After that reversal, the defendant corporation obtained an order at the Special Term authorizing it to amend its answer by setting forth therein substantially the same cause of action against the defendant Flannery as the plaintiff had attempted to allege in his complaint. We affirmed that order on appeal. See McCoy v. Gas Engine & Power Co., 139 App. Div. 938, 124 N. Y. Supp. 1121. The judgment now appealed from has been entered after a trial of the issues so joined, and dismisses the complaint herein pursuant to our previous decision, and also grants the defendant corporation's prayer for relief as contained in its amended answer, by setting aside the defendant Flannery's contract of retainer on the ground that it violates section 74 of the Code of Civil Procedure. The judgment awards Flannery the sum of $30,000 as the reasonable value of the services performed by him, and provides that the same is to be paid out of the award when collected, and the judgment further provides that the defendant Flannery shall render such further legal services in behalf of the defendant corporation as may be needed to collect the award, without further compensation, if the defendant corporation elect to have him do so.

[1] All parties have appealed from this judgment; but the defendant corporation asks in its brief, and asked upon the oral argument, that the judgment be affirmed. Manifestly so much of the judgment as dismisses the complaint upon the authority of our former decision must be affirmed.

[2] We are also of opinion that the learned Special Term was right in deciding that the contract of retainer violated section 74 of the Code of Civil Procedure. That section, as it existed at the time the contract was executed, prohibited an attorney or counsel from promising or giving, or procuring to be promised or given, "a valuable consideration to any person, as an inducement to placing, or in consideration of having placed, in his hands, or in the hands of another person, a demand of any kind, for the purpose of bringing an action thereon." That section has since been amended so as to extend its inhibition to special proceedings. See section 274 of the Penal Law (Consol. Laws 1909, c. 40). It is undoubtedly true, as conceded by the parties to this action, that the promise contained in the last paragraph of the contract of retainer, whereby Flannery agreed "to pay all expenses of every kind whatsoever," was the promise of a valuable consideration to the corporation as an inducement for the placing of the claim in his hands.

[3] The appellant Flannery contends, however, that his retainer did not violate the terms of former section 74 of the Code of Civil Procedure, because the prosecution of the corporation's claim before. the board of assessors was not the prosecution of an action, and because the parties to the retainer did not contemplate the bringing of an action. It is true that the prosecution of the claim before the board of assessors was not the prosecution of an action. If the legal effect of the retainer was that Flannery was merely under obligation to prosecute that claim before the board of assessors, then we should reverse the judgment in so far as it holds his contract a violation of

137 N.Y.S.--38

section 74. It seems, however, that the only method of collecting the award after the same has been made by the board of assessors, should the city refuse payment, is by action against the city. While it may very well be that the parties, at the time the contract was made, did not believe that the city would refuse to pay the award when made, nevertheless it appears certain, from the testimony of Flannery himself, that he knew the agreement obliged him to collect the award by action if necessary.

[4] The language of the retainer was chosen by Flannery, and in case of ambiguity would, in accordance with well-known canons of construction, be construed most strongly against him. An examination of the agreement shows that the amount of the contingent fee to be paid was based entirely upon the amount of the damages recovered by the corporation, and not upon the amount awarded. Thus Flannery is to receive 25 per cent. of any award and interest "recovered," up to and including $50,000. If the award is more than $50,000 and less than $100,000, he is to receive "33% per cent. of the full amount recovered." If the award and interest amount to $100,000 and less than $150,000, he is to receive "40 per cent. of the full amount recovered." If the award amounts to $150,000 or over, he is to receive "one-half of the full amount recovered." Thus in each instance the contract carefully distinguishes between the amount of the award that may be made and the amount of it that may be recovered, and bases the fee exclusively upon the amount of the recovery. It further provides that Flannery's fee is not to be paid until the award is paid.

[5] The judgment appealed from, in addition to fixing the value of Flannery's fees at $30,000, provides that the sum so fixed is to be a lien upon the award, and that Flannery shall, at the option of the defendant corporation, perform without additional compensation any future services necessary in the collection of the award. We are of opinion that the Supreme Court has no power to rescind a contract at the instance of the defendant corporation, and provide that Flannery, the other party to the contract, must perform additional services after such rescission.

