Lucas v. Taylor

Schmucker, J., delivered the opinion of the Court. This is an appeal from a decree of Circuit Court No. 2 of Baltimore City dismissing a bill filed by the appellants for the enforcement of a boat lien. The lien was claimed against the Steamer Anne Arundel, which was built at Baltimore City by the Baltimore Shipbuilding and Dry Dock Company under a contract with the Weems Steamboat Company The lien claim was for a balance of $1,764.13 for work done and materials furnished in equipping the steamer with an electric light plant at the instance of the Shipbuilding Company. It appears from the record that the keel of the steamer was laid on or about January 2nd, 1904, and the completed vessel was delivered on July 1st, 1904, to the Weems Steamboat Company, which paid in full the contract price for its construction.

The formal contract for building the steamer was not actually executed until eleven days after the construction had been commenced, but the terms of the contract had been 'agreed upon. The contract for installing the electric light plant on the steamer was made between the appellants and the Shipbuilding Company on April 19th, 1904, and the work called for by the contract was completed by July 1st, 1904. A few changes or alterations were made, in some of the wires, ¹⁰² between July ist and nth, after the steamer had passed into the hands of the Weems Steamboat Company and the charges for those alterations form part of the lien claim. The claim was filed in the office of the Clerk of the Superior Court on October nth, 1904, which was within six months from the commencement of the work for which the lien is claimed, but not within that time from the laying of the keel of the steamer.

The claim is in the usual form and states that the work was done and the material furnished by the appellants “at the instance and request of the said Baltimore Shipbuilding and Dry Dock Company in said Baltimore City.” In the claim as originally filed the Shipbuilding Company were described as “agents and contractors” for the steamer and the Weems Steamboat Company as its owner but by the amendment hereinafter mentioned the former company was described as its owner and builder and the latter company as being “now the owner;” After the steamer had been completed and delivered tó the Weems Steamboat Company the Shipbuiding Company failed and its affairs were by a deree of the Circuit Court of Baltimore City placed in the hands of Archibald H. Taylor and Walter Ancker as receivers, and the Weems Company sold the steamer to the Maryland, Delaware and Virginia Railway Company. In that situation of affairs the present bill for the enforcement of the lien was filed on February 24th, 1905. The bill alleges the facts which we have mentioned and prays for a sale of the steamer for the satisfaction of the lien. A certified copy of the lien claim was filed with the bill as an exhibit.

All of the defendants answered the bill. The receivers of the Shipbuilding Co. and the Weems Steamboat Co. in their answers deny the validity of the lien, but the Railway Co. states that it has no knowledge of the facts set forth in the bill and neither admits nor denies them but demands proof of them. The Railway Co. further states in its answer that it has purchased the steamer Anne Arundel with all the other property of the Weems Steamboat Co. but does not aver that ¹⁰³ it has paid for the same nor set up the defense of being a bona fide purchaser for value without notice of the lien. The plaintiffs took testimony proving their contract with the Shipbuilding Co. for the installation of the electric lighting plant on the steamer, the performance by them of the contract on their part, that the balance claimed of $1,764.13 of the contract price remained unpaid, and that on September 26th, 1904, they gave written notice to the Weems Steamboat Co. of their intention to claim a lien therefor.

The defendants put in evidence the contract for building the steamer between the Shipbuilding Co. and the Weems Steamboat Co. It was admitted that the Weems Steamboat Co. paid to the Shipbuilding Co. the full contract price for the construction of the steamer. The learned Judge below filed no opinion in the case and we are therefore not informed as to the ground on which he relied in dismissing the bill. The reasons asserted in argument by the appellees for denying the validity of the lien claim were substantially as follows: That the appellants were sub-contractors to whom the Code does not give a lien on boats, That the lien claim was not filed within six months 'from the commencement of the building of the steamer, That the .claim does not state at what place the boat was built, That the Weems Steamboat Co. and not the Shipbuilding Co. was the owner of the steamer, That there was no proper amendment of the lien claim and that the lien, if it ever was valid, had expired by limitation at the date of the decree. The provisions of the Code in reference to liens on boats and vessels are found in Art. 63 relating to Mechanics Liens.

Sec. 43 provides that all boats or vessels of any kind whatsoever used or intended to be used on the Chesapeake Bay or other waters of this State or belonging in this State shall be subject to a lien and bound for the payment thereof as preferred debts for all debts due to boat builders, mechanics, &c., from the owners, masters, captains or other agents of such boats or vessels for materials furnished or work done in the building, repairing or equipping the same. ¹⁰⁴ Sec. 44 requires the lien claim to be filed in the office, in Baltimore City, of the Clerk of the Superior Court “within six months from the commencement of the building, repairing, equipping or refitting of the boat or vessel,” and provides that the claim shall state, along with other things, the place where the boat was built, repaired, equipped or refitted. Sec. 46 provides that the lien on the boat or vessel shall continue for two years from the day on which the lien claim is filed and no longer. Sec. 41 provides that Article 63 “shall be construed and have the same effect as laws which give general jurisdiction or are remedial in their nature; and such amendments shall from time to time and at any time be made in the proceedings, commencing with the claim or lien to be filed and extending to all subsequent proceedings as may be necessary and proper; provided that the amount of the claim or lien filed shall not in any case be enlarged.” Considering the objections urged by the appellees against the validity of the lien claimed in this case in the order in which we have stated them; we observe that the question of the right of a sub-contractor to a lien has been eliminated from the case by the amendment of the proceedings so as to treat the Shipbuilding Co., for whom the work was done, as the owner of the vessel. We think that the filing of the lien claim on October nth, 1904, for the balance due for the installation of the electric light equipment which was begun on or after April 19th, 1904, was a compliance with the requirement of sec. 44 that the lien claim must be filed “within six months from the commencement of the building, repairing, equipping or refitting” of the boat or vessel.

