Henry & Coatsworth Co. v. Fisherdick. City Planing Mill Company, H. B. Dodge & Co., the Crane Elevator Company, and the Reliance Wire Works Company, prorating. d. The fourth lien to the appellant Marquett. e. The fifth lien was given to the Trust Company on the mortgage executed to Braley, February 17, 1890. This lien was made up of the amount of various mechanics' liens purchased by and assigned to the Trust Company. f. The court found and decreed that the appellants Holmes and Doolittle were not liable as sureties on their indemnity bond. All parties to the suit appeal except Holmes, Bond, Doolittle, and the Coatsworth Company. We will first dispose of Marquett's appeal. The appellants Holmes and the Coatsworth Company promised Marquett in writing that if he would release his mortgage upon the property of Mrs. Bond, Holmes would pay Marquett thirty (30) per cent, and the Coatsworth Company forty (40) per cent of their estimates on each story of the hotel until the full payment of Marquett's claim. Marquett relied upon these promises and released his mortgage, and his debt remains wholly unpaid. Holmes and the Coatsworth Company received a valuable consideration for these promises and they must be held to their performance. They are now estopped from claiming liens on this property prior to Marquett. To permit this would be unfair, inequitable, and unjust. Marquett is entitled to be subrogated to the extent of his claim to whatever lien Holmes and the Coatsworth Company may have upon this property, and their liens should have been charged with the amount due Marquett. The decree of the district court, in that it did not do this, was in that respect erroneous. It is claimed by the appellants, and especially by the Trust Company, that the finding of the district court that Holmes had a balance of $8,250 and interest, due him Henry & Coatsworth Co. v. Fisherdick. from Mrs. Bond, is incorrect. Holmes' entire claim amounted to $12,100, which he had credited with $3,850. On the trial there were put in evidence receipts signed by Holmes amounting to $6,900, and it is contended that he should be bound by them and thus increase his credits the difference of $6,900 and $3,850. It appears from the record that the method by which this part of the business was conducted was as follows: As before stated, the Trust Company was to disburse the $30,000 of the Drexel mortgage, as the work on the hotel progressed, on orders from Mrs. Bond. Mrs. Bond would give Holmes an order for, say, $2,000; he would take this to the Trust Company's agents, leave it with them with his receipt for $2,000 and procure from the agents $1,400 in money; and in this way Holmes receipted for $6,900, when, as a matter of fact, he only received $3,850 in money. The Trust Company's agents and Mrs. Bond were witnesses at the trial, and none of them claim that Holmes had actually received more money than $3,850. We do not think that the district court was wrong in its finding as to the amount due Holmes. The same objection is urged by the appellants against the amount found due the Coatsworth Company; but as this claim is based on the same theory as the objection to Holmes' claim, and the method of conducting the business of the Coatsworth Company was substantially the same, the answer to the objection must be like the one to the objection of the Holmes claim, and the finding of the court as to the amount of the Coatsworth Company's claim approved. The Trust Company, however, insists that the credits. acknowledged by Holmes and the Coatsworth Company should be increased so as to equal the amount of their receipts, and this contention appears to be based on the assumption that the Trust Company was, by the orders and receipts, led into paying out, on the orders of Mrs. Henry & Coatsworth Co. v. Fisherdick. Bond, a greater sum of money to her than the work done amounted to. Now, whether or not the value of the work done at a given date was equal in amount to the orders given was a question of fact; perhaps the burden was on the Trust Company to establish that it was not; and whether the Trust Company or its agents paid these orders in full without knowing the orders exceeded the work are questions of fact. We cannot say that the evidence is insufficient to sustain the court's finding in this respect. It is also insisted by the appellant Drexel that his mortgage should have been made a first lien. Holmes and the Coatsworth Company both began the furnishing of materials for the building prior to August 26, the date of the record of Drexel's mortgage, and by the statute a lien of a mechanic or laborer dates from the commencement of the furnishing of materials or from the commencement of performing labor. The appellants Holmes and the Coatsworth Company are therefore entitled to liens on this property prior to Drexel. A party taking a mortgage on real estate