OEHLESE W. PRYOR, Plaintiff,
PRYORS, PRINTERS, a Corporation et al., Defendants; BLAKE, MOFFIT & TOWNE OF ARIZONA, a Corporation (Intervenor-Defendant), Appellant,
CHAS. W. SLADE, CLIFFORD S. PRYOR and AUSTIN H. PEASE (Wage Claimants), Appellees
APPEAL from a judgment of the Superior Court of the County of Maricopa. Howard C. Speakman, Judge. Judgment reversed and remanded.
Messrs. Rawlins & Rawlins and Mr. Arthur M. Davis, for Appellant.
Mr. Thomas W. Glenn, for Appellees.
[56 Ariz. 574] McALIST J.
The question presented by this appeal is whether a claim for wages filed pursuant to section 62-215, Arizona Code of 1939, or the lien of a chattel mortgage has priority. It arises out of the following facts.
The administratrix of the estate of Harry B. Prior brought an action against Pryors, Printers, a corporation, and others, on July 27, 1937, in which she sought recovery of $2500, the establishment of an agreement dated July 9, 1934, as a lien on certain printing equipment of the defendants, and the foreclosure of that lien.
Blake, Moffit & Towne of Arizona, a corporation, having obtained permission of the court to intervene in the case as a defendant, filed an answer and a cross-complaint on August 24, 1938. In the former it alleged that any rights plaintiff might seek to enforce under the agreement of July 9, 1934, were inferior and subordinate to the rights of intervenor which arose under a note in the sum of $1,600 executed by Pryors, Printers, a corporation, on October 16, 1937, to Blake, Moffit & Towne of Arizona, a corporation, and was secured by a chattel mortgage on the same printing equipment as that on which plaintiff claimed a lien. This note was a renewal of one dated October 26, 1931, between the same parties that had been secured by a chattel mortgage under that date on the same printing equipment. Both mortgages were placed of record a day or so after they were executed.
The cross-complaint of intervenor-defendant sought judgment against Pryors, Printers, for the sum of $1,350, as the balance due on the promissory note dated [56 Ariz. 575] October 16, 1937, and for the foreclosure of its lien under its chattel mortgage of the same date against the plaintiff and all defendants.
On October 11, 1939, a decree in favor of intervenor for the relief prayed for and also in favor of plaintiff for $2,500 was entered. It provided that as between the respective liens of the plaintiff and the intervenor, the latter was entitled to the first $448.53, the plaintiff to the next $2,500, and the intervenor to the remainder due it.
The court decreed a foreclosure of the liens and a sale of the property pursuant to which a special execution and order of sale was issued October 13, 1939, directing the sheriff to sell the property described in the decree, notice designating October 25, 1939, as the date and the premises of the defendant as the place of sale being properly posted. On October 19, 1939, Chas. W. Slade, Clifford S. Pryor and Austin Pease gave the parties to the action and the sheriff of Maricopa county notice of their claims for wages due for labor performed by them for Pryors, Printers, within sixty days next preceding the levy of the writ, namely, $172.80, $169.02 and $50, respectively. Each of these notices was verified by the claimant, and given pursuant to the provisions of section 62-215, Arizona Code of 1939, reading as follows:
"Wages to take priority over attachments and levies. -- Procedure. In case of levy under execution, attachment, and like writ except where such writ is issued in an action under this article, any miner, mechanic, salesman, servant or laborer who has a claim against the defendant for labor done, may give notice of his claim, sworn to and stating the amount thereof to the creditor and defendant debtor, and to the officer executing the writ, at any time within three (3) days before the sale of the property levied on. Such officer shall file such statement with the clerk of the court issuing the writ, and unless the claim be disputed by such debtor or creditor before sale, such officer shall pay the claimant out of the proceeds of the [56 Ariz. 576] sale the amount he is entitled to receive for such services rendered within sixty (60) days next preceding the levy of the writ not exceeding the sum of two hundred dollars ($200) to each claimant; and upon the failure of the officer to do so, he shall be liable to the claimant therefor. Such claim may be disputed by the debtor or creditor, or any lienholder, in writing, specifying the reasons for disputing the same, verified and delivered to the officer before the sale, and shall by him be filed in the court issuing the writ. The officer shall, out of the first money received, pay all claims not disputed. If the total amount of all the claims presented exceeds the amount derived from such sale, the officer shall pay to the holders of such undisputed claims their pro rata of such money, and shall pay the pro rata amount of the disputed claims, together with such sum for costs as the court may order, into court. The court shall cite all parties interested to appear, and in a summary manner determine the validity of the disputed claim and direct the officer in distributing the proceeds of sale."
Subsequent to October 19, 1939, and before the date of sale, the intervenor asked the court to strike the notices of ...