Opinion
Decided February 17, 1930.
Mechanics' liens — Foreclosure — Novation defined — Oral proof and conduct sufficient — Insufficient evidence to establish novation substituting general contractor's obligation for owners' — Limitation for filing lien not extended by additional work and material — Lien void if not filed within sixty-day limitation.
1. "Novation" requires valid, prior obligation to be displaced, consent of all parties to substitution, sufficient consideration, extinction of old obligation, and creation of valid new one.
2. Novation may be shown by oral proof and conduct of parties.
3. In action by contractor for particular work against owners, evidence held insufficient to establish "novation" substituting general contractor's obligation for that of owners.
4. Where work was warranted for year, and owners moved into and accepted house as completed, held evidence showed no work or material furnished thereafter, as regards running of period for filing mechanic's lien.
5. Mechanic's lien filed more than 60 days after last furnishing of material and labor held invalid.
APPEAL: Court of Appeals for Hamilton county.
Mr. Frank Woodward and Mr. Robert L. Black, for plaintiff.
Messrs. Clark Robinson, for defendants Helen E. Lishawa and Chester A. Lishawa.
This case is here on appeal by the defendants from a decree of the trial court, granting the foreclosure of a mechanic's lien in favor of the plaintiff, John W. Garrett. The defendants, appellants, challenge the validity of the lien, and claim a novation, by which one Blickensderfer, the head contractor in the construction of the house for the defendants, became Garrett's debtor, thereby relieving appellants from any obligation to Garrett for the payment of material and labor.
The first question we will consider is the claimed novation.
It appears from the record that on May 16, 1927, a written contract was entered into between the appellants and the Sani Onyx Construction Company, which was Garrett, the appellee, for the furnishing and installing in the residence, under construction for the appellants, Sani Onyx on the walls of the bathrooms on the first and second floors, including shower on the second floor bathroom, also ceiling in the shower. The contract contained all the specifications, and the price agreed upon was $769.50, and Garrett guaranteed the material and work for one year.
The house was being constructed by one Blickensderfer, a general contractor, under a contract between him and the appellants, the Lishawas.
It will be noted, as above stated, that the contract for installing the Sani Onyx on the walls of the bathrooms was not made through the general contractor, but was made direct with the appellee, Garrett.
Garrett proceeded with the work under his contract, and the house, with the bathrooms installed, was substantially completed on September 8, 1927, the appellants taking possession and moving into the property on September 9.
On or about the 21st day of October, 1927, it appears that Blickensderfer presented the appellants with affidavits to the effect that all the parties had been paid, and the appellants paid the balance due under the original contract with Blickensderfer for the construction of the house. This settlement with Blickensderfer included the payment of $769.50 for installation of Sani Onyx on the walls.
It appears that the work contracted for by Garrett was substantially completed before the Lishawas moved into the property on September 9th; that some time during the progress of the work Garrett telephoned Lishawa asking for a payment on account, saying that he was sorely in need of funds; that Lishawa informed him that he had turned that matter over to Blickensderfer, that everything was being handled through Blickensderfer. Garrett states that he received from Blickensderfer a payment of $100, and, later, on October 15, received $200 more.
It appears that Garrett had a contract with Blickensderfer to put in tile floors in the bathrooms, which was not covered by his contract with the Lishawas for the Sani Onyx; that that contract with Blickensderfer for the tile floors amounted to $136.75; that out of the $300 he received, he credited $136.75 to the contract with Blickensderfer for laying of the tile floors and credited the balance on his Sani Onyx contract. Garrett later received two notes of Blickensderfer for part payment on the Sani Onyx contract, which notes were valueless, as Blickensderfer went into bankruptcy, and the notes were not paid.
Under this state of facts was there a novation which would relieve the Lishawas from their obligation to Garrett under the contract?
The requisites of a novation are a valid, prior obligation to be displaced; the consent of all the parties to the substitution; a sufficient consideration; the extinction of the old obligation; and the creation of a valid new one.
