Pollack O'Neill, Inc., its appeal was unauthorized and, therefore, is dismissed.
Simultaneously with the execution of the agreement by which Pollack O'Neill, Inc., agreed to furnish the materials and perform the work necessary for the plumbing, it, for a valuable consideration, executed another agreement by which it: "Covenants and agrees not to file any liens or to make any claims * * * against the aforesaid premises, or any part thereof, or against any building or buildings, or other improvements erected or made, or to be erected or made thereon, or against the leasehold interest aforesaid for any work that the said contractor may at any time do under the contract hereinbefore referred to, or any other, or for any materials that he may furnish thereunder, or for anything whatever done or to be done under and pursuant to such contract, or any other, or any modification thereof, or upon any other ground or nature or character whatsoever; and further covenants to release, and hereby does release, the premises above referred to and each and every part thereof and any and all buildings that may now or hereafter be erected thereon from any and every lien, charge or claim of any nature whatsoever that he might otherwise at any time have against the same, or any part thereof, for work done or to be done, or materials furnished, or to be furnished, or upon any other ground whatsoever, growing out of or in any way connected with or relating to the erection and construction of any building or buildings upon said premises."
The trial court found that this agreement not to file a lien was rendered ineffectual by reason of the fact that the realty company had failed to pay the amount found due. The Appellate Division reached the same conclusion, relying upon the authorities of Greenfield v. Brody ( 204 N.Y. 659) and Kertscher Co. v. Green ( 205 N.Y. 522).
I am of the opinion neither of these authorities sustains that view. In the Greenfield case the contract was for the construction of several houses and the contractors were to be paid in part by the conveyance to them of two of the houses. The owner transferred the property and thus put it beyond his power to comply with the contract. It was held this authorized the contractors to file a notice of lien, notwithstanding the fact they had agreed not to do so. Obviously, the basis of the decision was predicated upon the fact that the owner of the property had put it out of his power to perform.
It is true there are expressions in the opinion in the Kertscher case which sustain the view of the trial court and the Appellate Division. Such statements, however, were made upon the authority of the Greenfield case, which, as indicated, does not sustain such view, and besides, the statements made were unnecessary to and not involved in the decision, as an examination of the record will disclose. The decision was placed upon the provisions of the contract there involved, the court reaching the conclusion that the agreement not to permit liens to be filed referred only to liens filed against the contractor by workmen, subcontractors or materialmen. (See p. 525 of opinion in the Kertscher case.)
The statute gives to a contractor performing work or furnishing materials in the construction of a building, in case of the owner's default as to payments, the right, on complying with the statute, to file a notice of lien. The owner must have made default or put it beyond his power to perform before a notice of lien can be filed. No good reason can be suggested, however, why a contractor cannot, for a valuable consideration, waive the provisions of the statute giving him the right to file a notice of lien. The doctrine of the Kertscher case ought not to be extended, but should be confined to what was there decided.
It follows that Pollack O'Neill, Inc., had no right to file a notice of lien, since it expressly agreed not to do so. The judgment directing foreclosure of the lien and sale of the premises is, therefore, erroneous.
The lien having failed, I am of the opinion under the statute (Laws of 1909, chap. 38, secs. 54, 64) that, Pollack O'Neill, Inc., is entitled to a personal judgment against the realty company for the amount found due. The statute provides that: "If the lienor shall fail, for any reason, to establish a valid lien in an action under the provisions of this article, he may recover judgment therein for such sums as are due him, or which he might recover in an action on a contract, against any party to the action." (Lien Law [Cons. Laws, ch. 33], sec. 54, formerly Code of Civil Procedure, sec. 3412.) And: "A court or referee in any action heretofore or hereafter brought may at any time award a money judgment in favor of any party. * * *." (Sec. 64.)
Pollack O'Neill, Inc., performed labor and furnished materials for the improvement of real property at the request of the realty company. This gave it the right, except for the agreement referred to, to a lien. (Lien Law, sec. 3.) It filed its notice of lien, so far as appears, in good faith within the time prescribed by law, and the only reason why the lien cannot be enforced is its agreement. Under such circumstances it seems to me it should be given a personal judgment against the realty company. ( DiMenna v. Cooper Evans Co., 220 N.Y. 391; Abbott v. Easton, 195 N.Y. 372; Uvalde A.P. Co. v. City of New York, 191. N.Y. 244; Gilmour v. Colcord, 183 N.Y. 342; Bradley Currier Co. v. Pacheteau, 175 N.Y. 492.)
The judgments appealed from by the realty company should, therefore, be modified as indicated in the opinion, and as thus modified affirmed, without costs to either party.
HISCOCK, Ch. J., HOGAN, CARDOZO, POUND, CRANE and ANDREWS, JJ., concur.
Judgment accordingly.