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Koenig v. Mccarthy Constr. Co.

OPINION FILED JULY 12, 1951

ROY KOENIG, TRADING AS R.H. KOENIG AND SON, NEWKIRK TRANSIT MIX, INC., AND JOLIET BOILER AND MACHINE WORKS, INC., PLAINTIFFS-APPELLEES,

v.

MCCARTHY CONSTRUCTION COMPANY, INC., GOMORRA AND GIROT CONSTRUCTION COMPANY, AND CITY OF JOLIET, ILLINOIS, DEFENDANTS-APPELLANTS.



Appeal by defendants from the Circuit Court of Will county; the Hon. JAMES V. BARTLEY, Judge, presiding. Heard in this court for the first district at the October term, 1950. Judgment reversed in part and remanded with directions. Opinion filed July 12, 1951. Released for publication August 1, 1951.

MR. JUSTICE BRISTOW DELIVERED THE OPINION OF THE COURT.

Defendants, McCarthy Construction Co., Inc., a corporation, and the City of Joliet, Illinois, are appealing from a decree entered by the circuit court of Will county awarding plaintiffs liens in the respective amounts of $2,156.33 to plaintiff Roy Koenig, $1,105.66 to plaintiff Newkirk Transit Mix, Inc., and $640 to plaintiff Joliet Boiler & Machine Works, Inc., together with interest thereon, on funds withheld by the City of Joliet and due to the defendant McCarthy Construction Co., Inc. under a public improvement contract.

The salient issues on this appeal are whether plaintiffs can be deemed to be subcontractors under the terms of the Illinois Lien Act, and, if so, whether plaintiffs are entitled to recover the actual unpaid balance due them from the money withheld by the city from the general contractor, or whether they are limited to the sum due to the alleged subcontractor to whom plaintiffs furnished materials, at the time notice of the lien was given to the general contractor.

Under the stipulated facts, it appears that on August 3, 1948, defendant City of Joliet entered into a contract with defendant McCarthy Construction Co., Inc. for the construction of a sewer system. On August 10, 1948, defendant McCarthy Construction Co. contracted with defendant Gomorra & Girot Construction Co. for 3,800 precast manhole rings which were to be picked up by the McCarthy Construction Co. at Gomorra & Girot Construction Co.'s place of business located about a mile from the construction site. The Gomorra & Girot Construction Co. thereupon entered into contracts with the respective plaintiffs, whereby plaintiff Roy Koenig, doing business as R.H. Koenig & Son, furnished certain specified wooden and steel forms for the manhole rings; plaintiff Newkirk Transit Mix, Inc., furnished the concrete; and plaintiff Joliet Boiler & Machine Works, Inc. furnished certain steel molds.

Although plaintiffs delivered the requisite materials to defendant Gomorro & Girot Construction Co. in compliance with their contracts, the Gomorra & Girot Construction Co. did not pay plaintiffs therefor, and defaulted on its contract with the McCarthy Construction Co. after delivering only 310 of the 3,800 manhole rings specified in the contract. For the rings delivered, the Gomorra & Girot Construction Co. was paid $2,200 by the McCarthy Construction Co., which is presently holding the balance of $590 due thereon.

It was further stipulated that, although defendant McCarthy Construction Co. originally had no knowledge of the negotiations or contracts between plaintiff and the Gomorra & Girot Co., the McCarthy Construction Co. was served with all notices of unpaid claims in accordance with the requirements of the Illinois Lien Act.

On the basis of substantially the foregoing facts, the circuit court entered a decree that plaintiffs each had liens on the funds held by the city and due the McCarthy Construction Co. to the extent of plaintiffs' unpaid balances owing from the Gomorra & Girot Construction Co., together with interest thereon. Defendants have prosecuted this appeal from that decree.

Defendants contend that, from the stipulated facts, it is evident that the Gomorra & Girot Construction Co. was merely a supplier or materialman to the principal contractor rather than a subcontractor, on the grounds that the work was performed at defendant Gomorra & Girot's place of business and not at the site of the construction, and that the only contact between the parties was the periodic picking up of the rings by the defendant McCarthy Construction Co., which had no control over Gomorra and Girot's operations. Under these circumstances, defendants argue that, inasmuch as the legislature meant by "subcontractor" one who supplies material directly to the project, the Girot Co. was not a subcontractor, and its intervention breaks the sequence of contracts, so that plaintiffs cannot be deemed to be subcontractors within the meaning of the Act, and consequently are not entitled to assert rights thereunder.

Moreover, defendants assert further that even if plaintiffs are deemed subcontractors within the meaning of the Act, their recovery should be limited to the amount due the Gomorra & Girot Construction Co. from the McCarthy Construction Co. at the time the notices of the liens were given.

Plaintiffs, however, reject that interpretation of the statute, and maintain that under the amendment of 1935 to sec. 23 of the Lien Act [Jones Ill. Stats. Ann. 74.23], subcontractors, such as plaintiffs, were expressly granted the right to claim liens on funds due from the city under contracts for public improvements, and that the statute does not limit their liens to the amount due to their immediate contractor.

In interpreting the word "subcontractor," appearing in the Illinois Lien Act (ch. 82, Ill. Rev. Stat. 1949), this court shall be guided by the established rules of statutory construction, whereby the primary aim is to ascertain the legislative intent (Shaeffer v. Burnett, 221 Ill. 315) which may be discerned from the history of the legislation or from the use of the terms in other sections of the same or other Illinois statutes. (Alexander Lumber Co. v. Coberg, 356 Ill. 49.) This approach must precede any analogy to interpretations of allegedly similar statutes by courts of other jurisdictions.

The relevant sections of the Illinois Lien Act, supra, provide:

Sec. 21. [Ill. Rev. Stat. 1949, ch. 82, par. 21; Jones Ill. Stats. Ann. 74.21] "Every mechanic, workman or other person who shall furnish any materials, apparatus, machinery or fixtures, or furnish or perform services or labor for the contractor, or shall furnish any material to be employed in the process of construction as a means for assisting in the erection of the building or improvement in what is commonly termed form or form work, where concrete, cement or like material is used in whole or in part, shall be known under this Act as a subcontractor, and shall have a lien for the value thereof . . ."

Sec. 23. "For the purpose of this section `contractor' includes any subcontractor. Any person who shall furnish material, apparatus, fixtures, machinery or labor to any contractor having a contract for public improvement for any county, township, school district, city or municipality in this State, shall have a lien on the ...


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