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Intermountain Building and Loan Association v. Allison Steel Manufacturing Company

Supreme Court of Arizona

May 26, 1933

INTERMOUNTAIN BUILDING AND LOAN ASSOCIATION, a Corporation, Appellant,
v.
ALLISON STEEL MANUFACTURING COMPANY, a Corporation, WALLAPAI BRICK COMPANY, a Corporation, CALVERT-BAKER LIME & CEMENT COMPANY, a Corporation, SHOPE BRICK COMPANY OF PHOENIX, a Corporation, BOB CUSHMAN and BURWELL LEFTWICH, Appellees

APPEAL from a judgment of the Superior Court of the County of Maricopa. J. C. Niles, Judge. Judgment affirmed.

Messrs. Baker & Whitney and Mr. Lawrence L. Howe, for Appellant.

Messrs. Sloan, McKesson & Scott, for Appellee Allison Steel Manufacturing Company, a Corporation.

Messrs. Flanigan & Fields, Messrs. Cox, Moore & Janson and Messrs. Windes & Miller, for Other Appellees.

OPINION

[42 Ariz. 52] FICKETT, Superior Judge.

This is an appeal by the Intermountain Building and Loan Association, a corporation, hereinafter referred to as appellant, from a judgment of the superior court of Maricopa county in two cases consolidated for trial, wherein the court established and foreclosed several mechanics' and materialmen's liens, upon property in the city of Phoenix, hereinafter referred to as the Spear job, and adjudged them all to be prior and superior to the mortgage held by appellant on the same property.

The trial court correctly determined the priority of the various lien claimants in accordance with the decision of this court in Wylie v. Douglas Lumber Co., 39 Ariz. 511, 8 P.2d 256, 83 A.L.R. 918.

Appellant's first assignment of error involves only the Allison Steel Manufacturing Company, a corporation, hereinafter referred to as appellee. The principal contractor, Rex B. Mesney, Inc., contractors, hereinafter referred to as contractor, was constructing [42 Ariz. 53] two buildings about the same time for the same owner, Phoenix Land & Investment Company, on two different pieces of property, one being known as the Spear job, on the property herein involved, and the other being known as the P.I.D. job. Appellee furnished the steel work on both jobs. Appellant, after construction was started on the Spear job, took a mortgage for $55,000 on the property herein involved, the money from which was to be advanced as the building progressed. Appellant had no connection of any kind with the P.I.D. job. On November 18, 1930, appellee received from the contractor the latter's own check for $2,100, which payment appellee

Page 414

applied to contractor's credit on the P.I.D. job. The money represented by this check was received by the contractor from appellant as part of the mortgage money, and appellant contends that the appellee knew this money was part of the money advanced by the appellant mortgagee, and that appellee was therefore under legal obligation to credit this $2,100 on the Spear job, which would have made its judgment in this action $2,100 less. The trial court refused to allow this credit and appellant assigns this as error.

Under the rule heretofore announced by this court in Watson et ux. v. Murphey, 36 Ariz. 377, 285 P. 1037; Stolaroff v. Bassett Lumber Co., 21 Ariz. 490, 190 P. 81, if appellee knew, or was sufficiently informed so as to have been charged with knowledge, that the $2,100 in question was paid to the contractor by appellant as part of the mortgage money, appellee was obliged to credit said payment to the Spear job, and this rule would apply, even though the owner and contractor defaulted, as was done in this case, provided that this issue was properly presented by pleading it specially.

The evidence showed that attached to the contractor's check of $2,100 was a detachable stub, bearing this notation:

[42 Ariz. 54] "11/18 Structural Steel -- P.I.D. Job as per contract -- $2,100 -- $2,100."

The original contract for structural steel on the P.I.D. job was $2,100, which was then due, plus about $78 for extras. The check was received by appellee through the mail, and no letter or other instructions of any kind accompanied it other than the detachable stub above referred to. Appellant did not give any notice of any kind to appellee to the effect that it had paid money to the contractor which could be used to cover this steel work on the Spear job. While appellee knew that appellant was furnishing some money under a mortgage on the Spear job, it had no knowledge of any kind as to the source of this particular payment. A few days after the check was cashed, the secretary of the contractor called appellee's office on the phone, requesting that the credit be transferred from the P.I.D. job to the Spear job, which request was refused. In this telephone conversation no mention was made about the money coming from the appellant. Under these facts the trial court was correct in holding that appellee was justified in ...


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