If we were to adopt the contention of the appellees that all boat liens against a newly constructed vessel must be filed within six months from the commencement of its building we would not only ignore the language of the statute but would, whenever more than six months were consumed in building a vessel, deny the benefit of any lien at all to such mechanics and others as furnished labor or material to the ¹⁰⁵ vessel for that portion of its building which was done after the expiration of six months from the laying of its keel. We also think that the lien claim, in stating that the work was done and the materials were furnished “at the instance and request of said Baltimore Shipbuilding and Dry Dock Company in said Baltimore City,” sufficiently complied with the requirement of sec. 44 as to the statement of “the place where” the boat was built, repaired, equipped or refitted. Upon a proper construction of the contract between the Shipbuilding Co. and the Weems Steamboat Co. for the building of the Anne Arundel the former and not the latter company must be regarded as having been the owner of the steamer while it was being built. The essential features of that contract, which is too long for insertion here, are as follows: The Shipbuilding Co. agrees to construct and fully complete .on or before the first day of July, 1904, for the Weems Steamboat Co. a steamer to be a substantial duplicate of the. steamer Potomac then owned by the latter company. “The price for said steamer so constructed and ready for delivery within the time aforesaid” is fixed at $91,560, to be paid in installments as set forth in the contract.

The last two installments are stated to be: Eleven thousand ($11,000) upon completion of satisfactory trial trip; nine thousand five hundred and sixty dollars ($9,560) within thirty (jo) days of ter delivery in accordance with the terms of this contract and accompanying specifications and the establishment of the fact that the speed and carrying capacity are equal to those of the ‘Potomac.' ” A memorandum attached to the contract and signed by the parties provides among other things, that the material and workmanship of the vessel to be constructed are to be first class and to be satisfactory to the owners inspector, who shall at all times have access to the same. In this supplemental memorandum the Weems Steamboat Co. are described as “the owners.” The builder was required by the contract to give a bond for $50,000 for its performance. There is some conflict of authority as to who is to be regarded as the owner of a vessel being built under a contract ¹⁰⁶ to furnish both work and materials, before her completion and delivery to and acceptance by the party for whom she was to be built. Treating the vessel merely as a chattel its title during its manufacture would remain in its manufacturer until its completion and would then pass by delivery to and acceptance by the party for whom it was made.

But in contracts of this class like others the true method of interpretation to be followed is to ascertain from the terms .and circumstances of the contract what was the intention of the parties in making it. The, English Courts while upholding this rule have shown a tendency to regard the fact that the contract price for building a ship was to be paid to the builder in installments as the work progressed as furnishing strong evidence that the title to so much of the ship as was paid for by each installment was to vest in the vendee at the time of the payment. Woods v. Russell, 5 Barn. & Ald. 942; Clarke v. Spence, 4 Ad. & El. 448; Wood v. Bell, 5 El. & Bl. 772; Laidler v. Burlinson, 2 Mees. & Wel. 614; McBain v. Wallace, L. R. 6 App. cases, 589. Lord Campbell in Wood v. Bell, supra, referring to Woods v. Russell and Laidler v. Burlinson, supra, and other earlier cases said “still it must be remembered after all that what we have to determine is a question of fact; namely what upon a consideration of all of the circumstances we believe to have been the contract into which the parties have entered.” No Maryland decision construing a shipbuilding contract of this character has been brought to our notice nor are we aware of the existence of any.

In Clarkson v. Stevens, 106 U. S. 505 , the Supreme Court of the United States had occasion to pass upon and construe a shipbuilding contract containing many of the features of the one now before us, in order to determine whether the title to the vessel while unfinished remained in the builder or passed to the party for whom it was being constructed. Under the contract in that case Stevens was to build for the United States Government a harbor defense vessel of a specified character by a certain date. The government was to have an inspector to be admitted at all times to Stevens’ shipyard who ¹⁰⁷ should receive, receipt for and mark with the letters “U. S.’ all materials for the construction of the vessel and certify the accounts presented therefor. The government was to pay a gross price of $586,717.84 for the vessel, when fully completed and delivered at the Navy Yafd at Brooklyn in conformity with the contract, but payments to the extent of not exceeding $500,000, were to be made on account as the work progressed upon bills certified by Stevens and the government inspector, and the balance was to be paid when the vessel, fully completed according to the contract, was delivered to the government and accepted by it.

In lieu of other security for the faithful performance of his contract Stevens gave to the government a mortgage upon his shipbuilding establishment. The Supreme Court held that the title to the unfinished vessel remained in Stevens until its completion and delivery to and acceptance by the government. In arriving at its conclusion the Court reviewed the English doctrine as announced in the cases which we have cited and referred to the rule as laid down by Lord Campbell in Wood v. Bell, 5 El. & Bl. 772, and adopted by the Courts of Massachusetts in Williams v. Jackman, 16 Gray, 514 , and of New York in Andrews v. Durant, 11 N. Y. 35 , and of New Jersey in Elliott v. Edwards, 35 N. J. L. 265, that “Under a