is bound to know whether material has been furnished or labor performed in the erection of improvements on the real estate within the four immediate prior months. Drexel's mortgage was a lien only on the interest of Mrs. Bond in the mortgaged property. Her interest was the estate she conveyed to Drexel, less the amount due and to become due Holmes and the Coatsworth Company for labor or material, the commencement of the doing or the furnishing which was prior to the date of the record of Drexel's mortgage. On the other hand, some of the appellants claim that Drexel's mortgage should have been postponed to the liens of all parties who furnished material or performed labor in the erection of the hotel. To sustain this it is argued : (1) that there are no priorities amongst mechanics' liens for labor or material on the same improvement; (2) that the Henry & Coatsworth Co. v. Fisherdick. true meaning of our statute is that all parties performing labor or furnishing material for an improvement on real estate have a lien therefor from the commencement of the improvement; or, to state the second argument differently, after an improvement has been begun, a mortgage placed thereon is subject to a lien for labor done or material furnished, the commencement of which was subsequent to the record of the mortgage. In support of this counsel cite Phillips, Mechanics' Liens, sec. 216; Neilson v. Iowa Eastern R. Co., 44 Iowa, 71. An examination of the first authority shows that the statute on which the author is commenting provided that the building should be subject to the payment of debts of the mechanics, etc., "before any other lien which originated subsequent to the commencement of said house or other building." In the Iowa case the syllabus is as follows: "A mechanic's lien attaches from the commencement of the building and takes precedence over a mortgage executed after that time, although the particular work for which the lien is claimed was not commenced until after the execution of the mortgage." But it will be seen from an examination of the opinion that the conclusion reached was based upon the revision of the Iowa statute, which, the court say, "provides in substance that mechanics' liens shall have priority over a mortgage executed upon the land and building after the commencement of the building or improvement." These authorities, then, are not in point. Section 3, chapter 54, Compiled Statutes of Nebraska, provides: "And shall from the commencement of such labor or the furnishing such materials. * operate * as a lien." While this court has held that this statute is remedial and should be liberally construed, it has never arrogated to itself the right, if it had the disposition, to put a construction on the law that would, to all intents and purposes, amount to an amendment of it. By the Nebraska statute a person who performs labor or furnishes material Henry & Coatsworth Co. v. Fisherdick. for an improvement on real estate is given a lien thereon from the date he commences such labor or commences furnishing of materials; but this lien attaches only to the interest of the contractee in the property on which the improvement is to be erected, at the date of the commencement of the labor or the commencement of furnishing material. The material-man or laborer, furnishing material or performing labor for an improvement on real estate, must then take notice of his contractee's title and interest in the property as shown by the public records at that date. In Choteau v. Thompson, 2 O. St., 114, it is said: "If A. and B. commence work or the furnishing of materials and afterwards the owner mortgage the premises to C., and after this D. and E. begin to work or to furnish materials, here A. and B. have priority over C. and C. has priority over D. and E. In such case A. and B. must receive what they would be entitled to if C.'s mortgage had no existence; the residue must be applied next to the satisfaction of the mortgage; and whatever may remain after that must be distributed to D. and E. pro rata." The statute considered in that case appears to have been substantially like the Nebraska statute. In Crowell v. Gilmore, 18 Cal., 370, it is said: "The mechanic making the first contract, or first commencing work on a building, has no priority over others commencing work subsequently. The statute places all claimants on an equality and directs the property to be sold and the proceeds applied to all without preference. This rule of equality would not apply if some mechanics began work before a mortgage was executed, by the owner of the property, and some afterwards. In such case the first lienholders would have priority over the mortgagee, while the latter would not. The first class would be paid in full before the mortgage; then the mortgage; then the last class, each lienholder having equal claims with the others of his |