The power of the court would seem to be exhausted with the rescission of the contract and the fixing of the value of the services, and it therefore follows that the judgment should be modified, by striking out the provision requiring the performance of future services on Flannery's part, and by fixing the value of the services as heretofore performed, on the evidence adduced, at the sum of $30,000, and, as so modified, the judgment should be affirmed, without costs. All concur.

(152 App. Div. 718.)

FANNING et al. v. BELLE TERRE ESTATES, Inc., et al. (Supreme Court, Appellate Division, Second Department. October 4, 1912.) 1. VENDOR AND PURCHASER (§ 229*)-BONA FIDE PURCHASER-NOTICE.

A purchaser, to take land subject to liens, must be aware of the liens ; and mere knowledge of an indebtedness, that may ripen into liens if the land be unconveyed, is insufficient.

[Ed. Note. For other cases, see Vendor and Purchaser, Cent. Dig. 88 477-494; Dec. Dig. § 229.*]

2. MECHANICS' LIENS (8 64*)-CONSENT OF OWNER.

The fact that two corporations have certain officers and offices in common, and are each interested in the development of a tract of land, does not make them identical, so as to render a contract of sale, made by one of them, calling for the erection by the purchaser of buildings on the land, a consent of the other, a subsequent purchaser, to the improvement, which will subject its interest in the land to a mechanic's lien for the improvement.

[Ed. Note. For other cases, see Mechanics' Liens, Cent. Dig. § 81; Dec. Dig. 8 64.*]

3. MORTGAGES (§ 151*)-PURCHASE-MONEY MORTGAGE-MECHANIC'S LIENPRIORITIES.

A corporation conveyed land to a grantee, who gave a mortgage for part of the price and agreed to erect buildings on the premises. Не began work, but did not complete it, and, to finance the undertaking, he conveyed the premises and finally they passed to a distinct corporation, subject to the original purchase-money mortgage and other mortgages placed thereon at the instance of the grantee. Held that, under Laws 1897, c. 418, § 3, giving contractors, subcontractors, laborers, and materialmen liens, liens for the work and materials were not superior to the purchase-money mortgage, especially where the lienors filed liens only against the interest of the grantee, though stating that the corporation finally acquiring the title acquired the interest of the grantee. [Ed. Note. For other cases, see Mortgages, Cent. Dig. §§ 307–329, 332-336, 358-370; Dec. Dig. § 151.*]

4. MECHANICS' LIENS (§ 122*)-NOTICE OF LIEN-AGREED PRICE FOR MA

TERIALS.

A notice of a lien for materials, under Laws 1897, c. 418, giving a lien for materials, which does not state the agreed price for the materials, but only states the amount unpaid as the agreed price, is defective.

[Ed. Note. For other cases, see Mechanics' Liens, Cent. Dig. 88 165170; Dec. Dig. § 122.*]

5. MECHANICS' LIENS (§ 122*)-NOTICE OF LIEN-AGREED PRICE FOR MATERIALS.

A notice of a lien for labor and materials under Laws 1897, c. 418, which fails to describe the labor or materials, and which merely states the amount claimed for materials and the amount claimed for labor, is defective.

[Ed. Note.—For other cases, see Mechanics' Liens, Cent. Dig. §§ 165170; Dec. Dig. § 122.*]

6. MECHANICS' LIENS (8 124*)-NOTICE OF LIENS-CURING DEFECTS.

A defect in a notice of lien under Laws 1897, c. 418, arising from the failure to give the agreed price for the materials or to describe the labor or materials, is not cured by the fact that the owner knew what the work was and what materials were furnished.

[Ed. Note. For other cases, see Mechanics' Liens, Dec. Dig. § 124.*]

For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes

Appeal from Special Term, Suffolk County.

Action by Orange T. Fanning and another against the Belle Terre Estates, Incorporated, and others to enforce mechanics' liens. From a judgment for plaintiffs and the defendant lien claimant, the defendant named and others appeal. Reversed, and new trial granted.

Argued before HIRSCHBERG, BURR, THOMAS, CARR, and RICH, JJ.

Frederick H. Sanborn, of New York City (Willard N. Baylis, of New York City, on the brief), for appellants.

Thomas J. Ritch, Jr., of Port Jefferson, for respondents.