The facts in this case do not meet these requisites. There was a valid prior obligation which was the contract between the appellants and the appellee Garrett. There was no evidence that at any time Garrett consented to the substitution of Blickensderfer as his debtor. In fact the circumstances tend to disprove the consent of Garrett to the substitution of Blickensderfer for the Lishawas, as debtor. He had a valid, binding contract with the Lishawas, who were the owners of the property. There does not appear to be any reason or any consideration for Garrett to consent to the change of debtors. Neither does the proof show a valid new obligation entered into or created by the consent of all the parties. While it is true, as claimed, a novation may be shown by oral proof and the conduct of the parties, the proof and the conduct are insufficient to establish a novation in this case. The only proof tending to establish novation is that at the direction of the Lishawas Garrett took the matter up with Blickensderfer, and Blickensderfer made some payments to him, which he credited partly on the Blickensderfer contract and partly on the Lishawa contract.
In 20 Ruling Case Law, page 369, it is stated:
"The effect of a novation by the substitution of a new debtor is to extinguish the liability of the original debtor. For obvious reasons the mere assumption of the debt by the new debtor cannot have this effect. It is not within the power of the original debtor to release himself from liability by contracting for the assumption of the debt by another. There can therefore be no doubt that in order to effect a novation by the substitution of a new debtor, the assent of the creditor to the substitution is essential."
It is further stated in 20 Ruling Case Law, page 366: "In order to effect a novation there must be a clear and definite intention on the part of all concerned that such is the purpose of the agreement * * *."
The proof on the question falls far short of showing a definite intention on the part of Garrett to accept Blickensderfer as the debtor in the place of the Lishawas.
We, therefore, find, and so hold, that novation has not been shown, and that the Lishawas remain debtors to Garrett under the Sani Onyx contract.
The next question is the validity of the mechanic's lien.
This question turns on whether or not the lien was filed within the 60 days from the last furnishing of labor and material. The record discloses that the house, with the bathrooms, was substantially completed on September 8, and the Lishawas took possession and moved in on September 9; that, later, some work by way of pointing up and cleaning up the bathrooms was done by Garrett under his contract. The Lishawas testify that this was done not later than the middle of October. Lishawa states that he gave orders that no workman should be permitted in the house after he made the payment to Blickensderfer on October 21. The evidence of the appellants is all to the effect that there was no material furnished or labor performed under the Garrett contract after about the middle of October. Garrett claims that on the 13th day of December he had two men go to the premises and fix a leak around the bathroom door, complained about, and take some grease off the onyx, and do some little pointing up, and there is some evidence of the delivery of about 75 cents worth of paint, but it is not shown that this was used on the premises. It will be remembered that Garrett's contract contained a guaranty of his material and work for one year. It would be entirely consistent with that contract that he was making his guaranty good, rather than furnishing work and material under the original construction. It will be noted that this slight cleaning and pointing took place more than three months after the Lishawas moved into the property and accepted the same as completed. The two men, claimed to have been sent up by Garrett on December 13, testified, but their testimony is neither convincing as to the date nor as to the work.
Our conclusion is that there was no work or material furnished after the middle of October, and probably not after the 8th of September, from which to base the running of the 60 days time for the filing of the lien. It follows that the lien, having been filed January 31, 1928, was filed more than 60 days from the time of the last furnishing of material and labor, as herein indicated. The lien is therefore invalid, and the appellants are entitled to have the same canceled on the records.
The petition declared on two causes of action. The first cause of action is for a personal judgment, based upon the contract herein designated as the Sani Onyx contract, entered into between the plaintiff, Garrett, and the Lishawas. There is no dispute as to the amount due under the contract, which we have found to be the debt of the Lishawas. The amount of the contract price was $769.50, upon which is credited $163.25, leaving a balance due under the contract to Garrett of $606.25, with interest from the 13th day of December, 1927.
Since the only defense of the Lishawas to the payment of this money is the claimed novation, we will, in view of our adverse ruling on that question, enter judgment on the first cause of action in favor of John W. Garrett against Helen E. Lishawa and Chester A. Lishawa for the sum of $606.25, with interest from the 13th day of December, 1927, and for his costs. The case will be remanded to the court of common pleas for execution of the judgment. An entry may be prepared accordingly, including cancellation of the mechanic's lien.
Decree accordingly.
CUSHING, P.J., and ROSS, J., concur.