movement to give the subcontractor a direct lien on the property irrespective of the rights of the contractor.2 § 108. The New York Doctrine. In New York State the courts have not adopted the idea of a direct lien for the subcontractor, but have given him a lien based upon the doctrine of, or more exactly speaking in the nature of, subrogation. As a condition precedent to awarding any lien to the subcontractor, the New York courts require that the contractor himself shall be entitled to a lien, and that in any event there shall be monies due from the owner to the contractor to which the subcontractor may be subrogated. Under the subrogation doctrine as examplified in the New York cases, the owner is afforded a protection which is not given him under the doctrine of a direct lien for the subcontractor as exemplified in the Pennsylvania cases. Thus, under the New York doctrine, where the principal contractor fails to complete, while the right of the subcontractor to his lien is not affected, the extent to which the lien can be enforced is very 2 Linden Steel Co. v. Rough Run Manufacturing Co., 158 Pa. St. 238; Willey v. Topping, 146 Pa. St. 427; White v. Miller, 18 Pa. St. 52; but compare Schroeder v. Galland, 134 Pa. St. 277; Coonse Ice Co. v. Stove Co. (Ind.), 121 N. E. 293. 3 Szemko v. Weiner, 176 N. Y. A. D. 620; Rukeyser v. Fountain, 185 N. Y. A. D. 263; La Pasta v. Weil, 20 Misc. (N. Y.) 554, reversing 20 Misc. (N. materially affected, in that, under these circumstances, the New York courts will allow the subcontractor to enforce his lien to the extent merely of the amount due to the contractor from the owner at the time when the lien is filed, or at the time when the subcontractor gives proper notice of his claim.* Applying the New York doctrine to the usual provision in a building contract which provides that payment shall be made in installments, on account of the total amount, and that the balance of the stipulated price shall be paid upon completion, the effect is to prevent the subcontractor from enforcing a lien against the balance retained under such a provision, in the event that the contractor fails to complete." If the owner, however, elects to come in and complete the work under a contract provision allowing him so to do, and does this, shortly before an installment is to fall due to the contractor, a subcontractor or material-man may enforce a lien to the extent of the amount of the installment so to become due, less such amount as may be necessary to complete the work to the point when the installment would become due, less also such sum as may be required to make good defective work. This rule holds true despite the 4 Foshay v. Robinson, 16 N. Y. Supp. 817, affirmed 137 N. Y. 134; and to same effect see Wright v. Pohls, 83 Wis. 560; compare N. J. Steel, etc., Co. v. Robinson, 33 Misc. (N. Y.) 361. 5 Kelly v. Bloomingdale, 19 N. Y. Supp. 126, affirmed, 139 N. Y. 343; Brainard v. County of Kings, 84 Hun. N. Y. 290, affirmed 155 N. Y. 538. fact that there may be nothing due to the contractor, on the completion of the building, by reason of his failure to complete." § 109. Failure of Contractor to Complete.Work done by the subcontractor for the owner, after the abandonment of the contract by the contractor, gives to the subcontractor the right to a lien for the full amount of the value of such work, this being a new undertaking as between himself and the owner, and entirely separate from the work done by him theretofore under his contract with the main contractor. If the breach of the contract is on the part of the owner and not on the part of the contractor, and the latter's failure to complete results from such a condition, the lien of the subcontractor may be enforced to the extent of such part of the contract price as may remain unpaid. § 110. Rights of Subcontractor as Affected by Contract. There is a diversity of opinion among the courts of the different States as to the validity and effect of a provision in a building contract providing that the subcontractor shall not acquire a lien, or providing that the contractor may not, without the owner's consent, sublet his contract. In some jurisdictions it has been held that a lien, being purely statutory, and provided solely by the decree of the Legislature, cannot be interFoshay v. Robinson, 16 N. Y. Supp. 817, affirmed 137 N. Y. 134. 