THOMAS, J. The Suburban Construction Company received from the Belle Terre Development Company a deed of land, dated July 29 and recorded July 30, 1909. On the following August 4th, plaintiffs and the defendant Yarrington severally filed notices of lien, and on August 6th they filed supplementary notices. This action is to foreclose the liens, and to have the interests of the Construction Company and the Belle Terre Estates in the land sold, and so it has been adjudged. The Development Company, having the title, gave the Dean Alvord Company an option to purchase; but, upon that company declining, the Construction Company was substituted by consent. The option agreement required the payment of $15,000 in cash, and that the conveyance should be subject to mortgage liens, not exceeding a sum named.

It is alleged in the complaint, and is for some purpose here argued by respondent, that in addition the vendee agreed to pay the present alleged lienors. But any attempt to enforce such promise is waived by stipulation, although the allegation is preserved to show fraud, and there is no evidence whatever that any indebtedness entered into the consideration, save as enumerated in the option agreement. The purchaser wished to be informed as to the incumbrances, and, upon Hughes mentioning outstanding indebtedness, was told by Mr. Baylis that he wished only the mortgage indebtedness. Mr. Baylis, acting for the vendee, did not promise to pay the claims, and although Hughes showed Meyers, the broker, a statement of indebtedness that included the present creditors, I find no trace of an agreement on the part of the vendee to pay them. Indeed, the finding is that the vendee paid to Hughes the "full amount stipulated to be paid." The groundless contention that there was a promise to pay the plaintiffs and Yarrington may be dismissed.

[1] The respondents urge, and their contention seems to have some support in the findings, that the conveyance to the Construction Company is subject to the liens, because the vendee, knowing of the debt, took the title. If this means that a person cannot purchase with knowledge of indebtedness that may ripen into a lien, if the land be unconveyed, there is no justification for it. The purchaser must beware of the lien, but not of the debt.

[2] To what, then, is the question here reduced, if not to this: Did the vendee consent to the deliveries upon which the liens are

based? The court has found that the vendee is the Belle Terre Estates in another form. But how did that company consent? It sold to Hughes upon an agreement whereby he should within a time limited build six houses. The vendors advanced no money for the houses. The vendee began the work, received the deed earlier than the contract provided, but never completed the buildings. For the purpose of financing the undertaking, Hughes conveyed to his father, who conveyed to the Belle Terre Development Company, a corporation controlled by Hughes, and that company finally conveyed to the Suburban Construction Company. The plaintiff's position is that the Suburban Company is so identified with the Belle Terre Estates that the latter has reacquired the property, and that, as by its contract it obligated Hughes to build on the property, it thereby consented that its land should be subjected to any lien arising therefor. I regard both positions as quite untenable. There is nothing to identify the last purchaser with the first seller, save the fact that they had certain officers and offices in common, and were each interested in the development of the territory of which the lots were a part.

[3] Hughes, after ample aid and forbearance from his grantor, made a failure of the project, and the Suburban Company took the property subject to mortgages that had originally been a lien on it and others placed there at his instance, and paid him in cash more than enough to meet all indebtedness to materialmen. It has been found that the property was worth much more than Hughes received, but that is based upon his general statement of its value, which cannot be readily approved. In any case Hughes sought the purchaser, and was not importuned, much less constrained, by it, and received all that he asked. This action is merely to foreclose liens, and I consider that the statute does not subject a vendor's land to liens, where he sells lots and insists that the vendee shall use them for their proper purposes and build thereon houses of a prescribed kind within a time fixed. The sale of real estate with insistence upon adaptation to building purposes gives no priority to liens as against the vendor's interest.

The present proposition is that a sale to Hughes with stipulation for building houses was a consent that made liens for material and labor effective against the vendor, although Hughes, after conveyance to his father and another, finally procured a sale to a distinct corporation, whose officers and affairs were related to the original vendor. To facilitate Hughes' performance, the vendor stipulated to give him possession under a lease upon receiving a bond; but he gave no bond, and apparently entered upon the land under his contract, and later received a deed giving back a mortgage for part of the purchase money. The work was done in part before the deed was received. The contract made Hughes the equitable owner, and upon his death intestate the land would have gone to his heirs as realty, while the contract would be personal property. The vendor did not consent that the improvements be placed on its land, but upon that of the purchaser.