Opinion
10-31-1890
LEONARD et al. v. COOK et al.
W. J. Leonard, for complainants. H. M. Nevins, for defendant Ingling.
On motion for injunction.
W. J. Leonard, for complainants. H. M. Nevins, for defendant Ingling.
BIRD, V. C. The complainants entered into an agreement to sell to the defendant Cook their printing plant at Atlantic Highlands. He took possession, and after a short time proposed to purchase of them a lot of land near by, upon which was a large frame building, unoccupied. Before the negotiations were completed for the purchase and sale of said lot, and on the 2d day of November, 1889, one of the complainants went to Atlantic Highlands for the purpose of meeting Cook with reference to their business transactions. She then learned that mechanics were at work upon the building upon the lot which Cook proposed to purchase, and she learned from Cook that he had taken possession of the lot, and had employed the mechanics, and directed them to make the changes and improvements thereon in which they were then engaged. She objected, but to him only, to such possession, changes, and improvements, and insisted that, if he moved his printing business to such location, it would impair the security of the chattel mortgage which Cook had given to the complainants upon the sale and transfer to him of the printing plant. In order to overcome this objection, Cook assured her that the improvements which he was about to make would greatly increase the value of the lot about to be purchased, and that he would give them a mortgage upon the said lot as further security. Cook said to her that he desired to give the first mortgage upon said lot for the purpose of raising money to complete the improvements which he had contemplated. On the 6th of November both of said complainants went to the office of their counsel in Atlantic Highlands, whose office was very near to the printing establishment, and directed him to prepare a deed of conveyance of said lot from them to Cook. The deed was executed, but not delivered, because Cook professed not to be ready to complete his part of the contract. Afterwards, and by letter, the complainants instructed their counsel not to deliver the deed unless Cook would pay the $450 in cash for the lot, or give a first mortgage thereupon for $1,000. On the 22d day of November, the complainants and Cook had another interview, in which Cook prevailed upon them to consent that he should give a first mortgage to secure a loan of $600 upon his promise to give to them the second mortgage for $1,000, and an additional mortgage on this lot to them to secure their claims against him. Having consented to do this, they delivered to him an order directed to their counsel authorizing him to deliver to Cook the deed of conveyance which they had previously executed for the property upon his executing the said mortgages to the complainants. Their counsel delivered the deed before the mortgages contemplated were executed and delivered by Cook to the complainants. Cook thereupon executed a mortgage on the lot to secure the said loan of $600. This amount was all used by Cook in payment of lumber and labor which had been used and expended upon said lot. Two hundred and thirty-two dollars of the purchase money has been paid to the complainants. The complainants now ask to restrain the enforcement of the lien claim which was filed by Ingling, and upon which is due $435, on which it is agreed shall be credited about $150. I conclude that the complainants are not entitled to the preliminary injunction prayed for. In my judgment, it would be most inequitable for this court to interfere. Cook may have been guilty of the breach of contract; he may have failed to comply with his promise; or he may have been guilty of circumvention and fraud. But there is nothing whatever to connect the lien claim and Ingling with any such transactions. The complain ants and their counsel had fullest knowledge that Cook had taken possession of the lot in question, and had employed mechanics, and directed them to make the improvements which he contemplated, for at least three weeks before the deed was delivered. When the deed was delivered, there had been at least $600 worth of improvements put upon the lot by the mechanics and material-men, all of which was done before their face, and to which they made no objection to laborers and material-men. A court of equity cannot say that the complainants did right in allowing these laborers and material-men to proceed without warning them of their claim of title. The deed was delivered upon the 26th day of November. Soon after that a bill of complaint was filed by these complainants against Cook to enforce the performance of the contract for the purchase of the printing office. But, notwithstanding the fact that Cook did not execute the mortgage he promised to, and notwithstanding the complainants found it necessary to proceed in this court and establish their rights under the original agreement for the purchase of the printing office, they allowed the laborers and material-men to continue to bestow their labor and material to complete the changes and improvements upon the lot which was conveyed by the said deed on November 26th, and did not file their supplemental bill until September 5, 1890, or at any other time, or in any other manner, give notice to the defendant Ingling that the title to the said lot was not in Cook, but in them, andthat he was expending his labor and material on land for which he could not claim any lien. They claim that the defendant Ingling is not protected by the statute respecting mechanics' liens, although a large portion, if not all, of the balance due him, was for material furnished by him after the title passed to Cook. They claim also that their lien for the balance of the unpaid purchase money is superior to any claim under the mechanics' lien law. As already intimated, since the complainants, with full knowledge, acquiesced in what the lien claimant did in furnishing material, his equitable rights are superior to any claims made by the complainants. I think the following cases sustain these views: Brinkerhoff v. Brinkerhoff, 23 N. J. Eq. 477; Banking Co. v. Lewis, 12 N. J. Eq. 323; Collier v. Pfenning, 34 N. J. Eq. 22; Shippen v. Paul, Id. 315; Dusenbury v. Mayor, etc., 25 N. J. Eq. 295; Pickert v. Railroad Co., Id. 316; Liebstein v. Mayor, etc., 24 N. J. Eq. 201; Bond v. Mayor, etc., 19 N. J. Eq. 385; Bigelow, Estop. 488; Schwartz v. Saunders, 46 Ill. 18; Sharpley v. Railroad Co., 2 Ch. Div. 663; Kerr, Fraud & M. 127; 2 Pom. Eq. Jur. §§ 816, 817; 2 Story, Eq. Jur. §§ 1533-1535. The injunction is denied, with costs.