7 Delray, etc., Co. v. Keohone, 132 Mich. 17. 8 Person v. Stoll, 72 N. Y. A. D. 141, affirmed 174 N. Y. 548. fered with by the provisions of the building contract, and that the subcontractor is accordingly entitled to his lien, irrespective of any covenant which the contractor may have made in this connection with the owner." In other jurisdictions the courts have considered that the subcontractor is chargeable with notice of the provisions of the building contract and is, accordingly, barred from his lien under such circumstances.10 § III. Employees and Material-Men of Subcontractor. It was a very general rule in the earlier stages of the development of the lien law that the employee of a subcontractor was not entitled to any lien rights." The same rule was likewise applied to those furnishing materials,12 or furnishing labor to the subcontractor.13 9 Atlantic, etc., Co. v. Donnelly, 59 N. J. L. 48; see also Huttig, etc., Co. v. Denny Hotel Co., 6 Washington 122; and that a subcontractor is entitled to his lien despite a provision that the contractor may not sublet the contract and despite the fact that the owner has not given his consent to the making of the contract between the contractor and the subcontractor, see Wahlstrom v. Trulson, 165 Mass. 429; Perry v. Potashinski, 169 Mass. 351. 10 Dersheimer V. Maloney, 143 Pa. St. 532; Schroeder v. Galland, 134 Pa. St. 277; Seaman v. Biemann, 108 Wis. 365. 11 Central Trust Co. v. Richmond, etc., Co., 54 Fed. 723; Harlan v. Rand, 27 Pa. St. 511; Culver v. Attwood, 170 Ill. 432; Morrison v. Whaley, 16 R. I. 715; Farmer v. St. Croix, etc., Co., 117 Wis. 76. 12 Central Trust Co. v. Richmond, etc., Co., 54 Fed. 723; Wood v. Donaldson, 17 Wend. (N. Y.) 550, affirmed 22 Wend. 395; Heroy v. Hendricks, 4 E. D. Smith (N. Y.) 768; Carlisle v. Knapp, 51 N. J. L. 329; Duff v. Hoffmann, 63 Pa. St. 192, Harbeck v. Southwell, 18 Wis. 418; Stephens v. United R. R. etc., Co., 29 Ohio St. 227. 13 Central Trust Co. v. Richmond, etc., Co., 54 Fed. 723; Wood v. Donaldson, 17 Wend. (N. Y.) 550, affirmed 22 Wend. 395; Cairo, etc., Co. v. Watson, The stringency of these earlier decisions has been largely modified, however, by statutes and decisions providing in substance for liens in favor of those performing labor or furnishing materials for subcontractors. 14 § 112. Necessity and Effect of Filing or Recording Contract.-There are statutory provisions in a number of the States with reference to the filing or recording of the contract between the owner and the contractor, and while discussion of these might properly be included under the separate discussion to be given to the construction contract, their effect on the lien rights of the parties is such that it seems preferable that they be considered in the present connection. In some States these statutes have taken the form of providing that no lien can be predicated upon the contract unless the latter is in writing and recorded; 15 while in others only contracts in excess of specified amounts need be so recorded.16 In California the rule has been modified, by a de 85 Ill. 531; Vandenberg v. P. T. Walton, etc., Co., 19 Okla. 169. 14 Vogel v. Luitwieler, 52 Hun. (N. Y.) 184; Brainard v. County of Kings, 84 Hun. (N. Y.) 290, affirmed 155 N. Y. 538; Garrison v. Borio, 61 N. J. Eq. 236, 47 Atl. 1060; Gardner, etc., Co. v. N. Y. Central, etc., Co., 72 N. J. L. 257; distinguishing Carlisle v. Knapp, 51 N. J. L. 329; Snyder v. N. Y. Central, etc., Co., 72 N. J. L. 262; Smith v. Neubaur, 144 Ind. 95; Barlow Bros. Co. v. Gaff- 15 McClallan v. Smith, II |