Coleman v. Oregonian R. R.
Coleman v. Oregonian R. R.
Opinion of the Court
Opinion by
Upon these facts the important question for decision relates to the priority of lien between a judgment creditor of a railroad contractor who has duly garnished or levied upon the amount due his debtor from the company, and a subcontractor who, subsequent to the service of the garnishee process, gave the notice of lien required by the act under consideration. Section 1 of the law which governs the rights of the plaintiff in this case provides that any person who shall, as subcontractor, material-man, or laborer, furnish to any contractor of a railroad corporation any fuel, ties, materials, supplies, or other article or thing, or who shall do or perform any work or labor for such contractor, in conformity with the
The lien can be acquired only in the manner provided by law,—that is, by giving the prescribed notice,—and, when thus acquired, attaches only for the amount then actually due the contractor from the company. Prior to the notice, the subcontractor, laborer, or material-man has no lien, but is in the position of a general creditor, with no preferential right to be paid for his labor or material out of the fund due the contractor from the company. He may acquire a lien by giving the prescribed notice, but until he does so, no lien can attach in his favor; and, the debt due the contractor being subject to garnishment at the suit of his other creditors, the right of the attaching or execution creditor is not overreached by the notice subsequently given. The notice creates and originates the lien, and the statute provides that the corporation shall not be liable for any greater sum than the amount due the contractor at the time the notice is given and the lien attaches. If, therefore, before such notice, some general creditor, pursuing the remedies given by law, has acquired a right by garnishment under an attachment or execution, to have the entire debt applied in satisfaction of his claim, there is nothing “then” due the con
We understand the rule to be, from the authorities, that under a statute like this, which gives a lien upon the giving or filing of the prescribed notice, the lienor takes his lien subject to the rights of other persons, and that whatever rights such persons may assert in or to the fund, as against the contractor or owner, whether arising from contract or operation of law, may be asserted against a subcontractor, laborer, or material-man, who might have acquired a lien by giving the notice, but has omitted to do so: 2 Jones on Liens, § 1286, et seq.; McCorkle v. Herrman, 117 N. Y. 297, 22 N. E. 948; Stevens v. Ogden, 130 N. Y. 182, 29 N. E. 229; Dorestan v. Krieg, 66 Wis. 613, 29 N. W. 576; Craig v. Smith, 37 N. J. L. 549; Copeland v. Manton, 22 Ohio St. 398.
It is claimed that the implication to be drawn from the provision that the lien given by this statute shall not take priority over existing liens is that no lien on the fund due the contractor shall have preference. This argument assumes that the subcontractor, laborer, or material-man has, or can acquire, a lien upon the debt due the contractor from the corporation. But no such right is given him by the statute. His lien, when acquired, is not upon any debt owing the contractor, but upon the property of the company for the amount actually due the contractor at the time the notice is given. The provision concerning existing liens is only designed to render the subcontractor’s lien subject to liens upon the property of the company, and does not affect the
It follows from these considerations that the lien acquired by plaintiff was subject and subsequent to the rights of Dawson, and the decree of the court below must be reversed. Reversed.
Reference
- Full Case Name
- COLEMAN v. OREGONIAN R. R. CO.
- Status
- Published